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2023-12-31-accounts

ae THE CHURCH © Seeking.

The Newcastle Diocesan Board of Finance Limited

(A company limited by guarantee)

Annual Report & Financial Statements Year ended 31 December 2023

Company number 00650977 Registered charity number 247233

A large print version is available on request from

Church House St John’s Terrace North Shields NE29 6HS

E-mail: info@newcastle.anglican.org Telephone: 0191 270 4100

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT

FOR THE YEAR ENDED 31 DECEMBER 2023

TABLE OF CONTENTS Page Number
Mission Statement 3
Legal Objects 4
Strategic Report:
Strategic aims and objectives 4
Activities and achievements in the year 5
Future plans 9
Financial review 10
Principal risks and uncertainties 12
Structure and Governance 13
Trustees Responsibilities 16
Administrative details 17
Independent Auditor’s Report 19
Statement of Financial Activities 22
Income and Expenditure Account 23
Balance Sheet 24
Cash Flow Statement 25
Notes to the Financial Statements 26 - 50

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT

FOR THE YEAR ENDED 31 DECEMBER 2023

Mission Statement

With our outward-facing values of seeking , sharing , and sending we are further seeking to grow younger and more diverse. God calls us all to follow Christ, and in baptism the whole Church is summoned to witness to God’s love and to work for the coming of his kingdom. This is the shared vocation of all God’s people: we are all called to mission and ministry as part of what it means to follow Jesus together as his disciples.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

The Trustees, who are also Directors for the purposes of company law, present their annual report, together with the audited financial statements, for the year ended 31 December 2023. The Directors/Trustees are one and the same and in signing as Trustees they are also signing the strategic report sections in their capacity as Directors.

This combined report satisfies the legal requirements for:

LEGAL OBJECTS

The objects of the Diocese of Newcastle cover the local authorities of Northumberland, Newcastle, and North Tyneside and also small parts of County Durham and Cumbria.

The Newcastle Diocesan Board of Finance Limited (“NDBF”)’s principal object is to promote, assist and advance the work of the Church of England in the Diocese of Newcastle by acting as the financial executive of the Newcastle Diocesan Synod.

The NDBF has the following statutory responsibilities:

The main role of the NDBF is to identify and manage the financial aspects of the provision of ministry within the Diocese so as to provide appropriate personnel and financial resources to assist the Diocesan Synod, the Bishop’s Council, deaneries and parishes to further the mission and strategic priorities throughout the Diocese of Newcastle.

The strategic priorities of the company are established by the Diocesan Synod in consultation with Deanery Synods, Parochial Church Councils, and the Bishop of Newcastle (in respect of the Bishop’s responsibility for the provision of the cure of souls).

STRATEGIC AIMS AND OBJECTIVES

The Diocese of Newcastle aims to be a church which is Jesus Christ centred and outward facing and seeks to align its work with the national church’s strategic priorities through its outward facing values of:

SEEKING through being Open to God’s transforming love; SHARING through being Generous with God’s transforming gifts; SENDING through being Engaged in God’s transforming work in the world.

In living out these three values the Diocese of Newcastle is seeking to become a church of missionary disciples which fosters a mixed ecology of church and which includes establishing new worshipping communities, to be a church that is growing younger and more diverse.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT

FOR THE YEAR ENDED 31 DECEMBER 2023

ACTIVITIES AND ACHIEVEMENTS IN THE YEAR

Leadership

On 3rd February 2023 the Rt Revd Dr Helen-Ann Hartley became the 13th Bishop of Newcastle at a Confirmation of Election held at York Minister and began serving as Bishop of Newcastle following a service of inauguration at Newcastle Cathedral on 22 April 2023. Bishop Helen-Ann is an ex-officio trustee of the NDBF.

On 14[th] October 2023 the Very Revd Lee Batson was installed as the Dean at Newcastle Cathedral. The Dean is an ex-officio trustee of the NDBF.

On 19[th] November 2023 the appointment of the Revd Dr Richard Whaite as the Director of Mission and Ministry was announced. Dr Whaite took up his appointment in March 2024.

The Christian Presence

Our licensed ministers form a central part in the life of churches in the Newcastle Diocese and carry out important roles in communities. As well as engaging in a wide variety of community and church projects, we carry out around 440 weddings, 1700 funerals and 1520 baptisms every year.

In 2023 a Youth and Children’s Mission Coordinator and two Youth and Children Enablers were recruited to a project called Beyond Youth. This project has been generously supported by £300k awarded to the NDBF by the Lord Crewe’s Trustees’ Tercentenary Awards. The Beyond Youth Team is working across the parishes of Ashington Holy Sepulchre, Seaton Hirst, Cresswell & Lynemouth and Woodhorn with Newbiggin to build up the profile of youth and children’s work. The Diocese of Oxford has generously provided funding, through national Lowest Income Communities Funding, for a timelimited full-time Pioneer Minister serving the Bishop’s Mission Order covering these parishes.

The Lord Crewe’s Trustees have also awarded the NDBF £300k for the Lighthouse Project at Byker St Michael. Following the completion of planning and the granting of a faculty the reordering works commenced in late 2023 which will provide a safe and central meeting place in the heart of Byker where young people and the community can flourish, with access to a wide variety of community activities and services for around 1,500 young people and families each year, alongside a reimagined worship space. Together with the Tercentenary Award, the Lighthouse Project was granted £4.2m from the Department for Culture, Media and Sport’s Youth Investment Fund and a grant from the Squires Foundation. The reordered space is due to open in January 2025.

While the NDBF is responsible for the funding of clergy stipend costs, the national clergy payroll is administered by the Church Commissioners whom the NDBF reimburses monthly for the costs of stipendiary clergy deployed in the Diocese. Caring for the licensed clergy and lay workers in the Diocese is a priority of the NDBF and represents by far its largest financial commitment. Although the NDBF does not employ the parish clergy, it is responsible for ministerial formation, continued ministerial development and, where applicable, resourcing the stipend and paying into the pension fund.

In 2011 terms of service were introduced in the form of Common Tenure under which all new clergy are appointed. Common Tenure gives clarity on the rights and obligations of clergy and requires that clergy participate in a process of Continual Professional Development and Ministerial Development Review (MDR). A new MDR process was agreed in 2023. Common Tenure also gives clergy access to Employment Tribunals and other useful services.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

In 2023:

An average of 78.54 full-time equivalent (FTE) paid clergy, holding incumbent, priest-in-charge, team vicar or associate clergy roles were in post (2022: 76.4FTE). This meant an average of 11.91FTE incumbent status posts were vacant (in interregnum) in the year (2022: 17.4FTE).

In addition to the above establishment there were an average of 17.43FTE paid curates in training posts (2022: 18.0FTE), 2.0FTE Archdeacons; 1.5FTE paid chaplains serving the universities in Newcastle and also Northumbria Police (2022: 2.0FTE); 1.0FTE pioneer minister served at Seaton Hirst; and 1.0FTE Missioner served at Denton. 46 licensed Readers; 2 house for duty clergy; 21 selfsupporting clergy and 18 Authorised Lay Ministers also served in parishes across the Diocese in 2023.

The NDBF extends its gratitude to all those who have helped to provide worship during interregnums in 2023, particularly to Area Deans and Churchwardens who work closely to ensure scheduled services and other activities within the community continue uninterrupted.

For many, the clergy house represents the domestic heart of the parish, serving not only as a home but also as a base for ministry. The NDBF recognises the importance of a safe, secure and well-maintained house. Through the Houses & Glebe Committee the NDBF strives to continue with this work as well as carrying out programmed refurbishments and improvements, as available money allows. Our housing policy continues to be:

In 2023 work commenced to identify replacement vicarages at Rothbury (Alnwick Deanery); Blanchland (Corbridge Deanery); and Shotley (Corbridge Deanery).

In 2023 the Diocesan Mission and Pastoral Committee (DMPC) continued to review suspensions of presentation across all 12 deaneries and also the development of proposals for reorganisations of benefices within Bellingham and Hexham deaneries. The DMPC was also involved in the Deanery Planning process and spent time at its September away day learning about the plans which all deaneries had submitted. The DMPC was also involved in a potential church closure at Hunstanworth (Corbridge Deanery) and carried out a wide public consultation. The proposal to close the church has since been withdrawn.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

Church Buildings

The Diocesan Advisory Committee (DAC) held 8 meetings in 2023 and all were offered as hybrid to facilitate those preferring to join online. Meetings of the Standing Committee continued to take place wholly via video conferencing.

In 2023, 58 faculty applications were received (2022: 48) and all were dealt with by the Online Faculty System. The Committee informally advised on 26 cases (2022: 20) and carried out 17 site visits (2022: 11). The non-faculty work (authorised by the Archdeacon after review by a DAC member) amounted to 89 cases (2022: 90). The Committee considered the appointment of 12 new inspectors for Quinquennial Inspections.

A number of membership changes occurred. Ian Ayris stepped down as the local authority nominee on his retirement from Newcastle City Council and was co-opted as a member in March 2023 as the Committee wished to retain his expertise. Emma Wells stepped down from the Committee in June 2023 due to a change of job.

A Safer Church Open to All

During 2023 the Diocesan Safeguarding Advisory Panel (DSAP) was proud to support the development of a Chaplaincy for Survivors which was built on earlier work led by survivors with lived experience of abuse in a church setting. Maggi Creese took up the post of Lead Officer in November and the post is based in the Diocesan Safeguarding Team. The Chaplaincy acts as a main point of contact for survivors from across the diocese, and those affected by abuse, providing pastoral and spiritual care, and is a bridge to the Church, the Diocese and to external partners. The Chaplaincy for Survivors will also have a role in raising awareness within the Diocese about the needs of survivors, and contribute to the training of lay and ordained ministers on issues of trauma and church-based abuse. DSAP has continued to welcome the positive progress on support for survivors of abuse in a church setting and is enormously grateful to those who have had the courage to lead or participate in innovative ways of raising awareness and seeking positive ways forward. During the year the exhibition of art work following on from “ If I told you, what would you do ” was shown in several other cathedrals across the country.

