2021-12-31-accounts

The St Albans Diocesan Board of Finance Annual Report and Consolidated Financial Statements 31 December 2021 Company Limited by Guarante8 Registration Number 00145227 (England and Wale8} Charity Registration Number 248887 The principal object of the Board is the pron70tion of the work of the Church of England in the Diocese of St Albans @•0@ lov The aim of Living God's Love is to see flourishing Christ centred communities inspiring people of all ages and backgrounds to discover God. to grow in their relationship with him and to respond to his transforming love, through serving others so that God's Kingdom may grow in our world. The Sl Albans Diocesan Board of Finance

Contents Report Chairman's statement Members, report (incorporating 51ralegi¢ report) Independent auditor's report 23 Financial Statements Consolidated statement of financial activities 27 Comparative consolidated statement of financial activities 28 Consolidated balan￿ sheet 29 Comparative consolidated balance sheet 30 Charity balance sheet Comparative charity balance sheet 32 Summary consolidated income and expenditure account 31 33 Consolidated slalement of cash flows 34 Principal accounting policies Noles to the financial statements 35 40 Reference and admlnistrative Infomiation 70 The St Albans Diocesan Board of Finance

Chairman's statement Year to 31 December 2021 I would like lo thank all involved in our parishes, deaneries. chaplaincies, and schools, ably supported by our Diocesan staff who have got us through the last 2 years of the pandemic. 2021 was only slightly beller than 2020 in terms of the loss of income in parishes. especially where there 15 a relian￿ on giving through 'lhe plate, or income from the lelling of church property, and therefore on their ability to pay the parish share, which is the DBF'S primary source of income. Parishes responded, with support from diocesan staff. by continuing innovative ways of engaging with congregations and communities. This and the generosity of many congregations meant that parish share collection in 2021 was maintained at 2020 levels, although il did not recover lo the levels seen in the lasl'normal. year of 2019. Recovery is still slow. On the other hand, Income that the Board re￿iVeS from properties and listed investments held up better than was thought possible when budgets for 2021 were set in the early stages of the pandemic. Together with steps taken to reduce expenditure, this reduced the impact of the shortfall in parish share ¢olleclion5 of £1.3m so that the final deficit for the year on the Gommon fund was just over £0.4m. The majority of the Board's budget is expended on the monthly payment of stipends and salaries and any action to deal with cash flow shortfalls will lake time lo implement. Therefore, the Board has agreed that the level of free reserves should ideally be not less than eight and not more than ￿e1ve weeks, expenditure. Al the end of 2021, the free and realisable unrestricted operational reserves lotalled £2,922k representing 9.5 weeks of expenditure. which remains unchanged from 2020. The deficits over the last 2 years, tolalling £0.9m cannot be added lo the Common Fund collections of parish share in the next year, as has been the case in prior years, when any deficit has not been material. We have ulilised unrestricted, non-operational reserves to cover the deficits. This means that future investment income from these funds will be reduced, The pandemic has brought into sharper focus the main systemic issue facing the ChLJrch of England and which has a material impaGI on the funding of ministry, namely a decline in membership. Our budgeted expenditure in 2022 shows an increase in costs of 1.4Wo but this Iran51ates into an increase per member of 4.7'/¢. This adds pressure on our parishes, which will be facing signifi'cant increases in costs this year, especially in utilily costs. In common with other dioceses we do not see our budgets being balanced in the near ftjture and further reserve transfers are likely to be necessary. We are fortunate to have some measure of unrestricted fftserves lo cope. bul annual deficits of £500K are un5ustsinable. We do not see any material recovery in our overall nel income in 2022. Further reductions in costs will be required and are being planned. Our endowment funds (where we cannot use capital, bul income generated accrues to the Common Fund), saw an increase of £9.1 m, driven by our glebe portfolio which received realisalions from our minority slake in the large Linmere development near Houghlon Regis. £5m has been allocated lo further investment in land for the long term although it is proving difficult lo place this in the market. Accordingly, this has been transferred lo our financial asset managers pending reinvestment. We have also allocated £2.7m for the purchase of curates, houses. This will save on rental costs as well as pulling a small portion of our endowment funds into residential property. We acknowledge with thanks the support of our major external funders- the Church Commissioners for project funding, Allchurches Trust for support of our curates, programme and Hockerill Educational Foundation for support for our diocesan board of education in ils most important work in our schools. Above all, we give thanks for the magnificent continuing efforts made by so many people lo support the flourishing ofthe Christian faith here in the di0￿Se of Sl Albans. The St Albans Diocesan Board of Finance 1

Chairman's statement Year to 31 December 2021 I would like lo lake this opportunity lo thank on your behalf our new diocesan secretary. David Vvhile and all the staff al Holywell Lodge for managing operations so well given the conslrainls of working during the pandemic. Particular thanks are due to the IT team who have achieved so much lo enable us all to work remotely and to develop hybrid working for the many meetings of the board and commillees through the year. Colin B. Chairman of the Board of Trustees Dale.. The Sl Albans Diocesan Board of Finance 2

Members, report Year to 31 December 2021 INTRODUCTION The members, as trustees for the purposes of charily legislation. submit their report together with the consolidated financial statements of the Sl Albans Diocesan Board of Finance Ilhe °Board" or the "DBF" or the "Charity I for the year ended 31 December 2021. The report has been prepared in accordance with of the Charities Act 2011 and conslitules a diieclors, report for the purposes of company legislation. The financial statements have been prepared in accordance with the accounting policies set out on pages 35 10 39 of the attached rinancial statements and comply with applicable laws and Accounting and Reporting by Charities.. Statement of Recommended Practice appliGable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland IFRS1021. The St Albans Diocesan Board of Finance 3

Members, report Year to 31 December 2021 OBJECTIVES, ACTIVITIES AND POLICIES Promoting Christian values and service by members of the Church in and to their communities. to the benefit of individuals and society as a whole. The principal object of the Board, as sel out in ils Memorandum and Articles, is the promotion of the work of the Church of England in the Diocese of Sl Albans. The members of the Board are aware of the Charity Commission's guidance on public benefit in The Advancement of Religion for tha Public Benefit and have had regard to il in their administration of the Board. A review of the memorandum and articles of association of the DBF was undertaken and an updated version approv at an extraordinary meeting of the Board in January 2021. We are awaiting acceptance of this from the Charities Commission. The Board continues to support engagement with other Christian churches and other faiths throughout the Diocese. Together with the Bishop's Council the Board seeks to develop comprehensive, sustainable strategies for the use of resources - people, finance and properties - lo provide ministry and mission throughout the DI0￿Se and lo continue to provide practical SLJPPOrt and tools for parishes, schools and chaplaincies. Living God's Love is rooted in the parishes, and the effective deployment of Stipendiary Clergy is vital lo that work. The Board aims lo support and resource parochial mission and ministry through the payment of stipends and the provision of housing and training. The Diocesan iniliats've 'Living God's Love,, was launched in Sl Albans Abbey in January 2011. A strategic renewal of Living God's Love was rolled out in 2016 with plans for a further Ljpdate in 2021. However, a series of facililaled conversations planned for 2020 to inform that update could not take place because of COVID-19 restrictions. Nevertheless, throughout the Diocese, Mission Action Planning continues to be used, lo encourage churches to engage more missionally lo take forward the initiative and its three themes.. In March 2013. a strategy for Ordained and ALJthorised Ministry, including changes to the basis on which first- post curates are funded, was approved by Diocesan Synod. The number of ordained ministers as al 31 December 20211 were.. Going Deeper into God TraiisforminR Conimunities Making New Disciples Bishops and archdeacons Cathedral Clergy Parochial clergy- Incumbent status Curates Non-parochial clergy Total 204 44 31 290 The Board believes that, by prorrK)ling the work of the Church of England in the Diocese of St Albans, it helps lo promote the whole mission of the Church Ipasloral, evangelistic, social and ecumenicall more effectively, both in the Diocese as a whole and in its individual parishes, and that in doing so provides a benefit to the public by.. As al 31 December 2021. there were also 47 self- supporting ministers and 245 licensed readers. The Diocese continues lo.. Follow the national stipend benchmark adjusted for regional factors in determining the level of stipend for clergy of incumbent ststus., and + Contribute to the Church of England defined benefit pension scheme for clergy. s+ Providing resources for public worship, pastoral care and spiritual, moral and intellectual development, both for its members and for anyone who wishes lo benefit from what the Church offers., and Slatislics report for St Albans Diocese as at the end of December 2021 produced by the Church Commissioners. The Sl Albans Diocesan Board of Finan￿ 4

Members, report Year to 31 December 2021 Funding of slipendiary clergy and the provision of housing accounts form the majority of the B08rd's expenditure (see Note 6 to the accounts) and is achieved by.. primarily managed by Bidwells, professional managing agents, who reporl to the Glebe Committee which monitors their performance and the implemenlalion of the investment strategy. {il The collection of contributions from parishes via the Parish Share - the current Parish Share Scheme was approved by Diocesan Synod in 1995. It was reviewed by Synod in Ma￿h 2009 when it was agreed that the current scheme should continue. The Board seeks to ensure it operates effectively by receiving regular reports on receipts. following up where contributions have not been received and reviewing share factors on a regular basis. It also provides help with meeting Parish Share commitments by making Pastoral Aid Support grants lo offset the contribution due. These grants fall into two calegories111 Mulli-year Mission Aided Support Grants for parishes identified by senior clergy as needing particular support to sustain mission and121 Temporary One Year Pastoral Support Grants to assist with transitory financial challenges. The portfolio of listed investrnents al 31 December 2021 had a market value of £55.9m12020 £40.5ml. Under the Dittesan Stipends Funds Measure 1953, as amended by the Endowments and Glebe Measure 1976, capita5 may be applied lo the acquisition of land and buildings to be held as part of Diocesan glebe. Grant making pollcy Grants made by the Dlocesan Board of Finance fall into one or more of the following main categories.. Grants lo parish churches to assist with repairs or rebuilding costs.. + Grants lo parish churches for roof alamis,. Grants made at the discretion of the Bishop in support of evangelism and mission projects., •* Grants made at the discretion of the Bishop or Archdeacons for clergy assistance., Mission-Aided Grants identified by the Archdeacons for parishes who meet the criteria., + Pastoral Aid Support Grants to assist in meeting Parish Share Contribution., bo Mission Initiatives., Church Schools - Grants for capital funding from the sch(x)Is conditions allocations ISCAI,. other grants to Schools., External Charities For humanitarian relief mission and evangelism., Clergylclergy widows •% Ordinands, support., Discretionary Grants for the relief of financial hardship. {iil The rnanagernent of financial investments The investment policy and specific powers of investment of the Board are sel out in various measures and acts. The Board holds investments as aulhorised by the Trustee Act 2000. The objective is lo generate a sustainable and growing income stream In the short to medium term, whilst also seeking capital growth in real terms, over the mLJch longer term. This is to be achieved through balanced and diversified portfolio of equities, bonds, property, alternative assets and cash. The investment strategy is set by the Board and lakes into account income and capital growth requirements, ethical considerations, the risk profile and the investment managers, view of the market prospects in the medium term. The members receive quarterly reports from the investment managers. In addition lo the above, the Diocesan Board of Finance collected contributions from parishes and schools for the Bishop's Annual Harvest Appeal.. 'Water is Life, bringing clean, safe water to rural communities in the Democratic Republic of Congo and the lolal donations exceed £50,000 which was greatly appreciated given the difficult circumstances of 2021. The Board's Investment Managers are Cazenove Capital Management and CCLA Investment Management. The Board continues regularly lo review its investments. This includes systems for monitoring and reporting on ethical issues, good online reporting, semi-segregated fund approach adding investment management diversification and close nelworking with members of the Ethical Investment Advisory Group of the Church of England IEIAGI and the Charities Investment Group ICIGI. The property portfolio is All awards are authorised by the designated Iruslees. The St Albans Diocesan Board of Finance 5

Members, report Year to 31 December 2021 Reserles policy The majority of the Board's budget is expended on the monthly payment of stipends and salaries and any action lo dèal with cash flow shortfalls will lake lime lo implement. Therefore, the Board has agreed that the level of free reserves should ideally be not less than eight and not more than twelve weeks, expenditure. Al the end of 2021. the free and realisable unrestricted reseThes lolalled £2,922k representing 9.5 weeks of expenditure (2020 £2,802k representing 9.5 weeks of expenditure). The Board continues lo review the level of working capital regularly throughout the year lo ensure that it covers core costs and is content that there is sufficient cash flow to conduct the activities of the charity on a day-to-day basis. 11 is the Board's policy lo sel aside, in a Properly Ring-fenced Fund, capital receipts from the sale of former parsonage houses that become surplus lo needs after pastoral reorganisalion. The purpose of this fund is lo invest in income generating assets in order lo fund improvements lo ils remaining housing stock. The v81ue of the investments al the end of the year in the fund amounted lo £6,945k 12020 £6,502kl. We have been able lo maintain 9.5 weeks of operational reserves for two reasons. We transferred £500k from other unrestricted funds to operational reserves in order to cover the deficit from 2020. We have also controlled our costs and budget. increasing il for 2022 by only 1.45%. Careful management of resources and the fact that parish giving held up well meant that the impact on reserves was significant bul manageable. We have now seen two consecutive years where we have reported a deficit on the Common Fund before investment gains and losses. The continuing effects of the pandemic. increased costs of living and the uncertainties of the war in Ukraine means that recovery from this position is fragile. We are looking lo slightly increase our giving in lolal and will keep light control of costs. The Board will continue lo monitor and manage the ongoing consequences carefully. The Sl Albans Diocesan Board of Finance 6

Members, report Year lo 31 December 2021 COMMITTEE STRUCTURE The Bishop's Councll is a statutory body estsblished under the Synodical Government Measure 1969. 11 acts as the Standing Committee of the Synod and carries on the woik of the Synod between sessions. It advises the Bishop on mallers where he seeks guidance and has. since ils inception in 1970, gradually assumed an important role in the formulation of diocesan policy. Selling houses no longer required., Lelling houses during vacancies., and s• Providing new houses where required. The Committee is charged with ensuring that appropriate accommodation is provided for our clergy in the right places, that repairs are carried out and that improvements are made where there is the need and benefits are identified. This is done with regard to the Environmental PoI￿Y adopted by the Committee in recent times. During the year, the CoLJncil received regular reports from the Board for Mission and Ministry. Board of Education, Agenda Group and Policy Sub- Committee. The Council also received reports on new housing areas in the Diocese through the Development Plans Monitoring Group, and closed churches Ihiough the Closed Churches Uses Committee. The adoption of"Nel Zero Carbon" targets by Gener81 Synod will present new challenges and opportunities lo the Board in the coming years. The Board has consislenlly fcKussed resources where they are needed most notably the substantial programme of improvements reflecting environmental concerns across the Diocese. The Property Committee gives aclNe consideration to all aspects of this developing policy. th effect from 1 January 2019 the Bishop's Council assumed the role of Diocesan Mission and Pastoral Committee. The Diocesan Mission and Pastoral Executive Committee {DMPEC} is responsible for carrying out the detailed casework which is then ratified by the Bishop's Council. The statutory responsibilities are undertaken by the Bishop. Council. An increasingly important part of the Committee's work is the redevelopment of existing housing stock for which there are siles Gurrently under consideration. The DMPEC received revisions lo Deanery Mission Action Plans involving proposals for pastoral re- organisalion. The Diocesan Advisory Commlttee IDACI is a slalutory body whose funcb'ons are sel out in ecclesiastical legislation. Its role is lo advise the Chancellor and parishes on proposals for works to church buildings, churchyards and church furnishings, and lo advise more generally on the care and development of churches. In line with slatulory provision and the priorities of Living God's Love. the Committee has regard lo churches as k)cal centres of worship and mission, in which.. People can encounter God and be drawn Into a worshipping community., Parishes can reach out in mission,. and 4* Local communities can be transformed. The Glebe Commlttee continued lo manage glebe holdings. Investment properly comprises agricultural land, retail and residential property. The property is primarily managed by Bidwells, professional managing agents, who report lo the Glebe Committee, which monitors their performance and the investment strategy. The investment policy is lo maximise return with regard lo certain pre-defined parameters. The Diocesan glebe comprises 3,262 acres of rural land, together with some residential properties, mainly in the DI0￿Se of Sl Albans. The glebe land is managed for the benefit ofthe diocesan stipends fund for clergy in the Diocese. The Assets Committee's rolè is to recommend lo the Board of Finance an overall strategy for the management of the Board's investrllenl and operational assets consistent with the functional priorities of the DI0￿Se and the reswnsibililies of the Board as Charity Trustees to current and future beneficiaries.. The Property Commlttee oversees the management of paTsonage houses and the Board's own properties by.. During the year, the Committee received regular update5 on the Board's Investments. t￿ether with presentations from the B08rd's Investment Managers. In addition, it received updates on Glebe property developments and the Linmere development at Houghton Reg1S. Ensuring the Board meets ils slatulory duty lo carry out repairs., Replacing unsuitable houses where possible., .> Improving properties., • Realising development potential of sites. The Sl Albans Diocesan Board of Finance 7

