## **THE DANISH CHURCH IN LONDON** REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 Registered charity number 237897 THE DANISH CHURCH IN LONDON REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 |CONTENTS|PAGE| |---|---| |Charity Information|3-4| |Trustees' Report|5-10| |Independent examiner's Report|11| |Statement of Financial Activities (Income & Expenditure Account)|12| |Statement of Cash Flows|13| |Statement of Financial Position (Balance sheet)|14| |Notes to the financial statements|15-25| THE DANISH CHURCH IN LONDON 3 CHARITY INFORMATION FOR THE YEAR ENDED 31 DECEMBER 2020 UK Registered Charity No. 237897 Name of the charity: The Danish Church in London Registered office The Danish Church in London 4 St Katherine's Precinct Regent's Park, London NW1 4HH Trustees Trustees and members of the Church Council from January 2020 to June 2021 are: Dorte Bille Harding (Chair) Christine Bergstedt Jørgensen (Deputy Chair) Niels Ring Andersen (Honorary Treasurer) Anne-Grethe Jensen (Secretary) Andy Marino (Church Warden) Ole Justesen (Church Warden, to October 2020) Flemming Kloster Poulsen (Pastor) Johanne Nørtoft Thomsen (Pastor, to March 2021) Peter Melbye Palle Baggesgaard Pedersen Per Gullestrup Jacob Christiansen Helle Diget Bond Casper Orlyk Ulrik E. Petersen (Royal Danish Embassy, to Sept 2020) Anne Dorothea Bruum Aubry (Royal Danish Embassy, from Sept 2020) Bette Petersen Broyd (from October 2020) Connie Yilmaz Jantzen (from October 2020) THE DANISH CHURCH IN LONDON 4 CHARITY INFORMATION FOR THE YEAR ENDED 31 DECEMBER 2020 Independent examiner Michael Laughton C.A. Munro Brown Ltd Chartered Accountants 38 Gay Street, Bath, BA1 2NT Principal bankers Barclays Bank Plc Danske Bank HSBC Plc Cazenove (custody/investments) Charles Stanley & Co. (custody/investments) THE DANISH CHURCH IN LONDON 5 ## REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2020 The Trustees present their report and financial statements for the year ended 31 December 2020. ## **1. Structure, governance, and management** The charity is governed by its Constitution, revised on 15 September 2013, and further updated on 18 October 2020. The Church Council manages the Church in practical, legal and financial affairs, and represents the Church in all respects. The Bishop of Copenhagen is the Church's ecclesiastical supervisor. The Danish Ambassador is Patron of the Church. The Royal Danish Embassy appoints one ex-officio member of the Church Council. As of October 2020, according to the update of the Constitution, Danish YWCA can appoint one member of the Danish Church Council, if they want. Resident Pastors are automatically members of the Church Council, and Church Wardens are appointed directly by the Church Council. All other members (minimum of 5) are elected by the members of the Church, at the annual general meeting in June. Due to the corona virus pandemic, the 2020 annual general meeting was postponed to 18 October 2020. Two or three of the elected members retire annually, in rotation. Proposals to elect or reelect Church Council members are made either by the Church Council, or in writing by three members of the Church. ## **2. Objects, objectives and achievements** ## _Aim and Purpose_ The main purpose of the Danish Church in London is to preach the Christian Gospel according to the Lutheran Evangelical tradition, including conducting Services and performing religious ceremonies for Danes in London, and to act as cultural and social meeting point for Danes in the Greater London area. The Church Council ensures that activities are planned with due regard to the Charity Commission's public benefit guidance. In order to continue this service in the years to come, the Church has recently upgraded, renovated and increased the usable areas of the church premises. ## _Achievements and Performance_ In addition to Danish-language Sunday Services, The Danish Church in London normally performs a wide range of traditional religious acts, including Christenings, confirmations, weddings and funerals. When the Covid-19 pandemic hit London in March 2020, and the Church was forced to close the doors completely, we found ways to continue the Sunday Services via Zoom. This proved a great success, and, in fact, we have had more participants in Services in 2020 than ever before! THE DANISH CHURCH IN LONDON 6 ## REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2020 In 2020 the Church conducted 50 Services; 14 in the church nave, 21 via Zoom, and 15 as hybrids, with a limited number of church goers present in the church, and more participating via Zoom. In addition, there were 2 Christenings, 3 full marriages, 4 funerals and 12 confirmations. The Pastors were called to around 125 official conversations and had 6 visits to the homebound or imprisoned. Other Church activities had to stop completely during the extensive lock-down periods, and obviously, this had a negative impact on the financial result for the year. Despite the pandemic, the refurbishment project - started in September 2019 - continued, albeit at a slower pace due to the restrictions, causing delay and extra costs. The building works were substantially completed in December 2020. Covid-19 restrictions continue to limit the Church’s activities in 2021, but it is our hope that we will soon be able to resume traditional religious acts, as well as the usual full program of cultural and social activities and events. Pre-pandemic, some Church activities took place at nearby Danish YWCA, and others were temporarily cancelled, as the church halls and kitchens, shop and facilities were under renovation. Normal activities include showing Danish films, and hosting concerts, talks and debates. Several Danish groups normally meet in the church halls, amongst them parents and toddlers’ group, Open Evening Café, book club, bridge club, sewing club, Senior Group, Danish Women in England and Team Danmark, a football and running club. Due to the building works, the Church’s Saturday School continued in temporary rented premises at St David’s Church in Islington, until the pandemic forced a premature closure. The Church is expecting to resume running Saturday School in September 2021 in the newly renovated buildings. Pre-pandemic, around 120 children were taught Danish language and culture in the Saturday School, which has been running for 50 years. Adult Danish classes continued via Zoom, during the pandemic, and the Church hopes to resume Danish language tuition for adults as evening classes on the premises from September 2021. There are around 700 paying members of the Church, and in a normal year, a total of around 10,000 people benefit from our activities. The Church donated 3 bursaries to young Danes studying in the UK and continues to offer financial support to needy and/or elderly Danes on an ad-hoc basis. ## _Pastors_ In 2020 the Church has benefitted from a full-time