In 2023, a DSAP subgroup monitored progress on the action plan resulting from the Lessons Learned Reviews (LLR) which were carried out in 2022. The Group provided feedback to the full DSAP, noting achievements and that some actions were dependent on national actions. A report on the thematic learning from the three LLRs completed during 2022 was presented to the March DSAP meeting. It highlighted a number of deficiencies is practice and areas for improvement, but also noted that much good work had been done, particularly the levels of care shown to respondents, victims and those raising concerns. The LLR action plan was subsequently signed off by DSAP in September.

Safeguarding learning and development has continued throughout the year. The safeguarding leaders learning pathway has been well attended and received positive feedback for the revised approach to enable good practice to flow from understanding and inner motivation. Links have been made with the University of Sunderland which, following on from PCR2 recommendations, led to research asking: “ How can the Newcastle Diocese Safeguarding Team better support Incumbents, Parish Safeguarding Officers and Churchwardens in the effective implementation of Church of England safeguarding policy in practice?” Researchers from the University presented their report at an event at Newcastle Cathedral in 2023.

Through our safeguarding provision the NDBF has engaged with and contributed to the wider debate on national changes to safeguarding. The Diocese of Newcastle has been a pathfinder diocese for IICSA recommendations 1 and 8, which relate to a new model for governance and accountability.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

Involvement with the pathfinder in 2023 included commenting on the new National Safeguarding Standards and Quality Assurance Framework during their development phase, and members of DSAP were interviewed by the team reporting on the Future of Safeguarding in the Church of England. DSAP has contributed to the Diocesan Safeguarding Strategy 2023 – 2026. This strategy is now aligned with the new national safeguarding standards (Culture, Leadership and Capacity; Prevention; Recognising, Assessing and Managing Risk; Victims and Survivors; Learning, Supervision and Support).

Community Engagement

Our churches are embedded in their communities and, as a result, have developed trusting relationships and networks, enabling churches to play an important part in responding to the challenges faced by neighbourhoods and communities today.

In 2023, the Lord Crewe’s Trustees generously provided funding to the NDBF to continue a partnership with Transforming Communities Together: Tyne to Tweed (“TCTTT”). This partnership supports the development of connections and relationships with congregations with TCTTT acting as a resource to churches, individuals and groups that are wanting to get involved in some form of community activity as part of their mission and commitment to community engagement and social action.

Other related parties

The major related parties with whom the NDBF works include:

Volunteers

The Diocese of Newcastle is dependent on the huge number of people involved in church activities both locally and at diocesan level. We believe that the number of active volunteers (or volunteer hours) given to the mission and ministry of the church is a key indicator of the health of a church. The service provided to a community through church volunteering also has a significant impact on people’s relationship to the church particularly at times of crisis.

Within this context, the NDBF values the considerable time given by all members of Parochial Church Councils, the deanery synods, boards, committees, and the Newcastle Diocesan Synod in pursuit of the mission of the Church of England in the Diocese of Newcastle.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT

FOR THE YEAR ENDED 31 DECEMBER 2023

FUTURE PLANS

In June 2023 all 12 deaneries had submitted the first iteration of deanery plans through the Deanery Development Planning process. Work continued in 2023, supported by the Archdeacons, with the Deanery Development Groups refining their plans to support mission and ministry across all 12 deaneries.

Public Benefit

The diocesan vision of seeking, sharing and sending is instrumental in promoting the whole mission of the church (pastoral, evangelistic, social and ecumenical) the Trustees are confident (having had regard to Charity Commission guidance) that NDBF delivers public benefit through community engagement and supporting those in need both spiritually and physically.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

FINANCIAL REVIEW

Financial performance

Parish Share, the financial contribution given by parishes to the Diocese to fund mission and ministry, was the main incoming resource for the Diocese. Excluding the arrears received from earlier years, share decreased in cash terms by £22k compared to 2022, and including arrears remained consistent with the prior year. The total share received in 2023 (before prior year arrears) when expressed as a percentage of the overall share offered was 98.5% (2022: 97.2%).

The Trustees extend their gratitude to all the parishes who completed their parish share contributions during 2023. The Trustees are thankful to parishes that were able to make their parish share contributions by monthly instalments which helped the NDBF to resource the monthly financial responsibilities associated with the payment of clergy stipends and the salaries of those employed by the NDBF.

The balance on the General Unrestricted Fund reduced by £593k in 2023 to £284k. There was an overall unrestricted deficit of £244k and there was a net gain in our investment in equities, held with CCLA Investment Management Ltd (CCLA), of £379k. Overall, before fund transfers and after investment gains, we saw a net surplus of £619k.

The Trustees have prepared a budget for 2024 which includes a deficit of £862k before usage of contingency funds (the usage of contingency funds brings the budget back to being balanced). The target for Parish Share collection uses the 2020 parish share request as a baseline together with advice from parishes on what they felt able to offer in 2024 against this baseline. A Diocesan Contingency Fund has been set to support parishes meet any gap between their offer and the baseline figure keeping in mind the financial pressures that parishes have faced in 2020 to 2023 as a result of coronavirus restrictions and the cost of living crisis.

The 2024 Parish Share target summarises as:

Overall the NDBF’s funds have increased in 2023 by £619k. This breaks downs as an operating deficit on unrestricted funds of £244k after transfers (£104k deficit before transfers), net incoming resources on restricted and endowment funds of £541k, and unrealised gains on investments of £379k.

Significant property transactions

During 2023 two properties, 20 Ryecroft Way, Wooler and 103 Holyfield, West Allotment, were sold as they were surplus to ministry requirements. Proceeds of 20 Ryecroft Way were credited to the Diocesan Stipends Fund and a proportion of the proceeds from 103 Holyfields was designated to fund the installation of electric vehicle charging points at vicarages and other property housing clergy. Detail on these property transactions is as follows:

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

Balance sheet position

The Trustees consider that the balance sheet together with details in note 21 show broadly that the restricted and endowment funds are held in an appropriate mix of investment and current assets given the purposes for which the funds are held. While the net assets at the balance sheet date totalled £26.931m (2022: £26.312m) it must be remembered that included in this total are properties, mostly in use for the ministry, whose value amounted to £16.947m (2022: £17.293m). Much of the remainder of the assets shown in the balance sheet are held in restricted funds, and cannot necessarily be used for the general purposes of the NDBF.

Reserves policy

Free reserves

Having considered financial risk, liquidity requirement and the timing of cash flows throughout the year, the Trustees’ policy is to aim to maintain c.£2m in investments for future income generation (2023 actual £2.3m) with an additional 3 months expenditure (c. £1.9m) held in readily realisable assets (2023 actual £2m). The Trustees are satisfied with reserves at the current level in line with the aims of the policy.

Reserves tied up in fixed assets

The general fund comprises net assets amounting to £284k of which £11k is tied up in tangible fixed assets.

Designated funds

The Trustees may, with the approval of the board, designate unrestricted reserves to be retained for an agreed purpose where this is considered to be prudent. Such designated reserves are reviewed from time to time and returned to the General Fund in the event that the purpose of their designation is no longer considered to be adequate justification for their retention. A description of each reserve together with the intended use of the reserve is set out in note 22. At 31 December 2023 total designated reserves were £6.81m (2022: £6.46m).

Restricted and endowment funds

As set out in note 21, NDBF holds and administers a number of restricted and endowment funds. As at 31 December 2023 restricted funds totalled £2.3m (2022: £1.89m) and endowment funds totalled £17.54m (2022: £17.08m). Neither are available for the general purposes of the NDBF.

Going concern

The Trustees have considered the 2024 operating environment and availability of reserves and cash and the impact upon the going concern basis of preparation of these financial statements. At the time of writing the 2024 cashflow forecast, based on the approved budget and reporting from parishes on what they feel able to contribute in parish share during 2024, projects a fall in cash of £862k during 2024. The Trustees are keeping the operating environment under constant review and consequent impacts on general reserves. If the operating environment becomes more challenging than expected, it is possible that the Board would need to consider reducing operations in order to limit expenditure, consider utilising certain restricted reserves beyond the budgeted amount, or realising assets. The Trustees are comfortable that these measures, along with the current levels of cash and short-term deposits, are sufficient to allow the Diocese to continue to operate as a going concern for the foreseeable future.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT

FOR THE YEAR ENDED 31 DECEMBER 2023

Grant making policy

The Memorandum of Association of the NDBF explicitly permits the NDBF to make grants in pursuance of its objects, and the nature of grants made in 2023 is indicated in note 11. Certain grants are built into the Diocesan Budget which is approved by the Diocesan Synod, whilst others are overseen by the Bishop’s Council, the Diocesan Finance Group and the Diocesan Mission and Pastoral Committee.

Investment policy

The Memorandum and Articles of Association of the charity permit wide powers of investment. NDBF's investment policies are based on two key criteria:

These policies are achieved by holding all NDBF funds with CCLA. The Newcastle Diocesan Society holds one portfolio with RBC Brewin Dolphin for the NDBF. This was received as part of a legacy from the late Bishop Alec Graham. All funds held for the NDBF by the Diocesan Society conform to the guidance given by the Church’s Ethical Investment Advisory Group.

Investment policy for long-term funds is aimed primarily at generating a sustainable income with due regard to the need for the preservation of capital value and the possible need to realise investments to meet operational needs.

Glebe investments are held for the purpose of raising income to achieve the maximum contribution possible to clergy stipends on an on-going basis. Unrestricted and restricted fund investments are invested to balance income, liquidity and the maintenance of capital.

As part of the Diocesan Synod’s ongoing pledge to tackle the climate emergency and become netzero carbon by 2030, the NDBF has confirmed its commitment not to invest in companies involved in the extraction of fossil fuels, and pledged not to invest in fossil fuel companies in future. The NDBF has joined Operation Noah’s Bright Now campaign. Operation Noah is a Christian charity working with the Church to inspire action on the climate crisis and is calling on all UK churches to divest from fossil fuels and invest in clean alternatives.

PRINCIPAL RISKS AND UNCERTAINTIES

The Trustees are responsible for the identification, mitigation and management of risk. To achieve this, a register of all the risks identified is maintained and, alongside it, a management and mitigation strategy formed. This is subject to review by the Trustees on an annual basis with the responsibility for delivery of the mitigation strategies identified by it being delegated to the Diocesan Secretary. In 2023 the Finance Group, a sub-committee of the Bishop’s Council, reviewed the Risk Register.

