## **CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
**REPORT OF THE TRUSTEES AND AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2022**
**CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
**CONTENTS** ADMINISTRATIVE DETAILS ......................................................................................................... 3 REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2022................................................ 4 INDEPENDENT AUDITOR’S REPORT TO THE TRUSTEES OF CHELSEA METHODIST CHURCH AND PASTORAL CENTRE .................................................................................................................... 7 STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 AUGUST 2022 ............................ 10 BALANCE SHEET AS AT 31 AUGUST 2022 ................................................................................... 11 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2022 ........................... 12
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**CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
## **ADMINISTRATIVE DETAILS**
Charity registration number 1140225 Principal address 155a King’s Road, Chelsea, London SW3 5TX Bankers HSBC plc, 8 Victoria Street, London SW1H 0NJ Central Finance Board, 9 Bonhill Street, London EC2A 4PE Auditors Banks & Co, 1 Carnegie Road, Newbury, Berkshire, RG14 5DJ Solicitors Pothecary Witham Weld Solicitors, 70 St, George Square, London SW1V 3RD
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**CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
**REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 AUGUST 2022**
## **TRUSTEES**
Minister Rev. Faith Nyota (appointed October 2022) Rev. Mark Davenport (resigned August 2022)
Church Treasurer Alan Mills Church Trustees Alan Mills David Tamby-Raja (appointed September 2022 Colmeta Thorpe Marilyn Neufville (appointed September 2022) Noemi Vila Mercy A Egyri (appointed September 2022) Gloria Stewart (resigned) Jean Roncal (appointed September 2022) Angela Eyamba (resigned) Alvin Roncal (appointed September 2022) Ruby Edwards (resigned) Valerie Campbell (resigned)
## **STRUCTURE, GOVERNANCE and MANAGEMENT**
The Chelsea Methodist Church is managed by a Leadership Team drawn from the above officials and the Church Council, who are the Church Trustees, constituted as above. The Church also employs, normally, five staff and uses several volunteers to manage our homelessness project. Our volunteers are all suitably DBS checked as are our full-time staff. Training is given to any new volunteers and is arranged by the Resourcing Mission Executive Officer who has oversight of the daily running of the entire premises. Trustees are drawn from the Church congregation, usually on a voluntary basis unless a specific area of expertise which is unavailable in the Church is needed, in which case outside help from the wider Methodist community is enlisted.
The Trustees for Methodist Church Purposes (TMCP) own all land and buildings on behalf of the Methodist Church and local Trustees, the Church Council in this case, manage the assets on behalf of TMCP. Sale or purchase of these assets must be agreed with TMCP in Manchester before any local activity can take place. There is a centralised computer system, the Methodist Consent System, for controlling and approving any development, renovation, sale or purchase of the Methodist Church assets.
The Methodist Church in the UK is governed by Deed of Union (1932) and the Methodist Church Act (1976). These govern all Methodist Churches at local, Circuit, District and National levels and a copy of this Deed is available in C.P.D. (the Constitutional Practice and Discipline) of the Methodist Church.
During the approved leave of absence by the Minister Rev. Mark Davenport, the post was covered consecutively by Rev. Michaela Youngson, Rev. Peter Cornick and Rev. Nigel Cowgill with pastoral support offered by Rev. Lesinga Vunipola and Rev. Ayodeji Okegbile.
## **OBJECTIVES and ACTIVITIES**
The objectives of the Church are:
- To provide Christian worship and pastoral care for members of the Church, adherents and members of the wider community
- To conduct mission and outreach for the wider Church community
- To receive and manage income from our owned shops
- To encourage and develop use of the premises for church activities
- To maintain and care for the premises
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**CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
## **FINANCIAL REVIEW**
Our main income is from the four shops in King’s Road which have been fully occupied from December 2020. As most places of worship went into lockdown in March 2020 because of Covid 19, similarly our shop tenants are still finding these circumstances particularly challenging as well and we had to accommodate requests for reduced or modified arrangements for collecting rent. Our income from collections also suffered as Church services were cancelled and direct collections were not taken. The suite of offices on the second floor were fully let but our other facilities within the building were hardly used.