resident pastor, Flemming Kloster Poulsen. In addition, Johanne Nørtoft Thomsen, was employed as pastor on a fixed contract, from March 2019 to March 2021. Apart from her work at St Katharine’s, Johanne had a special focus on Danish students/young people, and conducted occasional Services in Hull. Due to financial constraints, we rely on Danish Church Abroad/Danish Seamen's Church to fund the pastors’ salaries. Unfortunately, for the time being, only the resident pastor is employed. An administrative assistant has been employed on a part-time basis, to assist the pastor. THE DANISH CHURCH IN LONDON 7 ## REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2020 ## **3. Financial review** In 2020 the Danish Church recorded an overall net deficit of £1,309,443 (2019: surplus £1,199,471). The large donations and expenditure related to the building project makes it somewhat difficult to read the financial statements. Looking at the summary financial statement on page 12, we suggest you focus on the first column as representing the ‘operational’ results for 2020. It shows total income of £157,371 (2019: £273,914) and total expenditure of £195,552 (2019: £249,915), giving a net operational deficit of £38,181 _before investment gains/losses and transfers between funds_ (a surplus of £23,999 in 2019). There was a net deficit on the unrestricted funds _after transfers and investment revaluations_ amounting to £46,194 (2019: surplus of £129,688). In the context of both the Building Project and Covid-19, this must be considered a very reasonable result, partly reflecting a number of cost-saving measures as well. The Net Loss on Investments of £30,870 represents the unrealised paper loss (2019: unrealised gain £127,464). Coronavirus caused a very significant drop in value in March 2020, but values recovered somewhat in the latter part of 2020. The second column on page 12 labelled, ‘Restricted funds’, represents various funds including the Building Project fund (see also note 14, pages 22-23). It shows a significant outflow of funds of £1,246,456 (including transfers) during 2020 of which an outflow of £1,228,779 relates to the Building Project (note 14, page 23). The 2019 accounts showed significant inflows of funds to finance the project and 2020 simply records the application of these funds as the building work was completed. Our budgets show that there was a small overspend to the building project, but we are hopeful that further donations will be made to cover this over the forthcoming 12 months. Overall, the trustees are satisfied with the outcome to this extensive piece of work completed despite the effect of Covid-19, covered elsewhere. We hope that 2021 will prove to be a better year as we, as a community, emerge from lockdown. ## **4. Investment policy** The charity’s constitution requires its assets to be invested in Denmark or Great Britain, in bank accounts, investment assets or property. The total investments on 31 December 2020 shown at note 10, pages 20-21, were £1,212,863 (2019 - £1,250,548). The Church has set out its Investments Policy in line with guidelines set out by the Charity Commission. The Investment Policy is reviewed annually. THE DANISH CHURCH IN LONDON 8 REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2020 ## **5. Reserves’ policy** The accumulated funds on 31 December 2020 were £1,794,678 (2019 - £3,104,121) of which £1,148,326 related to endowment funds, £27,169 related to restricted funds and £619,183 to unrestricted funds. It is the policy of the charity to maintain unrestricted funds, which are the free reserves of the charity, at a level which equates at least to approximately six months unrestricted expenditure. This provides sufficient funds to cover management and administration and support costs. The Church’s finances have been highly liquid in the last three years due to the incoming amounts from fundraising to the Façade Project Fund and then the Building Project Fund. Grants and donations raised for the Building Project Fund through the fundraising campaign are held in segregated DKK and GBP denominated bank accounts with Danske Bank, Barclays Bank and HSBC. The trustees remain of the view that the charity is a going concern. ## **6. Risk review** The trustees have taken steps to identify the major risks to which the charity is exposed, and systems have been established to mitigate those risks. Identification and management of investment risk is addressed in the Investment Policy of the Church. ## **7. Post balance sheet events** As we are only too well aware, Covid-19 has continued to have major impact on the Church activities, and consequently on our financial health. As also detailed under ‘Building Project’, there remain potentially significant obligations to Coniston Limited, the building contractor. We must therefore consider 2021 to be another year of transition, which may result in a further operational deficit. ## **8. Building Project** The Church’s essential and extensive building project, prepared and overseen by CF Møller Architects in London was substantially completed in December 2020. Ground source heating has been installed in the church nave, and gas heating in all other areas. Underneath the church halls, a full basement has been excavated, for extra storage area, as well as a new shop and extended facilities. 3 new meeting rooms are formed under the vicarage, with impressive terraces in front. A dormer is compensating the vicarage for lost space, and all areas have been thoroughly modernised and renovated. Disabled access is improved via a platform lift from the garden to the church halls, and new fully accessible toilet facilities. THE DANISH CHURCH IN LONDON 9 ## REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2020 In March 2020, the corona virus pandemic affected the building works, like all other areas of life. Restrictions to avoid spreading the disease caused wide-spread difficulties on site, as well as supply chain problems. Delays were unavoidable, but the project continued and was substantially completed in December 2020. In total, the building project has cost approximately £3 million to date. We are still in discussions with the main contractors, Coniston Limited, about a number of claims, partially arising from Covid-19 and the consequent delays. As of writing, it is not possible to give a clear indication of the size of any eventual agreement with Coniston. We were fortunate to receive a total of £2.9 million, in a mix of large and small donations to the building project. At the earliest possibility, we look forward to show all of our donators what we consider to be a very successful renovation of the historic buildings. Although as a religious and educational organisation we are only able to recover a portion of the VAT we incur, we were able to recover about £200,000 VAT relating to the building project. However, this is