Members, report Year to 31 December 2021 Developments on the laller sile are covered more fully in note 25 to the accounts. The Assets Committee has sel up a sub-group to review the Board's investment objectives and consider adopting lolal return with an appropriate distribution policy. The Diocesan Board of Education worked closely with the Board to seamlessly transition to a new conslilutional form following the enaclmenl of the DBE Measure 2021. After the resolution had been passed by Diocesan Synod in October 2021, the Archbishops, Council Certificate was received, confirming that the Scheme which prepared the way for the inslilulion of the Diocesan Board of Education as a slatulory committee of the Diocesan Board of Finance for implemenlalion on 1 January 2022. Key policies were reviewed, and a Ihree-year strategic plan approved which will cover the whole of the next Iriennium. The Board for Mission and Minlstry IBMMI has responsibility for f8cililating the Diocesan vision, Living God's Love, in keeping with its three themes of.. Going Deeper into God to help grow faith and di5¢ipleship across all age groups, Making New Disciples - to help gr()w the number of people from all age groups become Christians. Tmnsforming Communities - to help engagement in social responsibility mallers affecting Imosllyl local communities. In doing so, il promotes the diocesan values of generosity, joy. imagination and courage. The BMM has responsibility for facilitating the Diocesan vision of flourishing communits'es, flourishing churches and flourishing ministry by Living God's Love. The focus of the board's work in 2021 was to strengthen strategy around the diocesan objectives leading to spiritual and numerical growth. The Dlocesan Board of Education is a slalutory b(Kly established under the Diocesan Boards of Education Measure 1991, with functions including.. • The promotion of education consistent with the faith and practice of the Church of England,. The promotion of religious education and religious worship in schools and academies., The promotion of Church schools and academies in the Dio¢ese,' and s+ Advice lo school governors on any matter affecting Church schools and academies. The Diocesan Board of Education has a strong reputation with its schools due lo the quality and depth of services il provides. The Diocesan Board of Education is making a contribution lo the wider life of the Diocese through the creation of resources to support the development of faith at home, at school and in church. The St Albans Diocesan Board of Finance 8

Members, report Year to 31 December 2021 STRATEGIC REPORT ACHIEVEMENTS AND PERFORMANCE As part of the Vision of Living God's Love, statistics published during the year in respect of 2020, illustrate some of the work of mission and ministry being undertaken in parishes. 2020 2019. 2018 Infant and Child Bsptisms Adult Baptisms Total Baptisms 1,011 337 2,137 223 2,410 210 1,348 2,360 2,620 Infant Thanksgivings ChNld Thanksgivings Total Thanksgivings 15 16 31 49 26 75 83 56 139 Marriages Blessings Total 585 36 621 822 50 872 1,010 80 1,090 Funerals in church Funerals at crematorium 1,170 1,841 3,011 2,014 2,069 4,083 2,270 1.520 3,790 Total Funerals Easter D8y Communicants EasterAII Age Att8ndance Christmas Day Communicants Christmas All Age Allend8n¢8 Usual Sunday Attendance El8Ctor81 Ro113 nla nla 7,884 16,183 nla 32,190 26,675 37,137 27,091 91,703 20,463 27,055 27,600 39.100 29,000 98,000 21,200 32,518 The implementation of Living God's Love is undertaken by the statutory and non-slalulory Boards and Commillees and focuses on parochial mission and ministry and the three themes of Going Deeper into God. Making New Disciples and Transforming Communities. 2 stalislics for Mission 2020, published by the Research and Statistics Department of the Archbishops, Council. Previous years, figures have been updated as fvrther parish returns are recelved. 3 Diocesan Database The St Albans Diocesan Board of Finance 9

Members, report Year to 31 December 2021 BISHOP'S COUNCIL The impact of the COVID-19 pandemic continued to dominate the business of the Council during the year.

In early January 2021, a Joint meeting with the Council and the DBF took place lo discuss the common vision for the life of the Diocese. The Joint meeting discussion centred on the strategic priorities for developing children's ministry 8nd the key aims of a youth strategy. The Joint meeting discussed Diocesan priorities in the aftemialh of COVID-19 and il was acknowledged that the t)iocese should be ready lo grasp the opportunities as and when they arrived, and to continue to ¢ommunicate effectively. The Council was briefed by the Chair of the Board of Finance on the progress of finances during the year and the preparation of the budgetfor2022. The continuing lockdown and uncertainly over restrictions meant that finances for 2021 remained fragile. The 2022 budget had been sel with this in mind. The parish share request showed an increase over the 2021 request, but only by 1.450￿ as this was balanced by a significant increase in investment income. However, finances remain strained. During the year, the Council received regular reports and noted that the Safeguarding Team continued to promote Safeguarding policies and practice whilst dealing with a substantial workload and a large amount of online training. The Council noted that there had been no major issues as a result of the Past Cases Review 2, and the outstanding work of the Team and the Safeguarding Advisory Panel, much ofthe practice was excellent, and the culture and learning culture had been improved. The Councll, acting as Mission and Pastoral Committee, continued lo receive regular reports from the DMPEC and considered proposals for pastoral reorganisation lo promote appropriate models of ministry lo support mission in each part of the Di0￿se. During the year, the Council received and approved the Amplhill and Shefford Deanery Plan which would constitute a road map for the Deanery for the next few years and discussed the Lelchworth reorganisalion proposals and the closure of Sl Michael's church for publlc worship. For Closed Churches the DBF'S liability during the use-seeking period is recognised. For the first time in 10 years the Closed Churches Uses Committee ICCUCI was tasked with two new cases. Luton, St Matthew was closed when the parish was united with the parish of Luton, and the CCUC was able lo recommend to the Church Commissioners that the building should be leased to the Romanian Orthodox Church. Due to safely concerns, Letchworth, St Michael had been closed for two years. On l October, the building was formally closed and vested in the DBF, with the CCUC commencing work as part of the use-seeking period to identify the best possible future use for the sile. The CCUC continued lo identify new uses and work with local communities of the closed churches al Thundrldge, Old Church Tower and East Hyde. The Council re￿IVed updates on the work of the Development Plans Monitoring Group which included progress reports on new housing developments in the Diocese and parish responses lo new opportunities for growth. In October. the Council received a presentation entitled 'Hope for Creation,. The Council noted that the Church of England was the prO￿sS of developing a 'route map, lo Net Zero Carbon by 2030. The Council received, considered and unanimousty approved the 'Terms of Reference of the Diocesan Advisory Wellbeing Group,. The Council received and approved the 'Lessons Learned Review, and considered a number of outcomes from the Teview, 111 for everyone in the Diocese lo acknowledge and call out racism.. 121 to ensure that racial equality was a priorily',131 lo note the five headlines of the review, Parlicipalion. Education, Training and Mentoring, Young People and Structures and Governance and141 for policies and procedures to be made the general rule. The St Albans Diocesan Board of Finance 10

Members, report Year to 31 December 2021 DIOCESAN ADVISORY COMMIThEE Desplte the numerous changes of 2021. the DAC continued to assist parishes in developing proposals through site visits and advice on applications to encourage parishes to consider how to improve buildings for worship, particularly In the context of the COVID-19 pandemic. Advice given during the year included:

A DAC visit lo Clapham encouraged the parish lo consider the options regarding sealing which had severely limited numbers due to social distancing and inflexibility and provided liturgical issues al weddings and funerals. Sl Albans, Sl Peter were developing a major phased redevelopment scheme for the church building and adjoined hall to meet needs for worship and mission in the Glty centre. The DAC continued to provide advice and support for a range of cases for parishes to transfoTm the wider communities in whlch they live and worshlp. Many churches began to develop projects for greater accessibility and improved community use: During 2021, a DAC sile visit to Barley considered options for a toilet in the south-west vestry lo meet the needs of hospitality, mobility access and facilities to make the church fit for use by the village. At Sutton. the reordering of historic sealing to accommodate growing school ministry. During 2021, many churches began lo develop projects for greater accessibility and improved community use with environmental matters and working towards net zero carbon was on the minds of many parishes as they aim to transform communities locally and globally. During 2021. significant progress towards Bronze Eco Diocese award has been made, with the completion of the first four steps.. Formation of the Diocesan Environment Group to oversee and coordinate progress on environmental matters across Diocesan operations, including work towards Church of England Net Zero by 2030 target. Revision of the DI￿esan Environment Policy. Achieving and exceeding taiget of 10QA of churches registered for Eco Church scheme with 5Yo having achieved an Eco Church awaid. 83 churches are registered with 24 Bronze awards and 3 Silver awards. Establishing the habit of recording and celebrating individual environmental initiatives through news bulletins, case studies, social media posts. Diocesan Mentor scheme established to encourage sharing of good practice. The St Albans Diocesan Board of Finance 11

Members, report Year to 31 December 2021 DIOCESAN BOARD OF EDUCATION The DBE, through the creation of Christian communlties committed to a shared lrfe together, recognised the outstanding work undertaken by the school leaders. staff, governors and communities of its 138 schools, who had ensured that the re-organisation of learning and staffing had been maintained throughout the ygar.

Throughout the summer and autumn of 2021, the DBE echoed the message of hope being promoted across the Di0￿se. Church schools, their headleachers and leaders, were encouraged through a programme of retreat, conferencing and personal messaging to not lose sight that God was doing new things amongst them and that church schools could become even brighter beacons of hope than they were before. In 2021, despite the challenges, much had been achieved. In the autumn term, Hertingfordbury Cowper VA Primary held a 'School Vision Week,. As a school, they visited The Great Oak in Panshanger Park which gave the children a visual representation of their new school vision, 'Rooted in Jesus, Growing in Wisdom, Overflowing with Thankfulness,. Later in the week, each class found a creative way to share the Vlsion and the school's Christian values with their local community, including singing songs outside the village store, leaving gifts of a teabag and prayer in the local Parish Church, creating cards for a local care home, and delivering lellers of thankfulness to local residents. It was a very special week. During 2021, and based on the theme 'Lord of all Hopefulness,, over 35 headleachers and Chairs of Governors took the opportunity lo slep aside and reflect on the subject of Hope during September 2021. Retreat days were held across the Diocese and facilitated by parish priests with connections lo church schools. Alongside this emphasis on retreat, the Schools Team continued to priorilize time for one-to-one or small group meetings with headleachers and Chairs of Governors to support their pastoral and professional wellbeing. Feedback has indicated that this approach has been deepty valued, and headleachers and Chairs of Governors report that these interactions are affirming, uplifting and have sustained them in their roles. The Diocesan Board of Education IDBE) continued to support Initiatives that promoted transformation in and across communities within the Diocese, nationally and overseas. During 2021, Church schools increasingly addressed the issues related lo climate change and carbon reduction. Two children from the federation of Albury and Puller Memorial Nursery and Primary schools were selected along with 21 other children from the whole of the United Kingdom lo represent the voice of the future al COP26. Alongside their classmates, they learnt about the plight of the chalk rivers locally and had the chance lo visit a river and lake part in a truly inleraclive session which helped them to formulate key questions for ministers when they attended the global conference on 29th October 2021. In 2021, Church schools also shared the Diocese's commitment to racial justice. As part of Black History Month, St Helen's VA Primary. Whealhampslead looked at influential black people in the British communily as well as black saints. In October, the school received a visit from Shelley Hayles, Diversity Officer for Sl Albans Liberal Democrats who advises Members of Parliament on matters of Diversity and Inclusion. As part of her visit, Shelley delivered a short presentation about the Windrush generation. Following on from the release of 'God in this Place, in 2020 and 'Plug in and Play, in 2021, 'Hearl foT the Earth., is a ￿0-year curated resource to help schools reflect theologically on the issues surrounding climate change and the need lo move to a carbon neutral position. 'Heart for the Earth, will be launched in Seplemberloclober 2022 al the Diocesan Headleacher Conference and the Schools, Harvest Festival services at Sl Albans Cathedral. The St Albans Diocesan Board of Finance 12

Members, report Year to 31 De￿mber 2021 DIOCESAN BOARD OF MISSION AND MINISTRY Vocations, Training and Mlnistry Development

Thirty candidates are currently in conversation with the Diocesan Director of Ordinands IDDOI or Diocesan Director of Vocations IDDOVI or Assistant DDOS IADDO) with another 27 al the earlier stage of the discernment piocess and seeing a Vocations Adviser. Bi-monthly curate and reader training was undertaken (alternating online and onsite where possible) 2nd Bi-monthly curate and reader formation groups. The training of training incumbents lannualtyl was undertaken. The On￿oing formation and training ofall readers and curates in Living God's Love lo enable church growth as effective and reflective praclilioners. To sign off all fi'nal year curates, and previous year curates secured posts (where appropriatel, ready to undertake a position of responsibility or an ongoing supporting role in the ChLJrch of England. Lay Tralnlng including Reader Training During 2021, the new Foundations for Ministy and Pioneer Enabler courses have led to a combined total of49 newly commissioned Pioneer, Mission, Pastoral and Discipleship Enableis ￿sOUrC1ng their benefices. In 2021, for the first time there were 3 Lay Leaders of Worship ILLWS) courses in a single year plus the final sessions of a course that was on hold due lo COVID-19. The training was via Zoom and this has led lo a good number of new LLWS across the diocese- 37 commissioned and 13 due to be commissioned from the autumn term. Pioneering has been embedded into LLW training lo supplement foundations for Ministry to resource people and enable advocacy of these vital areas of ministry. During 2021, 9 Readers were licensed, 6 continue in training and there are 10 new Readers In Training. Mission and Mlnlstry Development Reviews IMMDRSI In 2021 progress was made in catching up on the back log of MMDRS dtje lo the pandemic. Review meetings with consultants took place in person where possible or online where appropriate. Work continued on planning Continuing Ministry Development Training from needs highlighted in the MMDR process. Support in your Minlstry {SIMI In 2021, Support In Your Ministry ISIMI continues to provide confidential support to ministers across the diocese. About 100 ministers use the scheme, supported by 50 volunteer Assistants who worked through the pandemic using a combination of phone, video and socially-distanced fa¢e-to-f8ce meetings. Reaching New People IRNP) RNP continued lo support churches looking lo launch or re-launch New Worshipping Communities. The "Hope is Happening" grant program had been used lo launch or re-launch youth, children's. young adult's gathering after the various lockdowns, with 87 small grants of £250 to different churches around the diocese. RNP continued lo train people in Transforming conversations with further training for coaches expected. The Sl Albans Diocesan Board of Finance 13

Members, report Year to 31 December 2021 During 2021. RNP worked in a more focused way with churches lo develop a plan and following them up depending on their specific needs and particularly churches with the geographic potential lo be younger and more diverse. RNP continued lo train lay pioneers on CMS. During 2021, new housing learning community had been launched, which gathered people together to explore the exciting missional opportunities new homes presented. In 2021, Liminal Live was launched. an online panel-based discussion enabling churches to share the post and rea¢h new people, the reach of this has been significant. RNP have run Pioneer Cafes and Masterclasses on optics such as social media. failure and re-launching NWCS.

As the RNP project comes to an end, constantly exploring creative ways lo integrate RNP'S work into the wider Mission and Ministry team with initiab'ves like the combined training plan, social media integration and reslruclure of meetings. Youth and Children Team During 2021, the Team continued with Zoom cafes. one-on-one paTish consultancy and support. and online training. Worked with Ministry Department colleagues lo deliver IME2 and other curalelReaderlFoundalion course training. The Lay Leader of Children and Youth course was developed with the Di0￿san Youth Officer and Lay Ministry Officer lo be launched in 2022. In 2021, the Team created resources for use during al home and hybrid church and developed outdoor church learning community, and continued toddler group leaders, learning community. Youth Mission The Team promoted and hosted conversations about a necessary renewal of youth engagement through sharing the Faith in Young People report and suggested a fresh vision and approach. This included presenting lo Deanery Synods and Deanery Chapter meetings, with a fresh priority on youth discipleship for small numbers and partnerships across churches lo build sustainable youlhwork aclivilies. During 2021, the Team supported churches lo navigate the changing context of ministry and provided ongoing youth ministry support with weekly resource emails, parish consultancy, regular evening Zoom meetings and Cafe events covering a range of youth specific topics. The St Albans Diocesan Board of Finance 14