The receipt of voluntary financial contributions from parishes through Parish Share remains the major risk to the Board’s overall performance. The Trustees have put in place a framework of support, including regular communication, active management through the Finance Group and budget consultation to mitigate this risk.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

STRUCTURE AND GOVERNANCE

Summary Information about the structure of the Church of England

The Church of England is the established church and HM The King is the Supreme Governor. It is organised into two provinces (Canterbury and York) and 42 Dioceses. Each Diocese is under the care of a Diocesan Bishop who is charged with the cure of souls of all the people within that geographical area. This charge is shared with priests within benefices and parishes which are sub-divisions of the Diocese.

The National Church has a General Synod comprised of ex-officio members and elected representations from each Diocese. In 2021 six representatives from the Diocese of Newcastle (three lay and three clergy) were elected to serve on the General Synod for the current quinquennium. The General Synod agrees, and lays before Parliament, Measures for the governance of the church’s affairs which, if enacted by Parliament, have the force of statute law. In addition to the General Synod, the Archbishops’ Council has a coordinating role for work authorised by the Synod; the Church Commissioners manage the historic assets of the Church of England; and the Church of England Pensions Board administers the pension schemes for clergy and lay workers. Within each Diocese, overall leadership lies with the Diocesan Bishop, who exercises that input as Bishop within the Diocesan Synod.

The Diocese of Newcastle is divided into twelve deaneries, each with its own Deanery Synod and within each parish there is a Parochial Church Council which shares with the parish priest responsibility for the mission of the church in that place, in a similar way to that in which the Bishop shares responsibilities with the Diocesan Synod.

Whilst each Diocese is a separate legal entity, with a clear responsibility for a specific geographical area, being part of the Church of England requires and enables each Diocese to seek support from and application for partnership with neighbouring Dioceses.

Organisational structure

NDBF is a company incorporated in England, limited by guarantee (No. 00650977) and a registered charity (No. 247233) governed by its Memorandum and Articles of Association. The company’s principal activity is to promote, assist and advance the work of the Church of England within the Diocese of Newcastle. It was established in its present form in 1882.

Governance and policy of the NDBF is the responsibility of the Trustees, who are also members of the company and Trustees for the purposes of charity law. There are nine ex-officio Trustees and six lay members and three clergy members elected from and by the members of Diocesan Synod every three years. The most recent elections were held in October 2021. The next elections to the NDBF and Bishop’s Council are scheduled to be held in Autumn 2024. The details of Trustees who served during 2023 are set out on page 17.

The Diocesan Synod, the statutory governing body of the Diocese, is an elected body drawn from across the Diocese with responsibility for setting the vision and strategy of the Diocese, guided by the Bishop’s Staff Team. The Synod’s membership is elected every three years, the last elections having been in July 2021. The next elections to the Diocesan Synod are scheduled to take place in June 2024. Whilst the NDBF is a separate legal entity, with clear responsibilities under both company and charity law, as well as a governing memorandum and articles of association, by virtue of the National Institutions Measure 2000 the NDBF is subject to the direction of the Synod in all its activities, unless such direction is not in accordance with the governing documents or statutory regulations.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

Decision making structure

Corporate priorities and the overall financial strategy for the Diocese, in its primary object to promote, assist and advance the work of the Church of England within the Diocese of Newcastle are set by the Diocesan Synod, and the NDBF. The responsibility for ensuring that these priorities and strategies are delivered is delegated to the Diocesan Secretary. The members of the company meet once a year in general meeting to receive and approve the annual report and financial statements and to appoint the auditors. The Diocesan Synod each year receives and agrees the annual budget, prepared and approved by the NDBF. The Trustees, meeting within the context of the Bishop’s Council & Standing Committee, hold up to seven meetings during the year to formulate and coordinate policies on mission, ministry and finance by:

The Trustees are assisted in their work by four sub-committees:

Finance Group : responsible for considering the financial affairs of the Diocese. Amongst other things, it draws up draft budgets for approval by the Trustees prior to submission to Diocesan Synod and monitors expenditure and income. The group comprises eight members of whom six are Trustees.

Houses & Glebe Committee : responsible for advising on policy concerning the management of parsonage houses in each benefice of the Diocese of Newcastle, including setting the policy for buying, repairing, maintaining and disposing of all parsonage houses, team vicarages and houses owned by NDBF, together with responsibility for determining policy and making decisions concerning the management of glebe property and investments for the benefit of the Diocesan Stipends Fund of NDBF. The committee comprises 6 members of whom 2 are Trustees.

Diocesan Mission & Pastoral Committee : responsible for advising on pastoral reorganisation in the Diocese of Newcastle, taking account of available clergy numbers and making use of new patterns of ministry. The Committee also advises on the finding of appropriate alternative uses for churches closed to regular public worship. The committee comprises 9 members of whom 4 are Trustees.

Diocesan Advisory Committee : advises on matters affecting churches and places of worship in the Diocese such as granting of faculties, architecture, archaeology, art and history of places of worship, the use and care of places of worship and their contents and the care of churchyards. The committee comprises 18 members of whom 3 are Trustees.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT

FOR THE YEAR ENDED 31 DECEMBER 2023

Trustee recruitment, selection and induction

The Trustees are the members of the Bishop’s Council. There are ex-officio members, elected members, with elections taking place every three years, and there is provision for co-opted members. Trustees are given induction at the outset of the triennium and at other times as appropriate. They are informed about the role and function of the Bishop’s Council before seeking membership. All Trustees are required to sign the code of practice and maintain their entry in the declarations of interest and loyalty.

Remuneration of key management personnel

Emoluments of higher-paid employees are determined by the Bishop of Newcastle, the Chair of the Board of Finance and the Human Resources Manager with reference to appraisals and remuneration and salary benchmarking.

Delegation of day to day delivery

The Trustees and the sub-committees which assist them in the fulfilment of their responsibilities rely upon the Diocesan Secretary and his colleagues for the delivery of the day to day activities of the company. The Diocesan Secretary is given specific and general delegated authority to deliver the business of the NDBF in accordance with the policies framed by the Trustees.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

TRUSTEES’ RESPONSIBILITIES

The Trustees are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

Company law requires the Trustees (as Directors) to prepare financial statements for each financial year. Under that law the Trustees have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the Trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of the affairs of the NDBF and of the surplus or deficit of the NDBF for that period. In preparing these financial statements the Trustees are required to:

The Trustees are also responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the NDBF and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the NDBF and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Trustees are responsible for the maintenance and integrity of the corporate and financial information included in the NDBF’s website. Legislation in England/Wales governing the preparation and dissemination of financial statements and other information included in Annual Reports may differ from legislation in other jurisdictions.

STATEMENT OF DISCLOSURE TO THE AUDITORS

So far as the Trustees are aware:

APPOINTMENT OF AUDITORS

The auditor is deemed to be reappointed under section 487 (2) of the Companies Act 2006 until otherwise resolved at a general meeting of the company.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT

FOR THE YEAR ENDED 31 DECEMBER 2023

ADMINISTRATIVE DETAILS

Ex officio Trustees

The Bishop of Newcastle, the Right Reverend Dr H-A Hartley (from 03/02/23)

The Suffragan Bishop of Berwick, the Right Reverend M Wroe (also Acting Bishop of Newcastle from 01/12/21 to 02/02/23)

The Dean of Newcastle, the Very Reverend L Batson (from 14/10/23)

The Archdeacon of Lindisfarne, the Venerable Dr C A Sourbut Groves

The Archdeacon of Northumberland, the Venerable R A Wood The Chair of the Diocesan Board of Finance, Canon S R Harper The Chair of the House of Clergy, the Reverend Canon B Hurst The Chair of the House of Laity, Canon I McDonald-Booth The Chair of the Diocesan Mission and Pastoral Committee, Mrs E A Kerry

Elected Trustees

Dr JC Appleby Professor G Holmes Mrs E Doran Mrs L Craggs The Reverend L Taylor-Kenyon The Reverend Y Daniel (to 16/11/23)

Secretary

S Waddle

Auditors : UNW LLP, Chartered Accountants & Statutory Auditors, Citygate, St. James' Boulevard, Newcastle upon Tyne, NE1 4JE Bankers : Barclays Bank plc, Barclays House, 5 Queen Ann’s Street, Newcastle upon Tyne, NE1 3DX Solicitors : Sintons LLP, The Cube, Barrack Road, Newcastle upon Tyne, NE4 6DB Investment Manager : CCLA Investment Management Ltd, Senator House, 85 Queen Victoria Street, London EC4V 4ET Glebe Agent : Galbraith, Blagdon Estate Office Seaton Burn, Newcastle upon Tyne, NE13 6DE Insurers : Ecclesiastical, Beaufort House, Brunswick Road, Gloucester, GL1 1JZ Registered Office : Church House, St John’s Terrace, North Shields, NE29 6HS Telephone: 0191 270 4100 Website: www.newcastle.anglican.org E-mail: info@newcastle.anglican.org Company registration number: 00650977 Registered charity number: 247233

Page 17

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

ANNUAL REPORT

FOR THE YEAR ENDED 31 DECEMBER 2023

In approving this Trustees’ Report, the Trustees are also approving the Strategic Report included on pages 4 – 12 within their capacity as company Directors.

BY ORDER OF THE TRUSTEES

Canon S Harper

S Waddle

Chair Secretary 6 June 2024 6 June 2024

Page 18

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

INDEPENDENT AUDITOR’S REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

Independent Auditor’s Report to the members of The Newcastle Diocesan Board of Finance Limited

Opinion

We have audited the financial statements of The Newcastle Diocesan Board of Finance Limited for the year ended 31 December 2023 comprising the Statement of Financial Activities, the Income and Expenditure Account, the Balance Sheet, Statement of Cash Flows and related notes. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis of opinion

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's responsibilities for the audit of the financial statements’ section of our report. We are independent of the charitable company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.

Conclusions 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 entity'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.

Respective responsibilities of Trustees and auditor

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 conclude that there is a material misstatement of this other information, we are required to report that fact.