adjusted over the next 10 years, subject to the proportion of ‘commercial’ income we generate from the shop, café and events. There is a risk that some of this VAT recovery will reduce. The net result is that there will be a significant overall deficit for the building project. ## **9. Plans for future periods** The combination of building works and Covid-19 pandemic meant that 2020 was a difficult year for the Danish Church in London. However, the interest in the Church during these difficult times has been encouraging. And, with the buildings now fully renovated, and ready for use post-pandemic, the Trustees are confident of a gradual, full return to normal activity level, in line with UK Government guidelines. In the longer term, Trustees do not anticipate any fundamental changes in the development of the charity`s operation. ## **10. Trustees’ Responsibilities** The charity trustees are responsible for preparing a trustees’ annual report and financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). Charity law in England and Wales requires the trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the charity and of the incoming resources and application of resources, including the income and expenditure, of the charity for that period. In preparing the financial statements, the trustees are required to: THE DANISH CHURCH IN LONtX)N 10 REPORT OF THE TRUSTEES FOR THE YEAR ENDED 31 DECEMBER 2020 • Select suitablc a(XXMW policies a￿1 thcn awly them cons]￿Y . Obscrvc tIK meth(ML8 and principl&s in the Charities SORP 2019 (FRS 102) . Ststc whcthLr applithle UK ac￿Uni￿n8 stsndards have been followe4 subjccl lo matcrial . Prepare the fiTwKial ststr4ncots on the going b￿lS wiless it is iwwo]xiatc The trustees are respMsiI)le for keeping protKr acc4)unting re¢￿dS thai disclose with reawthle accuracy at aoy time. the fll)anCI￿ ￿l￿oll of the cbarity atMI to enable them to ensure that the financial statanents comply with the Charities Aa 2011. the Chan"ties (Ac¢ollnts atxl Re￿ll$) RwlatIo￿ 2(￿ the provision of th¢ In￿t deed. They also TeswDsible for safeguarding the assets of Ihe charity and taking r¢&sonable st¢ps for the The trusi¢e5 are ￿s￿Ible for the mainienance ￿T￿ Eutegnty ofthe clwity and financial iDfor1)￿t10n in¢lu&xl on the charity's websi￿. L4isknion in the UDited K1Dgd￿￿ governing the prqwation and di&s¢m1￿￿tion of fiTrarKial statLHnents may diff¢r from legislation in other jurisdi¢tiOM5. A l. Independent Ewnln*tloll A resolutiofj prop￿ing atmlitors was apwlval at the l&st AGM. b]L (bje h) a sutrwotsal reduction in incom¢. ati itMleF¢nd¢nt examination w&$ sufficieni for the fin8ncia] yeaT under I¢vAew. Thc church previously required w) 1ndq*llth￿ exarn￿on prior to the building proie¢LS. Appn)ved and si￿￿ed M behalf of the tr• by Ik)rtc Billc Harding- Cbaim Niels Ring Andersen- H￿)rary Treasurer Dat¢d. 4th Junt 2021 THE DANISH CHURCH IN LONDON INDEPENDENT ELWLNER'S REPORT TO THE TRUSTEES OF THF. DANI.SH CHURCH IN I_ON'tX)N I retxTrrt 11? Lhdriiy tnLStees on my examinatiijn of ￿c￿nts of t￿ chariry the year entsl 31 IkccmlKr 2020. which aty gel wi ￿ ￿¢5 l? ￿ 25. As the eharitv's knLStees )DU are reswnsible for thc prqmration of tbe in accoth(% with the requirements 1)I' the C.harilies Aci 2011 I'the.4ct"i. I rep)rt in rble Directions g]ven by" Ciurtty CAimmi&sion un(kr seciion 14515Mbl of Aci. Inde￿iden1 EwM1￿'S Statemeni Since I1￿ charity's ￿ in(x)nK excttrfkd £250.(th y(￿Ck￿Miner a memkr of a listed in section 145 of Aa. I confimi l am qua]ificd to the eX￿Ination becau%e I am a memter ol the tn%iiiuie ot Charteral Accwnthnts of Scfyttrt W￿"ch 18 1)ne uf ts listed hjjie I hai'e con1ple￿I mv exdminaii()n. I curbfirm no material rnalla5 Ikive LI)n￿ to my auenkn'on in conncaioji with the examin￿lI)n ¥i￿1T￿g rTJe ca￿se to ￿lIeVe thar in any matdial respxt.. counting Jrcoi(ts wetr kryx in rthFttI Ot charity, as requi￿1 by section 1.30 of thc Act: or the ￿count$ (k) with those rec(Kds" the accounLS do n(x comply with I1￿ ￿￿￿lL7ble wllirernents concerning fonn c(mtent of accounLS sei oul in thc ch￿1]eS {Accounts aJKI Rew) Regulats'ons 2W8 LKher t1￿ rcquirini¢ni th¢ ¢￿L￿U￿15 wve a.tyue aNI fair iiew. which is not a maLter co￿￿1tr￿l &5 part of an In(￿nden[e￿[nln￿0n. I n() coKerns and have co￿£ nootlKY inL7)nneciiTh) the examination to which alleniion %hLx]Id ￿ drawi in this rqKKt in or(kr io etth]e a prO￿r u￿andIng of thc ￿cOuntS reached. liehael Lautphton In%lltiire of Chartered Accounthnts ol. SL.0d￿d For ivunro Brown Lid Daied.. June ?021 Munro Bmwn Lid Ch￿tered Accountants 3fl Ciily ,Sireet. Bath. BA I ?NT THE DANISH CHURCH IN LONDON ## STATEMENT OF FINANCIAL ACTIVITIES FOR THE YEAR ENDED 31 DECEMBER 2020 |Unrestricted
Funds
Notes
**GB £**
**INCOME & ENDOWMENTS**
Donations & legacies
2.1
101,352
Income from charitable activities
2.2
19,835
Income from other trading activities
2.3
21,394
Income from Investments
2.4
14,790
**Total income & endowments**
157,371
**EXPENDITURE**
**Costs of raising funds**
Costs of generating activity income
3
18,600
Investment Management costs
1,842
**Expenditure on charitable activities**
4
175,110
**Total expenditure**
195,552
**Net (expenditure)/ income before**
**gain/(losses) on investments**
**(38,181) **
Net (loss)/gain on investments
8
(8,013)
Net (expenditure)/ income for the year
(46,194)
**Transfer between funds**
-
**Net movement in funds**
(46,194)
**Reconciliation of Funds:**
Total funds brought forward
14
665,377
**Total funds carried forward**
14
**619,183**|Unrestricted
Funds
Notes
**GB £**
**INCOME & ENDOWMENTS**
Donations & legacies
2.1
101,352
Income from charitable activities
2.2
19,835
Income from other trading activities
2.3
21,394
Income from Investments
2.4
14,790
**Total income & endowments**
157,371
**EXPENDITURE**
**Costs of raising funds**
Costs of generating activity income
3
18,600
Investment Management costs
1,842
**Expenditure on charitable activities**
4
175,110
**Total expenditure**
195,552
**Net (expenditure)/ income before**
**gain/(losses) on investments**
**(38,181) **
Net (loss)/gain on investments
8
(8,013)
Net (expenditure)/ income for the year
(46,194)
**Transfer between funds**
-
**Net movement in funds**
(46,194)
**Reconciliation of Funds:**
Total funds brought forward
14
665,377
**Total funds carried forward**
14
**619,183**|Restricted
Funds
**GB £**
647,705
-
-
1,328|Endowment
Funds
**GB £**
9,921
-
15,680
28,277|**Total**
**Funds**
**2020**
Total
Funds
2019
**GB £**
GB £
**758,978**
1,762,559
**19,835**
77,983
**37,074**
19,367
**44,395**
51,295| |---|---|---|---|---| ||157,371|649,033|53,878|**860,282**
1,911,204| ||18,600
1,842
175,110|43
-
1,911,300|-
4,822
27,138|**18,643**
36,772
**6,664**
5,811
**2,113,548**
796,614| ||195,552|1,911,343|31,960|**2,138,855**
839,197| ||**(38,181) **
(8,013)|**(1,262,310)**
-|**21,918**
(22,857)|**(1,278,573)**
1,072,007
**(30,870)**
127,464| ||(46,194)
-|(1,262,310)
15,854|(939)