Members, report Year to 31 December 2021 STRATEGIC REPORT FINANCIAL REPORT FOR THE YEAR Overview During 2021, the Diocese continued to feel the impact of lockdown and the pandemic in its Parish Share ieceipts. Parishes sustained a generous response, and there was even a small increase in the percentage received from 2020, bul still below the rate from 2019193.9010). Investment income held up well. That and control of costs meant that the deficit on the common fund, in year was £413k. This was within forecast. bul is still a significant sum, which means that we have suffered a total delicil for the last two years of just over £g00k. In conlrasl the endowment and restricted funds have prospered, with their value increasing, partly as a result of a strong recovery in the value of the fund-holdings following the pandemic and partly due to the continuing sale of land as part of the Houghlon Regis development. Increases in the capital value of the funds have to be reinvested in the funds, bul the income generated from this capital can be used lo support the ministry and mission of the Diocese. This does help lo defray our expenses and so keep parish share increases as low as Possible. But in comparison lo the parish share, this is relatively small. The nature of the chU￿h of England's finances are lo be income poor and asset rich. and this is certainly true within the Diocese. In response lo the concerns posed by current circumstances, we have prepared a five-year forecast and are using il to undertake a number of actions that ensure support of the continuation of the Diocese, vision and strategy. Results for the year Total income amounted lo £25.3m compared to £25.7m in 2020, a decrease of £400k, the profi'l on the disposal of a parsonage house balancing a lower grant to aid with school capital projects. The propety company made sales of £5.4m in the year {2020 - £5.3ml During 2021,. Parish Share contributions amounted to £12.97m 12020 £13.12ml. This amount included contributions by parishes in respect of eadier years shortfalls" of approximately £104k12020 £36kl. The Golleclion rate for Parish Share for 2021 lamounl receivedlamount requested) was 91.01 %12020 _ 90.560AI. Expenditure tr)talled £22.3m in the year compared lo £22.Om in 2020. Net income before revaluations and investment asset disposals amounted lo £3.Om12020- £3.8m). The net realised and unrealised gains on investment properties and listed investments totalled £8.2m12020 £0.9ml. The nel increase in funds for the year was £11.3m12020- £5.3ml with the Common Fund showing an increase of £87k12020- £500k decrease), though this was due to transferring in £500k from other unreslri¢led funds to cover the 2020 deficit. Flnanclal posltion The consolidated balance sheet showed total funds of £202.6m {2020 £191.4ml. This figure included endowment funds of £156.gm12020 - £147.8ml. the principal part of this being the parsonage houses fLJnd amounting to £75.8m12020 - £75.5ml. Where income arises from these funds. it may be used for general purposes of the charity and therefore is credited lo unreslricled funds. Also included in total funds were restricted funds tolalling £15.3m12020 - £13.4ml. These monies have either been raised for, and their Ljse restricted to, specific purposes or they comprise donations subject to donor- imposed conditions. Further details of these restricted funds can be found in note 2210 the financial statements together with an analysis of movemènts in the year. Funds lotalling £24.Om 12020 £23.4m) had been designated, or set aside, by the Board for specific purposes. These purposes and an analysis of the movements on the funds are sel out in note 23 to the financial slalemenls. The St Albans Diocesan BoaTd of Finance 15

Members, report Year to 31 December 2021 FUTURE PLANS The Diocesan vision of Living God's Love will continue lo be promoted, lo encourage churches to engage more missionally. Boards and Committees will continue working to support that vision by resourcing parochial mission and mirTrislry and offering help and guidan￿ lo parishes as they seek lo Live God's Love. The theme of 'growing younger, is expected to continue lo be an important part of future work, but will now be a priority alongside a need lo respond to the challenges and opportunities arising from the impact of COVID-19. The Bishop's Council will continue lo make recommendations about proposals for pastoral reorganisalion and support and encourage emerging mission initiatives, and seeking ways to share good practice in parishes and deaneries. The Diocesan Board of Finance will continue to work with its Investment Managers to ensure maximum returns for the benefit of mission and ministry in the Diocese. It will also continue dialogue with parish IreasLJrers over the impact of COVID-19 on parish and diocesan fi'nances. The Diocesan Advisory Committee will continue lo support and advise on reducing carbon from church buildings and to take opportunities to improve the environment and to develop four church case studies, grant- aided by the Church of England. which will look at the circumstances of each and recommend ways of healing which reduce carbon. The Committee will promote ways in which churches can be maintained and repairs afforded given the shortage of major funding. They will continue lo provide training and other events and give opportunities for parishes to meet together. The DBE will continue to ensure that a minimum of 90¥¢ of schools are deemed to be good or excellent church sch(K)Is las defined by SIAMS) and support the development of Christian pedagogical approaches to leaching and learning. The Board wlll extend and develop work lo promote the wellbeing ofthe whole school Gommunity. The DBE will continue lo deliver diocesan-wide inilialives which promote a shared understanding of Living God's Love through community. worship and prayer, promote and facilitate oulslanding leadership and governance which supports excellence in church schools and develop Church of England provision across the Diocese of St Albans. The Board for Mission and Ministry will conts'nue supporting Lwing God's Love by encouraging the growth of all Christians as disciples, enabling missional ministry throughout the Diocese and equipping all God's people to discern and fulfi'l their vocation and ministry. The Hope for Creation video has been commissioned for the Bishop's conferen￿ in September 2022, and engagement with international climate justice events, especially COP26. The Flourishing Churches and Flourishing Leadership Team is planning to support parishes lo recruit and equip volunteer leaders who will be key, along with inspiring clergy and encouraging a whole church approach. New equipping opportunities through the locally delivered 'Essenlials' course, Lay Leader for Youth and Children training and running the Launchpad programme for churches starting youthwork from scratch. will aim to increase the inclusion and discipleship opportunities offered to 11-18s. Lay Training, including Reader Training, will continue to build on the success of the lay ministry courses with continuing cohorts across LLW, Enabler and Reader roles.. and lo build on resourcing pioneering and youth and children's work by providing pioneer supplementation for Foundations for Ministry, a youth and children's session for LLW, introducing both a pioneer and youth and children's placement for Readers In Training. working with the Eastern Region Ministry Course IERMCI lo introduce a new bespoke Youth & Children's Reader training pathway In adltilion lo the already operational Pioneer reader training pathway. The Sl Albans Diocesan Board of Finance fj 6

Members, report Year to 31 De￿mber 2021 PRINCIPAL RISKS AND UNCERTAINTIES The Board has reviewed the risks faced by the charity. Immediate risks concern the fragility of recovery from the pandemic, compounded by the rise in the cost of living and the international tensions. and how they impact allendance and the ability of people to give. In addition, il has identified four main risks namely Safeguarding, IT Security. Parish Share and closed churches. Safeguarding The Diocesan Safeguarding Advisory Panel IDSAPI continued to meet quarterly to oversee safeguarding arrangements in the Diocese and offer external expertise and challenge if necessary. The membership of the panel conforms with the requirements set out in the guidance. All safeguarding serious incidents are reported to the Charity Commission in line with House of Bishops Guidance. The safeguarding team continue to work towards achieving the 3 year strategy and a¢lion plan agreed by DSAP in 2020. IT Security The Board is aware of the increasing use of, and demand upon. IT services and the increased threat posed by those with maliclous intent. In 2021 the Board was certified by the Government-backed Cyber Essentials Scheme for data security (highly regarded by the Information Commissioner's Office, ICOI, having passed the Cyber Essentials Plus which included Vulnerability and Penetration testing. updated to a more sophislicaled anti-virus as well as fully implementing remote management for all diocesan computers, and servers. In order to strengthen our defences against allacks, via malicious emails and phishing attacks, staff had been receiving 'lesl phishing, emails lo train them lo detect these. Since that lime, the standard has improved lo represent a low threat level with 980/0 of users ranked at low risk. The lesling will continue to ensure that the staff awareness level is al ils highest al all times. There will be annual lesling of Cyber Essentials Plus lo ensure that the highest leve5s of defence continue. The Board considers Cyber Security to be a continuing risk. It continues to take professional and government advice and lo act upon il to seek to miligale the risk as far as possible. Parish Shore Scheme The Board continues to pay careful allenlion to the Parish Share Scheme which determines the allocation of contributions needed from each parish to maintain the Common Fund. Parish Share is the main funding source for the DI0￿Se, so even a small percentage fall has significant implications for funding. The Board regularly discusses the structure of the scheme and assesses the understanding and support ofthe scheme across parishes in the Diocese. The Board also monitors. on a regular basis, the collection rate of contributions received from individual parishes, with a view lo identifying al an early stage those parishes which are likely to have difficulties in meeting their Parish Share in particular in the light of COVID-19, lockdown and its effect on parishes. Closed Churches Closed churches may be transferred lo become the responsibility of the DBF. It occurs infrequently. bLJI two cases arose during the year. The Board was briefed about the risk arising during the slatulory use-seeking proces5, when the church buildings are vested temporarily in the Board, which has liability for insurance, maintenance and necessary urgent repair. The Church Commissioners operate a Closed Church Buildings Support Account and the Board has made provision for additional expenditure within the Diocesan Pastoral Account. During the year terms were agreed for a lease of one of the newly- The St Albans Diocesan Board of Finance 17

Members, report Year to 31 December 2021 closed chLJrches lo another denomination. The annual rental income from a lease and a proportion of the proceeds of the sale of a closed church are slatulorily due to the Diocesan Pastoral Account. CUSTODIAN FUNDS As al 31 December 2021, the Sl Albans Diocesan Board of Finance held funds on behalf of parishes, church schools and general trust funds within the Diocese with a market value of approximately £42.7m12020 - £39.5ml as Custodian Trustee. These assets are not included in the financial slalemenls. The funds are held predominantly as units in common investment funds held by the Central Board of Finance {CBFI of the Church of England and are professionally managed on behalf of the CBF by CCLA Investment Management Limited. At all limes. funds held by the charity as Custodian Trustee are segregated clearly from those belonging lo the charity itself. RAISING FUNDS The charity raises funds thmugh Parish Share and on occasions receives other donations and voluntary income. It aims always lo achieve best practice in the way in which il communicates with parishes, donors and other supporters. 11 takes care with both the lone of its communications and the accuracy of its data to minimise the pressures on parishioners, parochi81 councils, donors and supporters. 11 applies best practice to protect their data and never sells data, never swaps dats and ensures that communication preferences an be changed al any time. The charity manages ils own activities in respect to raising funds and does not employ the services of professional fundraisers. The charity undertakes lo react to and investigate any complaints regarding ils activities for raising funds and to learn from them and improve its service. During the year, the charity received no formal complaints about ils activities for raising funds. The StAlbans Di0￿san Board of Finance 18

Members, report Year to 31 December 2021 STRUCTURE, GOVERNANCE AND MANAGEMENT The Diocesan Synod is the democratically elected decision-making body of the Diocese and its standing committee, the Bishop's Council, is responsible for the formulation of dio¢e88n policy. The Sl Albans Diocesan Board of Finance is a registered charily (Charity Registration No 2488871 and a company limited by guarantee Icompany Registration No 00145227 (England and Walesll. 11 is consliluled in accordance with the Diocesan Boards of Finance Measure 1925. The Board of Finance 15 the financial executive of the Diocesan Synod and is responsible for the custody and management of the Synod's funds and the employment of all those paid directly from the funds. Mu¢h of the woik of the Board is delegated to ils executive committee, the General Committee, or lo ils sub-commillees, the Property Committee. the Glebe Committee and the Assets Committee. Each company member has undertaken lo contribute lo the assets of the company in the event of it being wound up whilst he or she is a member, or within one year after he or she ￿aSeS lo be a member. The conlribulion, which cannot exceed £1, may be applied toward the payment of the debts and liabilities contracted before he or she ceased lo be a member. The Board's staff provide administrative and financial services lo the Board of Education, the Board for Mission and Ministry as well as the Diocesan Mission and Pastoral Committee and Diocesan Advisory Committee. All these bodies report to the Diocesan Synod which has overall responsibility for policy. The Synod delegates ils day lo day business lo ils standing committee, the Bishop's Council. The members of the Board are empowered by the Articles of Association of the company to act as the company directors of the St Albans Diocesan Board of Finance. The members also act as Iruslees ol the Board for the purposes ol charity legislation. The Sl Albans Diocesan 808rd of Finance 19

Membei's, report Year to 31 December 2021 The members who served during the year land continuing unless otherwise slaledl were as follows.. Sub-committee Membershl Member ointedlResi ned Ex-officio Member Tlie Bishop of Sl Albans (The Rl Revd DrA G C Smilhl Clergy elected by the Diocesan Synod The Reverend Dr G R Cappleman The Reverend Canon Dr P M Ackroyd Resigned December 2021 Lay Members elected by the Deanery Synods ArGhdeaconry of SfAlbans N K Challis CBGage J H Robinson M Readman Dr R L V Southern 1,2,4,5 Resigned June 2021 Resigned De.cember 2021 Archdeaconry of Hertford CGBird M E Butcher J W Butler P E Easlerbrook Dr M Ealon 1,2,3,4 1,2,4, 5 Archdeaconry of Bedford D C Clar1( Dr D W Dallinger K Ebbage A J Gales K Smith Members nominated bythe Blshop ofStAlbans The Archdeacon of Sl Albans The Archdeacon of Bedford The Archdeacon of Heitford A Brown OBE (Chair of Glebe Commilleel 1,2,3 1,2, 3 1,2, 3 1,3,4 Members co-opted by the Board B Crawford T R Fleming P R Lindle 1,2,3,4,5 With effect from 1 January 2022, The Reverend C E Bunce, The Reverend K David, The Reveren(J Canon C E C Hudson, E D Roberts, M P Taylor and The Reverend A J Thomas were also appointed as members of the Board. 1 General Committee, 2 Property Committee. 3 Glebe Committee, 4 As*ls Committee, 5 Audit Committee 6 Diocesan Advisory Committee for the Care of Churches, 7 Closed Churches Uses Commillee The Sl Albans Diocesan Board of Finance 20

Members, report Year to 31 De￿mber 2021 Members During the year no member of the Board had any beneficial interest in any contract with the charitable company. During the year several members, who are also clergy within the Diocese, received stipends from the charitable company in connection with their religious and pasloffil duties within the Diocese. However, no member reTrived any remuneration in connection with their duties as members of the Board during the year. No expenses were incurred in the pèrformance of their duties as Board members were reimbursed during the year Remuneration of key management personnel Key management personnel comprises all the members of the Board, together with the senior executives who are the Diocesan Secretary, the Director of Finance, the Estates Secretary and the Diocesan Pastoral and Advisory Secretary. The remuneration of all lay members of staff, including that of key management personnel, is set according lo pay structures originally established by the Archbishops, Council which have, in recent years. been adapted by the Board. These scales are reviewed annually within the confines of the Common Fund Budget which. is in turn, approved by the Diocesan Synod. Members of the Board, also part of key management personnel, do not receive remuneration for their roles either as trustees of the charity or directors of the Board of Finance. The clergy members of the Board, as office holders within the Diocese. receive housing and stipends as part of their clergy role. Clergy stipends follow regional benchmarks as agreed annually by the National Church Central Stipends Authority. Member-selectlon and appolntment Members can be co-opted to the Board by existing members or they can be elected by a number of different entities including the Diocesan Synod and the Deanery Synods or nominated by the Bishop of st Alban5. The Bishop of Sl Albans is an ex-officio member of the Board. Members of the Board are elected to serve for a period of three years. after which period they may offer themselves for re- election. Elections were held al the end of 2021 to appoint members for the Iriennium 1 January 2022 10 31 December 2024. Members, responslbllltles statement The members of the Sl Albans Diocesan Board of Finance are Tesponsible for preparing the membeTS' report and financial slalements in accordance with applicable law and United Kingdom Accounting Standards {United Kingdom Generally Accepted Accounting Practice). On agreeing to become a member of the charity, the members are thoroughly briefed by their co- members on the history of the charity, the day-lo- day management, the responsibilities of the members, the current objectives and future plans. The members are also encouraged to attend any courses which they feel are relevant lo the development of their role, and to keep up-to-date on any changes in legislation. Company law requires the members to prepare financial statements for each financial year which give a true and fair view of the slate of affairs of the group and the charity and of the income and expenditure of the group for the financial year. Under company law the members must not approve the financial statements unless they are satisfied that they give a true and fair view of the stale of affairs of the group and the charity and of the income and expenditure of the group for that period. Member induction and training An induction pack has been issued to all members. The St Albans Di0￿san Board of Finance 21

Members, report Year to 31 DeGember 2021 Members, responsibilities statement In preparing these financial slalemenls. the embers are required lo.. The members are responsible for the maintenance and integrity of the financial information included on the charity's website. Legislation in the United Kingdom governing the preparation and dissemination of financial ststements may differ from legislation in olherjurisdiclions. select SLJitable accounting policies and then apply them consislenlly", + observe the methods and principles in Accounting and Reporting by Charities.. Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland IFRS102}', make judgements and eslimales that are reasonable and prudent., * slate whether applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial slalements., and prepare the fi'nancial statements on the going concern basis unless il is inappropriate to presume that the group and the charity will continue in operation. Tradlng subsldlary The charity has a wholly owned trading subsidiary, the Sl Albans Diocesan Property Company Icompany No. 08899302}, company incorporated in England with a share Capital of £1.700,000 12020 £1,700,000). The principal activity of the company is properly development. During the year the company made a net profil of £1,917k12020 - £2,999k} and made a charitable donation of £2.4m to the charity. This donation enabled a reduction in the tax liability for 2020. Debt-Equity swap In 2078, the charity loaned the subsidiary £7m for two years to aid working capital. £1 m of this was repaid in 2019. The remaining £6m loan was renewed in 2020 and is due for renewal in 2022. Rather than renew the loan again, il has been agreed that lo swap the debt for equity, which will strengthen the balance sheet of the trading subsidiary. The members of the Board are responsible for keeping proper accounting records which disclose with reasonable accuracy al any lime the financial position of the charity and which enable Ihern to ensure that the fi'nancial slalements comply with the Companies Act 2006. They have responsibility for safeguarding the assets of the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The members, report, including the strategic report, was approved by the members and signed on their half by.. Each member confirms that.. so f8r as the member is aware, there is no relevant audit information of which the charity's auditor is unaware,. and • the member has taken all steps that helshe ought lo have taken as a member in order lo make himlherself aware of any relevant audit information and to establish that the charity's auditor is aware of that information. olin Bird Chairman of the Board rustees David While Diocesan Secretary This confirmation is given and should be interpreted in accordance with the provisions of s418 of the Companies Act 2006. Approved on.. The St Albans Diocesan Board of Finance 22