Page 19

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

INDEPENDENT AUDITOR’S REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

We have nothing to report in this regard.

Opinion on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit, the information given in the Trustees' report for which the financial statements are prepared is consistent with the financial statements, and the Directors’ report included within the Trustees’ report has been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of our knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Trustees' report.

We have nothing to report in respect of the following matters in relation to which Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of Trustees

As explained more fully in the Trustees' responsibilities statement, the Trustees (who are also the Directors of the charitable company for the purposes of company law) 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 charitable company'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 charitable company's or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

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 specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud is detailed below:

We identified areas of law and regulations that could reasonably be expected to have a material effect on the financial statements from our general and sector experience and through discussions with the Trustees and other management (as required by Auditing Standards) and from inspection of the charitable company's legal correspondence, and we discussed with the Trustees and other management the policies and procedures regarding compliance with laws and regulations. We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit.

Firstly, the charitable company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation (including related companies and charities legislation) and taxation

Page 20

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

INDEPENDENT AUDITOR’S REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

legislation and we assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.

Secondly the charitable company is subject to many other laws and regulations where the consequences of noncompliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines or litigation. We identified the following areas as those most likely to have such an effect; data protection, safeguarding and certain aspects of company legislation, recognising the nature of the charitable company's activities. Auditing Standards limit the required audit procedures to identify noncompliance with these laws and regulations to enquiry of the Trustees and other management and inspection of regulatory and legal correspondence, if any. Through these procedures, we became aware of actual or suspected non-compliance and considered the effect as part of our procedures on the related financial statement items. The identified actual or suspected non-compliance was not sufficiently significant to our audit to result in any further disclosure within our report or the financial statements.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it.

In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

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.

Who are we reporting to

This report is made solely to the charitable company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company's members 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 charitable company and its members, as a body, for our audit work, for this report, or for the opinions we have formed.

Anne Hallowell BSC DChA FCA (Senior Statutory Auditor) For and on behalf of UNW LLP, Statutory Auditor

Newcastle upon Tyne

Date: 06 June 2024

Page 21

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

STATEMENT OF FINANCIAL ACTIVITIES FOR YEAR ENDED 31 DECEMBER 2023

Note
Income from
Donations
Parish contributions
2
Archbishops' Council
2
Other donations
2
Charitable activities
3
Other activities
4
Investments
5
Other
6
Total income
Expenditure on
Raising funds
7
Charitable activities
8
Total expenditure
Net incoming/(outgoing)
resources before investment
gains
Net gains/(losses) on
investments
15
Net income/(expenditure)
Transfers between funds
13
Net movement in funds
Reconciliation of funds
Total funds brought forward
Total funds at 31 December
2023
20		 Unrestricted
Funds
Restricted
Funds
Endowment
Funds
Total
Funds
2023
Total
Funds
2022
£
£
£
£
£
3,868,523
-
-
3,868,523
3,867,918
1,251,784
-
-
1,251,784
1,257,138
754,401
790,271
-
1,544,672
1,545,384
327,706
-
-
327,706
348,495
411,986
25,700
-
437,686
467,752
310,626
29,793
76,890
417,309
234,986
60,179
-
209,132
269,311
416,781
6,985,205
845,764
286,022
8,116,991
8,138,454
(86,540)
-
-
(86,540)
(67,729)
(7,199,825)
(578,333)
(12,549)(7,790,707)(7,881,624)
(7,286,365)
(578,333)
(12,549) (7,877,247)(7,949,353)
(301,160)
267,431
273,473
239,744
189,101
196,722
-
182,237
378,959
(389,765)
(104,438)
267,431
455,710
618,703
(200,664)
(139,849)
139,849
-
-
-
(244,287)
407,280
455,710
618,703
(200,664)
7,335,687 1,893,830
17,082,308 26,311,825 26,512,489
7,091,400 2,301,110
17,538,018 26,930,52826,311,825

All incoming resources and resources expended relate to continuing activities.

Page 22

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

INCOME AND EXPENDITURE ACCOUNT FOR YEAR ENDED 31 DECEMBER 2023

Total Total
2023 2022
£ £
Total incoming resources 7,830,969 8,077,168
Resources expended (7,864,698) (7,940,001)
__ __
Operating surplus for the year (33,729) 137,167
Net gains/(losses) on investments 196,722 (280,538)
__ __
Net income/(deficit) for the year 162,993 (143,371)
__ __
Total comprehensive income 162,993 (143,371)
__ __

The income and expenditure account is derived from the Statement of Financial Activities with movements in endowment funds excluded to comply with company law. All income and expenditure is derived from continuing activities.

Page 23

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

BALANCE SHEET AS AT 31 DECEMBER 2023

2023 2022
Note £ £
Fixed assets
Tangible assets 14 16,977,052 17,235,199
Investments 15 5,651,896 4,981,794
22,628,948 22,216,993
Current assets
Debtors 16 188,416 244,535
Investments 17 3,669,546 3,832,164
Cash at bank 874,396 505,573
4,732,358 4,582,272
Creditors: amounts falling due within one
year 18 (425,734) (482,396)
Net current assets 4,306,624 4,099,876
Total assets less current liabilities 26,935,572 26,316,869
Creditors: amounts falling due after more
than one year 19 (5,044) (5,044)
Net assets 26,930,528 26,311,825
The funds of the charity:
Endowment funds 21 17,538,018 17,082,308
Restricted income funds 21 2,301,110 1,893,830
Unrestricted income funds:
General funds 21 284,311 877,041
Designated funds 21 6,807,089 6,458,646
Total funds 26,930,528 26,311,825

The trustees acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and preparation of financial statements.

The financial statements were approved and authorised for issue by the trustees on 6 June 2024 and signed on their behalf by:

Canon SR Harper Chair Company registered number: 00650977

The notes on pages 25 to 50 form part of these financial statements.

Page 24

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

STATEMENT OF CASH FLOWS FOR YEAR ENDED 31 DECEMBER 2023

Cash flows from operating activities
Net cash used in operating activities
Cash flows from investing activities
Dividends, interests and rents from investments
Proceeds from the sale of tangible fixed assets
Purchase of tangible fixed assets
Purchase of investments
Payment of pension deficit
Net cash used in investing activities

Cash flows from financing activities
New loans advanced
Repayment of loans advanced
Net cash provided by financing activities

Change in cash and cash equivalents in the year
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
Reconciliation of net movement in funds to net cash flow from operating
activities
Net income/(expenditure) for the year (as per Statement of Financial
Activities)
Adjustments for:
Depreciation charges
(Gain)/loss on investments
Dividends, interests and rents from investments
Decrease in debtors
(Decrease)/increase in creditors
Profit on sale of fixed assets
Decrease in pension liability (net of cash paid)
Net cash used in operating activities
Analysis of cash and cash equivalents
Cash in hand
Deposits (less than 3 months)		 2023
2022
As restated
£
£
(412,317)
(248,414)
417,309
234,986
501,394
661,562
(10,538)
(206,730)
(291,143)
-
-
(104,000)
617,022
585,818
(1,500)
-
3,000
1,845
1,500
1,845
206,205
339,249
4,337,737
3,998,488
4,543,942
4,337,737
2023
£
2022
£
618,703
(200,664)
36,602
27,349
(378,959)
389,765
(417,309)
(234,986)
54,619
248,194
(56,662)
7,709
(269,311)
(416,781)
-
(69,000)
(412,317)
(248,414)
874,396 505,573
3,669,546 3,832,164
4,543,942 4,337,737

Page 25

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

1. PRINCIPAL ACCOUNTING POLICIES

The financial statements have been prepared under the historical cost convention, with the exception of freehold properties and fixed asset investments. The majority of freehold properties are shown at their 1995 valuation, based on a desk-top study carried out by a Chartered Surveyor working for Black Horse Agencies. Property additions since 1995 are shown at cost or at a lower fair value where the Trustees consider that this is appropriate. Fixed asset investments are included at their market value at the balance sheet date. The financial statements have been prepared in accordance with the Statement of Recommended Practice for Charities (SORP 2015), the Companies Act 2006 and applicable accounting standards (FRS 102).

NDBF meets the definition of a public benefit entity under FRS 102.

The financial statements are prepared in sterling which is the functional currency of the charity and are rounded to the nearest £1.

The principal accounting policies and estimation techniques are as follows.

a) Income

All income is included in the Statement of Financial Activities (SOFA) when the NDBF is legally entitled to them as income or capital respectively, ultimate receipt is probable and the amount to be recognised can be quantified with reasonable accuracy.

iii. Interest and dividends are recognised as income when receivable.

b) Expenditure

Expenditure is included on the accruals basis and has been classified under headings that aggregate all costs related to the Statement of Financial Activity category.

Page 26

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

c) Going concern

The Trustees have considered the 2024 operating environment and availability of reserves and cash and the impact upon the going concern basis of preparation of these financial statements. At the time of writing the 2024 cashflow forecast, based on the approved budget and reporting from parishes on what they feel able to contribute in parish share during 2024, projects a fall in cash of £862k during 2024. The Trustees are keeping the operating environment under constant review and consequent impacts on general reserves. If the operating environment becomes more challenging than expected, it is possible that the Board would need to consider reducing operations in order to limit expenditure, consider utilising certain restricted reserves beyond the budgeted amount, or realising assets. The Trustees are comfortable that these measures, along with the current levels of cash and short-term deposits, are sufficient to allow the Diocese to continue to operate as a going concern for the foreseeable future.

d) Tangible fixed assets and depreciation

Freehold properties

Depreciation is not routinely provided on buildings except in those few cases where the Trustees feel that the net book value is higher than the fair value. In such cases annual depreciation is charged, on a straight-line basis, at an amount equivalent to 2% of the excess of net book value over fair value. For the vast majority of properties depreciation is not regarded as a material amount due to the very long expected remaining useful economic life in each case, and because the expected residual value is not materially less than the carrying value. The NDBF has a policy of regular structural inspection, repair and maintenance, which in the case of residential properties is in accordance with the Repair of Benefices Buildings Measure 1972 and properties are therefore unlikely to deteriorate or suffer from obsolescence. In addition, disposals of properties occur well before the end of their economic lives and disposal proceeds are usually not less than their carrying value. The Trustees perform annual impairment reviews in accordance with the requirements of FRS 102 to ensure that the carrying value is not more than the recoverable amount.

