Re8iSt¢red number. 137029 Charity number. 249505 The Chelmsford Diocesan Board of Finance Annual report and Ilnancial statements For the year ended 31 D•cemb¢r 2021 The Chelmsford Diocesan Bo4rd of FITr￿(9 Tru5tees' Report for the year ended 31 Dec•mb•r 2021 Contents Intrcdurtion Legal objects Strategic ReFM)rt l. StrLte8ic Aims 3 2. 0tr4"ectives for the year 3 3. Ac¢Nirie5 and achievements in the year 4 4. Subsidiaries. related prties and volunteers 9 5. Hanning for 2022 10 6. Flnancial revlew I I 7. Custodian trustee 14 8. Prlnclpal rlsks and uncertainties 14 Struccure and Governance Trustees Responsibilities Administrative details 24 25 Independent auditor's report Sr2tement of financial activities 27 30 Summary income and expenditure account Balan￿ sheet 32 Sratrment of cash flov 33 Notes to the finanaal statements 34 Page I The Chelmsford Diocesan Board of Financ• Trustees, Report for th• yèar éndéd 31 December 2021 Registered number: 137029 INTRODUCTION The Trustees, who are also Directors for the purwses of company law, present their annu￿ repor¢ together with the audited financial statements, for the year ended 31 December 2021. The Direttorsrrrustees are one and the same and in Sibming as Trustees they are also signing the strategic report settions in their capacity as Director5. This combined report satisfies the legal requirements for. a Direccors. Report of a charitable company. a Strawc Report under the Companles Att 2006 and a Truttees, Annual Report under the Chariries Act 2011. Legal Objects The objects of rhe Diocese of Chelmsford cover the county of Es5eK the unitsry authoritie5 of Southend and Thurrock the five East London boroughs of Newham, Waltham Fore5¢ Barking & Dagenham. Redbridge. and Haverin& and a fthy parishes in South Cambridgeshire. The Chelmsford Diocesan Board of Finance's f'CDBn principal oblett is to promot< assist and adrdnce the work of the Church of England in the Diocese of Chdmsford by atting as the financial exeojtive of the Chelmsford Diocesan SyrKJd. The CDBF has the followng statutory respon5ibilitie* the managanent of glebe propercy and investments to genernte income to support the cost of StI￿d$ arising from the Endowment and Glebe Measure 1976; the repair of benefi￿ houses as the Diotesan Parsonage P*)ard under the Repair of Benefice Buiklings Measure 19TI' the management of investments and the custodianship of assets relating to church schools under the Di¢xesan Board of Education Measure 1991: iv} the CuS￿lianshiP of permanent endowment and real property assets relatingto trusts held by Ir￿urnbents and Archdeacons and ty Parochial Church Councils as Diocesan Authority under the Incumbenrs awj Churchvnrkns ffrusts) Measure 1964 and rhe Parochial Church Councils (P￿ErS) Measure 19S6. The strategic priorities of the company are estsblished by the Diocesan Synod on the advi￿ of the Bistrw's Council in communicauon with Deanery Synods, hrothial Church Councils (PCC5), and the Bishop of Chelmsford (in ￿sPecC of their resF)onsibility for the provision of the cure of souls). To this end, significant time and effort is committed to communication be￿￿n and with these bodie5. as well as with the Church nationally. Includlng dlscusslons on strat4K priorities and budgets. The Chelmsford Diocesan Board of Finance Trustees, Report for the year ended 31 December 2021 Strategic Report Strntegit Aims The Chelmsford Diocese Board of Finan￿ (CDBF) 15 responsible for the custody and management of diocesan finances and the employment of CDBF Staff. The CDBF'S purpose is t£J provide appropriate personnel and financial resources to assist the Diocesan Synod, Bishop's Council. deaneries and parishes to hjrther the mission and strategic priorltles in the Diocese. In November 2012 the Diocesan Synod agreed Tronsfvmiing Presen￿.. strategic priorities to 2025. In November 2015 the Diocesan Synod reaffirmed the diocesan mission statemenc "to be a Transforming Presen￿ in eyery communiry" and the four Strategic priorities: inhabiting the V￿r1d distinctively evangelising effectively serving WTth accountability r￿lmagInIng ministry. The Trarfomiing Presence scracegic priorities were reaffirmed and UPda￿d during 2018 and 2019 to expliclt include three particular priorities: The formation of 10 I new Christian Communities in the next 10 years. This Church Planing priority has been significantly enhanced through support from the Church Commissioner's Strdtegic Development Fund ISDF). The development of our VKJrk swth and for children. young people and tsmilies. Nationally this agenda is known a5 Growing Foith. A financial initiative under the title of Subsidy to Sustthnabilty to address the growing general fund deficiL These strategic aims and prior￿e$ remained in place in 2021. At the sxme time. our new Diocesan Bish¢¥ started a discernment Pro￿55 for the Diocese which will cor)unue throughout 2022. This will inevitably lead to a review of Transforming Presence. parriculady the more operational aspects. It is hoped that the diocese will be able w build on vknar has worked well and supportoj thc>se who serve in local parishes and worshipping communicies. 2. Objectives for the year In response to the strategic priorities the specifK objettives for the year have included the followins Continuing to support parish ministry through paying the costs of stipends and housing costs for clergy serning in the Di¢xese Resourcing mission and ministry in parishes and worshipping communities Continued implementation of the Finance Attion Plan.. identifying new income streams and adopting total return accounting to reduce the deficrt and increase funding awdilable to support local parish ministry Developing a new long term approach to Parish Share in order to encourage greater mutual support between parishes and increase funds to supp)rt local parish minis¢ry Supporting mission and ministry in pari5he5 arbd worshipping communities Reform of minis*rial development and training to support local ordained and lay ministry Brinyng together our Area youth ministry advisers ints) a single'mustard Seed Team. to strengchen support for local youth ministry Strengthening the projea management ol our SDF-funded Church Plants The Cholmsford DI0￿4￿ Board ol Flnance T￿Stee$, Report fr•r the y¢•r ended 31 D*￿mber 2021 2. Objectlv•$ for the yev (contlnued) Increasing focus of Diocesan sery1￿s on local parish SUPFQrt induding Safeguarding* Parish finance, communlcatlons and propercy Continuing to supFK)rt parishes dealing with the impact of the COVID-19 pandemic on local communicies and churches Continuing proye5s in social u7nsformation including our initiatives with Citizens UK and work with refugees and the work of the Raoal Justice Task and Finish Group Expanding our engagement with the 5th Mark of Mission and environmental issues following the General Synod resolution in February 2020 for carbon neutrality by 2030. The main objectilt for the CDBF is to resource diocesan need5 a5 determined ty Synod and infomed by local and national Church in5titution& and to discharge its sratutory function5. Through carrying out these obl￿tiVeS and in promoung the whole mission ofthe Church (pastornl, evangelisuc. social and ecumenical) the trustees are confident (havin8 had regard to Chariry Commission guidance) that CDBF delivers public benefii through community engagemen¢ resourcing edu(ation and 5LFrx)rting those in need both spiritually and physic211y. 3. Artlvities and achievements in the year Context 2021 was a year of slgnlficant challenge, particularly as continued to respond to the COVID-19 Pandemlc and its impacc on our communities and churches. It vras also a year of signif1¢2nt change in senior personnd. COVID19 we entered 2021. the county remained in lockdown and Essex and Easc London wve expEriencin8 some of the y￿r$t hoswalisation and fatality fdte5 in the counu7. The pandemic and its impaa on parishes 2nd the communiues we serve shaped 2021 and will continue to shape the life of our di¢xese for years to ccffne. Throughout the year our churthes continued to resFt*nd in remarkable ways. Despite the closure of chwch buildings during the early F41rt of 2021. many continued to offer online vrtjrship and increased their community engagement especkdlty among the elderly and vulnÈr&bte. Not every church had the capacty to provlde onllne v￿rShiP bjt were able to ptsint to C>ther provision, such as the national Daity Hope phone line, the weekly reflections and wdeo sermons or the daily Y￿rShIP streamed by Chelmsford Cathedrnl. Many parishes have experienced signrficant loss of income which has h￿1118hted the vulnernbilKy of some funding streams. Those FArishes where most w￿rShIpperS @ve by standing order or direct debit have been affected to a much lesser extent Those Fwishe5 that rely on cash offerings, fundraising or on income from hall letting5 and events have been hardest hic We are hugely grateful to those parishes who have done their best to maintain their payment of yrish share, induding those who have drawn on reserves. Transitions in personnel 2021 was a year of significant change in s￿￿)r personnel. The Rt Revd Dr Gull Francis-Dehqani started her minlstry as Blshop of Chelmsford on 19 Awil 2021 and was seated at Chelmsford Cathedrdl on 4 Sep￿rnber 2021. The Rt Revd Pew Hill retired as Bishop of Barking in August 2021. &'$hop Peter had also served as Ac(ing Diocesan Bishop befrlre Bishop Gull's arri￿. In November 2021 it vns announced that the Lynne Cullens would become the new Bishop of Barking having previously served as Rector of Stockport and BrInnIng￿ tn the DIOC￿ of Chester. Thè Chelmsford Di4)cesan Board of Finance Trustees. Report for the year ended 31 December 2021 3. Activities and achievements in the year (continued) The Venernble Mike Lodge, Archdeacon of Southend, retired from full time mlnlstry and the Revd Canon Mike Power Eecame Acting Archdeacon of Southend. Michaela Southworth became Chief Executive and Diocesan Secretary, vacating the role of Director of Financ< in which role she replaced by Emma Butler. The Revd Canon Dr Roger Matthews who had most recently Served as Acting Chief Executive and Diocesan Secretary. having previously served as Dean of Mission. Ministry and Educ2ti0n retired. as did Maureen Cole who had served as Interim Chief Operating Officer siKe Summer 2020. The Revd Rob Merchant was appointd as the new Dean of Mission, Ministry and Educauon, arriving from his previous role as Direttor of Sc Mellitus College, Chelmsford. The Diocesan Chancellor, the Worshipful George Pulman QC. sadly died after many years of service to the Diocese. The Deputy Chancellor, Philippa Hopkn"ns QC has subsequendy fulfilled the role and her permanent appointment as Chancellor has been announced Resourcing mission and ministry in parishes and worshipping communities The COVID-19 pandemic compounded the financial challenges already being faced by the diocese and 2021 saw some significant achievements in addressing those challenges as we strive to build solid foundations to fund parish mission and ministry for the future. l. The Pinance Action plan developed in 2020. continues to be implemented. The five tomponents of the plan are.. Strengthen reserves b. Increase revenue Reduce costs d. Improve the cash posrrion Capacity to deliver the pian I To SUPFK)rt liquidty, contSnued to drdw on support from the Archbishop's Councll- Including a grant of £ I million to compensate COVID losses. This wa5 additional to the £ I million grant we gratefully re￿Ned in 2020. 3. We adopted a Toral Return Accounting Policy which has allowed Endowmient funds to provide increased support towards stipend costs compared to the previou5 policy of utilising income only. See notr 27 on page 64. 4. Long term plans to reduce the totsl number of stipendiary cler8y. vthich V￿re accelerated as a consequence of the COVID-19 pandemic. continued to be implemented. This has been difficult and palnful but has served to bring us to where we are today and hope and pray that it will all¢)W US to move forward. living wthin our means and providing a foundation on which to build a Ilourishing mission and ministry. There are Still painful consequences that we must INe with and there will still be difficult decisions ahead. Where that is the case. parishes will be more involved in discussion and discernment about how we can best deploy ministry acros5 the communities we Serve. 5. We have only replaced staff who have left when essential and. in some cases. have recruited part-time replacements. The Cholmsford Diocesan Board of Finance Trustses, Report for the year ended 31 December 2021 3. Artivltles and achievemants in tho year {contlnued) 6. A consulration was launched in the Autumn to help us develop a long tem approach to Parish Share. 522 people from 299 parishes participated in the consultation that we hope will resuk in a share scheme that encourage5 greater mutual sUPPOrt between pArishes and reduces shordall in parish share contribution. 7. The Generous God, Generous Disciples stewardship resourc@ launched in Advent 2020 continued into 2021 aimed at equippin8 parishes to teach about generosity and to provide skills and resour￿$ to help encourage and enable &'ving. Supporting mission and ministry in parishes and worshlpplng communltles Support for clergy and lay ministers Mission and Ministry Units conunue to be a valued means of enabling minisu7. The Synod motion of all parishes to ￿ in an MMU by the end of 2021 has not been met in part due to the continued impact of the COVID-19 pandemic. Ordination of 26 new deacons (stlpendlary and non-stipendiaryl Authorisation & Licensing of 6 new ￿censed Lay Ministers (LLMSS). 