(15,854)|**(1,309,443)**
1,199,471
**-**
-| ||(46,194)
665,377|(1,246,456)
1,273,625|(16,793)
1,165,119|**(1,309,443)**
1,199,471
**3,104,121**1,904,650| ||**619,183**|**27,169**|**1,148,326**|**1,794,678**3,104,121| THE DANISH CHURCH IN LONDON ## STATEMENT OF CASH FLOWS: YEAR ENDED 31 DECEMBER 2020 |**Notes**
**Cash flows from operating activities:**
**Reconciliation of net movement in funds to**
**net cash flow from operating activities**
**Net movement in funds**
Add: depreciation
Deduct: interest and dividend income
Add: loss/ (deduct gain) on revaluation of investments
(Increase)/Decrease in stocks
(Increase)/Decrease in debtors
(Decrease)/Increase in creditors
**Cash (used in)/ provided by operating activities**
A
**Cash flows from investing activities**
Income from interest and dividends
Net movements in foreign exchange
Net movements on investment funds
**Cash provided by/ (used in) investing activities**
B
**Cash flows from financing activities**
C
**(Decrease)/Increase in cash and cash equivalents in the year (A+B+C)**
**Total cash & cash equivalents brought forward**
**Total cash & cash equivalents carried forward ***|**Total 2020**
Total 2019
**GB £**
GB £
**(1,309,443)**
1,199,471
**1,150**
10,655
**(44,395)**
(51,295)
**30,870**
(127,464)
**-**
4,828
**56,885**
(48,027)
**(102,398)**
187,949| |---|---| ||**(1,367,331)**
1,176,117| ||**44,395**
51,295
**(400)**
(1,994)
**7,215**
6,534| ||**51,210**
55,835| ||-
-| ||**(1,316,121)**
1,231,952
**1,737,929**
505,977| ||**421,808**
1,737,929| *refer to balance sheet THE DANJSH CHURCH IN LONtK)N 14 sTATEmE￿r OF FINANCIAL POSftlON IBALANCE SHEED AT 31 DECEMBER 2020 2019 GB£ GB£ GB£ GB£ Fued •ssets T¥ngl>k asscts Invoslments &95Tr 1212.863 IA61J13 250,100 1,250,548 1.5W.648 10 Cunut wsets st￿ks 12 39thS3 421 461.461 96,538 1.737.929 1,834.467 Casb at bank atHI ￿ hand CTrdlto 13 2311gM Lyet 33U65 1.603.473 Totsl net wets 1.794,678 3.104.121 14 14 619.183 27,169 665.377 1273.625 Endowmettt fimds 14 I.IW26 1,165,119 Total fimds 14 I,PM678 3.104,121 These accounts were approved on behalf of the tn￿ceS on 4 June 2021. Dorte Bille Hardthg- Chairnwi THE DANISH CHURCH IN LONDON 15 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## 1 **Accounting policies** ## **Accounting basis and standards** The accounts have been prepared on the going concern basis and in accordance with applicable accounting standards and the Statement of Recommended Practice on Accounting and Reporting by Charities SORP (FRS 102). ## **Income** Church activities and related income are accounted for in the period in which the service is provided. Fee receivables are stated after deducting discounts. Donations are credited to revenue when receivable provided conditions for receipt have been complied with. Donations for specific categories of revenue expenditure are credited to restricted funds. Investment income is included in the financial statements on an accruals basis. ## **Expenditure** Expenditure, including staff costs, is included in the accounts on an accruals basis and has been classified under heading that aggregate all costs relating to that category. The irrecoverable VAT is included with the item of expense to which it relates. ## **Tangible assets** Tangible fixed assets are stated at cost less depreciation. Depreciation is provided on certain classes of fixed assets to write off their cost over their expected useful lives, as follows: |Plant & Machinery|5 years| |---|---| |Furniture & fixtures|10 years| |Organ (refurbishment)|5 years| |Office equipment|5 years| |Motor vehicles|10 years| No depreciation is charged on the Royal College Street property. Heritage, consecrated and beneficed property is excluded from the accounts by virtue of section 10(2)(a)-(c) of the Charities Act 2011. All expenditure incurred on such property is written off in the accounting period it is incurred. THE DANISH CHURCH IN LONDON NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## **Foreign currencies** Assets and liabilities in foreign currency are translated into sterling at the rates ruling at the dates of the balance sheet. Transactions in foreign currencies are translated into sterling at the rates ruling at the date of the transactions. Exchange differences are taken into account when arriving at the operating result. ## **Investments** Investments held as fixed assets are stated at market value at the close of the accounting period. ## **Debtors & prepayments** Debtors are valued individually less any provisions applicable for potential bad debts. Prepaid expenditure is recognized if material to the accounts. ## **Creditors** Creditors are recognized where the church has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount to settle the obligation can be measured or estimated reliably. ## **Fund accounting** Permanent endowment funds are recognized when a donor has provided an asset(s) where the income therefrom is applied for a specific purpose. Expendable endowment funds allow the spending of both the related income and capital value on a specified purpose. Restricted funds are to be used for specific purposes as laid down by the donor or funder. Designated funds are unrestricted funds that have been set aside by the trustees for a particular purpose. General funds are unrestricted and available for use at the discretion of the trustees in furtherance of the general objectives of the charity and which have not been designated for any other purpose. Transfers between funds are made where income for a project has been exceeded by related expenditure or where it has been agreed with the funder to use unspent balances at the end of a project on activities with a similar objective. ## **Pensions** The church operates a group money purchase defined contribution pension scheme under the autoenrolment system. The assets of the scheme are held separately from those of the church in an independently administered fund. The pension cost represents the contributions payable under the scheme by the church and the church has no further liability other than the payment of those contributions. THE DANISH CHURCH IN LONDON ## NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## **2. Income summary** |**2.1 Income from donations and legacies**
Membership
Collections, donations & gift aid
Organ fund donations
In memoriam fund donations
Façade fund grants and donations
Nordea fund grants and donations
**2.2 Income from charitable activities**
Catering for charitable activities & events
Church shop income
Educational fees and books
DSUK allowances
**2.3 Income from other trading activities**
Church hall hire
Rents
Church magazine advertising
Coronavirus Job Retention Scheme
**2.4 Income from investments**
**Total Income**
Second Priest accommodation designated
Church interior fund designated
Building project fund grants & donations|Unrestricted
GB £
35,457
64,162
1,733
-
-
-
-
-
-|Restricted
GB £