Independent auditor's report to the members of The St Albans Diocesan Board of Finance Year to 31 December 2021 OpSniDn We have audited the financial statements ofThe St Albans Diocesan Board of Finance (the 'charitable company'l and its subsidiary Ilhe 'group'l for the year ended 31 December 2021 which comprise the consolidated slalement of financial aclivilies, the consolidated and charity balance sheets, the consolidated slalement of cash flows. the principal accounting FX)licies and the notes to the financial slatemenls. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic oflreland, {Uniled Kingdom Generally Accepted Accounting Praclicel. Conclusions relating to going concern In auditing the financial ststements, we have concluded that the members, use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Based on the wotk we have performed. we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast signifi'cant doubt on either the charitable company's or the group's ability lo continue as a going concern for a period of al least twelve months from when the financial slalemenls are authorised for issue. Our responsibilities and the responsibilities of the members with respect to going concern are desGribed in the relevant sections of this report. In our opinion, the financial stalemenls: + give a true and fair view of the state of affairs of the group and of the charitable company as al 31 December 2021 and of the group's income and expenditure for the year then ended., other information The members are responsible for the other information. The other information Comprises the information included in the annual report and financial statements, other than the financial statements and our auditor's report thereon. Our opinion on the financial slalements does not cover the other information and. except to the extent otherwise explicitly staled in our report. we do not express any form ofassurance conclusion thereon. * have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice,. and • have been prepared in accordance with the requirements of the Companies A¢1 2006. In connection with our audit of the financial statements, our responsibility is to read the other information and. in doing so, consider whether the other information is materially inconsistent with the financial slalemenls or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misslalements, we are required to determine whether there is a material misstatement in the finan¢i21 slalements or a material misstatement of the other information. 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. Basis for opinion We conducted our audit in accordance with International Standards on Auditing IUKI IISAS {UKI) and applicable law. Our responsibilities under those standards are further described in the auditor's responsibilities forthe audit of the financial statements section of our report. We are independent of the group in accordance with the ethical reqL¢irements that are relevant to our audit of the financial statements in the UK, including the FRC'S Ethical Standard, and we have fulfilled our other ethical responsibilities In accordance with these requirements. ljve believe that the audit evidence we have obtained is sufficient and appropriate lo provide a basis for our opinion. We have nothing lo report in this regard. The St Albans Diocesan Board of Finance 23

Independent auditor's report to the members of The St Alban5 Diocesan Board of Finance Year to 31 December 2021 Oplnions on other matters prescrlbed by the Companle5 Act 2006 In ouropinion, based on the work undertaken in the course of the audit.. Responsibllitles of members As explained more fully in the members, responsibilities statement, the members are responsible ftir the preparation of the financial ststemenls and for being satisfied that they give a true and fair view, and for such internal control as the members determine is necessary to enable the preparation of financial statements that are free from material misslalemenl, whether due lo fraud or error. + the information given in the members, report, which is also the directors, report for the purposes of company 18w and includes the 51ralegic report, for the financial year for which the fi'nancial statements are prepared 15 con51Stent with the financial stalemenls,. and this report has been prepared in accordance with applicable legal requirements. In preparing the financial statements. the members are responsible for assessing the group's and the charitable company's ability lo continue as a going concern, disclosing, as applicable, mallers related lo going concern and using the going concern basis of accounting unless the members either intend lo liquidate the groLJP or the charitable comp2ny or to cease operations, or have no realistic allernalive bul lo do so. Matters on which we are requlred to report by exception In the light of the knowledge and understanding of the group and the charitable company and ils environment obtained in the course ofthe audit, we have not identified material misstatements in the members, report. including the strategic report. Auditor's responsibilities for the audit of tho financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misslatemenl, whether due to fraud or error, and lo issue an auditor's report that includes ouropinion. Reasonable assurance is a high level of assurance, bul is not a guarantee that an audit conducted in accordan￿ with ISAS (UK) will always delecl a material misstalemenl when it exists. Misslalemenls can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected lo influence the economic decisions of users taken on the basis of these financial stalemenls. We have nothing lo report in respect of the following matters in relation lo which the Companies Act 2006 requires us lo report to you if, in our opinion.. adequate accounting records have not been kept by the charitable company, or returns adequate for our audit have not been re￿iVed from branches not visited by us., or • the charitable company's financial statements are not in agreement with the accounting records and returns., or certain disclosures of members. remuneration specified by law are not made., or 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 misslalements in respect of irregularities, including fraud. The exlenl lo which our prO￿dureS are capable of detecting irregularities. including fraud is detailed below. we have not received all the information and explanations we require for our audit. The Sl Albans Diocesan 808rd of Finance 24

Independent auditor's report to the members of The St Albans Diocesan Board of Flnance Year to 31 December 2021 Auditor's responsibilities for the audlt of the financial statements Icontinuedl Our approach lo identifying and assessing the risks of material misslalemenl in respect of irregularities. including fraud and non-compliance with laws and regulations, was as follows.. making enquiries of management and those charged with governance as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud., and considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. + the audit partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills lo identify or recognise non-compliance with applicable laws and regulations., To address the risk of fraud through management bias and override of controls, we.. + we identified the laws and regulations applicable to the charitable company and group through discussions with members and management, and from our knowledge and experience of the sector. + performed analytical proGedures to identify any unusual or unexpected financial relationships., • performed substantive testing of expenditure., • lesled journal entries to identify unusual financial Iransa¢lions', and we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the charitable company and group, including the Charities Act 2011, the Companies Act 2006 and various Church Measures including the Parochial Church Councils (Powers) Measure 1956 and the Incumbents and Churchwardens {Trusls) Measure 1964., assessed whether judgements and assumptions made were indicative of potential bias. In response to the T15k of irregularities and non- compliance with laws and regulations, we designed procedures which included, but were not limited to.. agreeing financial statement disclosures to underlying supporting documentation., • we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal Corresponden￿,. and reading the minutes of meetings of those charged with governance-, and + identified laws and regulations communicated within the audll team regularly and the team remained alert to instances of non-compliance throughout the audit. enquiring of management as to actual and potential litigation and claims. were There are inherent limi18tions in our audit pmcedures described above. The more removed that laws and regulations are from financial Iransaclions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and r￿Ul&tionS to enquiry of the members and management and the inspection of regulatory and legal correspondence, if any. We assessed the susceplibilily of the charitable company's and group's financial statements lo material misslatemenl, including obtaining an understanding of how fraud might occur, by.. The St Albans Diocesan Board of Finance 25

Independent auditor's report to the members of The St Albans Diocesan Board of Finance Year lo 31 December 2021 Auditor's responsibilltles for the audit of the financial statements Icontilluedl Material misslalemen15 that arise due to fraud can be harder lo delecl than those that arise from error as they may involve deliberate concealment or collusion. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website www.fr¢.org.uklaudilorsresponsibililies. descriptiorTr forms part of our audilorfs report. Use of our report This report is made solely to the charitable company's members, as a body, in accordance with Chapter 3 of Parl 16 of the Companies Act 2006. Our audit work has been undertaken so that we might stale lo the charitable company's members those mallers we are required lo stale lo them in an auditor's report and for no other purpose. To the fullest exlenl permilled by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company's members as a body, for our audit work, for this report, or for the opinions we have formed. This Catherine Biscoe, Senior Slalutory Auditor For and on behalf of 8uzzacoll LLP, Slalutory Auditor 130 Wood Street London EC2V 6DL Dale.. 20 June 2022 The Sl Albans Diocesan Board of Finance 26

Consolidated statement of financial activities Year lo 31 December 2021 Non- charitable trkdlng funds £'ooo Endow- ment Restricted furbds funds £'ooo £'ooo Un- restricted funds £'ooo Total 2021 £'ooo Total 2020 £'(x)o Notes Income and endowments from: Donations and legaoies Investments Trading activities Charitable activities Other sources Total income 57 318 13.023 1,594 13.080 1,912 5.444 4.493 383 25,312 13,209 2.095 5,264 5,tK)1 169 25,738 25 5.444 3,564 929 383 383 3.939 15,546 5,444 Expenditure on: Ralsing funds CharitalAe acllvilies Promotion of the work ol the Church of England in the DI0￿se of Sl Albans 147 290 3,224 3,664 2,917 2,980 3,127 15,688 15,978 18,668 22,332 19.060 21,977 Total •xpendilure 3,224 Net income lexpenditurel before investment gains and losses 380 812 14321 2,220 2,980 3,761 Realised g8in5 (losses) on disposal ol investment property and lis18d investments 1,070 188 51 1,309 11,089} Unrealised gains on investment property and lisl8d investments 4,806 1,322 734 6.862 2.010 Nèt Income before transfers and taxatlon 6,256 2,322 353 2,220 11,151 4.e82 Transfers between fund5 20 2,837 13921 374 12,819 corporation lax credit Ichargel Net Income lexpenditurel for the year 12 114 114 {5971 9,093 1,930 727 14851 11,265 5,279 Other reco9nised gains and losses.. Actuarial gains 30 11 11 18 Net movement in funds 9,104 1,930 727 14851 11,276 5,297 Fund balances brought forward at l January 2021 147,804 13,399 24,684 5.471 191,358 186,C61 Fund balances carrled forward at 31 Decernb&r 2021 156,908 15,329 25,411 4,986 202,634 191,358 All of the group's activities derived from continuing operations during the above financial period. The St Albans Diocesan Board of Finance 27

Comparative consolidated statement of financial activities Year to 31 December 2020 Non- charitable trading funds £'ooo Endow- ment funds £'ooo Re51ricled funds £'o(x) restricted funds £'ooo Note5 Total 2020 £'ooo Income and endowments from: Donations and legacies Investments Trading activities Charitable 8ctivitr.es Other sources Totsl Income 57 370 13,152 1.725 13,209 2,095 5,264 5,001 169 25,738 25 5,264 4,281 720 769 15.766 4,708 5,264 Expenditur& on.. Raising lunds Charitable ac(ivitie5 Promotion of the wod( of the Church of England in the DI0￿Se of Sl Albans Total expenditure 131 331 2,446 2,917 3,639 3,770 15,421 15,752 19,060 21.977 2,446 Net lexpenditurel Income before Investment galns 8nd103ses 191 938 14 2.818 3,761 Realised Ilossesl on dlsposal of investment property end listed inv8slmenls 16731 12241 1192) {1,0891 Unrealised gains on investment property and listed investments 1.703 201 2,010 Net income18XP8ndilurel befora transfers and taxation 1,021 915 1721 2,818 4,682 Transfers belween funds 20 5,422 12611 755 {5,9161 Gorporalion tax credit 597 597 Net Sncome lexpenditurel for the year 6,443 654 683 12,5011 5,279 other recognlsed gains and 1g$ses'. Actuarial g8in8 18 Net movernent In funds 6.461 654 683 12,5011 5.297 Fund balances brought forward at l January 2020 141,343 12,745 24,001 7,972 186,061 Fund balances carrl•d forward at 31 December 2020 147,804 13,399 24,684 5,471 191,358 All of the group's aclhjilies derived from continuing operations during the above fin8ncial period. The St Albans Diocesan Board of Finance 28

Consolidated balance sheet 31 December 2021 Non- ¢harltable tradln9 funds £'ooo Endowment fund5 £'ooo Restrlcted Unrestrlct8d funds funds £'ooo £'ooo Yotal 2021 £'ooo Total 2020 £'ooo Notes Flxed a5$ets Tangible assels Inveslrnenls 13 76.626 66.069 142.695 13.685 6,616 20,301 90.311 85,626 175,937 89.212 69.041 158,253 14 12,941 12,941 Curront assets stock.. land underdevalopxnenl Debtors- due within one year D8blors- due aft8r one year Short term d&positS Cash at bank and in hand 15 16 16 11,536 2.434 11,53S 3.344 464 12,635 1.812 29,790 11,787 1,578 2,077 20,005 2.452 37,899 42 74 794 464 4.856 1.682 7,796 6,297 1,259 223 130 14,322 6,339 1,333 CTeditors.' amounts fallirvJ due within one year Net ¢urr8nt assets 17 193BI 395 14841 7.312 13501 13,972 11.9501 27.B40 11,9581 35,941 6.161 Total as5¢ts le88 current Ilabllltle5 before elimlnatlng Inter-funfl balances Inter-fund balances Total assets less current IIHbllltles 146,866 ,473 167,329 13,336 1.993 16,329 27,613 11,70BI 26,906 13,972 18,7581 5,214 203,777 194,194 203,777 194,194 Credltors- atnounts falling due after on8 y8ar 18 14941 12281 17221 11,977) Provlslon5 for Ilabllltles Totsl net assets 19 14211 202,634 18591 191.358 156,908 15,329 25,411 4,9B6 Represented by: Thè funds of Ihe group Endowment funds Reslrlcted funds Unreslfi¢t8d fund8 NoTrch8ritable Iradlng funds 21 156,908 186,90B 15,329 28,411 4.986 202,634 147,804 13,399 24,684 5.471 191,358 22 23 15.329 25,411 23 4,986 4,986 166,908 15,329 25,411 Approved by the members of I g Board and signed on their behalf by.. in Bird hairman Approved on.. The Sl Albans Diocesan Boar of Finance Company Registration Number 00145227 (England and Wales) The Sl Albans Diocesan Board of Finance 29

Comparative consolidated balance sheet 31 December 2020 Non- charitable trading funds £'ooo Endowm8nt fund$ £'ooo ReStr￿ted funds £'OOD Unrestricted fund5 £'ooo Total 2020 £,￿0 Nol8S Flxed assets Tangible a55e*s Inveslmenis 13 76,247 52.110 128,357 12,965 5,839 18,804 89,212 69,041 158,253 14 11.092 11,092 Current assets Stock." land und&r davelormènt neblors- due within one year Debtor5- du8 aftèr one year Short term deposts Cash at bank and in hand 15 11,787 816 1.605 1.252 225 15,685 11.787 1,578 2,077 20.005 2,452 37,899 57 76 629 472 5,394 2,227 8,722 11,804 1,555 11.861 1,631 Credltors.. amounts falling due withln one year Nèt current assets 17 11781 11,683 17131 918 18041 8,118 14631 15,222 11.9581 35,941 Total assÈts le58 current liabilltles before ellminating Inter.1￿nd balance5 Inter-fund baL8nce5 Total as58ts less Current IlabSlltles 140,040 8.801 148,841 12,010 1,389 13,399 26,922 11,9151 25,007 15,222 18,2751 8,947 194,194 194,194 Creditor5.- amout)ts falling du& aftar one year 18 11781 13231 11.4761 11.9771 Provisions for Ilablllllss Total net a55els 19 18591 147,804 18591 191.358 13,399 24,684 5,471 Represented by= Thè funds of the group Endowmenl funds ReStr￿le0 funds U￿reStriCted fvnds NOn-Charitab￿ trading furHIs 21 147.804 147,804 13,399 24,684 5.471 191,358 22 13,399 23 23 24,684 5,471 5,471 147,804 13,399 24,684 The Sl Albans Diocesan Board of Finance 30

Charity balance sheet 31 DeGember 2021 Endowment Restricted Unrestricted funds funds funds £'ooo £'ooo £'ooo Total 2021 £'ooo Total 2020 £'ooo Notes Fixed assets Tangible assets Investments 13 14 76,626 67,769 144,395 13,685 6.616 20,301 90.311 87,326 177,637 89,212 70,741 159,953 12,941 12,941 Current assats Debtors- due within one year DebloT3- due after one year Shgrt term deposits Cash at bank and in hand 16 7,268 74 794 8.136 1,573 16 464 4,856 1,682 7,796 464 12,412 1,682 22.694 6,472 18,753 2,227 29,025 6,297 1,259 13,565 1,333 Creditors.. amounts falling due wilhin one year Net current aBsets 17 11781 13,387 19381 395 14B41 7,312 11.6001 21,094 {1,4951 27.530 Total assets less currènt liabilities before eliminating inter-fund balances 157,782 13,336 27,613 198,731 187.483 Inler-fund balances Total assets less currant liabilities 14531 1,993 11.5401 157,329 15,329 26,073 198,731 187.483 Credilors.. amounts falllng due 8ft9r one year 18 1494 14941 (5011 Provisions for liabilities Total net asset8 19 14211 156,908 14211 197.816 {8591 186.123 15,329 25.579 Rèpresented by.. The funds of the charity Endowment funds Restricted funds Unrestricted funds 21 22 23 156,908 156.908 15,329 25,579 197.816 147.804 13,399 24,920 186,123 15,329 25.579 25,579 156,908 15,329 Approved by the members of the Board and signed on their behaSf by.. Colin Bird Chairman Approved on.. The St ASbans Diocesan Board of Finance Company Registration Number 00145227 (England and Wales) The St Albans Diocesan Board of Finance 31

Cornparatlve charity balance sheet 31 December 2020 Endowment funds £'(x)o Restricted Unre51ricled funds funds £'ooo £'ooo Total 2020 £'ooo Note5 Flxed assets Tangible assets Investments 13 14 76,247 53,810 130,057 12,965 5,839 18,804 89,212 70,741 159,953 11,092 11,092 Curr8nt assets Deblors- due within one year Debtors- due after one year Short term deposits Cash al bank and in hand 16 16 866 6,000 11,804 76 629 472 5,394 2,227 8.722 1,573 6,472 18,753 2,227 29.025 1,555 18,672 1,631 Creditors.. amounts falling due within one year Nel current assets 17 11781 18.494 17131 918 16041 8.118 (1,4951 27,530 Total assets less current liabilities before eliminaling Inler-fund balances 148,551 12,010 26,922 187,483 Inler-fund balances Total assets less current liabilitte8 290 148,841 1,389 13,399 11,6791 25,243 187,483 Creditors.. amounts falling due aftbi one year 18 11781 1323) {5011 Provisions foi liabilities Tol81 nel assets 18591 147,804 1859) 186,123 13,399 24,920 Represented by.. The funds of the charity Endowmenl funds Reslricled funds Unrestricted funds 21 22 23 147,804 147.804 13,399 24,920 786.123 13,399 24,92CI 24,920 ff47,804 13.399 The Sl Albans Diocesan Board of Finance 32