65 people graduated from the Course in Christian Studies (CCS) in July 8 pwple receiving attendan￿ ￿￿ticateS. In 202165 people scarted CCS a numbw of courses have returned to being in person while some have remained online via Zoom Support for children¥ young people and famllles ministry 2021 has been a year of embedding the Mustard Seed Team model of worklng across the diocese sypporung d)ildren. Fafflilie5 and youth ministry. The Musrard Seed Team brings together the Area Youth and Children's Advisers into a single Dictesan Team focused on providing diocese wide ministry v¥hilst retainin8 supporc to individual episcopal area& Young people cononue to be served and suppor¢&4 through the Living Way. Youth Synod and Growing Young Leaders course. Training for lay people and clergy has been delivered by manna ministry tAinin& work with Mission and Ministry and more informal parish and deanery events. One focus of work in 2021 ha5 been to evalurt update and streamline the soclal medla and content on the diocesan websi* pages. Desptte the challenges of staff changes and the pandemic. the team have been able to meet together regularly ¢)nline and t£J offer rec￿(& training and 1-2-1 meetings online arKI in ￿r$on. The Mustard Seed Team have Y￿rked well to offer a(fvice and support across the dlocese but have identified the need for another member of the team to be at full capaaty. Support for New Christian Communltles Improved stronger governance and eydluation of our SDF church plants In parthershlp the Strntegic Development Unit now in place. continu￿ developrnent of the Sthool for Church Planting Successful application for £2.9m of funding ro rwource a third wave of planring in the Deanery of .NewhanL Tracking of lessons learned to feed back into fijture projert5 and wder across the di0￿e. Exploring what sustainabiliry looks like for New Christian Communities post SDF fur￿ing Many projects hive taken advantage of the offer of efftnded funding periods offered by Strntegie development Untt due to covid. The Chelmsford Dio¢￿￿￿ Board ol Finance Trustees, Report fr*r the year ended 31 December 2021 3. Activities and achievement5 in the year (continued) Schools Schools cononued to manage Si￿lficant disruprion through the ongoing Covid-19 pandemiG this included rnpid roll ouc of remote education, srrategies to support recovery to pupils learning and management of high levels of soff and puFNI absence. Take up of the Partnership Agreement amng Churth Schools remains high with 92% of schcrt for land and propery related issues and transacdons. New landlord gas safety contrac¢ mobilised successfully More than 30 elettrical upgrades completrd 68 periodic inspections were completed and 46 prOF)￿tieS had planned external rnaintenar 18 house sales completed generating over £5M of capital £no.000 of revenue generated through rentsl of SO+ properties during InterrWu￿ 5 refugee families housed SuP￿rt for V￿rk •where church bulldings are closlng and management of the pro￿$ to reath a decision on the fiJture of St Marks College- Audley End Communications The Diocesan Comrnunicauons Group contlnued to support parlshes V*lth advice and widance as they adaF£ed to the challenges p¢)5ed by the COVID-19 Pand￿1C in the early part of 2021 Communications ehanne15 that were established to support parishes during the p4ndemic were developed for the longer ￿rrn to wovide church leaders with news. inf0m￿tIOn and actess to resources to support parishes ministy. The wee￿Y 'The View. newsletter, Introdu￿ in 2020. ci)ntinued to be sent to all cfergy. chureh￿drden￿ Licensed Lay Minis*r& Deanery Lay Chairs and Members of Diocesan Synod. Rqular briefin85 online uskng channels such as Zoom helped to equip parlshes for Mission and Minlstry Includl The Generous God Generou5 Disciple5 Stewardship Resources. Online Church - to SUPFKJrt parishes in their use of digital technology. Leading your Church intD Growth, supporting and working with the e￿rnal Leading your Churth into Grovrth Team. The Communications Team helped to facilitate and encourage engd8ement bevween parishes across the diocese through: Meet and Greet meetings for the new Di¢xesan Bishop The Parish Share consulration A Livlng In Love and Faith intr¢)ductory day The Chelmsford Dlocesan Board of Finance Trustees, Report lor the year ended 31 December 2021 3. Artivities and achievements in the year (continued) The Communications Team created and provided re50urce5 to support parish ministry including the weekly sermon videos and transcripts and the WePrny Diocesan prayer diary. The tram also helped parishes and church leaders who found themselves at the centre of difficult Situations where media or social media response vrds required as well as helping to promote good news stories from across the diocese. The tsam a150 SUPPOrted the work of the diocesan bishop and leadership through media and digital communications. Social justice and environmental The Racial justi￿ Task and Finish Group, established in October 1020, brought its final report to the November 2021 meetin8 of Diocesan Synod where it was approved. The repor4 From Action to Real Change, includes a series of recommendations in I l area5 which will now be implemenced. They are the recruitment of a racial justice officer- a new proces5 for the handling of accusaiions and complaints. the establishment of a raaal justice advi50ry panel,. addressing systemic issue5: training: educauon: using statistics.. communicauon,. advocacy beyond the church. lrfe after the Committee for Minority Ethnic Anglican Concerns, and Monuments. memorials and other artefact5 connected to slavery. Continued engagement on refugee matter5 at local and national level and partnerships with Citizens UK forming across the Diocese. Renewed frKus on rhe 5th Mark of Mission and a Chriscban resw)nse to the clima￿ Crisis through a range of initiative5 including participation in national events. development of a rule of support of parishes aiming for Eco church status, working with Church Schools and management of our buildings in a way that is more Ènvironmentally sustainable. With the Bishop of Chelmsford also taking responsibility as the Church of England's Lead Bishop for Housin& the Diocese bwn to consider its ovm response to the housing crisis and the significant impatt of a lack of affordable housing on the comrnunitses we serne. 4. Subsidiaries, relatsd parties and volunteers Subsidiary Undertaking The CDBF has two trading subsidiaries, SFArrows Trading Company Limited (Sparr¢)ws), vthich provided high-quality childcare wth Christian di5tinctNene55 Within the Diocese of Chelmsford until the provisions closed in the summer of 2020, and Chelmsford Diocesan Trading Company Limited {donnant). Both subsidiaries Y￿e dissolved in 2021 (see note 5 to the finan¢ial sratements). Other relatèd parties Include: The Archbi5hop5' Council to which the CDBF pays a donation based on an apFK)rtionment system for funding national training of ordinands and the attivities of the wdrious national boards and councils. as Y￿11 as General Syno(5 The Church Commissioners which acts on Eehalfofclergy with HM Revenue and Customs. The CDBF pays for clergy 5tipend5 through the Church Cornrni55ioner5 The CDBF is in receipt of grant funding from the Church Commissioners (via the Archbishops. Council) for ministry support and special projects e& the Turnaround and Church Planting projec¢s The Church of England Pensions Board, to which the CDBF pays retirement benefit contributions for stipendiary clergy and employee5. It a150 offers schemes to provide housing for clergy in retirement The Vine Schools Trusts, and the Chelmsford Diocesan Educational Trus¢ which while separate and independent of the CDBF, have certain responsibilitie5 in relation to church schools in the diocese and y￿rk with the DBE The Chelmsford Dioc•5an Board of Financ• Trustees, Réport for th• y•ar •nd•d 31 DÉcèmber 2021 4. Subsldlarles, relatéd partles and volunt••rs (continued) The Guy Harlings Trus¢ which provides office facilities free of charge under licence to the CDBF and the Cathedrdl Dean and Chapter and makes grnnts toyftrds the upkeep of the premises The PCCS within the diocese Sc Mellitus College TrusL a Theological Education Institution which receives financial support from the CDBF arKI to which the CDBF pays fees for training of ordinands. Transaction5 with the main categories of related parties are identified in appropriate places throughout the financiai Statements and in particular note 24 to the financial sratements. Volunteers CDBF is dependert on the huge number of people involved in church artivitie$ both locally and ae diocesan level. The number of active volunteers (or volunteer hours) given to the mission and ministry of the Church is an indicator of the health of a Church. The Servi￿ provided to a community through church volunteering also has a significant impart on people's relationship th the Church particularly at times of crisis. Within this contexo the CDBF greatty values the considerable time given by committee members and other voluntews across the diottse in pursuit of the missi(￿ of the CDBF. We partycularly thank them for the additional suppc they have given during this challen&"ng year. There are many peoFle who are unpaid but who hold official positions wrthin the lrfe of the church that ca authorisation, licence. or Pemiission to Officia￿, This includes Churchwarden& who serve each Ioc21 parish church. localty authorised preathers. pastoral carer& erangeli5ts, armj funerdl mini5ter& plus LI￿nSed Lay Ministers and Reader5 and our self_supporting ordained ministers. 5. Planning for 2022 As the CDBF approached 2022 the Di¢xese was at a liminal time; re5pondin8 to the continued impact ofthe COVID 19 Pandanic, continuing to address financial challenges wth a new Diocesan Bishop in p)st and significant change5 in senior leadwship rol This shaped the approach to P￿nnIng for 2022. Discernment about the futurè In late 2021, the Bishop of Chelmsford wrots to church leaders inviting them to join her in a period of discernmenL Starting by refiecting on vthat we have Ilved through #s thurches and communities in the last years and to dI￿eMIng what God is t211ing u5 towards in the fucure. Plans were put in Pla￿ to bring church leaders together during Lent in 2022 for prayer, rellection and discussion. wth resources provided to help leaders engage others In their parishes and worshipFNng comrnunities. It is likdy that this period of discernment ￿11 I￿ to review change to some of our lon8 tenn strategic prioritie5. Re￿UrC1Th¥ mission and ministry in parishes and worshipping communities At the same tsme. building a 5UStwnable financial base for mission and rnini5try in our parishes and worshippw communicies remains a top priority and 2022 will see the development of a new parish share scheme for 2023. based on the extensive consultation work that stsrted in Autumn 2021. For 20221 plans were in place to consult on a de￿Ied proposal Deanerie5 and Di¢xe5an Synod before developing a final share proposal for thejune 2022 Diocesan Synod to consider. The aim of the new share scheme is to increase mutual sUP￿rt betr￿en parishes and to reduce the overnll shortlall which has had a significanc impaa on the capacty of the CDBF to fund local parish ministry. Other financlal planning was undertaken to SUPFKJrt the implementation of the Finance knion plan, launched in 2020. to: Strengthen reser¥es b. Increase revenue Redutt costs d. Improve the cash position CapaLlty to deliver the plan Pag8 10 The Chelmsford Diocesan Board of Finance Trustees. Report for the year ended 31 December 2021 5. Planning for 2022 (continued) ans focused on: Continuing to utilise Total Return Accounting to inCre￿e the amount of invesoi)ene return that can be withdrawn from the Stipends Endowment Fund. This has allowed Endowment funds to provide increased support towards stipend costs than under the previous p)licy of utilising income only. See note 27 on page 64. Continuing ro identify additional funding streams Scrutinising our property portfolio to identify opportunities to improve our financial posityon (whilst continuing to prioritise harnessing our properties for mission and ministry Continuing to idenrify opportunities to reduce expenditure Supporting mission and ministry in parishes and worshipping communitie5 As well as f¢xusing on resourcing mission and ministry in parishes and worshipping communities. 2022 planning focused on how the CDBF can sUPPOrt mission and ministry. In parricular. Support for clergy and ministerial wellbeing with plans for a member of Mission and Ministry to focus on this issue and the devdopment and implementation of the clergy covenan¢ A renewed focu5 in the Diocesan Office of departments pro￿ding good value services to parishes. As we approached 2021 there V￿re also a number of significant events and activities that shaped planning. During 2022: The Diocese will begin to implement proposa15 of the Racial Justice Task and Finish Group The nauonal Past Cases Review 2 safeguarding report will be published alongside an executive summary of the Chelmsford Diocese review and other Diocesan Reviews The Diocese will continue to imple￿nt its ptan to achieve carbon net zero across our churches and schools as part of the Church of Engknnd commitment to be net zero by 2030. The inirial findings of the Church of England's 'Living in Love and Faith. will be published. 6. Financial r•vi¢w Flnanclal Performance Against a budget deficit of £3.5m, the CDBF recorded a 5urplu5 of £1.9m for the year on its unrestricced funds before gains on revaluations of fixed asset& The improved performance malnly arose because of the adoption of Total Rewrn Accounting (see note 27 on page 64) which enabled a transfer of £3.Om from endowment to unrestrictsd funds to SUPF. £18.2ml and afw these adjustments the net increase in all funds amounted to £31.2m (2020.. £17.9m}- Gains (or losses} are dependent on market volatility and the majority of the gains. of £25.4m. (2020.. £15.7ml are ascribed to Endowmenc Funds and are therefore not available to spend. The overall financial result for 2021 15 encouragin& however some of the improvements in performantt. such as the Archbishop's Council COVID losses grdnE are not expected to repeat in future years. Net Cash inflow of £0.6m {202￿. £4.4m) arose as net proceeds from the sale of investmerts and fixed assets Wa5 used co purchase f￿ed asset investments and re￿Y existing loan& CDBF continued to benefit from ￿h¢ financial control whrch we wll conrinue in 2021 Signffjcant Property Trnnsactions The Asset Inve5tmen¢ and Management Pollcy adopted by the Trustees governs the managem4rt of operational and investment property. This Policy was updated in 1017 and approved in its updated form by the Trustees. The vast majority of the residential property FQrtfolio is held for operational purpose5. It is managed to achEve required qualiry standards at a Consis￿nt and efficient average annual eost ol ownership. Significant operdtional property transactyons in the year comprised: Purchase of two properties for housing stipendiary ecdesiasti(al Offi￿ holders Sale of eightren properties surplus to operational requirements Sale of one glebe land Iv)Idin& Glebe land and pmpery is held for Investment wrpose& The overall strategy is to retaln a Land holdi￿ tr> seek to leverage value through long term developmenL and to dispose of less lucrative holdings and dire exposure co commercial property. During the year the CDBF agreed the sale of one land holding providwig £0. I m of addiuonal Inve5tmurt fund5 on completion. The usual eycle of rent reviews and lease renewals on glebe land continued as advised ty the CDBF'S land agenrs. The Diocesan Stipends Capital Fund 15 available for providing and improving benefi￿ and glebe propwry and when invested provides Income and caplral growch for clergy stipends under the Total Retum Pollcy (see note 27 on page 64). Residential properties are valued on the basis of a certified annual Val￿tiOn. Balance Shèét Positlon The Trustees consider that the ￿lance sheet together with detai15 in I￿re 18 show broadty that the restricted and endowment fund5 are held in an approw&te mix of investment and current assets griven the purposes ft>r which the funds are heid. While the nec assets at the balance 5heec date totalled £356.5m (2020: £325.3rn) it must be remern￿red that included in this total are properties, mosdy In use as clew housin& whose N7lue amountrd co £288Am (2020: £275.4m). Much of the remainder of the a55ets shown in the bafance sheee are held in restricted funds, and cannot necessarity be used for the general purposes of the CDBF. R•serves Policy Having considered financial risl liquidity requirement and the tlming of cashfl¢)WS throughout the year. and based on the Charity Commission recommendation, the Tru5tee5 consider that an appropriate level of free geneAI reserves is three monthsgross senerdl fund expenditure, currently £4.7 This wlicywas last wevRd and a8reed by the Trustees in May 2020. The Finance Execuuve is charged with oversight over the rese￿eS policy and wtth improving