-

-

-
60

-

-

-

-
647,645|Endowment
GB £
-
9,921
-
-
-
-
-
-
-|**Total 2020**
Total 2019
**GB £**
GB £
**35,457**36,178
**74,083**88,683
**1,733**
-

**60**
316
**-**40,000
**-**
-
**-**30,000
**-**15,125
**647,645**
1,552,257| |---|---|---|---|---| ||101,352|647,705|9,921|**758,978**
1,762,559| ||4,813
767
10,447
3,808|
-

-

-

-|-
-
-
-|**4,813**48,687

**767**
8,089
**10,447**17,193
**3,808**
4,014| ||19,835|
-|-|**19,835**77,983| ||-
4,360
5,574
11,460|
-

-

-
-|-
15,680

-
-|**-**
1,030
**20,040**14,601
**5,574**
3,736
**11,460**
-| ||21,394|
-|15,680|**37,074**19,367| ||14,790|
1,328|28,277|**44,395**51,295| ||157,371|649,033|53,878|**860,282**
1,911,204| THE DANISH CHURCH IN LONDON ## NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## **3. Costs of generating activity income** |**3. Costs of generating activity income**||||| |---|---|---|---|---| |Catering & shop expenses
Danish fair
Other events
Books & education
Ecclesiastical expenses
Fundraising costs|Unrestricted
GB £
717
-
(205)
7,040
11,048
-|Restricted
GB £

-

-
-

-
43

-|Endowment
GB £
-
-
-
-
-

-|**Total 2020**
Total 2019
**GB £**
GB £

**717**16,861
**-**10,353

**(205)**
874
**7,040**
6,509
**11,091**
1,085

**-**
1,090| ||18,600|43|-|**18,643**36,772| ## **4. Expenditure on charitable activities** |**4. Expenditure on charitable activities**||||| |---|---|---|---|---| |Benevolent fund bursaries
Summer School & educational grants
Salaries & staff costs (note 6)
Premises costs
Insurance
Utilities
Repairs, maintenance & refurbishment
Nordea Fund furniture costs
Building project costs
Motor & travel expenses
Administrative costs & communications
Magazine costs
Second Priest accommodation costs
Depreciation
Support & accountancy costs
Bank charges
Irrecoverable VAT on general expenditure
Governance costs (note 5)|Unrestricted
GB £
-
-
37,837
11,031
12,149
25,642
4,573
-
-
3,337
15,502
6,466
13,400
1,150
22,485
2,007
13,500
6,031|Restricted
GB £