Summary Consolidated income and expenditure account Year to 31 De￿mber 2021 This summary consolidated income and expenditure account Telales lo income funds only {i.e. excluding vemenls on endowment funds) and has been prepared to comply with the Companies Act 2006. 2021 £'ooo 2020 £'ooo Total income of continuing operations Total expenditure of continuing opemlions 24,930 122,3291 25,738 121,968) Net income for the year before transfeis, investment gains and losses and taxation 2,601 3,770 Transfer to endowment funds 12,8371 15,422) Nel lexpendilure) before investment gains and losses and taxation 12361 11,6521 Investments gains Ilossesl 2,295 11091 Taxation 114 646 Nel income {expenditurel for the year as defined by the Companies Act 2006 2,173 11,1151 Total income as defined by the Companies Act 2006 comprises £20,990k12020 - £21,030k) for unreslricled and non<haritable trading fvnds and £3,940k 12020 £4,708kl for restricted funds. A detailed analysis of inwme by source is provided in the statement of financial activities. Detailed analyses of expenditure are provided in the statement of fi'nancial activities and related notes, Net expenditure before investment gains and taxation for the year of £236k12020 - £1.652k) comprise5 net expenditure of £656k {2020 £2,329kl on unreslricled and non-charitable trading funds and net income of £420k {2020 -£677kl on restricted funds. The summary consolid2led income and expenditure account is derived from the consolidated stalemenl of fi'nancial activities on page 27 which. logetherwilh the notes to the financial statements provides full information on the movements during the year on all funds of the group. The Sl Albans Diocesan Board of Finance 33

Con501idated statement of cash flows Year to 31 December 2021 2021 2020 Notes Cash flows from operating activilies: Nel cash used in operating activities {719) 11,346) Cash flows from investing activities.. Dividends, interest and rent from investments Proceeds from the disposal of tangible fixed assets Purchase of tangible fixed assets Proceeds from the disposal of investments Purchase of investments Taxation paid Decrease in cash deposits Net cash provlded by investing actlvities 1,912 718 {1,503) 7,850 116,0481 2,094 {762) 6,840 (10,5841 {827} 5.588 2,349 7,370 299 Cash flows from financlng activities: Repayment of borrowing Net cash used In financing activities 141 14) 141 {4) Change in cash and cash equivalents In the year 14241 999 Cash and cash equivalents at 1 January 2021 Cash and cash equivalgnts at 31 December 2021 3,171 2.747 2,172 3,171 Notes to the statement of cash flows for the year to 31 December 2021. A Reconciliation of net income to net cash flow used in operating activities 2021 2020 Net Income {as per tho statement of flnancial activltiesl Adjustments for.. Depreciation charge Gains on investments Dividends, interest and rent from investments Surplus on disposal of tangible fixed assets Decrease in stocks Increase in debtors Decrease in creditors Pension adjustment Net cash used in operating activitles 11,151 4.682 68 {8,171) 11,912} 13831 252 1153} 11.1441 14271 17191 66 19221 12,0941 12,0841 (3881 1705} (1,3461 B Analysis of cash and cash equivalents 2021 2020 Cash al bank and in hand Cash held by investment managers Total cash and cash equivalènts 1.812 935 2.747 2.452 719 3,171 The Sl Albans Diocesan Board of Finance 34

Principal accounting policies 31 December 2021 Basis of accounting The principal accounting policies adopted, judgements and key sources of estimation uncertainty in the preparation of the financial statements are laid out below. In accordance with the provision of paragraph 24.7 of the SORP, a statement of financial activities for the charity alone has not been prepared. The charity had total income for the year of £20,423k {2020 - £20,890kl, total expenditure of £19.176k 12020 £19,522k} and investment gains of £8.171 k12020- £921 kl, resulting in net income of £9,418k12020- £2,289k}. Basls of preparation These financial statements have been prepared for the year lo 31 December 2021 with comparalwe information provided for the year to 31 December 2020. Critical accounting estimates and areas of judgement Preparation of the financial statements requires the members of the Board and management lo make significant judgements and estimates. The items in the financial slalemenls where these judgements and estimates have been made include.. The financial statements have been prepared under the historical cost convention with items reeognised at cost or transaction value unless otherwise stated in the relevant accounting policies below or the notes lo these financial statements. • the valuation of investment properties., The financial statements have been prepared in accordan￿ with Accounting and Reporting by Charities.. Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland IFRS102} the Financial Reporting Standard applicable in the UK and Republic of Ireland IFRS102} and the Companies Act 2006. except where the special nature of the Sl Albans Diocesan Board of Finance's operations has required adaptation of the formals as allowed by section • the useful economic life of tangible fixed assets., • the underlying assumptions in the actuarial valuations of the defined benefit schemes.. • the valuation of stock of land under development., and + The eslimalion of future income and expenditure flows for the purpose of assessing going concern (see below). 396151. Going concern The members oflhe Board have assessed whether the use of the going concem assumption is appropriate in preparing these financial statements, considering the ongoing impact of ockdown both at the lime and on a return of people lo worshipping in their local community. The members of the Board have made this assessment in respect lo a period of al least one year from the date of approval of these financial statements. The charity consts'lules a public benefit entity a$ defined by FRS102. The financial statements are presented In sterling and are rounded lo the nearest thousand pounds. Basis of consolidatlon The financial statements consolidate, on a line by line basis, the results of the charity and its wholly owned subsidiary company, St Albans Diocesan Property Company Limited, made up lo the balance sheet dale. The St Albans Diocesan Board of Finance 35

Principal accounting policles 31 December 2021 Going concern Iconlinuedl For the charity, the effects of the past two years impact ils activities both directly and indirectly. The slow return of people to their local church has resulted in a reslriclion of income for those parishes which rely on giving through 'lhe plate, or income from letlings of church property, and therefore on their ability lo pay the parish share. The charity itself faces a loss of income from its properties as well as ils listed investments as well as uncertainty over the current and future value of ils assets which have already suffered significant volalilily. Donations are recognised when the charity has confirmation of both the amount and settlement dale. In the event of donations pledged bul not received, the amount is accrued for where the receipt is considered probable. In the event that a donation is subject to conditions that require a level of performance before the charity is enlilled lo the funds, the income is deferred and not recognised until either those conditions are fully mel, or the fulfi'lmenl of those conditions is wholly within the control of the charity and it is probable that those conditions will be fulfilled in the reporting period. In accordance with the Charities SORP volunteer 'me is not recognised. steps have been taken, and will continue, to reduce expenditure. The high percentage of the Diocesan budget expended on clergy stipends and housing means that significant savings take lime lo implement. The Board has prepared and reviewed a five-year forecast which provides us with a finance strategy that underpins the Diocesan missional strategy, whilst allowing us lo control sls. Nevertheless financial recovery will lake some time. Legacies are included in the statement of financial activities when the charity is entitled to the legacy, the executors have established that there are sufficient surplus assets in the estate to pay the legacy, and any conditions attached lo the legacy are within the Control of the charity. Grants from government and other agencies have been included as income from activities in furtherance of the charity's objectives where these amount lo a contract for services, bul as donations where the money is given in response lo an appeal or with greater freedom of use, for example monies for core funding. The members of the Board have Goncluded that despite these challenges, there are no material uncertainties related lo events or conditions that may cast significant doubl on the ability of the charity to ¢onlinue as a going cOn￿M. The members of the Board are of the opinion that the charity will have sufficient resources lo meet its liabilities as they fall due. Grants receivable on confirmation by the charity that specified performance criteria have been met are aceounled for only once such criteria have been satisfied. Income Income is recognised in the period in which the charity is entitled lo receipt, the amount can be measured reliably and il is probable that the funds will be received. Income is deferred only when the charity has lo fulfil performance related conditions before becoming enlilled to it or where the donor or funder has specified that the income is lo be expended in a future accounting period. Income comprises donations and legacies, including Parish Share income, income from listed and property Iglebel investments, income directly related to charitable activities {including grants) and the surplus on disposal of tangible fixed assets. Dividends are recognised once the dividend has been declared and nolificalion has been received of the dividend due. The St Albans Diocesan Board of Finance 36

Principal accounting policies 31 December 2021 Income Iconlinuedl Interest on funds held on deposit is included when receivable and the amount can be measured reliably by the charity,. this is normally upon notification of the interest paid or payable by the bank. Grants payable a￿ Included in the statement of financial 8clivilies when approved and when committed. Comrnilmentwill usually arise when the intended recipient has either received the funds or been informed of the decision to make the donation. School major repalr and capital projects The charity receives contributions from governors of Church schools in the Diocese in connection with major repair and capital projects to Church schools and also Government grants in connection with the same. Up until 31 March 2020, the charity administered these monies as managing agent under the LcKal Co-ordinated Voluntary Aided Programme ILCVAPI and made the appropriate payments to contractors for work carried out. This Was under the LCVAP scheme where the monies did not bek>ng lo the charity and as such the re￿ip1S and payments were not treated as income or expenditure in the stslement of financial activities. Any monies held al the balall￿ sheet date were treated as creditors on the balance sheet. The funding scheme changed on 1 April 2020 to the School Condition Allocation (SCA}. Under this arrangement monies are received before it has been allocated or spent. Projects are agreed by the Diocese, under the stalulory and non-stalutory guidance provided by the Department for Education IDfEI. The change in scheme means that the Diocese has some limited discretion over the application of funds, which is sufficient to change the agency status applied under the LCVAP. From 1 April 2020 all income and expenditure under the SCA has been included in the Diocesan accounts. Monies received have lo be spent within a ￿0-year lime period or returned to the DfE. Income from each sale of land under long term land development contracts recognised on completion. Costs of each sale are apportioned based on the proportion of the land area sold. Expenditure Expenditure is included in the statement of financial activities when incurred and includes any attributable VAT which cannot be recovered. Resources expended comprise the following-. a. Expenditure on raising funds includes all expenditure associated with raising funds for the charity. This includes Investment management fees, staff costs associated with fundraising, and an allocation of support costs. b. The charitable activities comprise expenditure on the charity's primary charitable purposes as described in the members, report i.e. promoting the work of the Church in the Diocese of Sl Albans including payments of grants. The expenditure includes both costs that can be allocated directly to such activities and those indirect costs necessary to support them. Support costs aTe those costs which enable charitable activities to be carried QLJI. These costs include the expenses relating to finance, human resources, property management, communications and information technology. Where expenditure incurred relates lo more than one activity it is apportioned using the most appropriate basis. The Sl Albans Diocesan Board of Finance 37

Prlncipal accounting policies 31 December 2021 Tangible fixed assets All assets costing more than £2,000 and with an expected useful life exceeding one year are capilalised. Investments Listed investments are a form of basic financial instrument and are initially recognised al their transaction value and subsequently measured at their fair value as at the balance sheet dale using the closing quoted market priTr. Freehold land and buildings owned as al 31 December 2013 comprising parsonage houses and corporate residential properties are included in the financial slalemenls al a valuation determined by the members of the Board as al 31 De￿rnber 2013. The valuation, deemed to approximate to the value based on an existing use basis, was based on an insurance value determined by Rumball Sedgwick, Chartered Surveyors. as part of their quinquennial review. Other freehold land and buildings are included in the financial slalements at cost, or where cost is not known, al a valLJalion determined prior to 31 December 1999 by members of the Board. All of the above valuations have been deemed lo be cost under the transitional provisions of FRS102. All other tangible fixed assets are included in the fi'nancial statements al cost. The charity does not acquire put options. derivatives or other complex financial instruments. As noted in the Members. Report 211a¢hed to these financial stalemenls, one of the main forms of financial risk faced by the charity is that of volatility in equity markets and investment markets due lo wider economic conditions. the allilude of investors lo investment risk, and changes in sentiment concerning equities and within particular sectors or sub sectors. Glebe property comprising agricultural land, retail property and residential property held ft)r investment is included in the tinancial slalemenls at a valuation based on rental yield. The valuation has been determined by the members after consultation with their professional property advisers. In the case of 8 small number of residential properties subject lo long leases, rental yield corNprises ground rent only and the resultant valuation reflects this. Parsonage houses being buildings designed as, and used wholly or mainly for, private residentl81 accommodation are not depreciated. Their value and conditions are reviewed annually by the members of the Board, who are satisfied that their residual value is not materially less than their book value. Realised gains lor losses) on investment assets are calculated as the difference between disposal proceeds and their opening carrying value or their purchase value if acquired subsequent lo the first day of the financial year. Unrealised gains and losses are calcu121ed as the difference be￿een the fair value at the year end and their carrying value at that dale. Realised and unrealised investment gains lor losses) are combined in the slalemenl of financial activities and are credited {or debited) in the year in which they arise. Other freehold buildings which are used as private residential properties are not depreciated. The value and condition of the properties is reviewed annually lo ensure that their residual value is not materially less than their book value. Computer equipment is wrillen off over a period of be￿een three and six years and office equipment over a period of len years, based on cost, in order to write the cost of each asset off over its eslimaled useful life. Stock.. land under development Stock is staled al the lower of cost and nel realisable value. The cost of stock includes the initial cost of the land, preliminary costs incurred prior lo the commencement of construction and borrowing costs. The Sl Albans Diocesan Board of Finance 38

Principal accounting policies 31 De￿mber 2021 Debtors Debtors are recognised at their selllement amount, less any provision for non-recoverabilily. Prepayments are valued at the amount prepaid. They have been discounted lo the present value of the future cash receipt where such discounting is material. The non-charitable trading funds represent the retained profil arising on the charity's trading subsidiary. Flnan¢lal Instruments Apart from fixed asset investments held at fair value, the charity only has financial assets and financial liabilities of 8 kind that qualify as basi financial instruments. Basic financial instruments are initially recognised al transaction value and subsequently measured 8t amortised cost using the effective interest method. Cash at bank and in hand Cash at bank and in hand represents such accounts and instruments that are available on demand or have a maturity of less than three months from the dale of acquisition. Deposits for more than three months bul less than one year have been disclosed as short-term deposits. Pgnsion costs All members of staff and clergy are eligible lo belong to a defined benefits pension scheme administered by the Church of England Pensions Board. The charity is unable to identify ils share of the underlying assets and liabilities of the schemes on a reasonable and consistent basis. Therefore in accordance with FRS102. it has accounted for its normal contributions as if the schemes were defined contribution schemes. Normal contributions are charged lo the statement of financial activities when payable. The present value of the expected deficit recovery contributions are recognised as a liability al the balance sheet date. The amount is reviewed annually taking into account any changes lo the deficit contribution rate or the implicit rate of interest used in discounting the liability. Creditors and provisions Creditors and provisions are recognised when there is an obligation al the balance sheet dale as a result of a past event, it is probable that a transfer of economic benefit will be required in selllemenl, and the amount of the settlement can be estimated reliably. Creditors and provisions are recognised al the amount the charity anticipates it will pay to sellle the debt. They have been discounted to the present value of the future cash payment where such discounting is material. Fund structure The unreslricled funds comprise those monies which may be used towards meeting the charitable objectives of the charity and may be applied al the discretion of the members of the Board. Certain unrestricted funds have been sel aside and designated for specifi¢ purposes by the Board. Custodlan funds Funds held by the charity on behalf of parishes. Ghurch schools and other entities and over which the charity has no power lo make management decisions are classified as custodian funds and are not included in the financial stalemenls. Instead, the funds held are disclosed by way of a note to the financial slatemenls. The restricted funds are monies raised for, and their use restricted lo. a specific purpose, or donations subject to donor imposed conditions. The endowment funds comprise assets which normally must be held as capital but, where permitted. may be applied towards meeting certain charitable aims. The income therefrom may be used either in accordance with the donors, wishes, rf slipulaled, or for general purposes. The St Albans Diocesan Board of Finance 39

Notes to the financial statements 31 De￿mber 2021 1 Income from donations and legacies Restricted Unrestricted funds funds £'ooo £'ooo Total 2021 £'ooo Total 2020 £'ooo Parish Share Specific parochial donations General donations and legacies 2021 total funds 12,973 10 40 13,023 12,973 10 97 13,080 13,117 22 70 13,209 57 57 Restricted Unresliicled funds funds £'ooo £'ooo Total 2020 £'ooo Parish Share Specific parochial donations General donations and legacies 2020 total funds 13,117 22 13 13,152 13,117 22 70 13,209 57 57 In addition to the above, the Diocesan Board of Finance received as trustees contributions of £604k (2020- £208k) from the governors of Church schools in the Diocese in connection with major repair and capital projects (see note 3 below). 2 Income from inveslments Un. Restricted restrlcted funds funds £'ooo £'ooo Total 2021 £'ooo Total 2020 £'ooo Income from listed investments and interest receivable Glebe income Income from miscellaneous rents and lellings 2021 total funds 294 1,008 465 121 1,594 1,302 465 145 1,912 1,226 477 392 2,095 24 318 Un- reslrieled fLJnds £'oao Reslricled funds £'ooo Total 2020 £'ODO Income from listed investments and interest receivable Glebe income Income from miscellaneous rents and lellings 2020 lolal funds 353 873 477 375 1,725 1,226 477 392 2,095 17 370 The Sl Albans Diocesan Board of Finance 40