the free general reserves to meet the increased policy requirement Pag• 12 ThÈ Chélmsford Diocèsan Board of Financ• T￿stee5, Report for the year ended 31 De¢omb¢r 2021 6. Financial review (continued) After trnnsfers, free genernl reserves at the yearond were in surplus by £4.6m (2021>. surplus £ l.Om) b￿n8 the Yalue of the General Fund excluding fixed assets. The Trustees previousty recorded that free general ￿serveS would fall if parish share shortfall did nor materially improve. The adoption of a Total Return Accounting Policy together with the other circumstances described in the Financial Performance 5ettion above, have significantly improved the level of free general reserves. The Trustees consider that the CDBF has sufficient resources to meet Irs day-to-day operatlonal needs despite the level of free reseryes falling below the poliq. Designated funds The Trusrees may designatr add￿lOnal unresrric¢ed reserves to be retained for an agreed purFose where this is considered to be prudenc Such designated reserves are reviewed on an annual basis and returned to the general fund in the evert that the purpose of their designation is no longer considered to be adequate justification for their retention. A description of each reserve together wtth the intended use of the reserve Is set out in note 18. At 31 December 2021 total designated reserves were £28.4m (2020.. £25.9m). The Trustees approved the release of amounts from one designated fund into the general unrestricted fiJnd during the year. £0.77m was transferred Irom the Mission Opportunities fund. Restr5cted and endowment funds As set out in notes 18 and 26. CDBF holds and administers a large number ot restricted and endowment fund* As at 31 December 2021 reStriC￿d funds totalled £10.3m Q020.. £8.9m) and endowment funds totalled £313.1 m (2020.. £288.4m). Neither are available for the generdl purposes of the CDBF. Liquidity Policy The CDBF has regular and predictable cash inflows {prinCi￿lIY from parish share) and outhows {principlly Stipend, salary ané pension payments). Less frequent cash m¢)vements include grant payrn￿ts. which are also predictable. The largest cash movements relats to property transactions which are infrequent and normally have a clear lead time. The CDBF aims to hold £2m cash in instant acces5 accounts to meet its cash needs. Where cash balances fall below £1.2m or ex￿ed £3.5m, the Executive will review the position and consider large forecax cash movements such as housing transactions, then r2ke action as required, for example drawing down or adding to investments, a proporuon of which are kew in near liquid holdings such as pooled funds ￿th dealin& with such transactions reported to FinaTr￿ Executive. Grant making policy Contributions are made to the Nacional Church to cover a proportion of its centrnl costs and also to cover the cost of training for ministry (see note 9). Grants are paid to other charities e.g. PCCS and charitable projects which appear to CDBF ro support the furtherance of its objects. The General Fund budget includes regular grants. Other grnnts are approved according to the terms of reference of the relwdnt fund. Investment Policy The Trustees approved an integrated Asset Investment and Management Policy in 2014 developed under the oyersight of the Investment Commitoe. The Policy VAS updated by the Investment Committee in 2017 and approved by the Trustees. This policy distinguishes between investment and operntional assets and sets out Page 13 The Chelmsford Diocesan Board of Financ• Trust•es' Report for the year ended 31 December 2011 6. Financial rnview (continu¢d) the policy frdmework for both. In relation to investment assets the key principles in the policy may tt summarised as follows: The overall objettives are to create sufficient income and capital gr9￿h to enable the CDBF to carry out purposes consiscentty year by year wich due and proper consideration for future needs and the Aintenance and enhancement of the value of assets wthile they are retsined Investment funds shall be oFrnted and cornpared on a total return basls Relevanc benchmarks include a target tOf21 return of CPI + 4.5% over the long term (previously RPI +3%) The CDBF requires its inves¢ment assets to be managed in complrance with the Church of England ethKal 8uidelines, and ethical consideratyons shall form parc of che dialogue with the Inve5tmeTht Manager5. The Trustees wll consider mixed-mouve investment prop)sals which are expecwl to deliver finantial r&UrnS and further the purp)ses of the charity The CDBF 15 assumed ro be a perpecual tharity and is able to rake a long term ￿eW on investrnents, balanced against the short needs of the charity for 1*4uidity and resources to bes¢ realise it5 operdtional purposes. The Trus￿$ regularly review and rettnder Investment Managers. The last review vrds in 2016 and concludpj with the reappointment of CCLA Investment Managemenc Ltd and appointment of Cueriove Capital Management (a ts7ding sryle of Schroder & Co. ￿MIted>. Funds at 31 December 2021 Proportlon of portfolio Income yleld in year Total re￿rn in year £000 CCLA Man Cazenove Se Other funds Total ed CBF Inyesunent Fund 29,631 24.625 62 54.317 54.6% 45.3Y. 0.1% 100.0% 2.40% 1.67% 17.46% 6.7 Fundraisinz The CDBF is aware of the Charities (Protection and Social Investment) Acr 2016 and the TrLL%tees fully suptx)rt the aims of thls legÉslation. The majoriry of the CDBFS income comes from other charitable bodies and it undertakes very litde direc¢ fundralsing acuvity involving individual donors. Example5 include one-off appeals {e.g. the Lent Appeal} which are promoted generally through communications rnther than orgeting specific individual* and the Friend5 of the Retreat House stheme where Retreat House guests are invited withou¢ pressure or obligation to join the 'Friends'. The CDBF con5ider5 the ori&n of unsolicited donations and legacies. d¢)es not share or purchase any donor data wrth or from third partles and, in 2021. did not engage with independent Profession￿ fundraisers. The CDBF did not recerve any complaints in relation to fundTrising or rnise any matw with regulators in 202112020: none). Golng Concern After making enquiries the Trustees are sau5fied that CDBF has adeq￿re resourw to continue to operate as a going COn￿M for the foreseeable fuwre and have prepared the financial wtements on that Ix$i> Page 14 The Ch•lm5ford Diocwan Board of Finance Trust•es' R•port for th¢ yo¥ ¢nd¢d J l December 2021 7. Custodian Tnisteè The CDBF 15 Custodian trustee of assets held on pernianent rrux by virtue of the Parochial Church Councils (Powers) Measure 1956 and the Incumbents and Churchvrnrden5 (fru5ts) measu￿ 19(A where the managing trustees are parochial church councils and others. These assets are n¢X aggregated in the financial statements as the CDBF does not control them, and they are segregated from the CDBF'S own assets by means of separnte bank accounts. Such funds are predominandy managed by CCLA Investment Management Ltd or M&G Investments as determined by rhe rrranaging trustees. The CDBF reserves the right to charge the manwng trustees an adminixration fee where alternative investment managers are used in recognition of the additional complexiry such arrangements cause. Further details of financial trust assets. whose market value amounted to £17.8m at 31 December 2021 (2020: £18.2m), are available from the CDBF on reque￿ and are summarised in note 26. Where propertie5 are held as custodian trustee, the deeds are identified as such. 8 Principal risks and uncertainties The Trustees are responsible for the identification, mitigation andlor managernent of risk. To achieve thi5, a registrr of all the risks identified is maintained and, alongside i( a management and mitigation strategy formed. The Finance Executive periodiolly reviews the risk register in detail. The Tru5tee5 are invited to review the risk registtr at least annually, leading to formal discussion and approval of the strate&c risk r￿Ster. setting out risks and mitigation stra￿gleS. At a recent Bishop's Council meeting the Tru5*es agreed to review the risk register quarterly. The responsibility for delivery of the identified mitigation strategies is delegated to the executive staff or Bishops and Archdeacons as appropria*. A programme of internal audit is overseen by the Audit Committee and complements the CD8F's risk management activities. The Trustees confirm that the major risks to which CDBF 15 exposed. as identified by the Tru5fft5 and staff. have been reviewed and that systems and protslures have been established to manage those risks. The regis*r identrfies seven stotegic risks with a pre-mitigation rating of 'high'. These risks and the associated mitigation strdtegies a￿ as follovo.. l) Missional Failure This risk recognises a variery of issues which could lead to the church failing to fulfil its missional purp)se. Acros5 the Church of England. we are experiencing a period ofr. Declining cOngr￿tIOnS, particularly as we emerge from the COVID-19 pandemic The closure of some church buildings with others facing significant costs Unrepresentative congrerdtion& which challenges the church's capacity to reach and serve local eommunttie5 and grow for the fvture Failure to remain in unity with one another due to different theological understsnding5 Potential consequences indud&" Failure to preach the gospel of Jesus to the people of Essex and East London Reduced Income and Ilkelihood of flnancial sustainability Costs to the CDBF in relation to ¢105ed church building5 Whilst the cause and presence of these factors exist cxrtside the boundarie5 of Chelmsford Diocese, there are Miti￿tionS that we can take locallr. Mutual sUPPOrt between parish clew for parish clergy to help them address issues at a local level A Diocesan focus on prioritising and supportin8 local parish ministry A new approach to Parish Share A church buildings group set up, to help parishes who a￿ dealing wlth the costs of maintaining historic buildin8S Guidelines and resources for parishes such as the 'Crossing the Threshold Toolkiv Page 15 The Chelmsford Diocesan Board of Financ¢ Trustee5' Report for th• y•ar •nd•d 31 DK•mber 2021 8 Prlnclpal rlsks and uncertaintles {contlnued) Racial Justice Workstream and new 'Mu5t3rd Seed. children, young people and families workstream to focus on improvlng representat*)n and missional growth. The existence of the SDF projert manaBement board Training for our clergy, lay leaders and con8regations to be confident evawdelists. 2) Flnanclal This risk recognises the threat P05ed by a long tErm structural deficit The risk of failure to address that deficit The risk of failure to amendl improve the parish share scheme The pension liability of the cler8y scheme The risk of poorly managed development opportunities or fallure to optlmlse property land resources for mission. The consequences of the failure to reco8nise and successfully respond to such ri5k5 indude: Inability to pay clerEY and staff Dependence on the national church SiEntficant reputational damage The mitigations in place are: The finance action plan A sufficiently resOUr￿d finance team The review of the parish share model for 2023 to recognise the current deficiencies and develop a more appropriate model Additional time limited resources to SUPPOrt the Property Team. 3) Incklent or accusations of $erlous mlscondurt Whi15C there is expeccatyon of any accusations of serious miscondu¢ or any reason to think tPot such accusatK)ns would arise, it is imrKJrtant that we consider the implications of an evttrt such as: A senior stsff member being found guilty of lor accused ofj serious misconduct An Incident or accusations of serious misconduct in a parish An historic allegation or incident of misconducl about an individual who Is no longer seNing in the Diocese or who is a hi8h profile church leader who has never served in the Diocese. Potentral consequences of such an Incldent or allerdtlon Include&. Missional failure An undemiining of confidence in the church and reputational damage Si8niflcant costs to the CDBF Significant demands on staff tlme The mili￿tionS in Pla￿ are: Oversight of Diocesan Bishop I Chief Executive Senior sLiff links with Deaneries and Pari5he5 Safeguardlng team, tralnln& pollcies and processes Racial justice officer and panel to oversee complaint process and provide guidance and education Bullyin8 and harassment policy Support from Communications Dlrector Visitations Page 16 The Chelmgford Dioc•$an Board of Finance Trustees, Report for the y•ar •nd•d 31DeceMb￿ 2021 8 Principal risks and uncertainties (continued) 4) Governance This risk recognises the implicauons of a wential governantt failure. wherv. CDBF trustees are not able to fulfil their role due to inadequote reportir)g, or failure to appoint trustee5 of sufficient calibre / skills as CDBF trustees or to key subcommittees. Failu￿ of trust in Synodical process or senior leadership Serious PCC failure which causes reputational damage or liability for the CDBF Serious governance failure in a "near relation" such a5 Vine Trust MAT or SDF 5UPPOfted CIO The potential consequences of such a failure in governance include.. People becoming unwilling to engage with diocesan governance methods. A lack of candidates standing for synod or similar positions. Significant costs and stsff tlme spent on resolving failure of "near relations" 5) Operational Risks This risk recognises the implications to the CDBF of operational failure resulting fro A lack of capacity impacting work and wellbeir Key person risks-the over reliance on key individuals Whole team physical risks e.g. terrorist incident at a major diocesan event attended by the whole senK)r Staff team Diocesan offices- loss of tenure of office building owned by Guy Harlings Trust or disaster le.g. firel. Serlous data protectlon or IT issuelbreach Failure to adequately maintaln church buildings The consequence5 include: Increased proportion of Clergy and lay leader5 on sick leave Increased chances of other risks occurring Reputational dama8e, fines or costs and an Inability to operate. Mitygation against such operational risks includ Clergy Wellbelng Covenant to be advanced in thls Dlocese in 2022. Greater sharing of knowled8e amon8 teams. 'Manuals' and guidelines for key staff. Data protection training for all staff, Data Protection Lead appointed and oversight group established. IT upgrade improved securlty and our new capaclty to enable staff to work from home, where posslble. Introduction of Multi Factor Authentication DAC Architects list. Heritage Support Officer. DAC staff and members. 