-

-

-

-

-

-

2,080
31,468
1,877,752

-

-

-

-

-

-

-

-

-|Endowment
GB £
8,694
1,800
7,695
2,000
-
-
6,949
-
-
-
-
-
-
-
-
-
-
-|**Total 2020**
Total 2019
**GB £**
GB £
**8,694**
2,680
**1,800**
3,258
**45,532**58,891
**13,031**15,614
**12,149**12,886
**25,642**27,400
**13,602**28,666
**31,468**
-

**1,877,752**545,949
**3,337**
4,659
**15,502**18,683
**6,466**
6,702
**13,400**14,881
**1,150**10,655
**22,485**26,166
**2,007**
2,543
**13,500**11,500
**6,031**
5,481| ||175,110|1,911,300|27,138|
**2,113,548**796,614| ## **5. Governance costs** |**5. Governance costs**||||| |---|---|---|---|---| |Independent examination fee (2019: audit)
Accounts drafting fee
Room hire & drafting fees from 2019
Trustee and AGM costs (note 7)
As previously stated in 2019
Trustee liability insurance
As restated|Unrestricted
GB £
1,900
2,700
855
-|Restricted
GB £

-

-

-
-|Endowment
GB £
-
-
-
-|**Total 2020**
Total 2019
**GB £**
GB £
**1,900**
2,700
**2,700**
2,205

**855**
-
**-**
-| ||5,455
576|
-

-|-
-|**5,455**
4,905

**576**
576| ||6,031|
-|-|**6,031**
5,481| THE DANISH CHURCH IN LONDON NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## **6. Staff costs** |Wages and salaries
Social security costs
Less: employment allowance
Other pension costs
Other staff costs (temps, child protection etc.)
DSUK Contribution
**Total**
Staff (full time equivalent)|**2020**
2019
**GB £**
**GB £**
33,050
41,210
1,586
1,778
(1,585)
(1,778)
2,898
2,998| |---|---| ||35,949
44,208
5,223
9,683
4,360
5,000| ||**45,532**
58,891| ||**2020**
2019
**No.**
No.
2.0
2.5| The average number of staff was three and no member of staff earned more than £60,000 ## **7. Trustees & related party transactions** No trustee was paid any remuneration in either year. The trustees are regarded as the key management of the church. No trustee or other person related to the church had any personal interest in any contract or transaction. ## **8. Gain/(Loss) on investments** |Unrealised gain/(loss) on investments
Gain/(loss) on foreign exchange translation|Unrestricted
GB £
(7,613)
(400)|Restricted
GB £
-
-|Endowment
GB £

(22,857)

-|**Total 2020**
Total 2019
**GB £**
GB £
**(30,470)**
129,458

**(400)**
(1,994)| |---|---|---|---|---| ||(8,013)|-|(22,857)|**(30,870)**
127,464| ## **9. Tangible fixed assets** |**Cost**
At 1 January 2020
Additions /(disposals)
At 31 December 2020
**Depreciation**
At 1 January 2020
On disposals
Charge for year
At 31 December 2020
**Net book value**
**At 31 December 2020**
At 31 December 2019|**Freehold**
**Property**
**GB £**
245,000
-|**Cars,**
**Fittings &**
**Equipment**
**GB £**
114,141