Chelsea Methodist Church and Fulham Broadway Methodist Church works in Church unity as separate legal entities operating on two sites because of the difficulties that lock down posed and the ability of both Churches to provide sufficient stewards to run both sites.
Both Chelsea and Fulham Broadway Methodist Churches are under the pastoral oversight of the same Methodist Minister with separate Trustees.
We were gifted a legacy from the late Ruby Edwards’ estate and this has been invested with TMCP in Manchester, it is Trust number 22595 and its initial value was £37,296. Ruby’s legacy was transferred late in August 2022 therefore no interest or charges have accrued as at the end of this financial year.
Our Circuit assessment for the year was £60,500p.a.; 17.00% of our total income. The assessment is reviewed annually by Chelsea, Hammersmith and Fulham Circuit and is based on the requirements to present a balanced Circuit budget.
## **INCOME**
Church income is derived potentially from four (4) shop lets, room bookings, office space rents, church offerings and occasional donations.
Chelsea Methodist Church is one of five churches in the Chelsea, Hammersmith and Fulham Methodist Circuit (Registered Charity No. 1133940) and retains control of Chelsea Surplus Funds (Trust No. 18632) and now the Ruby Edwards legacy (22595), mentioned above. Both are held by TMCP and interest derived from both Funds is / will be transferred into the Church current account for distribution as necessary. There is also a Trust Fund, held within Circuit accounts, which is ring fenced for use by Chelsea Methodist Church (Trust Fund 21747), also held within TMCP.
At the direction of Church Council we started to manage rent collection from our four shop premises ourselves with effect from June 2021 and this will continue for the foreseeable future as will negotiation of new leases and management of shop rent deposits.
We do not carry out any fundraising activities of any significance. When we do, it is aimed at other charitable organisations who have similar aims and objectives.
## **RISK ANALYSIS**
The Trustees make every effort to ensure that potential financial and operational risks are reduced to the minimum by maintaining strict oversight through regular financial reports to the Church Council and Leadership Team. Church Council meetings are usually held at least twice per year. The Church strives to maintain at least six months reserves to cover normal running expenses; this year our outgoings totalled £349,256 and our liquid unrestricted balances £112,300, representing 32.15% of a normal year’s expenses.
The Church maintains a separate ring-fenced interest-bearing deposit account for rent deposits from our shop tenants which will be repaid when tenancies end; it also acts as a backup should tenants default on rent payments. This account is a restricted account by law.
## **STATEMENT of TRUSTEES’ RESPONSIBILITIES**
Under the supervision of the Treasurer and the oversight of the auditors, the Trustees are required to approve the prepared financial statements every year which give a true and fair view of the financial activities of the Church and of its financial position at the end of the year. In preparing those statements, the Trustees are required to :
- Select suitable accounting policies and apply them consistently
- Make judgements and estimates that are reasonable and prudent
- State whether the policies adopted are in accordance with the Charities Act 1993 and with applicable accounting standards and statements of recommended practice, subject to any material departures disclosed and explained in the financial statements
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## **CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
- Prepare the financial statement on a “going concern” basis unless it is inappropriate to assume that the Church will continue to operate.
The Trustees are responsible for keeping proper accounting records which disclose, with reasonable accuracy at any time, the financial position of the Church and enable them to ensure that the financial statements comply with the Charities Act 1993. They are responsible for safeguarding the assets of the Church and hence for taking reasonable steps to prevent and detect fraud and any other irregular activities.
## **APPROVAL**
This report was approved by the Trustees on 19[th] September 2023, and signed on their behalf by :
Reverend Faith Nyota - Superintendent Minister.