6) External Risks This risk category recognise5 that there are fac¢ors e￿rnal ro the church that could have significant implication5 for our mission and ministry includini. Climate change Seriou5 incident affecting W￿le society e.g. another pandemic, sustained fuel or food shortage, civil unrest. Page 17 The Chelmsford Diocesan Board of Finance Tru5tee5' Report for the year 3 l December 2021 8 Prlnclpal risks and uncertalntiés (continued) The consequences of such risks includv. Economic impatts affect diocesan income and misstonal capacity Reputational and mlsslonal rlsk from not meetlng Z030 obligations Investment risks for own assets and for clergy pension scheme The micigations a8ainst such risks include: Our own work in the di0￿Se towards meeting the Church of En8land net carbon zero goal by 2030 Experien￿ gained during current pandemic- e.g. use of virtual resources to adapt. Structure and governance Summary Inforniation about the strurture of the Church of England The Church of England is the established church and HM The Queen is the Supreme Governor. It is ortdni5ed inco two provinces (Canterbury and York) and 42 Dioceses. Each Diixese is a See under the care of a Bishop who is charged with the cure of souls of all the people wtthin that S￿Braphical are& This charge is shared viith priests within benefices and tArishes which are sub4ivi5ion5 of the Diocese. The Nauonal Church has a General Synod comprisd of ex-officio and elected represerrtatives from each Diocese and it wees and lays before Parlkiment Measures for the governan￿ of the Church's affairs which. if enacted by ParlAmen¢ have the force of statute law. In addityon to the General Synod, the Archbi5hops' Councll has a coordinating role for work authorised by the Synod,. the Church Commissioners manage the historic assets of the Church of England,. arKI the Church of En8land Pension Board administers the pension Schemes for s(ipEndiary eccleslastical office holders and employees. Within each Dioces< oyerall leadership lies with the Di¢xe5an Bishopp vtho exercises that input as Bishop within the Diocesan Synod. Our Diocese is divided into 23 deaneries, each with its own Synod and within each parish there is a parochi￿ Church Council (PCC) which share5 with the F4rish priest responsibility for the mission of the church in that place. in a similar way to that in vlhich the Bishop shares resp)nsibiliues vrfth the Diocesan Synod. In this dI0￿se. a5 part of our re-imagining ministry Prior￿Y. parishes are on a journey to working together collaboratively. ofLen in Mi55ion and Ministry Units *ith common mission priorities and shared resources where appropriate. Whilst each Di¢xese is separate with a clear responsibility for a specific geographic21 area, and each diocesan board of finance is a separate legal entity, being part of the Church ol England require5 and enables working togeth¥ in a national frnmework and with national church institJJtions. Organigational structure The Diocese ofchelmsford VAS created in1914. It spans the whole of Essex and five boroughs of East London. It covers an area of 1.5314uare miles with an oyerall population in excess of three million. The diocese is divided into three EpiscoF41 areas by an Area Scheme under which the Diocesan B•shop. the Bishop of Chelmsford. has delegated certain authority to the Bishops of Barking* Bradwell and Colchester in relation to the Archdeaconrles in those areas. Since 2013 there are Se￿ Arhdeaconries. Each Archdeaconry is subdivided into deaneries, there being a total of 23 deaneries across the Diocese. The dear￿rIeS are further subdivided into 474 parishes. By the end of 2021. 33Mission and Minis¢ry Units had been approved. and most of these had been fornMIty commissioned or were planning their commissioning by the year end. Pag• 18 The Chelmsford Diocesan Board of Finan¢¢ TNst¢e$' Report for the year enfled 31 De¢¢mb¢r 2021 Structure and governance (continued) Diocesan governance The ststutory governing FK)dy of the Diocese of Chelmsford is the Diocesan Synod. which is an elected body with representation from all parts of the Diocese. Membership consists of ex officio member5, including the Bishops, the Dean and Archdeacons. clergy membvs ele￿d by the Houses of Clew in Deanery Synods., lay persons elected by the Houses of Laity in Deanery Synods," up to five persons vA)o may be co-OPted by each of the House of Clergy and the House of ￿lty and a maximum of eight members nominated by the Diocesan Bishop. The Diocese is governed by Standing Orders which were updated in June 2012. The Diocesan Synod meet5 or three times a year. Many of Diocesan Synod's re5pon5ibilities have been delegated to the Bishop's Council, the Bishop's Counal Standing Committee or the Finance Committee. Company Status The company, The Chelrnsford Dlocesan Board of Finance {CDBF}, vfas formed co manage the financial affairs and hold the assets of the Diocese. It Wds incorporated on 16 July 1914 as a charitable company limited by membership 8uarydntees (No. 137029) and its governing insrrument is the Memorandum and Article5 of A550ciation which Y￿re m05t recendy amended by Special Re501ution in June 2012. Revised Articles of A5s¢xiarion were approved for submission to rhe Charity Commission in November 2018 and we continue to await determination by the Commission. CDBF is registered with the Chartty Commission (No. 249505). Every eligible member of Di0￿$an Syr￿4 is a member of CDBF for company law purpose5 and has a personal liability limited to £ l under their gUarnn￿e as a comFany member in rhe event of it being wound up. Decision-making strurtur• Corporate priorities and the overall financial strateu for the Diocese (in its primary object to promote, a55iSt and advance the work of the Church of England within the Diocese of Chelmsford) are set by the Diocesan Synod and the CDBF. The company meets On￿ a year in general meeting to receive and approve the annual reporr and financial srAtemenrs and to appointthe audrcors. The Diocesan Synod each year receives and agrees the annual budget. prepared and approved by the Trustees. The Trustees, meeting wtthin the context of the Bishop's Council. hold up to six meetings during the year to formulate and coordinate policie5 on mission. ministry and financ& Pagg 19 The Chelmsford Ol¢K¢san Board of Finance Trust¢¢$' Report for the year ended 31 Dtt¢mber 2021 Declslonwmaldns structur• (continu•d) Certain execLrtive functions of CDBF are undertaken by the Finan￿ Committee, vA)ose members are the Trustees and Directors of CDBF. The Finance Committee's terms of reference are as follo Determine FA)liryk in particular for. Ministry number5. Clvgy Stipends, Capital Budgek Revenue budget levds, Grant making and Investments Monitor such poliq decisions Approve referral of Budgets to the Diocesan Synod Approve and sign the annual rep3rt and financial ststements afrer receiving a report from the A￿lt Committee ee remunerntion of che Audrtor each year Re￿1Ve a retNxt from the Finan￿ Executive at each meeting ReceNe minutes from all sU￿cOmmittEe5 Handle any buslness referrèj by the CDBF, Diocesan Synod or Bishop's Counc Create and dissolve SUt￿cOmmIttee5 as required Appoint members of Sub£ommittees and its representatives on other Diocesan bodie5. Committ•e strncturn The Firrance Committee's remit 15 Set our above; ir is supported by its sulKomnNttees: Finance Exe¢utiv• handles routirte business on behalf of the Finan￿ Commitoe and develops the budget and other proposals for FIna￿e Commit*e's considerntw)rs. Audit Committee responsible for assisung the Finance Committee in the discharge of its respon$ibilitie5 for financial reporting and irternal c<>ntrol. Houses Committee resp)nsible for making declsions concerning the operational management of all clery hou5e5 for which the CDBF has responsi￿11¢y. Inv•Jtm•nt Commlttee rwwn5ible for recommending policy and making decisions concerning the management of Glebe property and Investments. R•muneration and determines remuneration policy and anntjal salary awards, and oversees the Governance CommSttee effectiveness of g(wernan￿ across the CDBF. Dioc•&￿ Mlssion and Pastoral Committee (membership of which is c￿terMInUS with the Bishop's CounciD is responslble for pastornl reorg8nisation. taking account of clergy numbers and the need for new tterns of mlnittry. Diocwan Advisory Committee advise5 on ￿￿tter5 concerning churches and Pla￿ ofworship suth as the 8rantlng of faculue& archaeology. art and the history of places of worship. the use and care of plxes of worship and their con¢enr5 and the care of churchyards, Dlocesan Board of Education omotes education, religious educ2ti0n and religious worship in schools in the Diocese. It also prom0Tr5 and advises governors of church schools in the Diocese. The Chelm5tord Dior￿an Board of Financ Trnst¢¢s' Roport for th¢ y¢*r ènd•d 31 D•cemb•r 2021 Bishop's Council and Finance Committee Bishop's Council consists of 17 ex officio members. 3 clergy ele￿d by the House of Clergy from among their number ( I from each Episcopal area), 9 lay persons elected by the House of Laity from among their number (3 from each Episcopal area), 3 lay persons apwinted by and from the membership of each Area Mission & Pastornl Committee (I from each Episcopal area} and a m&ximum of 6 members nominated by the Diocesan Bishop. Finance CommTh consists of the Chair and Wice Chair of CDBF (who are also mem￿r$ of Bishop's Council) and those other members of the Bishop's Council not otherwise disqualified from membership such as persons remunerated by the CDBF. Trustee recruitment. selection and induction Trustees are members of the Finance Committee and are Select￿ as set ouc above. Trustees are offered an induction when first appointed. Trustee training 15 arranged at the Start of each triennium and subsequently as appropriate. An element of Trustee training is typically included in the programme for the annual day meeting. While some senior staff have job titles incorporating the title 'Director', they are not directors of the company for the purposes of company law. All Tru5tEes are required to mainrain their entry in the record of declarations of intere5L Page 21 The Chelmsford Diocesan Board of Finance Trustees, Report for the year ended 31 December 2021 Attendance at Trust•e Meetlngs Number of me¥ings eligible to atternd NumbEr Pertentt¥e of m*dn¥s attended ell¥lble attended 80 50 100 80 Mrs Isabd Adcotk Canrffi Lynne Bennety ¢019111121 The R•Td Katherine de B0￿r(ler1rorn 20111121 Th¢ V• Christophw &Jrke Mr Phlllp Carnelly from 20111121 The Ven Elwin Cockett Canon Vevet Deer to 19111121 Mrs W Dydacher from 20111121 Canon Rog¢r Ennals The Rt R￿d Gulnar Frnnfi$-Dehqani from 11103121 tr RKhard Freemin to 19111121 The R*d JohTr Fry Canon D•an Gtllospi? to 19111121 Canon Robert HartTh￿d 60 80 80 Mr Frank Havl¢ins 60 The Vwy Revd Nicholas Henshall Th¢ v￿ Vane$8a HErrick The Rt Revd Peter Hil to 1013121 Canon Christine to 1911 IQI Mrs Le51ey ludd from 2￿1 In I The Rwd Simon Law ty 19111121 Camon Jll Ltothard tts 19111121 The Ven Mike Lodge to 29111121 Mr Percy Lomax to 19111121 Canon Ftsrry Marsh tt> 19111121 Canoh Rontld McLern** to 19111121 Iss Mary Moor* to 19111121 The Rt Revd Rog¥ Morrls The Rwd Canon Paul Norrinyon fo 1911 Ini Mrs Mkhdlt Obende from 20111121 80 100 100 50 25 25 The v￿ Ruth Pau The Rt Revd Dr john P*￿mbaI1th The Re¥d Canon Jane Bichards from 20111121 The RVA Canon ￿Kh(la5 Ru*Ydn from 20111121 can￿ Adrian knith from 20111121 Mr &ian Smlth 80 The Ven Elizabeth sno￿en Mrjohn Tipping from 20111121 The Revd Canon LryJ15e Wiliam5 until 19111121 Mrjtthn Winterbotham from 2011 Ini Th• Chelmsford Dioc•$an Board of Financ• Trustees, Report for the year ended 31 December 2021 Remuneration of key management personnel The Remur)erdtion & Governance Commictee reviews the emoluments of senior employees on an annual basis. The Committee's membership is the Chair of the CDBF, the Bishop of Chelmsford. and the Lay and Clergy Vice Presidents of Synod. The Committee a150 determine5 any cost of liying Fqy increase for employed staff and reviews other matters relating to employee remuneration as required. Delegation of day to day delivery The Trustees and the s￿￿¢0mmIttee$ which assix them in the fulfilment of their responsibilities, rely upon the Chief Exec￿1Ve & Diocesan Secretary and her colleagues for the delivery of the day to day activities of the company. The Chief Executive & Diocesan Secretary is given specific and general delegated authorityto deliver the business of the CDBF in accordance with the policies frdmed by the Trustets. Funds held on behalf of schools The DBE (as incorporated within the CDBF) receive5 10% contributions from governors of church school$ within the Diocese in connection with major repair and capital projects to church schools and a150 government grants in connettion with the same. The D8E administers these monies a5 managing agent and makes appropriate payments to contrnccory for work carried out. The monies do not belong to che DBE and as such the receipts and payments are not treated as income and expenditure in the Statement of Financial Attivities. Any monies held at the balance sheet date are treated as creditors on the balance sheet. The income and expenditure relating to school projects noi reflected in the Staoment of Financial Actiyiues amounted to £1.737m and £0.828m respectively {2020.' £1.804m and £1.634m). We still hold the remaining monies as we have experienced delay5 in projects due to Covid restrictions and contractor availability. We are allowed under the Terms of Capital Funding co carry over funds for projects if delayed or straddle two financial years for larger projects if required to do so. A major expenditure of lasc year's Capital Funding was allocated for replacement of failed or damaged flat roofs for six schools wi¢h an initkil budget cosc of £1.291 m. We took the decision co treat all six Schools as one project and went through a tender process to secure the most competityve bid. This resulted in an overall saving of £252k, all0v￿n8 us to invest the savings in projects for additional schcsed at the Annual GeJ)ernl Meeting. Pa8• 24 The Chelmsford Diocesan Boar<1 of Finance Trnstees, Report for the year ended 31 December 2021 Administrative details Company regisu7tion number Charity registration number Registered Office 137029 (England & Wales) 249505 53 New Stree( Chelmsford CM I IAT Tel.. 01245 294400 lican.or Trustees In accordance with the Companies Act 2006 and the Statemert of Recommended Prac¢ice. Accounting for Charities {Second Edition, effective l January 2019), the Companies Act 2006 and applicable accounting standards, the Trustees (for the purposes of charity law) and directors (for the purposes of company law) durlng the year andlor as at the da* of signing were: President Chair The Rt Revd Gulnar Francis-Deqhani (from 1113121 > Mr Percy W Lomax {until 191111211 Mr Jeffrey Mushens (from 2612122) Mr Frank Hawkins (also ac(ing Chair from 20111121 to 261212022) The Rt Fievd Peter Hill (also ac¢ing President until 1013llll The Rt Revd Roger A B Morri5 The Rt Revd Dr John Perumbalath The Rt Revd Lynne Cullens from 2013122 The Ven Christopher Burke The Ven Elwin W Cockett The Ven Vanessa Herrick The Ven Michael J Lodge (uncil 29111121) The Ven Ruth Patten The Ven Elizabeth Snowden The Very Revd Nicholas J Henshall Canon Robert l Hammond The Revd Canon Louise M Williams (until 19111121) The Revd Canon Jane Richards (from 20111121) Vi¢¢-Chair Area Bishops Archdeacons The Dean Lay Vice-President Clergy VlctrPresldents Elected or appointed to fill a vacancy Mrs Isabel Adcock Canon Lynne Bennett (untll 19111121) Canon Vevet N Deer (until 1911 In i ) Canon Roger J Ennals Mr Richard Freeman (until 19111121) The Revd John Fry Canon Dean Gillespie (until 19111121) Canon Christine G Horton (until 19111121} Canon Jill S Leonard (until 1911 Ini) Mrs Michelle A K Obende (from 2011 Ir21) Canon Adrian J Smith {from 20111121) Mr John H w1n￿rb0tharn (from 20111121) Canon Harry Marsh (until 19111121) Canon Ronald V McLernon (unol 1911 Ir21) Miss Mary E Moore (until 19111121 > The Revd Canon Paul Norrington (until 19111121) The Revd Simon Law (until 1911 Irii) Mr