-|**Organ**
**Refurbish't**
**Total**
**GB £**
**GB £**
107,917
467,058

(107,917)
(107,917)| |---|---|---|---| ||245,000|114,141|-
359,141| ||-
-|109,041
1,150|107,917
216,958
(107,917)
(107,917)
-
1,150| ||-|110,191|-
110,191| ||245,000|3,950|-
248,950| ||245,000|5,100|- 250,100| THE DANISH CHURCH IN LONDON ## NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## **10. Investments** |**Benevolent fund investments:**
_M&G Securities Ltd Charifund Income Units_
Value of 8466.31 units at 1st January
Net movement on funds *
Sub-total
Value of 8466.31 units at 31st December
Unrealised (loss)/ gain - market movement
**Summer School fund investments:**
_Danske Bank_
Value of investments at 1st January
Net movement on funds *
Value of investments at 31st December
Unrealised (loss)/ gain - market movement
**Other fund investments:**
_General portfolio through Charles Stanley & Co. Ltd_
Value of investments at 1st January
Net movement on funds *
Value of investments at 31st December
Unrealised (loss)/ gain - market movement
_General portfolio through Cazenove Schroder_
Value of investments at 1st January
Net movement on funds *
Value of investments at 31st December
Unrealised (loss)/ gain - market movement
**Total value of investments**
Closing value at 31st December
Opening value at 1st January|**2020**
**2019**
**GB £**
**GB £**
**143,181**
**123,018**
**-**
**127**
**143,181**
**123,145**
**117,645**
**143,181**| |---|---| ||**(25,536)**
**20,036**| ||**25,411 27,920**
**(60)**
**(1,851)**
**28,030 25,411**| ||**2,679**
**(658)**| ||**515,267**
**448,732**
**(7,155)**
**(4,940)**
**488,980**
**515,267**| ||**(19,132)**
**71,475**| ||**566,689**
**528,084**
**-**
**-**
**578,208**
**566,689**| ||**11,519**
**38,605**| ||| ||**1,212,863**
**1,250,548**| ||| ||**1,250,548**
**1,127,754**| * movement on funds include dividend income less distributions to church and portfolio management fees THE DANISH CHURCH IN LONDON ## NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## **10. Investments continued** |**Portfolio asset allocation**
**and total investment value**
GB £
Fixed Income
Equities
Property
Alternatives
Mixed investments
Cash|**Charles Stanley**
**M&G Charifund**
**Benevolent Fund**
GB £
-
116,206
-
-
-
1,439
117,645|**Danske Bank**
**Summer School**
**Fund**
GB £
27,587
-
-
-
-
443
28,030|**Charles Stanley**
**Cazenove Capital**
**General Portfolio**
**General Portfolio**
GB £
GB £
33,090
49,380
400,983
366,716
11,715
85,033
27,658
46,348
12,070
16,452
3,464
14,279
488,980
578,208| |---|---|---|---| |1,212,863|||| The Benevolent Fund is invested with M&G Charifund, which is designed to provide a growing level of income for UK charities, while at the same time protecting their capital from the effects of inflation over a rolling ten year period. It aims to provide a level of income that is significantly higher than that of the FTSE All-Share Index. The investment is managed by Charles Stanley investment managers. The Summer School Fund investments are placed with Danske Bank and aim to generate a high return through Danish Bonds in order to fund annual scholarships. The objective of the Charles Stanley general portfolio is to produce a balance between capital growth and income without the income requirement eroding the potential to maintain capital. The objective of the general portfolio managed by Cazenove Capital (part of Schroder & Co. Ltd.) is to maintain capital value whilst distributing 3-4% annually as income. ## **11. Stocks** |Stocks of canteen and shop goods
**Total**
**12. Debtors: Amounts falling due within one year**
Registrations, memberships & advertising
Accrued income
Other debtors & prepayments
Listed places of worship grant due
Gift aid repayable
VAT repayable
**Total**|**2020**
2019
**GB £**
GB £
**-**
-| |---|---| ||**-**
-| ||**2020**
2019
**GB £**
GB £
**4,765**
5,885
**4,056**
16,120
**6,034**
5,232
**6,998**
37,959
**8,593**
6,695
**9,207**
24,647| ||**39,653**
96,538| THE DANISH CHURCH IN LONDON ## NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## **13. Creditors: Amounts falling due within one year** |**13. Creditors: Amounts falling due within one year**|| |---|---| |Shop creditors
VAT payable
PAYE/ NIC payable
Other creditors & accruals
**Total**|**2020**
2019
**GB £**
GB £
**-**
434
**-**
-
**-**
-
**128,596**
230,560| ||**128,596**
230,994| ## **14. Movement in funds** |General Fund
Organ fund
Church interior fund
Second vicar accommodation fund
**Total designated funds**
Garden fund
In memoriam fund
Building project fund
Nordea fund
**Total restricted funds**
Salary and pension fund (18.2)
Benevolent fund (18.3)
FUHU fund
Building and reserve fund (18.1)
Summer School fund
**Total endowment funds**
**Total church funds**
**Unrestricted funds**
**Designated funds**
**Total unrestricted funds (general & designated)**
**Restricted funds**
Friends fund
**Endowment Funds**|At 1st
January
2020
**GB £**
635,086|Net
Movement
in funds
**GB £**
(29,954)|Transfer
between
funds
**At 31st**
**December**
**2020**
**GB £**
**GB £**
-
605,132| |---|---|---|---| ||10,171
5,001
15,119|1,949
(4,789)
(13,400)|-
12,120
-
212
-
1,719| ||30,291|(16,240)|-
14,051| ||665,377|(46,194)|-
619,183| ||19,851
16,042
4,314
1,180,806
52,612|(2,080)
-
17
(1,228,779)
(31,468)|-
17,771

-
16,042
-
4,331
15,854
(32,119)
-
21,144| ||1,273,625|(1,262,310)|15,854
27,169| ||432,243
160,118
60,000
488,295
24,463|-
(19,535)
-
15,854
2,742|
-
432,243
-
140,583

-
60,000
(15,854)
488,295
-
27,205| ||1,165,119|(939)|(15,854)
1,148,326| ||||| ||**3,104,121**|**(1,309,443)**|**-**
**1,794,678**| THE DANISH CHURCH IN LONDON ## NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## **14 cont. Net movement in funds in year** |General fund
Organ fund
Church interior fund
Second vicar accommodation fund
Garden fund
In memoriam fund
Building project fund
Nordea fund
**Total restricted funds**
Salary and pension fund (18.2)
Benevolent fund (18.3)
FUHU fund
Building and reserve fund (18.1)
Summer School fund
**Total endowment funds**
**Total church funds**
**Unrestricted funds**
**Designated funds**
**Total designated funds**
**Total unrestricted funds (general & designated)**
**Restricted funds**
Friends fund
**Endowment Funds**|**Incoming**
**resources**
**GB £**
155,638|**Resources**
**expended**
**GB £**
(177,579)|**Gains/**
**(losses) on**
**investments**
**Movement**
**in funds**
**GB £**
**GB £**
(8,013)
(29,954)| |---|---|---|---| ||1,733
-
-|216

(4,789)

(13,400)|-
1,949
-
(4,789)
-
(13,400)| ||1,733|(17,973)|-
(16,240)| ||157,371|(195,552)|(8,013)
(46,194)| ||-
-
60
648,973
-|
(2,080)

-
(43)
(1,877,752)

(31,468)|-
(2,080)

-
-
-
17
- (1,228,779)
-
(31,468)| ||649,033|(1,911,343)|-(1,262,310)| ||11,617
15,595
1,800
24,803
63|(11,617)
(9,594)
(1,800)
(8,949)
-|-
-
(25,536)
(19,535)
-
-
-
15,854