Investment properties

Glebe properties which are held for investment purposes and rented out have been included at their fair value.

Page 27

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

Parsonage houses

The NDBF has followed the requirements of FRS 102, in its accounting treatment for benefice houses (parsonages). FRS 102 requires the accounting treatment to follow the substance of arrangements rather than their strict legal form. The NDBF is formally responsible for the maintenance and repair of such properties and has some jurisdiction over their future use or potential sale if not required as a benefice house, but in the meantime legal title and the right to beneficial occupation is vested in the incumbent. The Trustees therefore consider the most suitable accounting policy is to capitalise such properties as expendable endowment assets and to capitalise as endowed assets at cost. Parsonage houses are not routinely revalued. Depreciation is not routinely provided on Parsonage houses except in those few cases where the Trustees feel that the net book value is higher than the fair value. In such cases annual depreciation is charged, on a straight-line basis, at an amount equivalent to 2% of the excess of net book value over fair value.

e) Other tangible fixed assets

All capital expenditure over £1,000 on computers and other office equipment is capitalised and depreciated as follows. Depreciation is provided in order to write off the cost (less any ultimate disposal proceeds at prices ruling at the time of the asset’s acquisition) of other fixed assets over their currently expected useful economic lives at the following initial rates:-

Computers and printers 25% per annum straight line basis Equipment, fixtures and fittings 10-25% per annum straight line basis

f) Fixed asset investments

Listed investments, which have been classified as fixed assets investments, are measured initially and subsequently at fair value. The statement of financial activities includes the net gains and losses arising on revaluations and disposals throughout the year.

g) Debtors

Trade and other debtors are recognised at the settlement amount. Prepayments are valued at the amount prepaid net of any trade discounts due.

h) Cash at bank and in hand

Cash at bank and in hand includes cash and highly liquid investments with a short maturity of three months or less from the date of acquisition or opening of the deposit or similar account.

i) Liabilities and provisions

Liabilities are recognised when there is an obligation at the balance sheet date as a result of a past event, it is probable that a transfer of economic benefit will be required in settlement, and the amount of the settlement can be estimated reliably. Liabilities are recognised at the amount that the company anticipates it will pay to settle the debt or the amount it has received as advanced payments for the goods or services it must provide. Provisions are measured at the best estimate of the amounts required to settle the obligation. When the effect of the time value of money is material, the provision is based on the present value of those amounts, discounted at the pre-tax discount rate that reflects the risks specific to the liability. The unwinding of the discount is recognised within interest payable and similar charges.

j) Financial instruments

The company only enters into financial instruments transactions that result in the recognition of basic debt financial assets and liabilities like trade and other accounts receivable and payable, cash and bank balances and loans to or from related parties. All such instruments are due within one year, and are measured, initially and subsequently at the transaction price.

At the end of each reporting period debt financial assets are assessed for impairment, and their carrying value reduced if necessary. Any impairment charge is recognised in the statement of financial activities.

Page 28

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

k) Fund balances

Fund Balances are split between unrestricted (general and designated), restricted and endowment funds.

l) Estimates and judgments

Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

In preparing these financial statements the Trustees do not consider there were any significant areas of judgment that were required in applying the company’s policies as set out above.

Estimates within these financial statements include depreciation and asset valuations (for example agricultural land). None of the estimates made in the preparation of these financial statements are considered to carry significant estimation uncertainty, nor to bear significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

Page 29

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

2 DONATIONS

Parish Contributions

Parish Contributions
Parish share
Current year's allocation
Shortfall
Parish contributions
Arrears for previous years		 Unrestricted
Funds
Restricted
Funds
Endowment
Funds
Total
Funds
2023
Total
Funds
2022
£
£
£
£
£
3,881,983
-
-3,881,9833,980,416
(56,473)
-
-
(56,473)
(132,760)
3,825,510
-
-3,825,5103,847,656
43,013
-
-
43,013
20,262
3,868,523
-
- 3,868,5233,867,918

Archbishops' Council

Archbishops' Council
Lowest Income Communities funding
Transitional funding		 Unrestricted
Funds
Restricted
Funds
Endowment
Funds
Total
Funds
2023
Total
Funds
2022
£
£
£
£
£
1,068,283
-
-1,068,283
999,986
183,501
-
-
183,501
257,152
1,251,784
-
- 1,251,7841,257,138

Page 30

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

2 DONATIONS (continued)

Other donations

All Churches Trust grant
Lord Crewe's Charity grant
Grants received for Rural Churches
for Everyone Project
Grants received for Resource
Church Project
Church Commissioners -
restructure funding
Church Commissioners -
Safeguarding Funding
Church Commissioners - strategic
development funding
Church Commissioners - giving
adviser funding
Church Commissioners - parish
utilities support funding
Archbishops' Council - Net Zero
Capacity Building
Newcastle Diocesan Society
Newcastle St Andrew
Newcastle St Luke
Durham Diocesan Board of Finance
Ely Diocesan Board of Finance
Archbishops' Council
Bishop's House
Other		 Unrestricted
Funds
Restricted
Funds
Endowment
Funds
Total Funds
2023
Total Funds
2022
£
£
£
£
£
105,875
-
-
105,875
121,000
244,000
-
-
244,000
115,786
-
33,675
-
33,675
82,150
-
62,175
62,175
28,337
-
137,700
-
137,700
187,065
6,900
6,900
-
-
188,865
-
188,865
330,555
-
-
-
-
32,000
335
-
-
335
1,668
15,000
15,000
-
12,087
-
-
12,087
10,600
28,159
-
-
28,159
28,627
-
-
-
-
-
114,440
-
-
114,440
107,294
76,037
-
-
76,037
78,205
(2,043)
-
-
(2,043)
6,772
49,544
-
-
49,544
44,064
119,067
352,856
-
471,923
371,261
754,401
790,271
-
1,544,672
1,545,384

For other donations in 2022 £517,620 from Church Commissioners and £248,687 from other funders were restricted (total £766,307) with the balance of £779,077 being unrestricted.

Page 31

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

3 CHARITABLE ACTIVITIES

Statutory fees (funerals, weddings)
Chaplaincy income		 Unrestricted
Funds
Restricted
Funds
Endowment
Funds
Total
Funds
2023
Total
Funds
2022
£
£
£
£
£
267,722
-
-267,722298,706
59,984
-
-
59,984
49,789
327,706
-
- 327,706348,495

In 2022 all income related to unrestricted funds.

4 OTHER TRADING ACTIVITIES

Rental of houses
Contributions for use of Church House
Other contributions		 Unrestricted
Funds
Restricted
Funds
Endowment
Funds
Total
Funds
2023
Total
Funds
2022
£
£
£
£
£
384,156
3,000
-387,156444,672
27,830
-
-
27,830
19,755
-
22,700
-
22,700
3,325
411,986
25,700
- 437,686467,752

In 2022 all income related to unrestricted funds.

5 INVESTMENT INCOME

Income from UK listed investments
Bank interest receivable
Rents from Glebe		 Unrestricted
Funds
Restricted
Funds
Endowment
Funds
Total
Funds
2023
Total
Funds
2022
£
£
£
£
£
85,226
501
76,890162,617130,915
177,950
23,042
-200,992
57,665
47,450
6,250
-
53,700
46,406
310,626
29,793
76,890 417,309234,986

In 2022 £998 from listed investments and £6,436 from bank interest receivable were restricted (total £7,434) with £166,266 being unrestricted.

6 OTHER INCOMING RESOURCES

Profit on sale of assets Unrestricted
Funds
Restricted
Funds
Endowment
Funds
Total
Funds
2023
Total Funds
2022
£
£
£
£
£
60,179
-
209,132269,311
416,781
60,179
-
209,132 269,311
416,781

In 2022 all income related to unrestricted funds.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

7 FUNDRAISING COSTS

FUNDRAISING COSTS
Unrestricted
Funds
Restricted
Funds
Endowment
Funds
Total
Funds
2023
Total Funds
2022
£
£
£
£
£
Glebe costs
8,095
-
-
8,095
3,350
Parsonage rental costs
78,445
-
-78,445
64,379
86,540
-
- 86,540
67,729
CHARITABLE ACTIVITIES
Unrestricted Funds
Restricted
Funds
Endowment
Funds
Total Funds 2023
Total
Funds
2022
£
£
£
£
£
Contributions to
Archbishops' Council
Training for ministry
171,934
-
-
171,934
171,934
National church
responsibilities
100,536
-
-
100,536
105,306
Grants and provisions
17,705
-
-
17,705
14,509
Mission agency pension
contributions
5,504
-
-
5,504
7,180
Retired clergy housing
costs (CHARM)
68,105
-
-
68,105
59,451
Pooling of ordinand
candidates' costs
54,838
-
-
54,838
46,646
418,622
-
-
418,622
405,026
Resourcing Ministry and
Mission
Parish Ministry
Stipends and national insurance
3,025,269
61,986
-
3,087,255 2,969,469
Pension contributions
702,200
14,255
-
716,455
750,633
Housing costs
833,062
23,874
12,549
869,485
763,251
Removal, resettlement and
grants
85,125
-
-
85,125
110,217
Other expenses
90,284
67,800
-
158,084
81,768
4,735,940
167,915
12,549
4,916,404 4,675,338
Support for parish
ministry
2,045,263
410,418
-
2,455,681
2,801,260
6,781,203
578,333
12,549
7,372,0857,476,598
7,199,825
578,333
12,549
7,790,707
7,881,624		 Unrestricted
Funds
Restricted
Funds
Endowment
Funds
Total
Funds
2023
Total Funds
2022
£
£
£
£
£
8,095
-
-
8,095
3,350
78,445
-
-78,445
64,379
86,540
-
- 86,540
67,729
Unrestricted Funds
Restricted
Funds
Endowment
Funds
Total Funds 2023
Total
Funds
2022
£
£
£
£
£
171,934
-
-
171,934
171,934
100,536
-
-
100,536
105,306
17,705
-
-
17,705
14,509
5,504
-
-
5,504
7,180
68,105
-
-
68,105
59,451
54,838
-
-
54,838
46,646
418,622
-
-
418,622
405,026
4,735,940
167,915
12,549
4,916,404 4,675,338
2,045,263
410,418
-
2,455,681
2,801,260
6,781,203
578,333
12,549
7,372,0857,476,598
7,199,825
578,333
12,549
7,790,707
7,881,624