Brian Smith The Revd Katherine de Bourcier (from 20111121) Mr Philip Carnelley (from 20111121) Mr5 Mary Durlacher {from 20111121) Mr5 Lesley V Judd (from 20111121) The Revd Canon Nicholas E Rowan (from 20111121) Mr John Tipping {from 20111121) No Trustee had any beneficial interest in the company during the year. PagÈ 25 The Chelmstord Dioresan Board of Finance Trust•es' Report for the year ended 31 Decemb¢r 2021 Administrative details (continued) Senlor Staff The day to day rnanageM￿t of the Chelmsford Dlocesan Board of Finanee is ddegated to the Chief Executive. The officers who Se￿ed during the year and at the date of signing a Chief Executive & Dloc¢san Secretary Michaela Southworth (from l June 2021) Roger Matthews (to 31 May 2021) Maureen Cole (to 30 June 2021) Thomas Geldard ex Reeve The Revd Timothy Elbourne (to 31 January 2022} Michaeia Southworch (to 31 May 2021) Emma Butler (from 7 June 2021 to 13 May 2022) Martdret E5sery {to 31 March 2022) The Revd Rob Merchant (from 19 April 2021) The Revd Andy Griffiths to 18 April 2021) Nathan Whitehead Chief Operating Officer Director of Communications & Media Head of Property Director of Education Director of Flnance Head of Finance Dean of Mission. Mlnlstry & EduGttion Head of Serylce Delivery Prof•tslonal Adyiser Audltors Haysmacintyre LLP 10 Queen Street Pla London EC4R IAG Solicitors and Regirtrars Wincknvorth SheThvood Minem House 5 Montague Close London SEI 9BB Banknrs Barclays Bank pk 4￿41 High Srreet Chdmsford CM I I BE National Wescrrdnster Bank PIC 4-5 H￿h Street Chelmsford CM I I FZ Investment Managers Cazenove Charities 12 Moorgate London EC2R 6DA CCLA Investment Management Ltd 85 Queen Victoria Street London EC4V 4Er Glebè Property Agents Strutt & Parker Cordl Hall Chelmsford CM12QF In approving this Trustees, Repo￿ the Trustees are also approvlng the Strateoc Report Included atx)ve ￿thin their (3paciry a5 company director BYO OFTH TRUSTEES Mrj Chair o the Chdmsford i0￿$an Board of Finance Dat& Pw26 The Ch•lmsford Diocesan Board of Finance Independent auditors. roport to the members of The Chelmsford Diocesan Board of Finance Opinion We have audited the fin7Ancial statements of The Chelmsford Diocesan Board of Finance for the year ended 31 December 2021 which comprise Statememt of Financial Activities. the Summary Income and Expenditure Account. the Balance Sheet, the STrtement of Cash Flows and notes to the financial statements. including a summary of significant accounting policies. The financial reportyng frnmework that has been applied in their preparation is applicable law and United Kingdom Accounting Standard& including Financial Reporting Standard 102 The Fin(7ncial Reporting Stondard appIKable in the UK ond Repubfic of Irelond (United Kingdom Generally Accepted Accounting Practi￿}. In osjr opinion. the financial statements: giye a true and fair view of the state of the charitsble company's affairs as at 31 December 2021 and of the charitable comFtany's net movement in fund& including the income and expenditu￿ for the year then ended., have been properly prepared In ￿OrdanCe with United Kingdom Generally knepted Accounting Practice: and have been prepared in accordance with the requirements of the Companie5 Act 2006. Basis for opinion We conducted our audit in accordance vdth International Standards on Audiung (UK) {ISAs (UK)} and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements settion of our reporL We are Sndependent of the charity in accordance the ethical requirements that are releyant to our audit ofthe financial stttements in the UK, including the FRC, Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Conclusions relating to going concern In auditing the financial staternerts, we have concluded that the trustees, use of the going concern basis of accounting in the preparntion of the financial statements is appropriate. Based on the work we have performed. we have not identified any material un￿rtain￿e$ relating to events or conditions thaE i1￿1vIduallY or collectively, may c2St Significant doubt on the charitable company's ability to continue as a going concern for a period of at lea5¢ tyvelve month5 from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the trustees with respec¢ to going concern are described in the relevant sections of this reporL Other information The trusTres are ￿PonSible for the other information. The other information comprises the information included in the Trustees, RewJrL Our opinion on the financial statements does not cover the other information and. eX￿pt to the extent otherwise explicitly stated in our repor¢ we do not express any form of assurance conclusion thereon. 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 informauon is matwially inconsistent with the financial 5ratemencs or our knowledge obtained in the audit or othemse appears to be matsrially miss¢ated. If we identify suth material inconsistsncie5 or apparent material misst2￿Ments, we are required to determine whether there is a material misstatement in the financial stxtements or a materbal misstatement of the other information. If. based on the work we have performed, we conclude that there is a material mi55tatement of this other information. we are required to report that facc. We have nothing to report in this regard. Page 27 The Chelmsford Diocesan Board of Finance Indep￿dent auditors. roport to the members of The Chplmth>rd Diorwn Board of Flnance Opinions on other matters prescribed by the Companies Act 2006 In our OF4nion. based on the work undertaken in the course of the auditi the infomation given in the Tru5tees' Reporc (which includes the 5tr2ts8ic reporr and the direttors, report prepared for the purpose5 of company law) for the financial year for which the financial sratrments are prepared is consisTrnt with the financial sratements: and the Strategic report and the directors. report included within the Trustee5' Report have been pretxred in accord•￿e with applicable Iwl requirements. Matters on which we are required to report by exception In the light of the knowledge and understanding of the charitable company and its environment obrained in the course of the audik w￿ have not identrfied material misstatements in the Trustees, Rep)rt (which incorporates the stra￿lc report and the directors, report). We have nothing to report in re5pert of the following mat*rs in reLition to which the Companies Act 2(M)6 requires us to report to you rf. in our opinion: adequate accounting records have not been kept by the charitable compAny,' or the charitable company financial statements are not in weement with the accounting records and returns; or certain disclosure5 of trustees, remunerarion specified by law are not mad<. or have rK>t re￿1Ve￿ all the InfornMtAon and &(plarratlons ￿ requlre for our audit Responsibilitles of trustees for the fSnanc5al statements As explained more fully in the rrustees. responsibilicies Sta￿men¢ set out on F4ge 24, the truscees (who are a150 the directors of the charitable company for the purposes of company law) are responsible for the preparnuon of the financial sratwnents and for being satisfied that they gn've a true and fair view. and for such internal control as the trustees determine is necessary to enable the preparation of financlal statements that are free from material mi5Ststement. whether due to lTrud or error. In wepving the financial sratements, the trustees are responsible for assessing the eharitable comynls abilty to continue as a going concern, disclosin& as applicabl@ matters relatrd to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charitable company or co cease operdtions, or have no realistic alternative IX￿ to do so. Auditorfs responslblllties for the audit of the financTal statements Our obiec¢ives are to obtain reasonable assurance about whether the financial scatements as a vthole are free from material misstatemen( thether due to fraud or error. and to issue an auditor's report that includes our opinion. ReasonalAe assurance is a high level of assuran￿ but is not a guarantee that an audit conduLted in accordance with Isk (UK) will aFvAYS detect a material mi5Statemert when it exists. Missratements ean arise from fraud or error and are Considered material if. individually or in the aggregat4 they could reasonably be expected to in1luen￿ the economic decisions of users taken on the basis of these fmancial statements. IrregularNes, including frnud. are instances of non.compliance wlth laws and regU￿￿on￿ We design procedures in line with our responsibilitie& outlined abow to detert matrrial mi55ratements in respett of irregularities, including fraud. The extent to which our procedures are capable of detec¢ing irregulariues. including fraud is detailed belovr. Based.oh' our understapding of the and the environment in which it operates. we identrfied that the princiF41 risks of non-compl￿nce with lav*s and re8ulations related to charity and company law applicable in England and Wales. and we considered the extent to which nonwcompliance might have a matrrial effett on the financial sratements. We also considered those laws and regulation5 that have a direct imwatt on the preparauon of the financHI statements such a5 ehe Companies Art 2006 and the Chariues Act 2011. The Chelmsford Diocesan Board of Finance Independent auditor5. rnPOrt to the members of The Chelmsford Diocesan Board of Finance We eyaluatsd management's incentives and opportunities ￿ fraudulent manipulation ofthe financial 5taternents (including the risk of override of controls). Audit procedures performed by the engagement teAm included: Inspecung correswrKlence with regulators,. Di5CU55ions with management including consideration of known or sus compliance with laws and regulation and fraud: Reviewing the controls and procedures of the group relevant to the prepardtion of the financial ttatements to ensure these were in place throughout the year, including during the Covid-19 remote working Peri¢￿,. Evaluating management's controls deS￿ne￿ to prevent and detett irregularities; Identifying and testing journals. Identifying and testing journals, in particular journal entries posted Ydth unusual account combinations, postings by unusual users or wth unusual descriptions- Challenging assumptions and judgements made by management in their crirical iccounting estimate5 in particular valuation of property assets and inve$tment properties; and Reviewing the assumptions and judgements used by the professional actuary in relation to the charitable companls pension valuation. instance5 of non- Because of the inherent limitstions of an audiE there 1$ a risk that we will not detect all irregularitie5, including those leading to a macerial missracement in the financial sratrments or non-compliance with regulati¢Jn. Thi5 risk increases the more that compliance with a law or regulation is removed from the events and tran5accions refiected in the financial statements, as TrMII be less likely to become avrdre of instsnces of non-compliance. The risk is also greater r￿rdIng irregularities occurring due to fraud rather than error, as fr7ud invofves intentional concealmenL forgery, collusion, omission or misrepresentstion. A further description of our responsibilttie5 for the audit of the financial statements 15 located on the Financial Reporting Council's website at.. www.frc.org.uklauditorsresponsibilities. This description forms part of our auditor's reporL Use of our report This report is made solely to the charitable company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companie5 Act 2W6. Our audit work has been undertaken so that we might state to the charirable comFony's members those matters V￿ are required to state to them in an Auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibiliry to anyone other than the charitable company and the charitable company's member5 as a body, for our kudrc work. for Chis repork or k)r the opinions we haye formed. Adam Halsey (Senior Statutory Auditor) For and on behalf of Haysmacintyre LLP. Ststutory Auditors l O Queen Street Hace London EC4R IAG Da￿.. 7 July 2022 Page 29 Th• Chelmslord Diocesan Board of Finance Statement of finwcial *rtiYit•es Fortho y••r •nd•d 31 D￿¥mb•r 2011 Unrestrlct•d fundi R•rtrlet•d Endowm•nt Total General De5i8nated Funds Funds Fund5 2021 2021 2021 2021 21 É'ooo c'ooo £'oo Trtal Fund5 2020 £000 Intomè from: Parlsh contribuiiJn5 Oth¢r dona￿0￿$ and Ch2rbbl¢ artNr( Investrnents 13,544 3.072 13,S44 7,076 1.276 1,513 13J31 6m2 l J32 1.404 210 3.711 95 lJ29 19 109 Other Trading activrt*%' Par50Thage rents recthtable Oth* Income 722 722 603 694 701 Total In¢om• 1OJ45 3.8B7 110 14,141 23.021 Expenditure on". R•iiinK (vnd InTrtstment manag￿¢ CharKable activ* 26 3.•75 204 149 230 .651 217 23.053 18.718 Totsl expend4ttJr• 18,718 7•9 3,101 353 22,•11 23J70 Net surpluy l (deficit) b•for• In¥atmtmt gain$ (173) (417) 1.765 1248) Net?ins OA investmènts 650 46B5 3J95 Ntt surplus 1 (defKit) b•fore tranrf•rs (173) (417) 1.430 4100 3.147 Tr￿fIr fvnds 2.585 (77) (67) (l441) N•t *urplu* l (daficit} bdor• othw galns •nd Iosms l412 (494) 1,369 35* 3.147 Glns on rwaluadw of ft<¢d assas 3,070 20.355 23.505 14024 N•t mo¥•m•nt in futhds 467 2.570 1.394 24,715 31.152 17,971 Totsl fvnds bro￿￿￿t f•rwtrd 1178 25,860 801 2N379 325,298 307J27 T¢)tsl fundg ¢arrl•d forward 4,045 21,436 IIX275 313,094 354450 325298 The notes on pages 34 to 65 ferm part of thèsè financlal $tatè￿n¢$. Page 30 Th• Chèlmsford Diocesan Board of Finance Summary inc¢)me and expendi¢ure account For the year ended 31 December 2021 Tots 2020 £000 2021 £'ooo Totsl income 22,724 23.922 Total expenditure (12,528) 122.959) Operating Profit Nel￿n5/(lOsse$> on investments 196 63 650 670 Net inci)rne for the year 846 733 Other conprehen5iYe incorw. Revalutation of fLKed assets 3,150 1.855 (836) Net assets ￿nSferred froml{rol Endowment Tod C￿)rehens￿e Income 6.437 1,752 The income and expenditure account 15 derNed from the Ststement of Financi￿ ActwitE5 wr(h nTh)verrEnts in endowrnent fund5 excbjded to ccfflpty with corrpany kw. Al kncome and expendlture15 derNed frcffl continuing actfvtiès. The notes on pages 34 to 65 form part of these ffinanaal statements. Page 31 The Chelmsford Dlocesan Board af Fin•Ke B￿anCe Sheet FOY th• y•ar •nded 31 D¢¢•rTthr 2021 Company number. 