Notes to the financial statements 31 December 2021 3 Income from charitable activities Restricted Unrestrlcted funds funds £'ooo £'ooo Total 2021 £'ooo Total 2020 £'ooo Grants receivable Fees and chaplaincy income Schools, Service Level Agreements and Project levies Grant funding for Schools Building Projects Other income from courses and conferences Grant from Church Commissioners, Strategic Development Fund National Church allocab'ons 2021 total funds 431 258 671 689 671 81 2,286 35 473 516 117 3,104 17 81 2,286 35 250 481 3,564 250 481 4,493 271 503 5,001 929 Reslricled funds £'ooo restricted funds £'ooo Total 2020 £'ooo Grants receivable Fees and chaplaincy income Schools, Service Level Agreements and Project levies Funding frorn Schools Building other income from courses and Gonferencas Grant from Church Commissioners, Strategic Development Fund National Church allocations 2020 total funds 269 204 516 473 516 117 3,104 17 271 503 5,001 117 3,104 17 271 503 4,281 720 Grants receivable for the year which exceeded £100,000 from a single organisation were as follows.. 2021 2020 £'ooo £'ooo All Churches Trust Church Commissioners, Strategic Development Fund 178 250 168 271 The LCVAP scheme ran Ljnlil 31 March 2020. As result of the cessation of this scheme, no further monies were received as agent under this scheme in this financial year (2020 £191 k). Under the LCVAP scheme, the contributions received from school governors (see note 1 above) are used to fund contractor payments also administered by the charity acting as managing agent for the Church schools concerned. During the year, the Board made no payments to contractors12020 - £490k) under the LCVAP scheme. From 1 April 2020, the DI0￿Se administered grants under the SCA scheme, which provides the Diocese with greater discretion for allocation. As a result of this, income and expenditure for this scheme are included in these aG¢ounts. The Sl Albans Diocesan Board of Finance 41

Notes to the financial statements 31 December 2021 4 Income from other sources In 2021, the Diocese sold a parsonage house for a surplus of £383k12020- £169k income received from the Government's furlough scheme). 5 Expenditure on raising funds Non- charitable trading funds £'ooo Endowmènt Restrlctèd Unrestricted funds funds funds £'ooo £'ooo £'ooo Total 2021 £'ooo Total 2020 £'ooo Schools. Service Level Agreements Schools, Courses School Capital Projects Investment managernent Costs Trading expenditure (note 251 GlebB expenditure 2021 total funds 63 2S 14 63 25 14 221 3,224 117 3,664 55 15 22 230 2,446 149 2,917 173 3,224 117 290 147 3,224 Non- charitable trading fvnds £'ooo Un- restricted funds £'ooo Endowment funds t'ooo Restricted funds £'o Total 2020 £'ooo Schools, Service Level Agieernents Schools, Courses School Capital Projects Investment management cos15 Trading expendilure (note 251 Glebe expenditure 2020 total furids 55 15 22 39 55 15 22 230 2,446 149 2,917 182 2,446 149 331 131 2,446 The St Albans Diocesan Board of Finan￿ 42

Notes to the financial statements 31 December 2021 6 Expenditure on the promotion of the work of the Church of England in the Diocese of St Albans Year ended 31 Dec8mber 2021 Year ended 31 Decèmber 2020 Re8tricted Unrestrlcted Totsl Reslricled Unresliicted Total funds funds 2021 funds funds 2020 £'ooo È'ooo £'ooo £'ooo £'ooo £'ooo P8rochial clergy Stipends and related cosis Stipends Pension conliibulitsns National insurance Rernoval and reselllem8nl Other dergy costs 6,313 1,865 544 337 263 9,322 6,313 1.865 544 337 263 9,322 6.451 1.671 560 233 247 9,162 6,451 1,671 560 233 247 9,162 Clergy housing costs Parsonages (direct expenditure) . Allocation of support costs Sub-total Board of Finance properties {diiecl expendrturÈl 2,359 483 2.842 2,359 483 1,889 528 2.417 1,889 528 2,417 2,842 191 3,033 191 3,033 443 2,860 443 2.860 Ministry Direcl expenditure" . Allocation of 5Ltpport costs 351 1,045 S49 1,594 1,396 549 1,945 362 1,163 601 1,764 1,525 601 2,128 351 362 Education Schools Condition Alloca￿0￿ grants (r￿le 22} Direct expenditure Allocation ol sUPPtsrt costs 2,038 363 2.038 338 316 2,692 2,662 364 2,662 365 347 3,374 1251 316 291 347 2,401 3.026 348 Mission Dlrect expènditure" Allocation of support cost 46 710 316 756 316 1,072 49 650 347 997 699 347 1.(M6 46 1,026 49 Grants payable Inole 7) 182 422 604 202 290 492 Total funds 2,980 15,688 18,668 3,639 15,421 19.060 This figure includes the costs of supporting ordinands in training amounting to £696k (2020 £81 Ok}. Unrestricted fund expenditure in respecl to mission includes £250k12020 - £271 k) that has been funded by the Strategic Development Funding receivable from the Church Commissioners. Such funding has been credited to restricted funds. A transfer from restricted funds lo unreslricted funds has been made at 31 December 2021 and 2020 to reflect the utilisation of the monies for the purposes intended (note 20). The Sl Albans Diocesan Board of Finance 43

Notes to the financial statements 31 December 2021 7 Grants payable The DI0￿Se rnakes grants lo institutions in accordance with ils grant making policy set out in the members, report. A detailed list of those institutions receiving grants may be obtained on request from the Diocesan Secretary. Year ended 31 December 2021 Year ended 31 Decembei 2020 Re8trl¢ted Unrestrlcted Total Restri¢led Unreslricled Total fund5 funds 2021 funds funds 2020 £'ooo £'ooo £'ooo £'ooo £'ooo £'ooo Church Schoo15 Olh8r grants to schools 13 13 Parlshes To assist with repairs or rebuilding ￿$ts Pastoral Aid Support Grants lo assist in meeting Parish Shart contribution5 ML%sion Initiative5 92 92 13 13 222 101 222 106 200 85 2￿) 102 17 External charitles For humanitar￿n relkf mis8ion and evangelism 64 64 55 55 Clergy and cleryy wldow5 Ordinand5' SUPWrt Discretionary grants for the relief of financial hardship 68 58 68 68 42 49 44 49 Total funds 182 422 604 202 290 492 8 Support costs Unreslricled funds Total Total 2021 2020 £'ooo £'ooo Support st8ff costs Support office costs Governance costs General Synod Requirement 789 213 214 448 1,664 911 293 140 479 1,823 Reallocated to charitable activities as follows.. Clergy housing Ministry Education Mission 483 549 316 316 1.864 528 601 347 347 1.823 The St Albans Diocesan Board of Finance 44

Notes to Ihe financial statements 31 December 2021 9 Net income before investment gains and losses This is staled after charging.. Totsl 2021 £'ooo Total 2020 £'ooo Staff costs Inote 101 Auditor's remuneration Slalulory audit services Depreciation 2,418 2.452 28 66 68 10 Staff costs and employees Total 2021 £'ooo Total 2020 £'ooo Staff costs during the year were as follows.. Wages and salaries Social security costs Other pension costs 1,77S 178 465 1,835 172 445 2,418 2,452 Total 2021 £'ooo Total 2020 £'ooo staff costs per function were as follows.. Direct promotion of the work of the Church of England in the DI0￿Se of St Albans Other support staff 1,692 726 2,418 1,687 765 2,452 The average number of employees and office holders, analysed by function, was.. 2021 2021 Full-tlme Part-tlm 2020 Full-lime 2020 P8rt-time Direct promotion of the work of the Church of England in the Diocese of Sl Albans Other support slaff 21 13 34 22 20 11 31 24 26 31 The 26 (2020 - 31 } part-time posts are equivalent to 15 full-time posts {2020- 15}. The Sl Albans Diocesan Board of Finance 45

Notes to the financial statements 31 December 2021 10 Staff costs and employees (continued) The number of employees who earned over £60,000 (excluding employer's pension contributions) during the year was as follows.. 2021 2020 £60,001- £70,000 £70,001- £80,000 £80,001- £90,000 Employer contributions are also paid into a pension scheme in respecl of Ihe employees who earned over £60,000. Key management personnel remuneration (including employer's pension and national insuran contributions) totalled £552k in the year lo 31 December 2021 (2020 - £553kl including stipends and related employer's pension and national Insuran￿ contributions in respect to Board members of £199k {2020- £204k) 11 Board members, remuneration During the year no member of the Board had any beneficial interest in any contract with the groLfP or the charily12020 - none). During the year several members of the Board, who are also clergy within the Diocese, received stipends from the charity in connection with their religious and pastoral duties within the DioGese. These stipends totalled £186k (2020 £191 k) including pension contributions of £48k (2020 - £41k) to the Clergy scheme and other 8mployer costs. However, no member of the Board re￿iVed any remuneration in connection with their duties as members of the Board during the year (2020 - none). No travel expenses were incurred in the performance of their duties as Board members12020- none). Four clergy members benefited from clergy housing provided by the Board12020 - five members). The Board's insurance policy includes cover for Trustee Indemnity. 12 Taxation The St Albans Diocesan Board of Finance is a registered charity and therefore is not liable to income tax or corporation tax on income derived from its charitable activities, as il falls within the various exemptions available to registered charities. The charity's subsidiary company paid corporation tax as result of the profit on the completion of the sale of a portion of the glebe land in 2020. The corporation tax liability was reduced as the subsidiary company made a charitable donation to the charity in 2021. Further land was sold in 2021 and the subsidiary company may make a further charitable donation should sufficierit funds be available. The St Albarks Dlocesan Board of Finan￿ 46

Notes to the financial statements 31 December 2021 13 Tangible fixed assets other freehold land and Office buildings equipment £'ooo £'ooo Parsonage houses £'ooo Totsl £'ooo Group and charlty 2021 Cost or deemed cost At 1 January 2021 Additions Disposals At 31 December 2021 76.247 716 3361 76,627 13,187 771 308 16 {801 244 89,742 1,503 14161 90,829 13.958 Depreciation At 1 January 2021 Charge for year Disposals Al 31 December 2021 317 21 213 47 1801 180 530 68 338 518 Net book values At 31 December 2021 A 31 December 2020 76,627 76,247 13,620 12,870 64 95 90,311 89,212 Parsonage houses and corporate residential properties owned as at 31 De￿mber 2013 have been included in tangible fixed assets al a valuation at Ihat date. The valuation attributable to each house a5 at that date is that deemed by members of the Board of Finance to have approximated to the value calculated on the basis of existing use. In calculating this valuation, reference was made to insurance value, as delermined by Rumball Sedgwick, Chartered Surveyors, as part of their quinquennial review. The historical cost of the parsonage houses is not known as many of these assets have been given ortransferred to the DI0￿Se over a period af many years. These valuations are now regarded as the deemed cost of the properties under the transitional provisions of FRS102. Parsonage houses and corporate residential properties acquired since 1 January 2014 have been included within tangible fixed assets at their cost. The book value of other freehold land and buildings is based on cost, or where cost is not available, at a members, valuation made in prior accounting periods. Other fi'xed assets are stated at cost. The Board has opted to adopt a policy of not revaluing its tangible fixed assets as permitted on Ihe implementation of FRS102. 11 is likely that the open market values of the group's and the charity's other freehold land and building5 are materially greater than their book values. The amount of such differences cannot be ascertained without incurring significant costs, which, in the opinion of members, is not justified in temis of the benefit lo the users of the finanGial statements. In accordance with FRS102, to the extent that property is financed by Church Commissioners, equity loans for sector minislry, il is excluded from both langible fixed assets and Ihe related Creditors in the balance sheet The Sl Albans Diocesan Board of Finance 47

Notes to the financial statements 31 December 2021 14 Investments En- dowment Restrict8d fund5 fLFnds £'ooo £'ooo Un- restrlcted funds £'ooo Total 2021 £'ooo rolal 2020 £'ooo Group Glebe property Listed inveslmenls and cash 28,7B3 37,286 66,069 28,783 56,843 85,626 27,652 41,389 69,041 12,941 12,941 6,616 6,616 En- dowmenl Restricted funds funds £'ooo £'ooo Un- reslricled funds £'ooo Totsl 2020 £'ooo Group Glebe property Listed investments and cash 27,652 24,458 52.110 27,652 41,389 89,041 11,092 11,092 5,839 5,839 En- dowment Restricted funds funds £'ooo £'ooo Un- restricted funds £'ooo Total 2021 £'ooo Total 2020 £'ooo Charlty Glebe property Listed investments and cash Investment in subsidiary undertaking 28,783 37,286 1,700 67,769 28,783 56,843 1.700 87,326 27,652 41,389 1,700 70,741 12,941 6,616 12,941 6,616 En- dowmenl Reslri¢led funds funds £'ooo £'ooo Un- restricted funds £'ooo Tolal 2020 £'ooo Charity Glebe propety Listed investments and cash Investment in subsidiary undertaking 27,652 24,458 1,700 53,810 27,652 41,389 1,7DO 70,741 11,092 5,839 11,092 5,839 Movements in the group's and Gharity's inveslmenls during 2021, excluding those in subsidiary companies, were as follows.. Glebe Listed property Investments £'ooo £'ooo Total £'ooo Market value al 1 January 2021 Additions al cost Disposals al book value {proceeds.' £7,850k,' nel gains.. £1,309kl Net unrealised investment gains Market value at 31 December 2021 Cash awaiting investment 27,652 33 116) 1,114 28,783 40,671 68,323 16.015 16,048 16,525) {6,5411 5,747 6.861 55,908 84,691 935 935 56,843 85,626 28,783 The cost at 31 December 2021 of listed inveslmenls was £43,19Ok12020- £33,520k). The Sl Albans Dlocesan Board of Finance 48

Notes to the financlal statements 31 December 2021 14 Investments (continued) Glebe property Glebe property is included in the financial statements at a valuation based on rental yield. The valuation has been calculated by the Board based on informalion provided by the charity's managing land agents. The historical Gost of Ihe Glebe properties is not known. Many of the properties have been owned for a significant number of years and, in many cases, the properties were given or transferred to the Diocese for no consideration. Glebe property held at 31 December 2021 comprised Ihe following.. Group 2021 £'ooo Charlty 2021 £'ooo 2020 £'ooo 2020 £'ooo Agricultural land Residential property 23.354 5,429 28,783 22.317 5,335 27,652 23,354 5,429 28,783 22,317 5,335 27,652 Part of Glebe agricultural land, valued in the accounts at £30k at the year end, was sold for £1.1 m on 4 January 2022. Listed investments Listed investments comprise units in funds held by Schroder and Company Limited, by the Central Board of Finance of the Church of England (CBF) which are professionally manag8d on behalf of the CBF by CCLA Investment Management Limited, together with a holding in M&G Charifund, a common investment fund managed by M&G Securities Limited. At 31 December 2021, the investment portfolio for both the group and charity included the following holdings which represented a material proportion of the total value of the fixed asset investment portfolio al that date.. 2021 Percentage of portfolio 2020 Percentage of portfolio Market value £'ooo Market value £'ooo CCLA CBF Investment Fund - Income units Schroeder Global Sustainable Growth SGhroeder Fidelity Global Dividend Fund Schroeder Vanguard S&P 500 UCITS ETF Schroeder Charity Equity Fund Schroeder Real Eslale UK Property Fund Schroder Charities Property Fund Trojan Ethical Income Fund LF Majedie UK Equity Fund 34.8 19,428 4,106 3,522 3,353 2,621 2.441 2.274 1,972 1,958 19.0 7,716 2,178 3,207 2,590 2,390 2,238 2,166 838 1,332 All listed investments are held within the United Kingdom. The St Albans Diocesan Board of Finance 49

Notes to the financial statements 31 December 2021 14 Investments (continued) Investment In subsidiary company During 2014, the charity established a wholly owned subsidiary cornpany, St Albans Diocesan Property Company Limited, investing £1.7 million in the purchase of the subsidiary company's Galled up share capital of 1.700,000 ordinary shares. Further details of the subsidiary and ils trading results for the year to 31 December 2021 and financial position as at that date are given in note 25 to these financial statements. 15 Stock: land under developrnent 2021 £'ooo Group Al 1 January 2021 Development costs Borrowing costs Disposals Al 31 December 2021 2020 £'ooo 11,787 2,619 54 12,9251 11,535 11.886 2,192 25 {2,316} 11,787 Land under development relates to a parcel of land that is being developed by the charity's wholly owned trading subsidiary, Sl Albans Diocesan Property Company Limited. On 20 December 2017 St Albans Di0￿san Property Company Limited signed a Collaboration and Equalisation Agreement with the owners and co-developers ofadjacent land to its own near Houghton Regis. This agreement is pursuant to an existing Collaboration and Equalisation Agreement in place I"Heads of Agreement") with the same owners. The new agreement sets out detailed terms and Gonditions of the financial and operalional obligations of each member to the Houghton Regis Consortium which will manage the development and sales of land owned by each member of the Consortium. During the six years to 31 December 2021, professional, feasibility and borrowing costs have been incurred and have been treated as additions to the value of the land under development. The first major sale of land was made in February 2019 with further sales in 2020 and 2021. The profits on these sales have been included in the group financial statements in the year appropriate to the transactions. The Sl Albans Diocesan Board of Finance 50