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**CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
## **INDEPENDENT AUDITOR’S REPORT TO THE TRUSTEES OF CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
## **Qualified opinion**
We have audited the financial statements of Chelsea Methodist Church and Pastoral Centre (the ‘charity’) for the year ended 31 August 2022 which comprise a statement of financial activity, balance sheet and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 _The Financial Reporting Standard applicable in the UK and Republic of Ireland_ (United Kingdom Generally Accepted Accounting Practice).
In our opinion, except for the effects of the matter described in the basis for qualified opinion, the financial statements:
- give a true and fair view of the state of the charity’s affairs as at 31 August 2022, and of its incoming resources and application of resources, for the year then ended;
- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
- have been prepared in accordance with the requirements of the Charities Act 2011.
## **Basis for qualified opinion**
As stated in note 6 on page 15 of the financial statements, properties held as investments were professionally valued for the first time and stated within the financial statements at their fair values, resulting in a net gain of £2,556,840.
However, we are unable to form an opinion as to their fair values as at 31 August 2021. Consequently, the total net gain is reported within the Statement of Financial Activities for the current year in its entirety.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor responsibilities for the audit of the financial statements section of our report. We are independent of the charity in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
## **Conclusion relating to going concern**
In auditing the financial statements, we have concluded that the trustees’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the charity's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report.
## **Other information**
The other information comprises the information included in the trustees’ annual report, other than the financial statements and our auditor’s report thereon. The trustees are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we
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## **CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
## **Matters on which we are required to report by exception**
We have nothing to report in respect of the following matters in relation to which the Charities (Accounts and Reports) Regulations 2008 require us to report to you if, in our opinion:
- the information given in the financial statements is inconsistent in any material respect with the trustees’ report; or
- the charity has not kept adequate accounting records; or
- the financial statements are not in agreement with the accounting records and returns; or
- we have not received all the information and explanations we require for our audit.
## **Responsibilities of trustees**
As explained more fully in the trustees’ responsibilities statement set out on pages 5 & 6, the trustees are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the trustees are responsible for assessing the charity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charity or to cease operations, or have no realistic alternative but to do so.
## **Auditor responsibilities for the audit of the financial statements**
We have been appointed as auditor under section 144 of the Charities Act 2011 and report in accordance with regulations made under section 154 of that Act.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
- Enquiry of management and those charged with governance around actual and potential litigation claims;
- Enquiry of Trustees in compliance functions to identify any instances of non-compliance with laws and regulations;
- Reviewing financial statements disclosure and testing to supporting documentation to assess compliance with applicable laws and regulations;
- Performing audit work over the risk of management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
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## **CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
## **Use of our report**
This report is made solely to the charity’s trustees, as a body, in accordance with Part 4 of the Charities (Accounts and Reports) Regulations 2008. Our audit work has been undertaken so that we might state to the charity’s trustees those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charity and the charity’s trustees as a body, for our audit work, for this report, or for the opinions we have formed.
Banks & Co Ltd, Statutory Auditor Chartered Certified Accountants 1 Carnegie Road Newbury Berkshire RG14 5DJ
Banks & Co Ltd is eligible for appointment as auditor of the charity by virtue of its eligibility for appointment as auditor of a company under section 1212 of the Companies Act 2006.