137029 Z021 £'ooo 202Q fQOQ Not¢ £'ooo £'ooo Flxed AJ¥•ts Tanglbk assets Inve5trnentS 13 189,525 04.377 276.159 53.318 353.902 329.477 Curr•nt Stock Assets held for S￿¢ 19 3,715 7,265 Debtors.. an￿￿ntS falllng due after nxjre than one year Debtors.. atrounrs fallin8 due ￿th[Tr one ye¥ Cash at bank and in hand J41 1997 9.202 141 2.439 8.557 19.005 14.871 Credlt0rs.'anx￿nts fallkngdue within ¢)ne yèar (16,403) 17.065) Net current ass¢ts 3,401 7.806 Totsl ajsets less current Il*bllitiéS 357.303 337.283 Credltom: amtyjnts fllSni due after mre than c￿e year (874) [11.901) Not assèts •xtluding penshn schem• Il•blliti Defined benefit pension schemE liabiliti25 354429 21 325,412 {184) 22 Net ass•ts ¢xdudin8 penthn Kh•m• Ilabiliti•s 356,450 335,298 Fundj End¢Y•vment Fund5 {includlngproperty & lTrves¢rrMt rèvaluation reserve of £193.79m12020 £illMm) Restricted Funds (including property & knvestsnent rtvaluation reserve of U.42m (2020 £2.51 m) DeSi￿ated Funds (inClud￿g property & inve5tmEnt revaluatbjn rtserve of £14.78m12020 £12.97ml GenvJ Funds On¢ludln8 property & InvestM￿t I￿aluatIOn reserve of £O.Om (2020 £1.29m) 18 311094 284.379 18 14275 4881 18 24430 2&160 18 2,171 Total Funds 354450 325.298 The financ￿1 srate and auth¢rf$ed for is$ue by the Trustees *Jn 24 May 2022 and Signed On thr behaw. br. The note5 pages 34 to 65 forni ofthese fftnanclal statémen￿. P#ge 32 The Chelmsford Diocesan Board of Finance Statement of cash flows For the year efftded 31 Dtcember 2021 2021 2020 Note Net Cash used In from operatSng actl¥ltl•s (B•low A} £'ooo (541) cooo cooo (1.514) Cashfiow from investing activities Dividend% interest and rent from inve5tment5 Interest pald Proceeds from the sale of tsn&ble f￿ed assets Proceeds from the sale of held for tradingassers Proceeds from the s￿e of investments Purchase of ranOble fixed assets for Ihe use of the CDBF Purchase of assets invest￿￿nts N•t Cash usad ifb in¥&tinB atti¥iti•s 1.523 fl66) 5.283 3,664 4.777 (1,771) (10.151) 1.464 12071 I.IIB 13 8.775 {2.310} (3.1471 3.159 4693 C•sh flows from financin8 activities New loans recdved by CDBF Lcsins repad by CDBF Ntt Cash provided by firbancin8 activities (1.972) 261 11,972) 261 Change In cash and cash equbvalents In the reportln8 period Cash and cash equivalents at l January Cash and cash equivalents at 31 December (Below B> 645 8,557 9,202 4,440 4,117 557 Reconcillatlon of net Incon* to net cath used In operatln8 actlvltles 2021 £YJOO 2020 eooo A. Net Income for tho year ended 31 Decemb•r 31,152 17.971 Adjustments for. Deprecmtson Gins on rev21utatlon of fixed assets 93 123.505) 11.523) 166 96 (14.824) (1.464) 207 196 (3.395) D￿￿ends. knterest and rent from Inve5tsnents In*r¢tt pwd Gain c￿ sale of funckllon￿ a8sets Gains on inve5tn*nt5 Detrease in stock 1682) {5.6851 22 Decreasellincreasel in debw5 Intreaselldecrea5e) credr(or5 17581 178 Q94) (Is) N•t cash us•d in op•ratin8 activiti•s (542) (1.514) Analysis of ¢ath and cash equlvalents Cash ar bank and on depos 9,202 8,557 See n¢xe 28 fe* nb)v*nent in net debt The notes on page$ 34 to 65 lom) part of these financial statements. Page 33 The Chelmsford Dlocesan Board of Financ¢ Notes to the financial statements For the year ended 31 December 2021 PRINCIPALACCOUNTING POUCIES The financial statements have been prepared under the histori¢21 cost convention, Èxcept for freehold properties v*hich are included at their fair value as determinejj under the applicable valuaDon method as detailed below. and fixed asset invesunents which are included at their market fdlue ac the balan￿ sheet date. The financial Sta￿rnents have been prepared in accordan￿ with the Statement of Recommended Praccice for Charities (Second Edrtion. effec¢Ne l January 2019). the Companies Att 2006 and appli<3ble accounting standards (FRS 102). CDBF meets the definition of a Public Benefit emity a5 defined by FRS 102. The principal accounting wlicies and estimation technique5 are as follows: (a) Basis of consolidation The accounts for the CDBF have been preFAred on a company only i*sis. The CDBF had one wholly ¢)wned subsidiary Chelmsford Diocesan Trnding G)mpny Limited (company no. 8474175) which was dormant during the prior pwiod and vfis dissofved on 10.112021. The Sparrow5 Trading Company timited (company no. 8626895) ceased to trnde in the summer of 2020. The company wa5 dissolved on 23 March 2021. (b) Income All income is included in the Statement of Financial Activities (SOFA) when the CDBF 15 le￿Ity entitled to it as inco￿* or capitat respectively. U￿.mate receipt is probthle and the amount to be recognised can be quantified with reasonable accuracy. Parish Contributyon5 are reCO￿lSed as income of the year in respect of which it 15 recervthe. Rent receivable is recognised as income in the period with respect to which it relatrs. iii) Interest and dividends are recognised as income receNabl iv) Grnnts re￿ived which are sub)ett to pr&conditions for entIden￿n¢ specifiwl by the donor which have not been met ar the year*nd are included in creditots to be (3rried forvrdrd to the following year. Parochial fees are reCO￿lsed as income in the year to which they relate. vi) Donations other than grdnts are recognised when receivable. vii) Gains on disposal of fixed assets for the CDBF'S own use (i.e. n0n-investme￿t assets) are accounted for as other income. Losses on disposal of such assets are accounted for as oth expenditure. viii) S￿Pends fund income. The Sripends Fund Capitsl account 15 governed by the Diocesan Stipends, FuThJ Measure 1953. as amended. and the use of the income is restricted for dergl supends. However, the income is fully expended within the year of receipt and the legal restrictions, therefore. are ￿tisfied. It 15 on thi5 basis that the income and the (normally much larger) related expenditure are both included in the unrestricted column of the Statement of Finaneial ACtI￿tieS for the sake of greater clarry and simplicity in financial reporting. Page 34 Th• Ch•lm$ford Dioc•gaTr Board of Financ8 Notes to the finanaal statements For the year ended 31 December 2021 PRINCIPAL ACCOUNTING POLICIES (CONTINUED) (c) Expenditur• Expenditure is included on the accwals basis and ha5 been classified under headings that aggryte all costs related to the Statement of Financial Attivity category. Costs of raising funds are constrained to costs relating to the temporary renting out of parsonages and investment managemert costs of ￿ebe and any other investment properties. Charitable expenditure is analysed between corbtributions to the Archbishops. Counal, expenditure on resourcing mission and ministry in the parishes of the diocese. expenditure relating to the running of the diocesan retreat centre, and expenditure on education and Church of England schools in the diocese. iii) Grants payai4e a￿ charged in the year when the offer is conveyed to the reeipient except in those cases where the offer is conditional on the recipient satisfying performance or other discretionary requirements to the satisfaction of the CDBF. such grant5 ￿ing recogni5ed as expenditure when the conditions attaching are fvlfilled. Grants offered subject to such COnd￿on$ vthich have not been met at the year-end are noted as a commitmen¢ but not accrued as expendtture. iv) Support Costs consist of central managemen( administfdtion, and governance coscs. The amount spent on raising funds and other accivioes are consldered to be immatrrial and all support costs are alloratrd co the purpose of charitable activitie5. Costs are allocated wherever FKJssible directly to the acciyity to which they relate. but where such dirett allocauon is not possible. the remainder is allocated on an approximate staff time ba51S. Pension contributions - the CDBF participates in three pension schemes to provide pension benefits based on final pensionable pay, namely the Church of England Funded Pensions Scheme (clergy), the Church of England Defined Benefits Scheme part ofthe Church Workers Pension Fund, and the Teachers Superannuation Scheme. The CDBF also parc1cl￿￿ in the Church of England Pension Builder Scheme {formedy kn¢)wn as Defined Contributions Scheme) FRrt of the Churth Workers Pension Fund. Detsi15 of the schemes are sei out in note 22. The pension costs charged as expenditure represent the CDBF'5 Contributions payable in respect of the accounting period, in accordance with FRS102. Ddicit funding for the pension schemes to which CDBF participates is accrued at current value in creditors distinguished betsveen contributions falling due within one year and after more than one year. vi) Short term employee benefits including holiday pay are recognised as an expense in the period in which the service is received. vii) Employee terminauon benefits are accounted for on an accrual basis and in line with FRS 102. (d) Going concern The financial statements are approved during a period where there is uncer¢ainty al)out the econornic recovery of parishes following the coronavirus {COVID-19} pandemic. The ultima econofnic and social impacts of the COVID-19 pandemic remain unclear, including whether COn￿e[dt10n￿l worship will return to previous pattern& and whether economic recovery will lead to a recovery in parish giving. Diocesan OfPicers are modelling stenarios regarding the potential medium-tem) impact on income. and reviewing eynditure plans as a result of thls. Ho￿￿ver, having revIev￿1 the funding facilities a￿ailable to CDBF together with the expected future cash flows. the trustees have a reasonable expecratson that charity has adequate resources to continue its activities for the foreseeable future and consider that there were no material uncertainties over the charirfs financial viability. Accordingty, they also continue to adopt the going concern basis in preparing the financial statements. Page 35 The Chelmsford Diocesan Board of Finance Notss to the financial statements For the year ended 31 December 2021 PRINCIPAL AccouKfiNG POLICIES (CONTINUED) (e) Tan8lble fixed assets and depreciation Freehold properties Depreciation is not wovided on buildings as any provision (annual or cumulatNe) would not be material due to the very long expected remaining useful economic life in each c2s< and beause their exF*Cted residual value is not materially less than their ￿rryIng value. The CDBF has a ￿lIcY of regular structural inspec¢ion. repair. and ￿rain￿nanCI which in the ￿e of residential pro￿leS is in accordance ￿ the Repair of Benefices Buildings Measure 1972 and properties are therefore unlikdy to deteriorate or suffer from obsolesonce. In addition. disposals of propertie5 (xcur well before the end of their economic lives and disposal proeeeds are Usual￿ not less than their carrying value. The Trus￿$ perform annual impaimient reviews in accordance with the r4uirements of FRS102 to ensure that the carrying value is not more than the recoverable amoun¢ Properties for the charity's own use All houses {excepting properries subject to Ydlue Ilnked loans shovm below) are included in the balants sheet at professional Ma￿et valuation. Such houses are revalued annually. Propertles subject to ￿lue15Thked loans Properties which hve been bought with the assistance of walue•linked loans from the Churth Commi55ioner5 are 5(a￿d using the Ydlue of the related loan at the t4lance sheet da￿. Each year end the respectyve propery and loan are carried at an index linked current rdluati¢)n basis. Parsomge houses The CDBF has followed the requirements of FRS102. in its accounting treatment for benefice houses (parsonages). FRS102 requires the accounting treatment to follow the Substan￿ of arrangemencs rather than their stria legal form. The CDBF 1$ formally responsible for the rna1ntenan￿ and ryir of suth properties and has some jurisdittion over their future use or potential sale rf not requirej Eenefice hous< bue in the meantime legal tltle and the light to beneficial occupation is vested in the incumbenL The Trustees therefore consider the most suitable accounting policy is to capitalise such properties as expendable endowment assets and to carry them at their escimated current market Y4lue. Parsonage houses are reydluwj annually. (Q Other tangible fixed assets Deweciation is provided to write off the cost (less any ukimate disposal proceeds at prices ruling at the rAme of the asset's acwlsitlon) of other fixed assets over t￿r Current￿ eXPe￿d useful econ*Jmit live5 at the following initial rntes: . Solar PV panels Motnr vehicles cOmF￿￿s Furniture and Offi￿ equipment 4% per annum strneht line 25% per annum str7￿ht line 25% per annum stralght line 20% per annum styaight line All capital expenditure over £l.OCKI is capitalised. Pa88 36 The Chelmsford Diocesan Board of Finance Note5 to the financial statements For the year ended 31 December 2021 PRINCIPAL ACCOUNTING POLICIES (CONTINUED) (g) Other accounting policies Fixed a55et inve5¢ments - Investmenc proper¢ie5 include agricultural holdin85 and commercial properties which are professionally valued annually. Other investments are included in the balance sheet at market Yalue and the gain or loss on revaluation taken to the Sfa*ment of Financial Actiyities. Financial Instruments - Other than equity loans which are initially recognised at the amount re￿IVed. with the carrying amount adjusted in subsequenc years to refiect the value based on the proportion of the current value of the relevant property and any accrued interes¢ the company only ha5 financial assets and liabilitie5 of a kind that qualify as basic financial instrumen Debtors- Trade and ¢xher debtors are recognised at the setdement amount due after any trade discount offered. Prepayments are valued a¢ the amount prepaid net of any trade discoijnts due. At the end of each ￿PortIng period debtors are assessed for evidence of impairnienL If an asset is impaired an impairment loss is recognised in the Statement of Financial Activiries. Cash - Cash at bank and cash in hand include5 cash and short term highly liquid investments with a short maturity of three months or less from the date of acquisition or openlng of the deposit or similar accounL Creditors- Basic financial liabilities, including trade and other pardbles and bank loan5, are recognised where the chariry has a presenc obligation resulu.ng from a past event that wll probabty result in the trnnsfer offunds to a third party and the amount due to 5et¢le the obligation can be measured or estimaod reliabty. Creditors and provi5i0ns are recognised at transactyon price. Leases - The company has entered into operdting lease arrangements for the use of certain assets, the rental for which is charyed in full as expenditure in the year to whKh it relates. Where rent free periods are &ven as part of an operating lease, the imptt of thi5 rent.free period 15 refiec¢ed in the Statement of Financial Acuvities over the shorter of the overall lease Trrm or first break clau5& b) d) (h) Fund balances Fund balances are split bety￿n unrestricted (general and designated). res¢ricced and endowment funds. Unrestricted funds are the CDBF'S corpora* funds aTrJ are freely available for any purpose within the charirAble company's object4 at the discretion of the CDBF. There are two types of unrestricted funds: General funds which the CDBF intends to use fry the general purposes of the CDBF and Designated funds set aside out of unrestritted funds by the CDBF for a purF()se specified by the Trustees. Restricted funds are income funds subject to condicions imposed by the donor a5 specific tenns of trUSL or else by legal measure. Endi)wment thJnds are thc>se held on trust to be retained for the benefrt of the charltable company as a capital fund. In the case of fhe endowment funds administered by the CDBF (Stipends Fund Capiral and Parsonage Houses). there are discretionary powers to convert capital into income and, as a r￿￿1¢. these funds are classified as expendable endowment Endowment funds where there is no provlsion for expenditure of caprtal are dassified as permanent endowment. During the year the trustees FR5sed a resolution under $104 Chariues Act 201 I to adopt Tot31 Return Accounung as pennitted by the Diocesan Stspends Measure (Amended) 2016.. For further derail see note 27 on p3ge 65. Page 37 The Chelmsford Dior￿an Board of Finance Notss to the fmanclal statements For the year ended 31 December 2021 PRINCIPAL ACCOUNTING POLICIES (CONTINUED) "Special trusrs" (as defined by the Charities Act 2011) and any other trusts where the company acts as trUs￿e and controls the manY￿￿nt and use of the funds. are included in the companls own financial