2,679
2,742| ||53,878|(31,960)|(22,857)
(939)| ||**860,282**|**(2,138,855)**|**(30,870)**
**(1,309,443)**| ## **Purpose of funds** **General fund:** Unrestricted and for use in the furtherance of the general objectives of the church ## **Designated funds:** **Organ fund:** for the maintenance and repair of the church organ. **Church interior fund:** Maintenance and repair of the church interior. **Second vicar accommodation fund:** Accommodation for a second priest over two years ## **Restricted funds:** **Garden fund:** Renovation of the Church's courtyard and gardens. **Friends fund:** Support for the long-term financial stability of the church. **In Memoriam fund:** To provide flowers and candles on specific dates in memory of deceased members. **Building project fund:** Internal rebuilding and redevelopment of the church buildings. **Façade project fund:** External rebuilding and maintenance. **Nordea fund** : Educational supplies, particularly electronic equipment, as well as fixtures and fittings for educational and general purpose. ## **Endowment funds:** **Salary and pension fund:** Income from a permanent endowment to provide salaries and pensions for the pastors and support workers. THE DANISH CHURCH IN LONDON 24 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## **Purpose of funds cont.** **Benevolent fund:** Income from a permanent endowment to be used for making grants to Danes in London, who are in financial need. **FUHU fund:** Interest from a permanent endowment to provide help and financial assistance to Danish students living in the UK or with connections to the UK in the form of bi-annual scholarship grants. **Building and reserve fund:** An expendable endowment for the purchasing or leasing of new sites or buildings or the repair or rebuilding of existing buildings to be used for Danish Church services in London or in other ways for the furtherance of the work of the church. **Summer School fund:** An expendable endowment where the interest from the fund may be used to send pupil(s) to Summer school in Denmark. ## **15. Analysis of net assets between funds** |General fund
Organ fund
Church interior fund
Second vicar accommodation fund
Garden fund
In memoriam fund
Building project fund
Façade project fund
Nordea fund
**Total restricted funds**
Salary and pension fund* (18.2)
Benevolent fund (18.3)
FUHU fund
Building and reserve fund* (18.1)
Summer School fund
**Total endowment funds**
**Total church funds**
**Total unrestricted funds (general & designated)**
**Restricted funds**
Friends fund
**Endowment Funds**
**Unrestricted funds**
**Designated funds**
**Total designated funds**|**Fixed**
**Assets**
GB £
3,950|**Investments**
GB £

391,650|**Bank &**
**Cash**
GB £

120,223|**Other Net**
**Current**
**Assets**
**Net Assets**
GB £
GB £

89,309
605,132| |---|---|---|---|---| ||-
-|
-

-|
12,120
212

1,719|
-
12,120

-
212

-
1,719| ||-|
-|
14,051|
-
14,051| ||3,950|
391,650|
134,274|
89,309
619,183| ||-
-
-
-
-
-|
-

-

-

-

-

-|
17,771

16,042

4,331

146,133

-

21,144|
-
17,771

-
16,042

-
4,331

(178,252)
(32,119)

-
-

-
21,144| ||-|
-|
205,421|
(178,252)
27,169| ||-
-
-
245,000
-|
432,243

117,645

-

243,295

28,030|
-

22,938

60,000

-

(825)|
-
432,243

-
140,583

-
60,000

-
488,295
-
27,205| ||245,000|
821,213|
82,113|
-
1,148,326| ||**248,950**|**1,212,863**|**421,808**|**(88,943)**
**1,794,678**| * The Building and Reserve Fund and Salary and Pensions Fund investments are held as if in cash equivalents attracting a set return. The risk from capital gains and losses on investment properties and other investments is taken by the General Fund. ## **16. Funds in deficit** At 31st December 2020, the main building project was in deficit by £32,119, but it is hoped that this will be cleared by donations during 2021. Otherwise, the balance will be transferred against the Building & Reserve Fund. ## **17. Taxation** No taxation was payable on any surplus or deficit or investment income in 2020 because the church is regarded as a charitable organisation and is not engaged in trading activities as defined by the Income & Corporation Taxes Act 1988. THE DANISH CHURCH IN LONDON ## NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## **18. Linked Charities** |**(Linked charity number 237897-1)**
Opening value of investments at 1st January
Income from investments (net return after management fees)
Less: Lease payment to Crown Estates
Façade expenditure
General repairs to buildings
Surplus to carry forward
Transfers to main building project fund
Investment (losses)/ gains in year
Closing value of investments at 31st December
**(Linked charity number 237897-2)**
Opening value of investments at 1st January
Income from investments
Less: Salaries applied from employees
Portfolio management & transaction fees
Surplus to carry forward
Investment (losses)/ gains in year
Closing value of investments at 31st December
**(Linked charity number 237897-3)**
Opening value of investments & cash at 1st January
Income from investments
Donations to benevolent fund
Less: Payments to beneficiaries
Portfolio management fees
Surplus to carry forward
Investment (losses)/ gains in year
Closing value of investments and cash at 31st December
Represented by:
Investments
Cash balances (benevolent account & with general fund)
**18.1 Danish Church in London Building and Reserve Fund**
**18.2 Danish Church in London Salary and Pension Fund**
**18.3 Benevolent Fund: Hjaelpefond for Danske I London**|GB £
GB £
GB £
GB £
488,295
489,834
24,803
18,782
(2,000)
(6,041)
-
(2,480)
(6,949)
(11,800)
15,854
(1,539)
(15,854)
-
-
-
**488,295**
**488,295**
GB £
GB £
432,243
432,243
11,617
18,567
(7,695)
(14,090)
(3,922)
(4,477)
-
-
-
-
**432,243**
**432,243**
GB £
GB £
160,118
135,713
5,674
7,049
9,921
(8,694)
(2,680)
(900)
-
6,001
4,369
(25,536)
20,036
**140,583**
**160,118**
117,645
143,181
22,938
16,937
**140,583**
**160,118**
**2020**
**2019**| |---|---| ||11,617
(7,695)
(3,922)| ||5,674
9,921
(8,694)
(900)| ||| ## **18.4 Danish Emergency Trust Fund summary** ## **(Linked charity number 237897-4)** The assets of the Danish Emergency Trust Fund were registered as a separate charity number 213338. During 2020, the assets were transferred to the Benevolent Fund within the Danish Church in London and shown as the £9921 donation. ## **19 Contingent Liability** The Charity is in discussions with its main building contractors, about a number of claims, partially arising from Covid-19 and the consequent delays. At present it is not possible to quantify any financial impact on the charity and therefore a provision has not been included in the financial statements for the year ending 31 December 2020.