Notes to the financial statements 31 December 2021 16 Debtors Group 2021 £'ooo Charity 2021 £'ooo 2020 £'ooo 2020 £'ooo Due within one year Amounts due from Parochial chU￿h Councils Building loans Parochial contribulK)ns (note lal below) 142 146 81 85 142 146 81 85 Church Commissioners- Pastoral Account {nole Ibl below) Investment income receivable Staff loans Loan lo subsidiary company (note 251 Due from subsidiary company Inote Icl below) Amount due in iespect lo sale of land Sundry debtors and prepayments 16 140 13 16 140 13 94 94 6.000 1,226 811 2,432 668 3.344 802 522 1,578 666 8,136 508 1,573 Group 2021 £'ooo ChaTIty 2021 £'ooo 2020 £'ooo 2020 £'ooo Due after one year Amounts duè from Parochial Church Councils.. Building loans Equity loans to finance the purchase of curates, houses (note Idl below) other loans Loan to subsidiary company (note 251 Amount due in respect lo sale of land 1S5 157 155 157 300 298 17 300 298 17 6.000 1,605 2,077 464 464 6,472 Notes la} The debtor for parochial contributions represents monies in respect of parish share for 2021 re￿iVed subsequent to the year-end but prior to 17 January 2022 {2020- 14 January 2021). (b) Amount due from the Church Commissioners represents proceeds from the sale of a redundant church. (c) In 2020 and 2021, the amount due from the subsidiary company includes accrued interest on the loan to the company (note 251. {dl Equity loans enable Parochial Church Councils lo purchase curates, houses. They are repayable only on the future disposal of the relevant property. The St Albans Diocesan Board of Finance 51

Notes to Ihe financial statements 31 December 2021 17 Creditors: amounts falling due within one year Group 2021 £'ooo Charity 2021 £'ooo 2020 £'ooo 2020 £'ooo Church School buildings and maintenance Grants commilled Corporation tax payable Sundry ttredilois and accruals 926 593 33 456 876 1,958 926 620 343 678 1,950 671 869 1,495 1,600 Church schools buildings and maintenance represents re￿ip1S held and allocated to a project but not yet spent. 18 Creditors: amounts falling due after more than one year Group 2021 £'ooo Charity 2021 £'ooo 2020 £'ooo 2020 £'ooo Amounts due lo the Central Board of Finance in respect of parish property loans Amounts due to the Church Commissioners Variable deposit rate and equity loans for the purchase of curates, houses Amount due lo consort(vm development partners Other creditors 401 228 90 722 316 1,476 178 1,977 401 316 90 494 178 501 The Church Commissioners, loans have no fixed dale of repayment. The equity loans bore interest at between 7.190/0 and 8.2 % during the year. 19 Provisions for liabilities 2021 £'ooo 2020 £'ooo Group and Charity Clergy pension scheme deficit contribution liability (see note 30} 421 859 The Sl Albans Diocesan Board of Finance 52

Notes to the financial statements 31 December 2021 20 Gross transf8rs between funds The inter-fund transfers during the year were as follows.. Non- charltablfy trading lunds £'ooo Endowment Restrlded lunds funds £'ooo £'DOO Cornmon other lund unrèstrlcted £'ooo £'ooo Group and charlty Net reduction In C￿rgY pension SGheme d8ficil Provi51on for p8n8ion scheme deficll on pasl setvi¢È (lay workers scheme) Net movement on parson)gÈ benefice fund in year Grants fromchurch Commissioneis, Slr31egic D￿eloPMent Fu transfèrred lo meet tnisslon 8xpenditure Transfers from operational resetve5 to covèr 2020 deficit Transfer of SADPC interest lo de5ign2tsd fund Common fund transfer to School work Reallocation of Parsonage Housè Improvements Transfer of grants paid from CCFS fund Transfer of incom8 to Glebe Endowm8nl frorn Unrestr￿ted Transfer of interest pay2b18 on loan to subsidiary company Charitablo donation frorn subs￿l￿ty company to paient charity 427 14271 110 12601 250 500 12621 15001 262 10 1461 164 46 11641 417 14171 12,4021 12,8191 2,402 2,837 13931 457 The inter-fund transfers during the previous year were as follows.. Non- charitable Endowment RÈ$trfcled Common Other fund5 funds fund ￿n￿stricted £'ooo É'o £'ooo £'ooo funds Group 8nd charity £'ooo N8t reduction in C*rgy pension scheme deficit Provlslon for pensbn s¢hema d8ficil on p85t servlc8 Ilay workers schetnel Net movement on parson8ge benefi¢0 fund in year Gra￿ts trom Church corr￿15s1on@rS. Strategic D&vtrbpment Fund transferred to mission expenditure Transfers from oporational r8seNe5 Transfers from g￿be to Gover c(mmilment5 Common fund tr8nsfer to School wotk Transfer5 of unus8d funds on patsonage houses Tonsf6r of incotnE lo G￿be Endowment frorn unr8slrKled Tr8ll5fer of Inter851 payable on loan lo subsidiary company Charitabl8 donation frotn subsidiary company lo parent charity 705 (7051 121 1181 271 13251 63 12751 262 275 10 1101 16781 89 678 1891 416 14161 15,5001 15,9161 5,500 5,422 15811 1,336 The Sl Albans Diocesan Board of Finance 53

Notes to the financial statements 31 De￿mber 2021 21 Endowment funds The capital funds of the group and the charity are endowed assets which normally must be held as capital but, where permitted, may be applied towards meeting certain charitable aims. At1 Gains, January Income and losses and 2021 Expendlture transfers £'ooo £'ooo £'ooo At31 December 2021 £'ooo Group and charity Endowment lunds stipends Capital Fund Pension reserve 22.940 18591 22,081 75,474 2,045 48,204 147,804 2,454 427 2,881 {12) 292 5,552 8,713 25.394 14211 24.973 75,845 2,334 53,756 156,908 11 11 383 13) Parsonage Houses Fund Parsonage Benefice Fund Glebe Fund 391 A11 January Income and 2020 Expenditure £'ooo £'ooo Gains, losses and transfers £'oDo At31 December 2020 £'ooo Group and ch2rity Endowment funds stipends Capital Fund Pension reserve 23,224 11,582) 21,642 75,487 2,674 41,540 141,343 12841 723 439 22,940 18591 22,081 75,474 2,045 48,204 147.804 Parsonage Houses Fund Parsonage Benefi￿ Fund Glebe Fund 113} {6291 6,660 6,470 (91 The endowment funds were established as follows.. • Parsonage Houses Fund and Parsonage Benefice Fund The Parsonage Houses Fund represents the nel book value of properties used as parsonage houses less the value of temporary finance from the Stipends Capital Fund for the replacement of parsonage houses where the sale of existing houses is pending. The Parsonage Benefice Fund represents net proceeds from disposals of parsonage houses or parsonage land which are not the subject of a Pastoral Reorganisalion. Under the Parsonage Measure 1938 (as amended by the Church Property Measure 20181, Ihese funds are required to be held by the Board on behalf of the benefice concerned. The first call on these funds is to make improvements to the urrenl parsonage house. Once these requirements are met, the remaining funds can be transferred to the Diocesan Stipends or Diocesan Pastoral Account after serving due notice on the ParoGhial Church Council and Patron. The Sl Albans Diocesan Board of Finance 54

Notes to the financial statements 31 December 2021 21 Endowment funds (oonlinued) + Parsonage Houses Fund and Parsonage Benefice Fund (continued) The parsonage house belongs to the benefice (not to the Parochial Church Council nor the DBFI and the ownership is vested in the incumbent for the time being.. During a period of vacancy in the benefice, the Diocesan Bishop has powers lo sell in accordance with the provisions of the Church Property Measure 2018. The statutory provisions relating to repairs to parsonage houses are contained in the Repair of Benefice Buildings Measure 1972. The Measure puls a statutory obligation upon the DI0￿$an Parsonage Board lor DBF Property Commiltee) to repair and insure benefice houses, thereby relieving the incumbent of this responsibility. + Glebe Fund The Glebe Fund represents the value of the Glebe Property plus net current assets of £14,650k 12019- £13,333kl. The use ofthe fund is restricted under the Endowments and Glebe Measure 1976, which transferred ownership of all Glabe land and property from the benefice to the Diocesan Board of Finance to be held by the Board exclusively for the benefit of the Diocesan Stipends Fund (see below). All income derived from this fund is included within Glebe Rents shown in the Common Fund. • Stipends Capltal Fund This fund represents net proceeds from the disposal of Glebe land subsequently invested to be held as part of the Stipends Capital Fund. Income from the fund must be applied towards the payment of stipends. The provision for the Clergy pension SGh8me deficit recovery payments forms part of this fund. The fund balance is represented by lisled investments, cash on deposit and loans to provide temporary finance to the Parsonage Houses Fund for the replacement of parsonage houses where the sale of existing houses in pending, less the provision for the deficit in the Clergy pension scheme. The St Albans Diocesan Board of Finance 55

Notes to Ihe financial statements 31 December 2021 22 Restricted funds The income funds of the group and the charity include reslricted funds comprising the following unexpended balances of donations and grants held on trusts to be applied for specific purposes.. At1 January 2021 £'ooo Gains. At31 losses and December transfers 2021 £'ooo £'ooo Group and charlty Consolidated Fund for Slalutory Education Church Commissioners, Str21egic Development Fund Committee for Social Responsibility funds Creed Fund Trust for London ICCFS) Bishop's Harvest Appeal Church Repairs Fund Parker Fund Archdeacons, DisGretionary Yapp Fund Historic Buildings Fund Ordinands, Training Fund Grimlhorpe Fund other reslricled funds Income Expenditure £'ooo £'ooo 8,789 2,728 12,501) 1,038 9.994 250 1250 670 96 675 22 355 698 529 729 174) 180 212 518 13,399 18 151 87 11 1164) 770 109 805 13 411 787 610 842 (1001 309 240 539 15,329 294 55 10 20 22 19 18 481 164) 46 90 76 1211 {17) 1352) 14} 1591 {3.1271 26 64 1,118 16 3.939 The St Albans Diocesan Board of Finance 56

Notes to the financial statements 31 December 2021 22 Restricted funds Icontinuedl At1 January 2020 £'ooo Gains, At31 losses and December transfers 2020 £'ooo £'oDo Income £'ooo Expenditure £'ooo Group and charity Consolidated Fund for Slatulory Education Church Commissioners, Strategic Development Fund Committee for Social Responsibility funds Creed Fund Trust for London ICCFSI Bishop's Harvest Appeal Church Repairs Fund Parker Fund Archdeacons, Discretionary Yapp Fund Historic Buildings Fund Ordinands, Training Fund Grimlhorpe Fund Other restTrcted fvnd5 8,567 3.614 {3.1631 12291 8,789 271 12711 629 89 553 20 326 654 503 668 1571 41 204 548 12,745 18 1171 40 670 96 675 22 355 698 529 729 1741 180 212 518 13,399 133 57 10 20 18 18 26 502 1551 {21 1181 1221 21 42 30 43 1431 13631 141 1721 (3,7701 13 4,708 29 {2841 The Consolidated Fund for Statutory Education is legally reslricted by the trusts set out in Section 17 of the Education Act 1993. Its uses include.. (i} Purchase, erection, maintenance and improvement of any school or teacher's house in the relevant area., (li) Provision of advice, guidance and resources for the rnanagemenl of schools in the area,. (iii) Inspection of relevant schools in the area. The Sl Albans Diocesan Board of Finance 57

Notes to the financial statements 31 December 2021 22 Restricted funds {continued) Movements on the Consolidated Fund for Statutory Education during the year can be summarised as follows.. 2021 £'ooo 2020 £'ooo Group and Charlty Income Donation Investrnenl income Grants received Rental income from school properties Service Level Agreement income School Courses Grant funding from SCA School Building Projects levy Total Income 192 110 24 81 35 2.246 251 107 17 79 17 3.104 38 3,614 2,728 Expenditure Education {2,561} 13.1631 Net Income before Investment galns and transfers Investment galns (losses) and transfers Net Income 167 1,038 1,205 451 12291 222 The fund is represenled by the following net assets.. 2021 £'ooo 2020 £'ooo Investments Debtors SCA Funds held ft)r future use Short term deposits Creditors.. amounts falling due within one year Inter fund balances Total nel assets 9,000 73 53 238 19731 1,603 9,994 7,632 75 442 679 {1,089) 1,050 8,789 Historically the Consolidated Fund for Stalulory Education acted as agent for school governors in relation lo school building works and the purchase of IT equipment for schools. 11 acted as the agent of school governors in helping to arrange funding Ihrough the DfE and local authorities and in paying professional fees and building costs on behalf of school governors. The SCA (Schools Condition Allocation) system ComMen￿d in April 2020. Therefore, income and expenditure was not previously reflected in the Statement of Financial Activities as the transactions were those of the school governors, and the Board acted simply as an agent or facililalor. The grant funding received has now been included in the SOFA along with the related expenditure. The unspent balan￿ is included as part of the surplus for the CFSE al the year-end. 11 has to be spent for the purposes detailed under the SCA agreement and the unspent amount at the end of the year has lo be spent by 31 March 2022 or returned to the DfE. The Sl Albans Diocesan Board of Finance 58

Notes to the financial statements 31 December 2021 22 Restricted funds {conlinuedl The specific purposes for which the other restricted funds are to be applied are as follows.. Fund Appllcationlpurpose Church Commissioners Strategic Development Fund Consolidated Fund for Slalutory Education Committee for Soci81 Responsibility Funds Grant funding received from Church Commissioners co-funding the Reaching New People project Application of nel sales proceeds of ¢losed church schools under section 17 of the Education Act 1993. Formerly held under the charity registered number 291355, grants are awarded by the Committee lor Social Responsibility, which 15 a sub-committee of the Board foT Mission and Ministry Evangelism and mission al the discretion of the Bishop For the support of parishes in the Metropolitan Police area. Monies are applied lo support specific qualifying projects where expenditure occurs irregularly. Monies raised as part of the Bishop's annual appeal Monies for the repair of churches within the Diocese Assistance to clergy as directed by the Bishop Assistance lo clergy as directed by the Archdeacons Creed FLJnd Trust for London ICCFSI Bishop's Harvest Appeal Church Repairs Fund Parkei Fund Archdeacons, Discretionary Yapp Fund Towards the Common Fund of the Board, lo support the payment of stipends This is a jointly funded project with Historic England to build the capacity of local Communities to conserve and develop the use of their church buildings. Grants are received once a year, whilst expenditure supported by those grants occurs evenly throughout the year. This fund receives block grants from the Archbishops, Council Ministry Division intended lo meet the tuition costs for Ordinands at accredited Training institutions. Grants are received termly, lo meet termly payments throughout the year. Monies applied for the repair of churches within the Archdeaconries of Hertford and Sl Albans. Sunclry specific purposès Historic Buildings Fund Ordinands, Training Fund Grimlhorpe Fund Other restricted funds The Sl Albans Diocesan Board of Finance 59

Notes to the financial statements 31 December 2021 23 Unrestricted funds The unrestricted income funds of the group and the charity, including designated funds which have been set aside by the Board for specific purposes, are as follows-. At1 January 2021 £'ooo Gains, losses and transfers £'ooo At31 Deeember 2021 £'ooo Income £'ooo Expendlture £'ooo Common Fund Other unreslricled funds Tangible fixed assets fund Property ring-fenced fund Special Designations Operational Reserve Mission Other 1,515 15,878 {15,8401 49. 1,602 13,323 6,502 2,908 1,287 450 1,171 13,323 6,945 2.978 1.320 390 1,268 443 250 157 (185) 1124} 1611 93 Pastoral Account 672 80 1211 731 23,405 85 12061 693 23,977 Unreslricled funds Elimination of Intra group profit Non-charitable trading 24,920 15,963 (16,0461 742 25,579 12361 (4171 68 417 1168} 5,471 5,444 13.1101 12,8191 4,986 30,155 20,990 119,0881 11,6fj01 30,397 This figure includes a transfer of £500k made to the Common Fund from other unrestricted funds, to cover the deficit from 2020. Subtracting this, shows that the common fund incurred a deficit of £413k for 2021. A11 January 2020 £'ooo Gains, losses and transfers £'ooo A131 December 2020 £'ooo Income £'ooo Expenditure £'ooo Common Fund Other unreslricled funds Tangible fixed asset fund Property ring-fenced fund Special Designations Operational Reserve Mission Other 2,015 16,150 115.6501 11,0001 1,515 13,323 6,064 2,164 1,027 380 757 13,323 6.502 2,g08 1,287 450 1.171 438 813 266 81 466 32 11011 161 {391 1561 28 Pastoral Account 673 (1} 672 22,224 32 11021 1,251 23,405 Unreslrirted funds Elimination of Intm group profil Non-charitable trading 2020 amounts 24,239 {2361 7,972 31,975 16,182 {4161 5,264 21,030 115,7521 251 416 15,3191 14,652} 24,920 {2361 5,471 30,155 {2,4461 118,1981 The Sl Albans Diocesan Board of Finance 60