statements as charity brnnche& Trusts where the CDBF Icts merely as custodian trustee with no tontrol over the management of the funds are not included in the financial statements but are $ummarised in the notes to the financial slatemen (i) Capital expenditure on Voluntary Aided schools Contributions to (2Pital expendthre from Departmert for Educatlon and school governors are not recognised in the Statement of Finanerdl Attivitses. t)etails of the turnover related to this activity are included in note 25. The CDBF Contribu￿ to the improvemenL extension and building of schools not under its cortrol by rnaking grnnts to the school governors concerned, and these are shown as Suth in the Statement of Financial Attivitie& The CDBF does n¢x recognise the fdlue of the comFqnls reversi¢)nary int￿eSt in the assets of closed schools until the ultyma￿ proceeds of disposal have been recwyed. li) Judgements and estimates In the application of the accounting policie& the Trustee5 are required to nAke judgements. estimates and assumptions about the carrying value of assets and liabilities that are not readily apparent from other sources. The estimates and under￿.ng assumpuons are t4sed on hiK￿(al exp￿ien￿ and other factors that are considered to be relevanL Accual results may differ from these estimates. The estima￿ and underlying assumptions are continually evaluated. Revisiorfj tn accounting estimates are reco￿lsed in the period in whith the estimate is revise¢L &gnfrficart judgements i) Valuation of Freehold properties and Fmrsonage houses- Al freehold proptrties and parsonage houses, Including inve5¢ment properties. buc exduding those 5ubjert to rdlue linked bans are revalued w their fair fdlue annually using valuations provided by exwnal professionals. Properties subjett to value linked loans are r￿lUed each year at the fair value based on the index linked current Ydluation basis. ii) Vatuation of IAbilitie5 arising from the charity'5 obligation to meet deficit reduction paymerts for it5 multi•ernployer defined benef￿ pension scheme- These liabilities are revalued at each year end using discount ra￿ which are reassessed annually. iii) Residual Yalue of Freehold ￿0perties- The Trustees consider that the residual value of freehold properries is suffiaently hi8h that depret￿tI0Th would not be material. Sources otestimaTion Un￿rtaInty In the view of the Trustees there are no sources of estimation uncerrainry affecring assets or liabilit￿S at the balance sheet date that are likely to result in a matsrial adjustment to their carrying amounts in the next financ41 year. Pa8• 38 Th• Chelmsford Diocesan Board of Finance Notes to the financial statements For the year ended 31 December 2021 I INCOME FROM DONATIONS Parish Contributions Unrestricted funds Restricted Endowment Total Tothl General De5i8nated Funds Funds Funds Fund5 2021 £'ooo 2021 £'ooo 2021 2021 £'oo 2021 £'ooo 2020 £000 Parish share assessment for the year Credit for fee5 and discounts 16,808 (738) (2,593) 16,808 (738) (2.593) 10,532 (515) {2.498J Shortfall In contributlJn$ P3yrnents in excess of as5es5rÈnt Arrears fef years (41 13.531 13,544 13,544 All parKsh contrbjticffis in 2020 were unrestricted Other Donations unrestrict￿ fvnd3 RestrKted Endownwnt General Deslgnated Funds Funds 2021 2021 2021 £'ooo £'ooo £'oo To¢•1 Funds 2021 Totol F￿d$ 2020 £wo 2021 L'OOO L'ooo Donavons 14 1,997 1,000 91 105 1.997 199 Ministry Support Funding Susthnability Funding All Churches Trust Strawc tkveFopnMt Fundin Church Planting Tralnln¥fLY Mi)istry City Churche5 Fund Strawc Capaciry Fund Strdtegk Mlnistry Fund Other Grants 2.174 1.000 278 286 1,070 1,076 686 655 796 1.590 133 74 1.590 133 74 721 160 18 91 61 129 3.on 286 3.718 7,076 4092 Total donations 16,616 3.718 20,620 19.623 In 2020. £3.588.000 of other dcfiations were unrestricted and £2.504.000 were restricted. Page 39 The Chelmsford Dlocesan Board of Flnan¢¢ Notss to the fjnanclal statsments For the year ended J l December 2021 3. INCOME FROM CHARITABLE ACTIVITIES Parfsh Contrl>vt*)ns Unrestrkted Restrlcted Endowment Genwal Desi8n*t Fund* Funds F￿d$ 2021 2021 2021 2021 2021 2020 cooo 00 £￿00 eooo Sututory lees ch*lncy Incorm Printihg ind bookshop M¢utyon$ to Arthbl$hop$' Councll From Unrestrict￿ funds PCC feasibilrg study Churthes Togethw or8anisati¢)ns Intwfalth wothng Other in5tyWti¢)nal 1300 lJ36 12 12 20 13 22 Ordinands in TMing fty trainin8 268 377 10 35 Total from unr*icted fund5 74 273 1.237 1,510 1.666 Total from dwi8nat•d fundi PCCS for rrission pro*cts (8) From restrlcted funds (>¢rsw missKJTr pr*cts RefuEte support PCCS f(* ft¥$sion projects O¢her LOB Fund$ Multi Acadry Trusu 17 14 14 321 Tolal from r¢strkted fund$ 19 33 36 367 93 276 1.270 lJ46 1025 IQ ALLOCATION OF SUPPORT COSTS 2020 Re5oJrcing MIn￿ty and mlss Education 1.288 228 192 2,113 1.516 The Chelmsford Diocesan Board of Finance Notss to the financial statements For the year ended 31 December 2021 I I. NET INCOME Thls is stated after charging 2021 2020 £'ooo cooo Auditws, remunwation Audit Fees 27 27 Other Fees Opwating Ivd5e costs in the year DePreCia￿n charge Interest paid 57 120 93 96 207 166 12. STAFF COSTS 2021 £'ooo 2020 £000 Staff costs wtre as lollows: 2.061 197 2,530 250 316 3.096 National Insurance c¢)ntribtsdons PenS￿)n costs (note 22) 289 2,S47 The averap nunl)er of perscfis wrployed by the cc¥npany duringthe ye¥ was as foll)ws: 2021 2020 Suppor¢ for parish nyni5try Diocesan Retreat House 77 80 10 Secretsrles to Archdeacons 94 98 The average mnthly nun*er ofeThployees duringthe year expressed a5 full twne equiV￿ents wa5 a5 follow5 lincludin8 casual and part-tiTh% skffj.. 2021 2020 No. Support for patish ￿nIstrY Diocesan HcAJse Secretsries to Archdeacons 67 69 75 78 Page 45 Th• Ch•lmsford Diocesan Board of Finance Notes to the flnancial rtatements For the year ended 31 December 2021 12. STAFF COSTS (Continued) Tht numbw of higher paid •mploy••s was: 2021 2020 In th• band £60,fyJ1- £70,0 In the band £70,001- £80,￿ In the band £80,001- £90.0 During the year the rhatity made emplo>Tnent termination payments totalling £I&OOO (2020: £14947). Remuneratl(ffi of key manwdernent personnel Key management perscnnel are deemed to be those having authority and responsibility. delegat81 to them by the Trustees, fe* plannin& direcring and conrrding the activities of the thocese. During 2021 they w¥& Chi•f Ex¢cutive & Diocesan Secretary The Revd Canon Dr Roger Matthews (to 31105lll} Michada S¢Juthworth (from 01106121) Maureen Cole (to 30106121) Thomas Gddard Alex Reeve The Revd Timothy Elbourne (to 31101121) Maryaret Essery ¢0 31103n i ) Mithaela S¢uthw¢rch (from 08102121 to 31105121) Ernma Butler (from 07106ni ¢0 13105n21 The Revd Robert Merdmnt (from19104r211 Nathan Wthltehead Chief ExecutlY6 & Diotèsan Secretary Interlm Chl•f Op•ratlng Offlcer Dlr•rtor of Communications & Medl Head of Property Dirertor of Education Head of Flnance Dlroctor of Flnance Intérlm Dlrertor of Flnanc• Dèan of Mission. Ministsy & Edu3ns are made avalab￿ by the Church COmn￿$s1onttS to assist with provisiC￿ of hou5ingfor curntes and ¢xher nlnistws. The thrn￿ are that the loan 15 r4Jayable rf the property is sokl or ceases to be used for the purpose under wh￿h the kAn was ￿ftted. The amount repayable to the Church Ct)nvni55icfflers is the proportion of the current y￿ue of the property that the kxn bore to the origSnal purchase COSL Most103ns incurred interest initAly at 3% per annum but the rats thereafter vari25 with infktion: the aver88e Interest rate on these loans is 6%. Page 51 Tho Chèlmsford Diocesan Board of Flnanc• Not£s to the financial statements For the year ended 31 December 2021 18. SUMMARY OF FUNDS MOVEMENTS STATEMENT OF FUNDS - CURRENT YEAR anc• at Tr•nsfers Gain Bajance at l Januvy Incomo Expendlthv• X121 21 cooo I￿(0￿) (loss69) 31 D¢c8mber 2021 É'c￿0 D•**t•d fund* Houses Alkhu￿h¢S Trust Stratw Changt Mi%sKxb Opportunitips Dhxewi Retreat H¢)us¢ R¢furbishn*rrt Ck)sed Chur¢h¢5 Asbestos surveys 25.197 476 3.070 28,101 324 14381 IB (/ 10 65 1651 17091 25%60 292 17n 3,070 28.436 G•noral funds Geherdfunds 2.178 18545 118,71B) 2,58S 5S 4.645 To¢4 UnreJtritted Funds 28.038 18,837 119,427) 2,508 3,125 33NI Endowment Funds Stipends Fund Cap* Parson4B H*>JSe5 PernBnent EndowrnEnt 82503 202120 3P56 288379 1.342 681 95 2,118 12041 11491 Q.3341 7.161 17.795 435 25.390 88.468 221.147 3.479 313P94 11071 12.4411 13531 R•s1￿¢•d Funds D6c¢esan Board of Educ￿1¢￿ Dltxtsan R¢ty¢at Houst 5,996 67 247 14271 522 6,338 (67) Lohdon Cfver the Border Church Fund Lent AP￿ Refuye Appeal ch￿rCh Plantin8 prwt Reitruthrini Tralnlnxfor Mknktry Stra¢* Capacity SCF Pr(iect Lead YollnKPeople Sm•c Ministry Fund Hi5torK Enxknnd 1032 660 41 1,590 (461 1598) (20) 153 1.980 11+52 14 45 127} 1.076 {1,049} (99) 1622) (961 {451 (74) 1251 67 189 686 88 45 74 25 3887 8,881 (671 675 10.275 ToTal Funds 325298 24A42 122,8811 29.190 356.450 Pago $2 Th• Ch•lmsford Diocesan Board of financ• Notes to the financial statements For the year ended 31 December 2021 18. SUMMARY OF FUNDS MOVEMENTS (continued) STATEMENT OF FUNDS- PRIOR YEAR 8ulGnce ut TrGnsftr5 inl(ou¥ 2020 Goin$1 801once 0¢ l J￿V￿ry 2020 000 l Jonuury 2020 Income Expenditure 2020 (1055e5) 202Q £'ooo 2020 cooo eooo £000 £000 DeslEnated fvnds Houses 23.455 200 181 12) 2) 181 1.750 25,197 476 Allchurches Trust 278 Strote£ic Ch¢7ngE M"syon OppornJnitie5 Dioce5cn RetreGt House Refvrlx5hment Tumuround ProJea aosed Churches 20 18 1.385 32 11,3811 76 104 69 169) 999 69 26.198 (9991 Asbestos surveys 14) (94) 65 310 (2,380) 1.826 25,800 Gen•rol fvnds Genero1 fvnds 1.064 19.794 {2ts.309) lJ44 85 2.178 Totol Unrestriaed Funds 27.262 20.104 QO.403) (836) 28,038 Endowmert Fund5 5wnd5 Fund Cotytol Pdr50ngge HJuse5 Perm(Jnent Endo￿Trent 71.605 191.695 2.860 272.160 836 4,178 I l J20 196 82J03 203.015 2.861 288J79 1195) 836 15,694 Restricted Funds Dioceson 8oord of Educ¢Jtio Diocesan Retreot H￿Se Lon¢Jtsn Oyer the 8oorder LentApi*al Refvgee *4ppeol Church Pldntingtyojett Restructyrin£ TroininEfvr MNstsy Srr¢Jte£ic Capocity One otTSCF SCF Projert Lead Young Peoi Strotegic Mntstry Fund 5.625 121 J,89Q 305 166 808 10 {415) 481 (91 142 5.996 67 (348) (2) 2,492 14 39 1401 196 45 23 655 {6421 (301 {7161 P7) 166 796 103 125 (121 (451 1181 (2.5561 45 18 7.905 2.918 614 8.881 Totol Funds 307.327 23.022 (23.270) 18.219 325.298 Page 53 Th• Chelmsford Diocesan Board of Finance Notes to the financial statements For the year end￿ 31 December 2021 18. SUMMARY OF FUNDS MOVEMENTS (continued) SUMMAMY OF FUNDS. CURRENT YEAR Balance at Transf•rs inl{out) G4ln (Io*M5) 31 D¢¢emb¢r 21 anr• l January 2011 In¢•m* Exp¢nd*wo Oeswated funds Gener￿ lunds 25060 2.178 28M38 292 1709) 177) 2,S8S 2,508 3M70 55 28.436 4.645 33NI 18,545 18,837 {19,427> 3.125 EThdrMmenthJnds 288,379 8A81 1353) 12,4411 1671 25390 675 313.094 10275 Restrkted fund5 3￿87 325298 24￿41 122M81) 101 29.190 356,450 SUM•IARY OF FUNDS. PRIOR YEAA l•nc• It Transfers Inl(out) 2021 G•kn anc• It l Janu 2021 In¢om• Exp•ndltyw• 2021 X121 (los￿) 31 D•cemb•r £'oDo Desbat¢d lundi Gened funds 26,198 1.064 27.262 310 19,794 20,104 (941 QO,3091 120.403) {2,380) 1.544 1836) li26 85 25*60 2.178 28m8 End17wn%n¢fund5 Re5tritted funds 272.160 7.905 836 15*94 614 288J79 8MI 2,918 12,556) 307.327 23,022 123,270 18,219 325,298 ANALYS15 OF TRANSFERS BEfwEEN FU14D5 Unr6*lcted funds Restrletsd Endowment Geneval Deslgn•t¢d 2011 Funds Fund$ FrI)Mn￿10th QPP0rWn￿e5 to gener41 fund Frorn re5tric*d fund to¥eneral fund Total return transfer to general funds FrornpDerl fund tol￿PendS endownwnt for t*ductlon of pensk￿ defitlt 77 177) 67 16 2,995 12,995 1554} 2585 S54 {2,441} 177) 167) Pw54 The Chelmsford Diocesan Board of Finance Notes to the financial statements For the year ended 31 December 2021 18. SUMMARY OF FUNDS MOVEMENTS (continued) Desi Houses Fund Allchurches Trust This fund represents monies allocated to clergy housing This fund represents grants received from Alchurches Trutt and is to bè dlstributed at the diseretlon of the Bishop of Chelmsford ThSs fund represents monies allocated for strat￿£ change predominant thè Transforming Presence Prozramme This fvnd represents monies alloeatrd lor new mlsslon In10a￿ve$ Strategit Change Mission Opportunities fund Diocesan Retreat House R•furbishm•nt This fund represen¢s monie$ allocated f¢ improve laciiities at the Retreat House This fijnd represents monies allo¢Ked w a 'wrnaround' project to Improve mission and ffinancial perforn)ance This fund represents proceeds from the sale of closed churches whi¢h have been set aside to cover future costs arising on other churches in the di¢x¢se Closed lor public worship Turnaround Project Closed Churches General Fund Thi5 lund is available for any purpose wthin the obiects of the CDBF Stipends Fund Capital This fund is governed by the Diocesan Stypends Measure 1953. The Income of the fund can only be used lor clergy stypends This fund represents the y￿ue of all the benefice houses Iparsonag¢s) in the Diocese The income of these funds is available to be spent wthin the General Funds Parsonage Houses Permanert erbdowments Restricted Fund . Dlotèsan Board of Educatl¢)n The Diotesan Board of Education is an unincorpordted body conrtituted in accordince with the Diocesan Board5 of Education Measure 1991 INo.21. This includes the pooled sale proceeds of closed church schools and the unspent balance of the grdnt received trom the Hockerill Eduotional Foundation The Diocesan Retreat House at Heshey is operatrd a5 a sepat7te attl￿ty. Under thè tenns of the tnjst for the Retreat all income must be ended within the centre and, therefore, this is treated as a restricted find within CDBF'S accounts Thè Council is institutèd to administer speciffic funds for the benefrt of parishes wtthin five specified deaneriés Of thÈ Diocèse This fund represents grant5 rèceivèd from the Churth Commissioners tOW2rds the cost of the on-going deyelopment of résourtè churches a network of new church communities in 5 strnttyc mbssion prioiity ar This lund represents income from the Bishop's Lent Appeal This lund represents income from the &shop's RekngeÈ Appeal This lund represents grants received from the Church Commissionèrs towards the Cost of the on-going development of reSOu￿e churches and a network of new church communities in 5 strawc mission priority areas This lund represent5 grants received from the Church Commissicners to aid the Diocese to transition to new funding arrangements This lund represents grants receTrved from the Arthbi5hops' Council to a5S15t in the funding of training cle Diocesan Retreat House London Ovér thé Bord•r Cty Churthès Fund Lent Appeal Refugee Appeal Church Planting Project Restructuring (transition) Funding Training for Ministry Page 55 The Cholmsford Diocesan Board of Flnance Notes to the financial sLitsments For the year ended 31 December 2021 19. ANALYSIS OF NET ASSETS BETWEEN FUNDS ANALYSIS OF NET ASSETS BETWEEN FUNDS- CURRENT YEAR Unrestrlrted funds R•8trlct•d:ndowm•nt Geheral Desl8nat Funds Funds 2021 1021 L'ooo £'ooo Totsl Funds 2021 £'ooo 2021 2021 £'ooo ran￿ble assets xe¢J asset investments 2,733 36,727 365 249,699 54,578 3,045 289.525 64.377 7.265 341 6.354 12.199 16031 (16,403) (874) 21 9,799 Assets hdd for sale 4,220 Debtors due ther than one year Curmt as$ets 341 3.390 11,6821 (1371 (2,765} {9.009} 7371 5,221 15.1091 Creditor5 due wthin one year CrEditDr5 due Wb [r￿re than c￿e year Defined benefft penilon scheme fmbifrties 21 464S 28,436 10,27S 