Date: 19[th] September 2023
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**CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
## **STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 AUGUST 2022**
|Notes
Unrestricted
funds
£
**INCOME**
Offerings
5,323
Donations
56,935
Gift Aid
558
Investment income
2
293,093
**TOTAL INCOME**
**355,909**
**EXPENDITURE**
Expenditure on investment income
1,200
Expenditure on charitable activities
3
207,859
Administrative expenses
46,165
Premises expenses
47,198
Bad Debts
-
Governance costs - audit fee
4
4,000
Depreciation
42,834
**TOTAL EXPENDITURE**
**349,256**
Net gain/(deficit) before investment
and revaluation gains/(losses)
6,653
Net gain on investments
2,556,840
**NET INCOME/(DEFICIT) FOR THE YEAR**
**2,563,493**
BALANCE BROUGHT FORWARD
7,254,734
**BALANCE CARRIED FORWARD**
**9,818,227**|Notes
Unrestricted
funds
£
**INCOME**
Offerings
5,323
Donations
56,935
Gift Aid
558
Investment income
2
293,093
**TOTAL INCOME**
**355,909**
**EXPENDITURE**
Expenditure on investment income
1,200
Expenditure on charitable activities
3
207,859
Administrative expenses
46,165
Premises expenses
47,198
Bad Debts
-
Governance costs - audit fee
4
4,000
Depreciation
42,834
**TOTAL EXPENDITURE**
**349,256**
Net gain/(deficit) before investment
and revaluation gains/(losses)
6,653
Net gain on investments
2,556,840
**NET INCOME/(DEFICIT) FOR THE YEAR**
**2,563,493**
BALANCE BROUGHT FORWARD
7,254,734
**BALANCE CARRIED FORWARD**
**9,818,227**|Restricted
funds
£
-
-
-
-|Total
Total
funds
funds
2022
2021
£
£
5,323
3,522
56,935
39,915
558
414
293,093
198,634
**355,909**
**242,485**
1,200
3,882
207,859
124,772
46,165
45,073
47,198
69,308
-
15,000
4,000
4,000
42,834
42,834
**349,256**
**304,869**
6,653
(62,384)
2,556,840
17,046
**2,563,493**
**(45,338)**
7,258,493
7,303,831
**9,821,986**
**7,258,493**|
|---|---|---|---|
||**355,909**|**-**||
||1,200
207,859
46,165
47,198
-
4,000
42,834|-
-
-
-
-
-||
||**349,256**|**-**||
||6,653
2,556,840|-
-||
||**2,563,493**
7,254,734|**-**
3,759||
||**9,818,227**|**3,759**||
All activities are derived from continuing operations
There are no further recognised gains /(losses) other than the surplus/deficit for the financial year The notes on pages 12 to 17 form part of these financial statements
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**CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
## **BALANCE SHEET AS AT 31 AUGUST 2022**
|Notes
£
**FIXED ASSETS**
Tangible assets
6
**9,636,960**
**CURRENT ASSETS**
Investments
7
93,013
Debtors
8
109,705
Bank and Cash Balance
9
90,140
292,858
**CREDITORS: Amounts falling due**
**within one year**
10
39,468
**TOTAL NET CURRENT ASSETS**
**253,390**
**TOTAL ASSETS LESS CURRENT**
**LIABILITIES**
**9,890,350**
**CREDITORS: Amounts falling due**
**after one year**
11
72,123
**TOTAL ASSETS**
**9,818,227**
**FUNDS**
12
Restricted
Unrestricted
9,818,227
**TOTAL FUNDS**
**9,818,227**
Unrestricted
funds|Notes
£
**FIXED ASSETS**
Tangible assets
6
**9,636,960**
**CURRENT ASSETS**
Investments
7
93,013
Debtors
8
109,705
Bank and Cash Balance
9
90,140
292,858
**CREDITORS: Amounts falling due**
**within one year**
10
39,468
**TOTAL NET CURRENT ASSETS**
**253,390**
**TOTAL ASSETS LESS CURRENT**
**LIABILITIES**
**9,890,350**
**CREDITORS: Amounts falling due**
**after one year**
11
72,123
**TOTAL ASSETS**
**9,818,227**
**FUNDS**
12
Restricted
Unrestricted
9,818,227
**TOTAL FUNDS**
**9,818,227**
Unrestricted
funds|£
**-**
Restricted
funds|2022
2021
£
£
**9,636,960**
**7,115,026**
93,013
78,143
109,705
65,297
93,899
134,983
296,617
278,423
39,468
48,129
**257,149**
**230,294**
**9,894,109**
**7,345,320**
72,123
86,827
**9,821,986**
**7,258,493**
3,759
3,759
9,818,227
7,254,734
**9,821,986**
**7,258,493**|
|---|---|---|---|
||
93,013
109,705
90,140|-
-
3,759||
||292,858
39,468|3,759
-||
||**253,390**|**3,759**||
||**9,890,350**|**3,759**||
||
72,123
**9,818,227**|-
**3,759**||
||
9,818,227|3,759||
||**9,818,227**|**3,759**||
Approved by the Trustees on 19th September 2023 and signed on their behalf by:
## **ALAN MILLS**
Treasurer
## **REV. FAITH NYOTA**
Superintendent Minister
The notes on pages 12 to 17 form an integral part of these financial statements.