8 CHARITABLE ACTIVITIES

£863,171 of 2022 expenditure related to restricted, £9,352 to endowment and £7,009,101 to unrestricted funds.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

9 ANALYSIS OF EXPENDITURE INCLUDING ALLOCATION OF SUPPORT COSTS

Activities Total
Undertaken
Grant Funding		 Support Total costs costs
Directly of Activities Costs 2023 2022
£ £ £ £ £
Raising funds 86,540 - - 86,540 67,729
Charitable activities:
Contributions to
Archbishops' Council - 418,622 - 418,622 405,026
Resourcing parish
ministry 6,165,350 181,183 1,025,552 7,372,085 7,476,598
6,251,890 599,805 1,025,552 7,877,247 7,949,353
10 ANALYSIS OF SUPPORT COSTS
Total
Unrestricted
Restricted		 Endowment
Total costs		 costs
Funds
Funds		 Funds
2023		 2022
£
£		 £ £ £
Central administration 915,536
3,000		 -
918,536
774,616
Governance
External audit 23,280
-		 -
23,280
990
Registry and other legal costs 59,586
-		 -
59,586
94,663
Synodical costs 24,150
-		 -
24,150
15,713
1,022,552
3,000		 -
1,025,552
885,982

Page 34

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

11 ANALYSIS OF GRANTS MADE

ANALYSIS OF GRANTS MADE
From unrestricted funds to support national
Church responsibilities
Contributions to Archbishops' Council
From unrestricted funds
Support for ordinands
Shepherds Dene Retreat House
Transforming Communities Together
Tyne to Tweed
Continuing Ministerial Development
grants
Ministry Experience Scheme grants
Other grants
From restricted funds
Support for ordinands
Shepherds Dene Retreat House
Transforming Communities Together
Tyne to Tweed
Partners fund
Other grants
Total Grants Made		 Number
Individuals
Institutions
Total costs
2023
£
£
£
6
-
418,622
418,622
9
47,318
-
47,318
1
-
603
603
-
-
-
-
48
20,799
10,585
31,384
2
8,004
-
8,004
8
2,635
6,502
9,137
68
78,756
17,690
96,446
7
76,706
-
76,706
1
-
1,820
1,820
1
-
4,301
4,301
4
-
621
621
1
109
1,180
1,289
14
76,815
7,922
84,737
88
155,571
444,234
599,805

Page 35

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

Grant funding of activities in previous year
From unrestricted funds
Contributions to Archbishops' Council
Contributions to Diocesan-based charities
Other grants
From restricted funds
Other grants		 2022
2022
No. of grants
£
6
405,026
69
154,497
17
33,131
92
592,654

Page 36

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

12
STAFF COSTS
Employee costs during the year were as follows:
Wages and salaries
National insurance contributions
Pension costs
The average number of persons employed during the
year:
Administration and financial management
Supporting mission & ministry
Property
Safeguarding
Newcastle St Thomas’, Diocesan Resource Church
The average number of persons employed during the year based on
full-time equivalents
Administration and financial management
Supporting mission & ministry
Property
Safeguarding
Newcastle St Thomas’, Diocesan Resource Church		 2023
2022
£
£
1,227,668
1,217,737
109,577
117,671
144,584
130,731
1,481,829
1,466,139
Number
Number
13
14
21
21
2
2
2
2
6
6
44
45
Number
Number
10
11
13
16
2
2
2
2
6
6
33
37

The Diocesan Resource Church excludes the 2 full-time office holders (Leader & Curate)

2023 2022
number number
The number of staff whose emoluments (including benefits in kind but
excluding pension contributions) amounted to more than £60,000
were as follows:
£60,000 - £70,000 1 1

Pension payments of £15,367 (2022: £12,355) were made for this employee.

Page 37

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

2023 2022
£ £
Stipends 2,843,875 2,728,738
National insurance contributions 243,381 240,731
Pension costs - current year 716,454 750,633
____ ____
3,803,710 3,720,102

Remuneration of key management personnel

Key management personnel are deemed to be those having authority and responsibility, delegated to them by the Trustees, for planning, directing and controlling the activities of the Diocese. During 2023 they were:

Diocesan Secretary and Company Secretary Shane Waddle MSc, FCIPP Property Manager Ian D Beswick MSc, MRICS Finance Manager (to 31/08/2023) Philip D Ambrose BA, CPFA Head of Finance (from 11/09/2023) Thomas Royle ACMA, CGMA

Remuneration, pensions and expenses for these employees amounted to £232,650 (2022: £232,980).

Trustees’ emoluments

No Trustee received any remuneration for services as Trustee. The Trustees received travelling and out of pocket expenses totalling £6,211 and this sum was paid out to 3 Trustees in respect of General Synod duties, duties as Archdeacon or Area Dean, and other duties as Trustees. (In 2022 £6,200 was paid out to Trustees).

The following table gives details of the Trustees who were in receipt of a stipend and/or housing provided by the NDBF during the year:

DBF during the year:
Stipend
 Housing
The Right Revd M Wroe No Yes
The Venerable R A Wood Yes Yes
The Venerable Dr C A Sourbut Groves Yes Yes
The Revd Canon B Hurst Yes Yes
The Revd L Taylor-Kenyon Yes Yes
The Revd Y Daniel Yes Yes

The funding of stipends for the Bishop of Newcastle, the Bishop of Berwick, the Dean and two Residentiary Canons at Newcastle Cathedral is a responsibility of the Church Commissioners. The NDBF is responsible for funding the stipends of all other licensed stipendiary clergy in the Diocese of Newcastle. Where eligible, the NDBF is responsible for the provision of housing for serving clergy, including the Bishop of Berwick. The NDBF is not responsible for the provision of the See House for the Bishop of Newcastle or for the provision of housing for the Dean and two Residentiary Canons at Newcastle Cathedral.

In 2023 the NDBF paid stipends to an average of 99.8 (2022: 94.4) clergy ministering in incumbent status posts, training curacy posts and the posts of archdeacon.

The stipends of the Bishop of Newcastle and the Bishop of Berwick were funded by the Church Commissioners and were in the range of £38,050 - £48,972 (2022: range £38,050 - £46,640. The annual rate of stipend funded by the NDBF paid to Archdeacons in 2023 was in the range £38,295 - £39,058 (2022: range £37,198 - £38,633) and other clergy who were Trustees were paid in the range £27,514 - £28,890 (2022: range £27,514 - £28,444).

Page 38

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

13 TRANSFER BETWEEN FUNDS

Analysis of transfers between funds

Total
Unrestricted Restricted Endowment Funds
Funds Funds Funds 2023
£ £ £ £
General Fund contribution to Resource Church (126,890) 126,890 -
-
General Fund contribution to Rural Churches for All (12,959) 12,959
(139,849) 139,849 -
-
4 TANGIBLE FIXED ASSETS
Unrestricted funds Endowment funds
Office Glebe TOTAL
Property
Equipment		 Parsonages Property
£
£		 £ £ £
At cost or valuation
At 1 January 2023 3,463,027
158,907		 15,185,888 1,896,155 20,703,977
Additions 2,290
8,248		 -
-		 10,538
Disposals (163,116)
-		 -
(99,110)		 (262,226)
At 31 December 2023 3,302,201
167,155		 15,185,888 1,797,045 20,452,289
Accumulated depreciation
At 1 January 2023 552,856
123,913		 2,485,526
306,483		 3,468,778
Charge for the year 14,717
13,036		 8,849
-		 36,602
Disposals (13,043)
-		 -
(17,100)		 (30,143)
At 31 December 2023 554,530
136,949		 2,494,375
289,383		 3,475,237
Net book value at 31
December 2023 2,747,671
30,206		 12,691,513 1,507,662 16,977,052
Net book value at 31 December
2022 2,910,171
34,994		 12,700,362 1,589,672 17,235,199

14 TANGIBLE FIXED ASSETS

These properties were purchased using either unrestricted reserves, the Pastoral Account or the Stipends Capital and Glebe Fund. Included in this category is £431k (2022: £429k) which is attributable to the Bishop Bilbrough Fund, being part of the cost of the new Church House office accommodation paid for from the proceeds of the former Church House building. The balance of the cost of Church House is held within the Mary Wilkinson Legacy Fund. The other NDBF properties are included in the NDBF Houses Fund, an unrestricted fund.

Page 39

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

Parsonage houses

Rectories and vicarages (other than team vicarages) are vested in individual benefices. However, the NDBF is responsible for the maintenance and repair of all parsonage houses and carries substantially all the risks of ownership. Following a scheme for pastoral reorganisation the net proceeds of the sale of a parsonage house may be credited to the Diocesan Pastoral Account, which is recognised as an asset of the NDBF.

Glebe team vicarages

Team vicarages are included as glebe but they are not held as investments. The proceeds of any sale must be credited to the Stipends Capital Account.

15 FIXED ASSET INVESTMENTS

Within the United Kingdom
At 1 January 2023
Additions
Revaluation
At 31 December 2023
Cost at 31 December 2023		 Investment
property
Unlisted
investments
Listed
investments
TOTAL
£
£
£
£
1,660,229
-
3,321,565
4,981,794
-
-
291,143
291,143
46,308
-
332,651
378,959
1,706,537
-
3,945,359
5,651,896
1,450,042
-
1,631,095
3,081,137

Investment Properties

An estimate of the value of Glebe land and properties held as investments at the end of the year is £1,706,537. This figure has been provided by the Diocesan Property Manager, Mr I Beswick MRICS.

Listed investments

Listed investments are valued at bid market value at the year-end.