Notes to the financlal statements 31 December 2021 23 Unrestricted funds (continued} Common Fund The Common Fund is used to fund the budget of the St Albans Diocesan Board of Finance as agreed by the Diocesan Synod. Its primary source of incomeis Ihe amounts collected from Parochial Church CounGils via the Parish Shares Scheme. The Common Fund provides the liquidity needed to operate effectively and the ability to finan￿ short-term deficits. The aim is for the fund lo be represented, in part, by a minimum cash balance sufficient to meet stipend and lay staff salary payments as they fall due. The need for such working capital is taken into account when setting the annual budget. Excess monies may be distributed to parishes via the budgetary process, but conversely any prior year deficits sustained on the Common fund may be recouped via the same process. The policy itself. and the levels of resources required, are reviewed annually. • Tangible Fixed Assets Fund This fund represents those assets held by the Board for carrying out ils general activities. Reserves are needed to provide the St Albans Diocesan Board of Finan￿ with the assets needed to carry out its objectives including statutory requirements, administration of funds and housing of non-benefsced clergy. • Special Designated Funds These are funds which the Board has set aside for specific sundry purposes falling within the normal aGlivities of the Diocese. + Pastoral Account The Diocesan Pastoral Account is held by the Board for the purposes defined in Sections 93 and 94 of the Mission and Pastoral Measure 2011. Its uses include.. (i) Expenses inGurred relating to the purposes of the measure., (ii) Grants and loans for parsonage and church provision, restoration. improvement or repair., (iiil Transfers to Ihe Di0￿san Stipends Fund., (iv) Other purposes as defined in the Measure. The St Albans Diocesan Board of Finance 61

Notes to the financial statements 31 December 2021 24 Unrealised gains The total unrealised gains as 8t 31 December 2021 constitutes a revaluation reserve and are as follows.. 2021 £'ooo 2020 £'ooo Unrealised galns on listed Investments at 31 December 2021 12,718 7,151 Reconciliation of movements in unrealised galns Unrealised gains al 1 January 2021 Less.. in respect to disposals in the ye8r Net gains arising on revaluation arising in the year Total unrealised gains at 31 December 2021 7,151 11801 5.747 12,718 7,214 (9281 865 7,151 25 St Albans Diocesan Property Company Limlted On 18 February 2014, St Albans Diocesan Property Cornpany Limited was established as a 100 % owned subsidiary of the St Albans Diocesan Board of Finan￿. Its current directors are Mr C G Bird, Mr A C Brown, The Ven D Middlebrook, Mr J W Butler and Mr C B Gage who are also members and directors of the Board of Finance and, Mr E M Wood, The Hon H T Holland-Hibbert and Mr J B Watkiss who are independent directors. Sl Albans Diocesan Property Company Limited is part ofa VAT Group registration with the St Albans Diocesan Board of Finance. On 10 April 2014, the St Albans Diocesan Board of Fin8nce transferred a parcel of its land with planning potential to Sl Albans Diocesan Property Company Limited. The land was classified initially as investment land as il was not known whether satisfactory planning permission for developmenl would be obtained. Such permission was granted in July 2015 at which point the land was reclassified as slock of land under development. As explained in note 15, the company has signed an agreement with the owners and co-developers of adjacent land to ils own near Houghton Regis and a consortium has been formed to manage the development and sales of land. Since 2019 the consortium has completed a number of significant sales of land. All sales proceeds and associated costs are included in the financial statements of the company and these cor)solidated financial statements. Tax has been calculated on the profits and is included in the financial statements. The corporation tax liability was redU￿d following a charitable donation from the subsidiary company to the charity in 2021. The charitable donation has been accounted for as a distribution in the financial statements of the property company in line with FRS102. The reduction in the tax liability has resulted in a tax credit as a result of the write-back of the tax provision for 2020. The St Albans Diocesan Board of Finance 62

Notes to the financial statements 31 December 2021 25 St Albans Diocesan Property Company Limited Icontinuedl During 2018, the company entered into an agreement for a loan of £7 million from its parent charity, repayable in two years. In 2019, £1 million of the net sales proceeds were ulilised to repay part of this loan. The loan was due to be repaid in July 2020, bul following the year-end, the St Albans Diocesan Board of Finance agreed to extend the loan facility by a further two years. Interest is payable at a commercial rate of interest which is at a lower rale than that charged by the consortium partners and therefore benefits both the company and ultimately the parent charity. A summary of the company's statement of income and retained earnings for the year and balance sheet at 31 December 2021 is given below. Audited accounts will be filed with the Registrar of Companies. The company's registered office is Holywell Lodge, 41 Holywell Hill, St Albans, Herts, AL11HE. 2021 £'ooo 2020 £'ooo Income and oxpendlture Tumover Cost of sales Operating costs Interest payable Taxation Profit for the year 5,444 13,2001 1241 14171 114 1,917 5,264 12,3541 1911 14171 597 2,999 2021 £'ooo 2020 £'ooo Balance sheet Current assets C￿dItorS.. amounts falling due wlthin one year Creditors.. amounts falling due after one year Total net assets 14,490 17,5761 12281 6,686 15,921 11,2741 17.4761 7,171 2021 £'ooo 2020 £'ooo Capital and reserves Called up share capital Profil and loss account Total shareholder's funds- equlty Interest$ 1,700 4.986 6.686 1.700 5,471 7,171 The Sl Albans Diocesan Board of Finance 63

Notes to the financial statements 31 December 2021 26 Custodian funds As at 31 December 2021 the St Albans Diocesan Board of Finance held funds on behalf of parishes, church schools and general trust funds within the Diocese with a market value of approximately £42.7m12020 - £39.5m) as Custodian Trustee. As explained under principal accounting policies, these assets are not included in Ihese financial statements. The funds are held predominantly as units in common investment funds held by the Central Board of Finance (CBF) of the Church of England and are professionally managed on behalf of the CBF by CCLA Investment Management Limited. At all times, funds held by the charity as Custodian Trustee are segregated clearly from those belonging to the charity itself. 27 Liability of company members The charity is constituted as a company limited by guarantee. In the event of the charity being wound up, company members are required lo contribute an amount not exceeding £1. 28 Related party transactions Hockerlll Education Foundation- registered charity number 311018 Four (2020 - Four) members of the Board are trustees of the Hockerill Educational Foundation. In 2021 the St Albans Diocesan Board of Finance received educational grants from Ihe Foundation tolalling £11 Ok (2020 - £107k} and £114k {2020- £92k} was spent during the year. Eastern Region Ministry Course- registered charity number 1090989 Two members 12020 - two member) of the Board are trustees of the Eastern Region Ministry Course. In 2021 the Sl Albans Diocesan Board of Finance made payments to the Ministry Course totalling £139k (2020- £117k), for academic fees for Student Readers. Associated committees Details of all associated committees can be found in the Diocesan Directory available at Ihe registered office. Donations from Board members No donations were received from Board members in the year {2020- £none}. Other than those Iransactions stated above there were no other related party transactions dur(ng the year {2020- none). 29 Connected entities The Sl Albans Diocesan Board of Education (DBE) was a Board of the St Albans Diocesan Synod up until 1 January 2022. The Board worked closely wilh the Diocesan Board of Finance to seamlessly transition to a new constitutional form following the enactment of the DBE Measure 2021. After the resolution had been passed by Diocesan Synod in October 2021 the Archbishops, Council Certificate was received, confirming the Scheme which prepared the way for the institution of the Diocesan Board of Education as a statutory committee of the Diocesan Board of Finance frorn January 2022. Key policies were reviewed and a three-year slralegic plan approved which will cover the whole of the next triennium. The Sl Albans Diocesan Board of Finan￿ 64

Notes to the financial statements 31 December 2021 29 Connected entities (continued} Whilst il has certain functions and responsibilities imposed by statute (the Diocesan Boards of Education Measure 1991 {as amended 2006)) and reports directly to the Diocesan Synod, it has no legal personality separate from Ihe DBF. A key function of the DBE is to assist in the promotion of education in the Diocese. such education being consistent with the faith and practice of the Church of England. It promotes or assists also in the promotion of religious education and religious worship in SGhools in the Diocese. Following the enactment ofThe Academies Act 2010, the DBE established The Diocese of StAlbans Educational Trust, a company limited by guarantee (Company Registration No. 08223185 (England and Walesll to assist Church of England Academy Trusts in Ihe Diocese as they seek to provide a high quality education for pupils and students in their schools. This company is a member of each of the Academy Trusts formed in the Diocese since 1 September 2012. Five of the seven directors of the company are appointed from the DBE with two non-DBE appointments. In response to the Education and Adoption Bill 2015, the Diocese of St Albans Multi Academy Trust was incorporated on 27 October 2016 as a company limited by guarantee (Company Registration No. 104493741. The five members of the Multi Academy Trust are appointed by The Diocese of St Albans Educational Trust. These members are responsible for appointing the seven directors of the ulti Academy Trust who have responsibility for its day to day management. The Multi Academy Trust has been established to provide for schools within the Diocese requiring rapid improvement having been placed in Special Measures and subject to a directive Academy Order, good or outstanding schools where no natural clusler of local Church of England provision exists, and new schools within new housing provision where the Diocese is the identified sponsor. During the year, there have Gonlinued to be a limited number of transactions between the Multi Academy Trust and the DBF in respect of a recharge of staff salaries by the DBF. The amounts involved are not material to these financial statements. 30 Penslon commitments Lay workers scheme Sl Albans DBF participates in the Defined Benefits Scheme {DBS} section of the Church Workers Pension Fund {CWPFI for lay staff. The Scheme is administered by the Church of England Pensions Board, which holds the assets of the schemes separately from those of Ihe Employer and the other participating employers. CWPF has two sections". 1. the Defined Benefits Scheme 2. the Pension Builder Scheme, which has two subsections., 8 deferred annuity section known as Pension Builder Classic, and, a cash balance section known as Pension Builder 2014. Defined Benefits Scheme The Defined Benefits Scheme ("DBS'I section of the Church Workers Pension Fund provides benefits for lay staff based on final pensionable salaries. The Sl Albans Diocesan Board of Finance 65

Notes to the financial statements 310ecember 2021 30 Pension commitments (continued) Lay workers scheme (continued) 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 Lrfe 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. They do 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 FRS102.11 is not possible to atlribule DBS assets and liabilities lo 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 (2021.. £10,200., 2020.. £10,200) There were no deficit recovery payments in 2020 or 2021. 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 Iransferred land their allocation between the sub-pools) will be settled by the Church of England Pensions Board on the advice of the Actuary. A valuation of DBS is carried out once every three years. The most recently finalised was carried OLrt as at 31 December 2019. In this valuation. Ihe 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 othetwise have been payable. The overall deficit in DBS was £11.3m The next actuarial valuation is due at 31 December 2022. Following the valuation, the Employer has entered into an agreemenl with the Church Workers Pension Fund to pay expenses of £11,200 per year. 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. Pension Builder Scheme Both sections of the Pension Builder Scheme are classed as defined benefit schemes. Pension Builder Classic provides a pension, accumulated from contributions paid and converted into a deferred annuity during employment based on terms set and reviewed by the Church of England Pensions Board from time to lime. Discretionary increases may also be added, depending on investment returns and other factors. The Sl Albans Diocesan Board of Finance 66

Notes to the financlal statements 31 December 2021 30 Pension commitments Icontinuedl Lay workers scheme (continued) Pension Builder 2014 is a cash balance scheme that provides a lump sum which members use to provide benefits 81 retirement. Pension contributions are recorded in an account for each member. Discretionary bonuses may be added before retirement, depending on investment returns and other factors. The account, plus any bonuses declared is payable, unreduced, from age 65. There is no sub-division of assets between employers in each section of the Pension Builder Scheme. A valuation of the Pension Builder Scheme is carried out once every three years. The most re￿nt valuation was carried oul as at 31 December 2019. In this valuation, the Life Risk Section was shawn 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 othe￿ise have been payable. The overall deficit in DBS was £11.3m. The next valuation is due as at 31 December 2022. For the Pension Builder Classic section, the valuation revealed a deficit of £4.8m on the ongoing assumptions used. Al the most recent annual review. the Board chose to grant a discretionary bonus of 30/0 following improvements in the funding position over 2021. There is no requirement for deficit payments at the current time. For the Pension Builder 2014 section, the valuation revealed a surplus of £5.5m on the Ongoing assumptions used. There is no requirement for deficit payments at the current time. The legal structure of the scheme is such that if another employer fails, St Albans DBF could become responsible for paying a share of the failed employer's pension liabilities. Cleryy scheme st Albans DBF participales 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 schemes separately from those of the Responsible Bodies. Each participating Responsible Body in the scheme pays contributions at a common contribution rate applied to pensionable stipends. The scheme is Gonsidered to be a multi-employer scheme as described in Section 28 of FRS102. This means it is not possible to attribute the Scheme's assets and liabilities to each specific Responsible Body, and Ihis 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 benefils and expenses accrued in that year {2021 £2,416k,' 2020 £2,421 k), including the figures highlighted in the table below as being recognised in the SOFA. A valuation oflhe SGheme is carried out once every three years. The most recent Scheme valuation completed was carried out at as 31 December 2018. The 2018 valuation revealed a deficit of£50m, based on assets of £1,818m and a funding target of £1,868m, assessed using the following assumptions.. The St Albans Diocesan Board of Finan¢e 67

Notes to the financlal statements 31 De￿mber 2021 30 Pension commitments (continued) Clergy scheme (continued) • An average discount rate of 3.2°A p.a., + RPI inflation of 3.4% p.a. land pension increases consistent with Ihisl.. • Increase in pensionable stipends of 3.4 % p.a.. and • Mortality in accordance with 950A of the S3NA_VL tables, with allowance for improvements in mortality rates in line with the CMI 2018 core projections with a long term annual rate of improvement of 1.50kn, a smoothing parameter of 7 and an inilial addition lo mortality improvements of 0.5¥.. Following the 31 December 2018 valuation, a recovery plan was put in place until 31 December 2022 and the deficit recovery contributions las a percentage of pensionable stipends) are as set out in the table below. /0 of pensionable stipends January 2018 to December 2020 11.9° January 2021 to December 2022 7.1% Deficit repair contributions As at 31 December 2019, 31 December 2020 and 31 December 2021 the deficit recovery contributions under the recovery plan in force were as set out in the above table. 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 FRS102 requires agreed deficit recovery payments to be recognised as a liability. The movement in the balance sheet liability is set out in the table below. 2021 £'ooo 2020 £'ooo Balance sheet liability at 1 January Deficit contribution paid Interest cost {recognised in SOFA) Remaining change lo the balance sheet liability. Irecognised in SOFA) Balance sheet liability at 31 December 859 14281 1,582 17181 13 1181 859 421 Comprises change in agreed deficit recovery plan and change in discount rate and assumptions between year-ends. This liability represents the present value of the deficit contributions agreed as at the accounting date and has been valued using the following assumptions. In general, these are sel by reference to the duration of the deficit recovery payments but as at 31 December 2021, under accounting rules the payments are not discounted since the remaining recovery plan is less than 12 months. No price inflation assumption is needed since pensionable stipends for the remainder of the recovery plan are already known. The St Albans Diocesan Board of Finance 68

Notes to the flnancial statements 31 December 2021 30 Pension commitments Icontinuedl Clergy scheme {continued) December 2021 De￿rnber 2020 De￿rnber 2019 Discount rate Price inflation In¢￿ase lo total pensionable payroll o.oo nla 0.2°knpa 3.10/opa 1.6 /oPa 1.1/0 pa 1.3/opa The legal structure of the scheme is such that if another Responsible Body fails, the charity could become responsible for paying a share of that Responsible Body's pension liabilities. OthersGhemes Conlribulions were also made to the Teacherfs Pension Scheme and the Hertfordshire County Council pension scheme of £3k (2020 - £3kl. The St Albans Diocesan Board of Finance 69

Reference and administrative information Board members Chairman CGBird Vice Chairman T R Fleming Other Members The Bishop of St Albans The Archdeacon of Sl Albans The Archdeacon of Bedlord The Archdeacon of Hertford The Reverend Dr G R Cappleman A Brown OBE The Reverend C E BunGe M E Butcher J W Butler N K Challis D C Clark B Crawford Dr D W Dallinger The Reverend K David P E Easterbrook Dr M Eaton K Ebbage CBGage M J Gales The Reverend Canon C E C Hudson P R Lindley E D Roberts K Smith Dr R L V Southern M P Taylor The Reverend A J Thomas Secretary to the Board DJ￿Ile Registered office Holywell Lodge 41 Holywell Hill st Albans Hertfordshire AL1 1HE Telephone Facsimile 01727 854532 01727 844469 Company registration no. 00145227 (England and Wales) Charlty registration no. 248887 The governance structure of the charity is more fully discussed on pages 19 10 21. The Sl Albans Diocesan B08rd of Finance 70

Reference and administrative information Auditor Buzzacotl LLP 130 Wood Street London EC2V 6DL Bankers Barclays Bank plc Blenheim Gate 22124 Upper Marlborough Road st Albans Herts BX3 2BB Diocesan Registrar and Solicitors Vvinckworth Sherwood LLP Minerva House 5 Monlague Close London SE19BB Legal Advisers Debenhams Otlaway Solicitor5 Ivy House 107 St Peter's Street Sl Albans Herts AL13EW Investment managers listed investments Schroder & Company Limited trading as Cazenove Capital Management 12 Moorgate London EC2R 6DA CCLA Investment Management Limited Senator House 85 Queen Victoria Street London EC4V 4ET Diocesan Surveyor Rumball Sedgwick Chartered Surveyors, Valuers and Eslate Agents 58 St Peter's Streel st Albans Herts AL1 3HG Glebe property agents Bidwells Bidwell House Trumpington Road Cambridge CB2 9LD The Sl Albans Diocesan Board of Finance 71