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**CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
## **NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2022**
## **1. ACCOUNTING POLICIES**
## **a) Basis for preparing the financial statements**
These financial statements have been prepared under the historical cost convention with items recognised at cost or transaction value unless otherwise stated in the relevant accounting policies below or in the notes to the financial statements.
They have also been prepared in compliance with FRS 102, ‘The Financial Reporting Standard applicable in the UK and the Republic of Ireland’, the Charities Statement of Recommended Practice issued in October 2019 and the Charities Act 2011.
Chelsea Methodist Church and Pastoral Centre is a public benefit entity, as defined by FRS 102.
The financial statements are presented in Pounds Sterling, rounded to the nearest pound.
The Trustees consider that there are no material uncertainties about the entity’s ability to continue as a going concern.
## **b) Fund accounting**
Unrestricted funds represent the funds of the Church that are not subject to any restrictions regarding their use and are available for application in the furtherance of the general objectives of the Church.
Restricted funds which are held for specific use in accordance with the specific restrictions imposed by donors.
The financial statements only include transactions, assets and liabilities for which the Church can be held responsible. They do not include the financial statements of church groups that owe an affiliation to another body nor those of informal gatherings of church members.
## **c) Income recognition**
All incoming resources are included within the Statement of Financial Activities (SOFA) when the Church is legally entitled to the income after any performance conditions have been met, the amount can be reliably measured and it is probable that the income will be received.
No amount is included in the financial statements for volunteer time in line with the SORP.
The charity receives grants from the government in respect of the covid pandemic. These grants are recognised at fair value when the Church has entitlement after any performance conditions have been met, it is probable that the income will be received and the amount can be measured reliably.
Investment income is earned through holding certain assets for investment purposes such as shares and property. It includes dividends, interest and rent. Where the management costs can be identified with reasonable accuracy, these are included. Interest income is recognised using the effective interest method and dividend and rent income is recognised as the Church’s right to receive payment is established.
## **d) Expenditure**
Expenditure is recognised on an accruals basis when a liability is incurred or a constructive obligation arises that results in the payment being unavoidable. Liabilities are recognised as soon as an outflow of economic benefit is considered more likely than not under the legal or constructive obligation committing the Church to pay out resources.
## **e) Grants and donations**
Grants and donations made by the Church from its own funds are recognised in full at the time of the agreement or when the Church accepts that there is a legal or operational obligation to make the payment.
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**CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
## **Notes to the financial statements for the year ended 31 August 2022 continued**
## **f) Tangible fixed assets**
The investment properties and Church building disclosed in the Accounts are legally owned by the Trustees for Methodist Church Purposes in its capacity as trustee or custodian Trustee. The freehold property is shown in the Accounts at its deemed historical cost under FRS102 represented by its insurable value in 2017. No depreciation is provided because the trustees consider the current residual fair value of the building, in its present condition, to be not less than its historical cost.
All fixed assets with a cost in excess of £1,000 are capitalised. Otherwise, such costs are written off in the year of expenditure.
Depreciation is provided on tangible fixed assets at rates calculated to write off the cost, less estimated residual value, over its expected useful life as follows:
Church organ – 10% on a straight line basis.