16 DEBTORS

Due within one year
Church Commissioners: sundry debtors
Loans for parish buildings
Other debtors
Due after one year
Loans for parish buildings > 1 year		 2023
2022
£
£
4,065
4,065
25,500
24,000
158,851
213,470
188,416
241,535
-
3,000
188,416
244,535

Page 40

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

17 CURRENT ASSET INVESTMENTS

Deposit fund

2023 2022
£ £
3,669,546 3,832,164

18 CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2023 2022
£ £
Taxation and social security 51,791 48,021
Other creditors 45,603 40,902
Accruals and deferred income 328,340 393,473
Falling due within one year 425,734 482,396
Deferred Income
2023 2022
£ £
Deferred income at 1 January 217,272 229,247
Resources deferred during the year 36,960 109,383
Amounts released from previous periods (15,149) (121,358)
239,083 217,272
19 CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
2023 2022
£ £
Deposit held on glebe property 5,044 5,044
Falling due after more than one year 5,044 5,044

Page 41

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

20
SUMMARY OF FUND MOVEMENTS		 20
SUMMARY OF FUND MOVEMENTS
Balance at Gains and Balance at 31 Dec
1 Jan 2023 Income Expenditure Transfers losses 2023
£ £ £ £ £ £
Unrestricted Funds
General Unrestricted Fund 877,041 5,430,729 (6,023,822) (139,849) 140,212 284,311
Designated Funds:
Mary Wilkinson Fund 357,858 494 - - - 358,352
DBF Houses Fund 4,506,156 67,063 (15,020) (142,000) - 4,416,199
Bishop Bilbrough Fund 739,792 - - - 40,873 780,665
Strategic Mission Fund - 4,931 - - 15,637 20,568
Building Grants and Loans
Fund 112,052 4,802 - - - 116,854
Allchurches Grant Fund 222,778 105,875 (94,232) - - 234,421
Clergy Expenses Fund 4,370 - - - - 4,370
Lowest Income Communities
Fund 515,640 1,068,283 (980,470) - - 603,453
Lord Crewe Fund - 244,000 (159,261) - - 84,739
Diocesan Communications
Network - 59,028 (11,247) - - 47,781
Net Zero EV Charging - - (2,313) 142,000 - 139,687
7,335,687 6,985,205 (7,286,365) (139,849) 196,722 7,091,400
Restricted Funds
Partners Fund 56,637 8,681 (14,625) - - 50,693
New Church Building Fund 151,627 5,956 - - - 157,583
Diocesan Pastoral Fund 1,196,650 11,689 (3,000) - - 1,205,339
Archdeacons Fund 59,398 3,294 - - - 62,692
Training for Ordinands Fund 122,543 - - - - 122,543
Botswana Donations Fund 7,867 - - - - 7,867
Church House Wallsend Fund 7,688 9,250 (5,311) - - 11,627
Resourcing Ministerial
Education Fund 108,780 137,700 (87,371) - - 159,109
Resource Church Project Fund - 450,556 (333,597) 126,890 - 243,849
Resource Church Giving Fund 182,640 169,963 (87,795) - - 264,808
Rural Churches for Everyone
Fund - 33,675 (46,634) 12,959 - -
Net Zero Capacity Building
Fund - 15,000 - - - 15,000
1,893,830 845,764 (578,333) 139,849 - 2,301,110
Endowment Funds
Stipends Capital and Glebe
Fund 4,468,736 286,022 (3,700) - 175,574 4,926,632
Parsonages Houses Fund 12,543,363 - (8,849) - - 12,534,514
St Aidan's Fund 70,209 - - - 6,663 76,872
17,082,308 286,022 (12,549) - 182,237 17,538,018
26,311,825 8,116,991 (7,877,247) - 378,959 26,930,528

Page 42

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

21 SUMMARY OF ASSETS BY FUND

Unrestricted Income Funds:
General Unrestricted Fund
Designated Funds
Mary Wilkinson Fund
DBF Houses Fund
Bishop Bilbrough Fund
Strategic Mission Fund
Building Grants and Loans Fund
The Allchurches Grant Fund
Clergy Expenses Fund
Lowest Income Communities Fund
Lord Crewe Fund
Diocesan Communications
Network
Net Zero EV Charging
Restricted Income Funds:
Partners Fund
New Church Building Fund
Diocesan Pastoral Fund
Archdeacons Fund
Training for Ordinands Fund
Botswana Donations Fund
The Church House Wallsend Fund
Resourcing Ministerial Education
Fund
Resource Church Project Fund
Resource Church Giving Fund
Rural Churches for Everyone Fund
Net Zero Capacity Building Fund
Endowment Funds:
Stipends Capital and Glebe Fund
Parsonages Houses Fund
St Aidan's Fund
Total Funds		 Fixed assets
Fixed assets
Current
Long
term
Tangible
Investments
assets
liabilities
Net assets
£
£
£
£
£
11,223
117,600
160,532
(5,044)
284,311
352,486
-
5,866
-
358,352
2,088,692
1,500,000
827,507
-
4,416,199
313,914
471,551
(4,800)
-
780,665
-
180,398
(159,830)
-
20,568
-
-
116,854
-
116,854
30,768
-
203,653
-
234,421
-
-
4,370
-
4,370
-
-
603,453
-
603,453
-
-
84,739
-
84,739
-
-
47,781
-
47,781
-
-
139,687
-
139,687
2,797,083
2,269,549
2,029,812
(5,044)
7,091,400
-
-
50,693
-
50,693
-
-
157,583
-
157,583
-
-
1,205,339
-
1,205,339
-
-
62,692
-
62,692
-
-
122,543
-
122,543
-
-
7,867
-
7,867
-
-
11,627
-
11,627
-
-
159,109
-
159,109
-
-
243,849
-
243,849
-
-
264,808
-
264,808
-
-
-
-
-
-
-
15,000
-
15,000
-
-
2,301,110
-
2,301,110
1,488,322
3,305,475
132,835
-
4,926,632
12,691,647
-
(157,133)
-
12,534,514
-
76,872
-
-
76,872
14,179,969
3,382,347
(24,298)
-
17,538,018
16,977,052
5,651,896
4,306,624
(5,044)
26,930,528

Page 43

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

Summary of assets by fund (2022 comparatives)
Fixed assets Fixed assets Current Long term
Tangible Investments assets liabilities Net assets
£ £ £ £ £
Unrestricted Income Funds:
General Unrestricted Fund 4,223 1,477,388 (599,526) (5,044) 877,041
Designated Funds
Mary Wilkinson Fund 352,486 - 5,372 - 357,858
DBF Houses Fund 2,243,771 - 2,262,385 - 4,506,156
Bishop Bilbrough Fund 313,914 430,678 (4,800) - 739,792
Strategic Mission Fund - 164,761 (164,761) - -
Building Grants and Loans Fund - - 112,052 - 112,052
The Allchurches Grant Fund 30,768 - 192,010 - 222778
Clergy Expenses Fund - - 4,370 - 4,370
Lowest Income Communities
Fund - - 515,640 - 515,640
Lord Crewe Fund - - - - -
2,945,162 2,072,827 2,322,742 (5,044) 7,335,687
Restricted Income Funds:
Partners Fund - - 56,637 - 56,637
New Church Building Fund - - 151,627 - 151,627
Diocesan Pastoral Fund - - 1,196,650 - 1,196,650
Archdeacons Fund - - 59,398 - 59,398
Training for Ordinands Fund - - 122,543 - 122,543
Botswana Donations Fund - - 7,867 - 7,867
The Church House Wallsend Fund - - 7,688 - 7,688
Resourcing Ministerial Education
Fund - - 108,780 - 108,780
Resource Church Project Fund - - - - -
Resource Church Giving Fund - - 182,640 - 182,640
Rural Churches for Everyone Fund - - - - -
- - 1,893,830 - 1,893,830
Endowment Funds:
Stipends Capital and Glebe Fund 1,589,672 2,838,759 40,305 - 4,468,736
Parsonages Houses Fund 12,700,363 - (157,000) - 12,543,363
St Aidan's Fund - 70,209 - - 70,209
14,290,035 2,908,968 (116,695) - 17,082,308
Total Funds 17,235,197 4,981,795 4,099,877 (5,044) 26,311,825

Page 44

THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

22 DESCRIPTION OF FUNDS

The General or Unrestricted Fund is available for any purpose within the objects of the Board. It is principally used for payment of stipends, national insurance, pension contributions and housing costs of clergy and licensed lay-workers in parish ministry. It also provides the assets and liquidity for the NDBF to carry out its objectives, including statutory compliance and administration of funds.

The Mary Wilkinson Fund is a bequest fund which can be used for general purposes. It has been used to provide part of the costs for buying, modifying and fitting out Church House. In 2015 the fund was used to purchase the Church House caretaker’s bungalow from the Newcastle Diocesan Education Board.

The DBF Houses Fund is a designated fund for holding those houses which are neither parsonages nor team vicarages.

The Bishop Bilbrough Fund is a bequest which can be used for general purposes. It has been used to provide part of the costs for buying, modifying and fitting out Church House.

The Strategic Mission Fund was set up as a designated fund in order that the NDBF could set aside funds to bid for matched project funding from the National Church.

The Building Grants and Loans Fund is a designated fund to make loans and grants to parishes to enable them to carry out work on their existing church buildings.

The Allchurches Grant Fund is a designated fund which uses grant income from Benefact Trust to support and resource the NDBF’s mission and ministry activity expenditure.

The Clergy Expenses Fund is a designated fund set up to help ensure that clergy can be reimbursed the level of expenses they are entitled to, particularly those working in more deprived areas.

The Lowest Income Communities Fund is a designated fund representing funding from the National Church to help resource ministry in the most deprived areas of the Diocese.

The Lord Crewe Fund is a designated fund representing funding from the Lord Crewe Charity awarded to the Board of Finance for agreed workstreams.

The Partners Fund is a restricted fund used for making relatively small grants to community-based projects.

The New Church Building Fund is a restricted fund used, but not frequently, for making grants and loans to parishes to enable them to acquire new church buildings.

The Diocesan Pastoral Fund includes the proceeds of redundant churches and parsonages. The purposes for which the account may be used are laid down in Section 78 of the Pastoral Measure 1983.

The Archdeacons’ Fund is a restricted fund which is spent at the discretion of the Archdeacons to help clergy who experience financial difficulties.