Equipment - 20% on the net book value
## **g) Investment properties**
Investment properties which comprise four retail shops are shown in the Accounts at their deemed historical cost under FRS102.
## **h) Investments**
The Church’s investments are monetary assets classified as financial instruments under FRS102 and are held by the Trustees for Methodist Purposes (TMCP) as custodian trustees. The valuations, at market value, are those provided by TMCP. The unrealised gains/(losses) arising on investments at the end of the year are shown in the SOFA.
## **i) Taxation**
Chelsea Methodist Church is recognised as exempt from income and Corporation tax on income derived from its charitable activities because of its charitable status. Since the Church is not VAT registered, all input VAT borne is charged with the expenses to which it refers.
## **i) Reserves policy**
Chelsea Methodist Church holds sufficient balances in the general fund to meet at least 6 month’s expenditure at the current level and a small balance to meet unanticipated expenditure and programmed works which cannot be funded from a single year’s budget.
## **j) Going concern**
At the time of approving the financial statements, the trustees have a reasonable expectation that the Church has adequate resources to continue in operational existence for the foreseeable future. Thus the trustees have therefore continued to adopt the going concern basis in preparing the Church's financial statements.
## **k) Financial instruments**
Financial assets and liabilities are recognised when the Church becomes party to the contractual provisions of the instrument.
## **Basic financial assets**
Basic financial assets, which include debtors, cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost. Financial assets are derecognised only when the contractual rights to the cash flows of the asset expire or are settled, or when the Church transfers the financial asset and substantially all the risks and rewards of ownership to another entity.
## **Basic financial liabilities**
Basic financial liabilities, including trade and other creditors are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Debt instruments are subsequently carried at amortised cost, using the effective rate of interest. Financial liabilities are
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**CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
## **Notes to the financial statements for the year ended 31 August 2022 continued**
derecognised when, and only when, the Church’s contractual obligations are discharged, cancelled, or they expire.
## **2. INVESTMENT INCOME**
|Shop rent and insurance
Other rental income
Other church activities
TMCP interest
Central Finance Board interest
Other interest
**3.**
**EXPENDITURE ON CHARITABLE ACTIVITIES**
Circuit assessment
Donations
Worship expenses
Church Activities
Staff costs
Salaries, employer's national insurance and pension, net of
government grants|2022
£
240,750
49,928
398
1,970
47
-
293,093
2022
£
60,500
699
141,038
4,667
955
-
207,859|2021
£
146,197
50,704
-
1,717
15
1|
|---|---|---|
|||198,634|
|||2021
£
37,625
45
77,756
6,429
2,917
-|
|||124,772|
There were no employees who received total employee benefits of more than £60,000 during the year.
## **4. GOVERNANCE COSTS**
|Audit Fee
**5.**
**SALARIES, NIC and PENSION COSTS**
Salaries and wages
Employer's national insurance contribution
Employer's pension contribution
COVID job retention grants|2022
2021
£
£
4,000
4,000
2022
2021
£
£
131,879
114,729
3,807
5,452
5,352
2,713
-
(45,138)
**141,038**
**77,756**|
|---|---|
## **5. SALARIES, NIC and PENSION COSTS**
Salary costs of £18,678 (2021: £13,276) were incurred during the year representing the Church’s total cost of fundraising.
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**CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
The average number of staff employed by the Church during the year was 8 (2021: 7).
## **Notes to the financial statements for the year ended 31 August 2022 continued**
## **6. TANGIBLE ASSETS**
||Investment
Properties|Church
Building|Organ|Equipment|Total|
|---|---|---|---|---|---|
||£|£|£|£|£|
|Cost/valuation at 1 September 2021|1,485,232|5,332,720|414,502|8,306|7,240,760|
|Revaluation during the year|2,564,768||||2,564,768|
|Cost/valuation at 31 August 2022|4,050,000|5,332,720|414,502|8,306|9,805,528|
|Accumulated depreciation||||||
|At 1 September 2021|-|-|124,350|1,384|125,734|
|Charge for the year|-|-|41,450|1,384|42,834|
|At 31 August 2022|-|-|165,800|2,768|168,568|
|Net book value at 31 August 2022|4,050,000|5,332,720|248,702|5,538|9,636,960|
|Net book value at 31 August 2021|1,485,232|5,332,720|290,152|6,922|7,115,026|
A professional valuation of all the investment properties was carried out on 23 March 2023 by T. Scott MRICS, Chartered Surveyor, of £4,050,000. This was based on their open market value as at that date. The Trustees are of the opinon that these values are similar to those as at 31 August 2022 and so they have been used for the purposes of these Accounts.
## **7. INVESTMENTS**
General surplus funds are held by TMCP within their Trustees Interest and CFB Management Equity Funds. These funds are available to the Church as and when required.
## **8. DEBTORS**
|Rent
Other debtors
Amount due from Chelsea, Hammersmith & Fulham circuit
Amount due from other Methodist Church
Prepayments|2022
2021
£
£
58,006
21,250
2,402
2,044
599
820
47,183
37,098
1,515
4,085
**109,705**
**65,297**|
|---|---|
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**CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
## **Notes to the financial statements for the year ended 31 August 2022 continued**
## **9. CASH AT BANK**
|Current account
Methodist Central Finance Board|£
Unrestriced
7,938
82,202
**90,140**|2022
2021
£
£
£
Restricted
Total
Total
3,759
11,697
38,124
-
82,202
96,859
**3,759**
**93,899**
**134,983**|
|---|---|---|
## **10. CREDITORS: AMOUNTS DUE WITHIN 12 MONTHS**
|Rent paid in advance
Other creditors
Accruals|2022
£
17,465
525
21,478
**39,468**|2021
£
17,465
11,383
19,281|
|---|---|---|
|||**48,129**|
## **11. CREDITORS: AMOUNTS FALLING DUE AFTER ONE YEAR**
The creditors falling due after one year relate to rent deposits of £72,123 (2021 - £86,827), which are held in a separate bank account and the interest earned is for the benefit of the tenants.
## **12. FUNDS**
|Balance at 1 September 2021
Movement during the year
Balance at 31 August 2022|**Unrestricted**
**funds**
General fund
£
7,254,734
2,563,493|External
Organ
196|Benevolent
fund
£
314
-|**Total**
Internal
organisations
£
£
3,249
7,258,493
-
2,563,493
3,249
9,821,986|
|---|---|---|---|---|
||9,818,227|196|314||
## **13. TRUSTEES**
One Trustee received a total of £730 during the year for services rendered (2021: £780). There was a total of £587 paid to two other Trustees as gifts and reimbursement of expenses.
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**CHELSEA METHODIST CHURCH AND PASTORAL CENTRE**
## **Notes to the financial statements for the year ended 31 August 2022 continued**
## **14. COMMITMENTS UNDER OPERATING LEASES**
The Church had the following operating lease commitments:
|The Church had the following operating lease commitments:|||
|---|---|---|
|Within 1 year
Between 2 - 5 years|2022
£
4,002
6,930
10,932|2021
£
4,002
10,932|
|||14,934|
## **15. CAPITAL COMMITMENTS**
There were no capital commitments at the year end (2021: nil)
## **16. VOLUNTEER CONTRIBUTION**
Every wing of the Methodist Church (Local Churches, Circuits, Districts, Connexion) in the United Kingdom is heavily reliant on volunteers who contribute their skills, time, money and their resources in the furtherance of the work of the church. Principally, this contribution is by serving on committees of the Church that deal with mission, finances, policy, grants, training developments. The contribution of volunteers is not included within the income of the Church.
The Trustees are grateful to all of the volunteers for their held and commitment.
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