The Training for Ordinands Fund , formerly the McFarlane Bequest Fund, is a restricted fund used to help provide for clergy training. A sum in excess of £100,000 was left to the NDBF in 2015. In 2019 a donation of £25,000 was received from Mrs Shirley Chamney.

The Botswana Fund receives donations from parishes and individuals which are used to assist projects within our partner Diocese of Botswana.

The Church House Wallsend Fund was set up when the Wallsend Church House building was recognised as a glebe asset in the NDBF accounts. At the same time, accumulated rental income was passed across to NDBF from Wallsend Parish. Rental income is paid into the fund and expenditure relating to the Wallsend property is charged against the fund.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

The Resourcing Ministerial Education Fund receives Block Grants from the Archbishops’ Council for ministerial education training for the ordinands sponsored by the Diocese of Newcastle. The Grants may only be expended on initial ministerial education pathways which have been approved by the Archbishops’ Council’s Ministry Division at accredited Theological Education Institutions (TEIs).

The Resource Church Project Fund holds the income and expenditure of the Resource Church project.

The Resource Church Giving Fund receives donations which are contributions to St Thomas’ Newcastle, the Diocesan Resource Church. Funds will be transferred to the legal body for St Thomas’ once the legal body is established.

The Rural Churches for Everyone Fund receives grant funding for a fixed-term project supported by Heritage Lottery Funding.

The Stipends Capital and Glebe Fund is governed by the Diocesan Stipends Measure 1953. The income of this endowment fund is used to fund clergy stipends and, since 1993, capital can be applied for improvements to parsonage houses.

The Parsonage Houses Fund is an endowment fund. The balance represents the book value of the benefice houses (parsonages) in the Diocese. The fund also holds a cash balance, the proceeds from the sale of a parsonage house, and a liability which relates to the deficit on the clergy pension scheme.

The St Aidan’s Fund is an endowment fund. The balance is held as units in the Central Board of Finance Investment Fund. Dividend income is paid into the unrestricted fund and is used for ordination training.

The Diocesan communications network (Diocesan and Cathedrals Digital Community) (DC2) is an unincorporated association for and run by dioceses and cathedrals of the Church of England. It allows dioceses and cathedrals to work together to create, evolve and develop a common web platform by sharing knowledge and resources, rather than each member commissioning the creation of their own website. Every year, each diocese and cathedral who are Members of the community pay a financial contribution which collectively funds continuing development of our websites by the web developer Church Edit. This means functionality can be scoped and built once rather than multiple times. As a goodwill gesture, NDBF has agreed to hold and manage DC2’s funds. The association is democratic with each Member (diocese or cathedral) nominating a Representative to vote on their behalf, and the association conducts itself in accordance with their agreed set of rules.

Net zero EV charging - NDBF designated part of the proceeds from the sale of a NDBF property to fund the installation of electric vehicle (EV) charging points at vicarages and other property held for clergy. The installation rollout is underway.

Net zero capacity building fund - The National Church awarded NDBF an amount of funding to be used on developing a net zero carbon action plan. The award was made in 2023 and expended in 2024 when the plan was written. The plan was adopted by the Diocesan Synod on 11th May 2024.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

23 CONTINGENT ASSET

The Pension Board indicated that the NDBF’s section of the Church Workers Defined Benefit Scheme was in an asset position at the balance sheet date, with some element of the surplus being available to members of the scheme on closure. However the scheme remained active at that date, and therefore the value of this asset upon closure was yet to be fully quantified. This is because the cost of settling the scheme liabilities had not been fully determined and therefore this asset has not been recognised within the financial statements due to uncertainty over its value. It is anticipated that any surplus usable by NDBF will be used to fund future pension contributions to the Church Workers Pension builder Classic Scheme, and it is expected that the value available to the company will be determined more reliably during 2024.

24 PENSIONS

Clergy

NDBF participates in the Church of England Funded Pensions Scheme for stipendiary clergy, a defined benefit pension scheme. This scheme is administered by the Church of England Pensions Board, which holds the assets of the scheme separately from those of the Responsible Bodies.

Each participating Responsible Body in the Church of England Funded Pensions Scheme pays contributions at a common contribution rate applied to pensionable stipends.

The scheme is considered to be a multi-employer scheme as described in Section 28 of FRS 102. It is not possible to attribute the Scheme’s assets and liabilities to each specific Responsible Body, and this means contributions are accounted for as if the Scheme were a defined contribution scheme. The pensions costs charged to the SoFA in the year are contributions payable towards benefits and expenses accrued in that year, which were £716,454 in 2023 (2022: £750,633), plus any figures arising from contributions in respect of the Scheme’s deficit (see below). The 2021 valuation showed the Scheme to be fully funded and as such in 2023, following the valuation results being agreed, the deficit contributions paid were £0 (2022: £104,000).

A valuation of the Scheme is carried out once every three years. The most recent Scheme valuation completed was carried out at as 31 December 2021. The 2021 valuation revealed a surplus of £560m, based on assets of £2,720m and a funding target of £2,160m, assessed using the following assumptions:

Following finalisation of the 31 December 2021 valuation, deficit contributions ceased with effect from 1 January 2023, since the Scheme was fully funded.

The deficit recovery contributions under the recovery plan in force at each 31 December were as follows:

% ofpensionable stipends
31 December 2021 7.1% payable from January 2021 to December 2022
31 December 2022 Nil
31 December 2023 Nil

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

An interim reduction to deficit contributions to 3.2% of pensionable stipends was made with effect from April 2022, and remained in place until December 2022. For senior office holders, pensionable stipends are adjusted in the calculations by a multiple, as set out in the Scheme’s rules.

Section 28.11A of FRS 102 requires agreed deficit recovery payments to be recognised as a liability. However, as there are no agreed deficit recovery payments from 1 January 2023 onwards, the balance sheet liability as at 31 December 2023 is nil. The movement in the balance sheet liability over 2022 and over 2023 is set out in the table below.

2023 2022
Balance sheet liability at 1 January - 173,000
Deficit contribution paid - -104,000
Interest cost (recognised in SoFA) - -
Remaining change to the balance sheet liability* (recognised in SoFA) - -69,000
Balance sheet liability at 31 December - -

This liability represents the present value of the deficit contributions agreed as at the accounting date and has been valued using the following assumptions. No assumptions are needed for December 2022 as there are no agreed deficit recovery payments going forward. No price inflation assumption was needed for December 2021 since pensionable stipends for the remainder of the recovery plan were already known.

December 2023 December 2022 December 2021
Discount rate n/a n/a 0.0% pa
Price inflation n/a n/a n/a
Increase to totalpensionablepayroll n/a n/a -1.5%pa

The legal structure of the scheme is such that if another Responsible Body fails, Newcastle DBF could become responsible for paying a share of that failed Responsible Body’s pension liabilities.

Lay staff

NDBF (DBS) participates in the Defined Benefits Scheme section of CWPF for lay staff. The Scheme is administered by the Church of England Pensions Board, which holds the assets of the scheme separately from those of the Employer and the other participating employers.

CWPF has two sections:

  1. the Defined Benefits Scheme

  2. the Pension Builder Scheme, which has two subsections;

  3. a. a deferred annuity section known as Pension Builder Classic, and,

  4. b. a cash balance section known as Pension Builder 2014.

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

Defined Benefits Scheme

The Defined Benefits Scheme (“DBS”) section of the Church Workers Pension Fund provides benefits for lay staff based on final pensionable salaries.

For funding purposes, DBS is divided into sub-pools in respect of each participating employer as well as a further sub-pool, known as the Life Risk Pool. The Life Risk Pool exists to share certain risks between employers, including those relating to mortality and post-retirement investment returns.

The division of the DBS into sub-pools is notional and is for the purpose of calculating ongoing contributions. This does not alter the fact that the assets of the DBS are held as a single trust fund out of which all the benefits are to be provided. From time to time, a notional premium is transferred from employers’ sub-pools to the Life Risk Pool and all pensions and death benefits are paid from the Life Risk Pool.

The scheme is a multi-employer scheme as described in Section 28 of FRS 102. It is not possible to attribute DBS assets and liabilities to specific employers, since each employer, through the Life Risk Section, is exposed to actuarial risks associated with the current and former employees of other entities participating in DBS. This means that contributions are accounted for as if DBS were a defined contribution scheme. The pensions costs charged to the SoFA during the year are contributions payable towards benefits and expenses accrued in that year (2023: £nil, 2022: £nil) plus the figures in relation to the DBS deficit highlighted in the table below as being recognised in the SoFA, giving a total charge of £nil for 2023 (2022: £nil).

If, following an actuarial valuation of the Life Risk Pool, there is a surplus or deficit in the pool, further transfers may be made from the Life Risk Pool to the employers’ sub-pools, or vice versa. The amounts to be transferred (and their allocation between the sub-pools) will be settled by the Church of England Pensions Board having taken advice from the Actuary.

A valuation of DBS is carried out once every three years. The most recently finalised valuation was carried out as at 31 December 2019. In this valuation, the Life Risk Section was shown to be in deficit by £7.7m and £7.7m was notionally transferred from the employers’ sub-pools to the Life Risk Section. This increased the employer contributions that would otherwise have been payable. The overall deficit in DBS was £11.3m.

The next actuarial valuation is due at 31 December 2022. The calculations for this are under way.

Following the 2019 valuation, the Employer entered into an agreement with the Church Workers Pension Fund to pay expenses of £3,600 per year.

The movement in the provision is set out below:

2023 2022
Balance sheet liability at 1 January - -
Deficit contribution paid - -
Interest cost (recognised in SoFA) - -
Remaining change to the balance sheet liability*(recognised in SoFA) - -
Balance sheet liability at 31 December - -

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THE NEWCASTLE DIOCESAN BOARD OF FINANCE LIMITED

NOTES TO THE FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2023

Where relevant this liability represents the present value of the deficit contributions agreed as at the accounting date and has been valued using the following assumptions, set by reference to the duration of the deficit recovery payments:

December 2023 December 2022 December 2021
Discount rate N/A 0.00% 0.00%

The legal structure of the scheme is such that if another employer fails, the employer could become responsible for paying a share of that employer’s pension liabilities.

25 RELATED PARY TRANSACTIONS

There were no related party transactions.

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