313,094 356,4SO ANALYSIS OF NET ASSETS BETWEEN FUNDS . PRIOR YEAR Unrestr*thl fvnds Restriaed Enrhwment Fund$ Totol Funds 2020 £000 2020 fooo 2020 cooo 2020 fOOO 2020 fooo Tanoble f￿ed assets Frxed 3S5et Invest￿Trts A55ets hekl fcr s312 2.696 1.169 39.919 340 233204 43248 1.630 276.159 53J18 3.715 141 11.015 17.0651 (11,8011 (184) 325.298 8,901 2,085 Debt¢ys dueafter more than one year Currwt as$ws Credthr5 due within one year Creditor5 due in mc+re than ¢ne ye¥ Defined benefit pension s¢hen* f•biliues 137 375 (4.306) 1541 (11.7841 3.540 13.904) 11.406 (925) 12.182) (17) (184) 288.379 2.178 25.860 8.881 20. CONTINGENT LIABILITIES There were no c*￿tingent liabilltiès at thÈ balance shÈÈt date. 11, CAPITALCOMMITMENTS There were no capital commitments at the balanc• sheet datè. Pag• 56 The Chelmsford Diocesan Board ￿ Finance Notes to the financial statsments For the year ended 31 December 2021 22. PENSIONS Chelmsford DBF participates in four pension schemes: Church of England Funded Pen5ion5 Scherne Church Worker5 Pension Fund DBS Church Worker5 Pension Fund Pension Builder Tvachers Pengon Stheme The Church of England Funded Pensions Schem• {CEFPSI and the Church Workers Pension Fund ICWPFI are multi-employer last man standing dèfinèd bènèfit Ponsion sc￿M•S for which the CD8F is unable to ident'fy its share of the underfying assets and liabiliti•s as each employer is èxposed to actuarial risks associated with the current and former employees of othor èntities participating in the schèmè. For multi*mployèr schèmès whwt this is the case, paragraph 28.1 l of FRS102 requires the CDBF to account for pension costs on the basis of contributions actually payable to the schéme in the year and, where contributions are affetted by a surplus or dÈficit in the schemè. to disclose information about the surplus or deficit and the implications of the surplu5 or deficit for the CDBF. A valuation of each scheme 15 carried out once evwy three years. Church of Engl•nd Funded Pensions Scheme (CEFPS) - the Clergy defined benèfit pènsion scheme Chelmsford DBF partitipates in the Church of England Funded Pensions kheme for supendiary clergr, a defined benefit pension scheme. Thi5 scheme is administered by the Chwch of E￿and Pensions Board, which holds the 355ets of the schemes 5epara¢ety from those of the Responsible Bodies. Each parvcipavnz Responsible Body in the stheme pays contributions at a common contribuwon rate applied ¢0 pensionable s¢ipends. The scheme is considered to be a multl•employer scherne as described in Section 28 af FKS 102. This means it is not possible to attribute the Scheme's assÈts and liabilities to the specific ResPonsi￿e Body and this means that contributions arè accounted for a5 rfthe kheme were a defined contribution Scheme. The pensions costs charged to the SOFA in the year are contiibutions paythle towards benefits and expenses accrued in that year12021.. £1515m, 2020.. f2.142ml, plus the figures highli8hod in the tknle bdow as being r￿￿ISed in the SOFA, giving a to￿ charge of £2.522m for 2021 (2020.. credit of £2.216m). A valuavon of the Stheme is carried ou¢ once every three year& The most recent Scheme Yal￿00n completed was Ca￿led at as 31 December 2018. The 2018 valuation revèaled a deficrt of £50m. based cn assets of £1,818m and a funding targèt of £1.868m, assessed using the following assumptions: average discount rate of 32% RPI in11a￿On of 3.4% p.& {and pension increases consittent wlth this): Increase in pensionable stipends of 3.4% p.L- mort￿1￿ in acciydance with 95% of the S3NA VL tatAe4 with ajlowance fw improvements in mort21ity in line with the CMI 2018 extended model a long terffl annual rate of improvement of 1.5%, a smoothing p3r&me￿r" of 7 and an initial addition to mortality improvement5 of 0.5% p& Pale 57 The Chelmsford Diocesan Board of Fin4n¢¢ Nots5 to the financial statements For the year ended 31 December 2021 22 PENSIONS (cortinued) Church of England Fundèd Pensions Sthem• (CEFPS) - thè aer8y defined benefit pension scheme (continued) Following the 31 December 2018 valuatiorn a recovèry ptan vths put in place untll 31 December 2022 and the deficit recovery contributions payable (as a parcentagè of ￿nSIonable ttlpends) ar• s•t out in th• ta￿e below. January 2018 January 2021 DÈcÈmb 2022 7.1% to % of pensi+)nable supeThJs December 2020 11.9% Defia¢ rewr contributions As ae 31 De£ember 2019 and 31 December 2020 the deficit recov￿ contributions under the recovery plan In forc• wèrè Is se¢out in th• above For sénior office holdews penSio￿ble suwd5 are adjusted in the calcula¢1¢￿5 by a as se¢ out in the Stheme's nAe5. Section 28.1 IA of FRS102 requires agr& defi¢it rry paymencs to be recoymsed as a Ilablljty. Tk m0￿M￿l In the balance sheet liabillty over 2020 and 2021 1$ Set in the table below. 2020 £000 1.094 (501) 2020 Balance sheet liability a¢ l January Deficit contrkni¢n pa Interest cost (recogni5ed in SOFA) Rerninin8 thange to th• b￿anCe Sheet lllbili¢P (recognlsed in SOFA) 1.930 (940) 16 58 Bahnce sheet ha￿.11￿ at 31 De¢¥nber 540 1.094 *Comprises dwge in agreed defici¢ recovery ￿an and change in di5CQUTl¢ fdte and assumptions bemen yearwends. This liability represents the present value of the defici¢ conuibutions as at thè aceounring date aThl has been ued usinz the foll￿￿n8 assumption5 set ty referenc• to thè duration dthe ddiclt recovery tAyments.' December D¢c¢mb¢r Dec42mber 2021 2020 2019 Disc¢un¢ rdte Price inltation Increase to total p￿S1on3bIe payroll 0.0% pa 0.2% pa 3.1% 1.6%pa I.I%F4 2.8% pa 1.3%pa -1.5 %pa The lègal stnKtwe ofthe stheme 15 such that rfanoth¥ Responsible Bodyfrdils. thè CD8F t(yJld bKome responsible for ptwng a share of that Résponsible Botys pension liabilid•s. The Chelmsford Dlocesan Board of Finance Notes to the financial statements For the year ended 31 December 2021 22 PENSIONS (continued) Church Work•rs Pension Fund (CWPF)- Lay Workers Defined Beffter￿ Stheme The CDBF participates in the Defined Benefits Scheme settion of CWPF ft)r lay staff. The Stheme 15 adrnini5tèr•d by the Church of Enland Pensions Board, which holds the a￿ets of the Kheme5 separately from those of the Employer and the other participaiing employers. The CWPF has a sectlon known as the Defined Benefits Schem4 a deferred annulty sectyon known as Pension Bullder Classl¢ and a ¢ash balance secuon known as Penslon BuSlder 2014 (see settion C below). The Defined Benefits scheme {"DBS') section of the CWPF provides benefjts for lay staff based on ffin￿ pensionable salaries. The CDBF has not h74d any acuve members in the DBS since March 2018. For fundirbg purposes, the DBS is divided into sub-poc4s in respett of eath partycipating employer 15 well as a further sub.pool. known as the Life Risk Pool. The Lrfe Risk Pool exists to share certain risk5 betyveen employers, including those relating to moruliry and post-retirement investmeni returns. The division of the DBS into sub-pools is noti¢)nal and is for the purpose of calculating ongoing contribution5. They do not alter the fact that the #ssets of the DBS are held as a single trust fuThJ out of which all the benefits are to be provided. From time to time, a notional premium is Iransferred from employers, sub-pools to the Lrfe Fknsk Pool and 411 pensions and death benefits aré paid from thè Life Risk Pool. The Scheme is a rnulty-employer scheme as described in se£tion 28 of FRS 102. It is not P055ible to attributs the stheme's a55ets and liabiliues ¢0 specific employers, since eKh employer. through the Life Risk Seciion, is exposed to actuarial risks associated with the current and former employees of other entstyes parricipating Trn the D8S. This means that contributions are accounted for as il DBS were a defined contribuvon scherne. The pensions costs charyed to the SOFA during the year are contrit*Jtions payable towards benefits and expenses accrued in that year 12021.. £9.000, 2020.. É9.tsJOI plus the thgures in relation to the D8S deficit hi8hli8hted in the table below as being r time. Bonuses may also be dedared, depending upon the investment rewrns and other facters. Pension Builder 2014 is a ¢tsh b￿ance stheme that womdes a lump sum that members use to prowde ￿nefrt$ at ￿￿rèmen¢ Pension contributions are recorded In an ¥count for each member. This account may have bc￿USes added by the Board before retlremen¢ Thtr bonuses depend on in￿tment •xpwi•nce and cth•r factors. Therè i¥ no requirement for the Board to grart any bonuse& The accoLm¢ plus any bonuses dedared is payable from rnernbers. Non￿￿ Pensron Age. There Is no sutrAMslon of assets beTh¥een employers in éach séthon ofthe PeThsi￿ Builder Sthth. The scheme is considered to be a Mu1rk￿Pl¢Yer scheme as described in Section 28 of FRS 101 This mean5 It. not possible to attribute th¢ Pension ￿lIder Scheme's assets and liabilities to spttific enyloyers and that contrlbutions are a¢counted for as ifthe Scheme were a defined contributyon Sch￿￿ The pension5 C0S¢5 charyed to the SOFA In the year are contributions payable (2021>. £26ZOOO, 2019.. Q50.000). Avaluaion ofthe Pension Builder Scheme is carried once every three years. The most rttert was carried out as at 310ec&nber 2016. A valuation as at 31 Decembw 2019 was under way as at 31 December 2020. For the Pension Builder Cla5SiC 5ettion, the Y￿UatIOn r•¥•aled a defici¢ of £142m on the ongoing assumptions Us￿. At the most recent annual review. the Board chose not to grant a di$cretyonary knnus. which will hove acted to improve the fvnding P0s￿on. There is no requbrement for defici¢ payments at the current tim& For the Pension Builder 2014 section. the Y4luation revealed a surplus of £1.8m on the ongoing assumptions uwl. Therè Is no rnquirunént for defiat PaYn￿ntS at th• CUrr￿t dmÈ. The legaj Structure of the stheme is such that il another employer fails CDBF could become responsible for Pa￿￿4 a share of that employer's pension liabilitie Th• Chèlmsford Diotssan Board of Financ Notes to the financial statements For the year ended 31 December 2021 22 PENSIONS (continu•d) Teachèrs. Pension Scheme (TPS) The TPS 15 an unfunded stheme and members con¢ribu¢e on a "pay as you go" basis - thesè Contributions along with those made by employees are credited to the Exchequer. Retirernent and other pension benefit5 are p￿d by public fund5 provided by PadiamenL The co8￿ employer's pension costs paid to the TPS in the y￿r amounted to £35,1)00 {2020 £46,000). A copy of th• valuatlon report and supporting documentstion is on the Teachers, Pertsions websi Under the definityons set out in FR5102 the TPS is a muki employer 5chem& The CDBF ha5 accounted lor Sts contriF*Jtion5 to the scheme a5 rf it were a ddined contribution schem The employer contribution rao was increased to 23.6% in Au8us¢ 2019 following the TPS 2016 r41uation.. Prior to August 2019 the employer contribu¢ion rate was 16.48%. The summary of all the schemes, liabilitie5 at 31 December is.. Amounts falllng due within one year 2021 £000 2020 £000 Church of En￿and Funded Pensions Scheme Church Workers Pension Fund DBS Church Workers Pension Fund - Pension Builder Classi¢ and PB2014 561 910 18 Total 570 928 Amounts falling du• aft•r mor• than one year 2021 £OOD 2020 Church of England Funded ￿nsIOnS Schèmè Church Wtfkers Pènsion Fund DBS {21) 184 Total (21) Pale 61 The Chelmsford Diocesan Board of Financ• Notes to the financial stat•monts For the year ended 31 December 2021 23. OPERATING LEASE COMMITMENTS At 31 DeLember 2021 the total of future rn•iinwm lease payrmts under non-cancellable operriTrg leases wa%: 2021 2020 eooo Within l ye¥ Betw&n 2 and 5 yws Aftw nwethan 5 ye 95 28 75 170 28 RELATED PARTY TRANSACTIONS Transactions bthen 5p¥rows TTrthng Canwany and the CDBF were a5 f￿1¢￿$. 2021 £'ooo 2020 ATrwnt {￿1￿8 at l Janvary Loan advanced to Sparrows Tr•dknz Conyany Unwted durin8 tho y 60 (69) Apart frorn the abcrfe 2nd the trUStee￿n$act1oThS dist105ed In Tho¢¢ 12. there wwe no other related party tr￿SactIOnS in the f￿anC￿l year. ADart from the above and th* trust•• transactions dixlosed in 12. there were no other relat•d pary transactions in the financial year. 25. CAPITAL EXPENDITURE ON VOLUNTARY AIDED SCHOOLS CDBF recelved funding on beh￿f of schools from the Department Edutstio￿ local authoritres and from sth0¢4 governing bodies to finance buildSng worl( amounting t¢ £1,771,CO) (202tr. £1.804.0001. These funth w•r• thtn utilistrj to pay for schod building impro¥em•nt w¢rk& N•lther the In¢om¢ nor the •xp•nditur• art included in these accoun¢& Page 62 The Chelmsford Diocesan Bowd of Financé Notes to the flnandal statements For the year ended 31 December 2021 26. FUNDS HELD AS CUSTODIAN TRUSTEE CDBF acts as Diocesan Authority or custodian trustee for many trurt lunds by virtuè of the Parochial Church Counci15 {Power5) Measure 1956 and the Incumbents Churchwarden5 ITrusts) Mèasure 1964 where the mana8in8 trustees are parochial church councils and others. Assets held in this way are no¢ a88regated In these financial statements as the CDBF does not control them. 2021 2020 £'ooo £000 CBF Church of Enband lTrvescft*nt Fund income share$ CBF Church of En￿and Investment Fund accumulation shares CBF Church of En￿and fixed Interest Securities Fund 5hare$ CBF Church of En￿and Global Equry Inco￿￿ Fund income 5hare5 CBF Church of Enèand Property Fund share5 COIF incoft* and accurThJFatK¥n shares Other comrnon investmeAtfvnd holdings (M&G) Direct holdin? in UK equitE5 CBF Church of Engand Deposit Fund 10.175 1.238 274 9.994 1.019 305 65 56 291 590 901 6Y8 850 648 4.288 4.659 T¢X 17.B32 18.205 Page 63 Thè Chelmslord Dioc•5an Board of Finance Notes to the financial statements For the year ended 31 December 2021 27. TOTAL RETURN ACCOUNTING From the I january 2021 the Chelmsford Diocesan Board of Finan￿ adopted a totat return approach co investments and property with rewd to the Stipend Capital Fund (SCF) the Pern)anent Endewment Fund (PEF). The iniual walue5 for implemernng total retum wwe deterniined a¢ l JanLWy 2021 the SCF £60.51 I m a￿1 the PEF £1.67&n. The unapplied total return was set at £21.992m for SCF and £1.378m for PEF a combined valued at £23.370m. Total re¢urn accounting was suppO￿d by the Finanre Cgmmit¢ee on 3 November 2021. The principles were resofved in 2020 for application in 2021 and the final calculations were coMple￿d in 2021 as SUFffJOrted by the finance commlttw. 3.5% was quoted and agreed as the ann￿1 percentage to fdnsfer to the General Iwj to 5uppkm￿¢ revenu The Indexati￿ of the base Ydlues is calculated using thÈ Natyonaj CPI inde Pwmw•nt Endowm•nt iknapplle41 TTu#for T•t*l Unthpplled Tru*f•r To¢ Éioo• As*t I ￿TrU￿ry 2021: B35e vthe ofthe perrfAnaK endowrnent Un¥pl￿ tcrtal thrn Totsl 60,511 60511 21.992 82503 1,670 Ih78 1378 3￿56 21,992 21.992 lJ78 lJ78 61JS11 1,678 Mov•mÈnts in th* yw: Add￿kn￿ s* proce*Js oF¥ebe knd sale ns ￿ redu8￿¢￿ h￿JS¢S G￿$ ￿ dL%pQ$￿ ofwets Investsrnnt r￿rns.. dMd•nds r￿1￿*1 Investy￿( rewrn: re￿￿ unrdw W)sses InveStTh￿t lees Costs r#JJrn ￿k￿ted to thcamekn they Add l)d&xatbJfv dbase knef Ner nK)YemEnts h the year 1563 1563 1,329 4.496 {2041 554 (2A681 132691 2.59S l J29 4,496 (2041 554 12088) 95 435 9S 435 1107 3,269 3J70 (911 332 5,965 423 A•at JI D•¢*7*w 2021: &¥ivlue céthe ptrnW￿t£ndrmmth Un4ppkèJ tod rtturn V*u•kn as at 31 D￿th)er2D21 63081 63M81 24.587 88,468 1.769 1,769 iJio 3.479 24587 24587 63M81 1.769 ANtythofWlthdrAw•lt• In¢•m• To Fund Isoe n(rt• 18 8naysls dtM$lersl WthdrwA to In¢rAre IA88 2W8 107 107 350% The Chelmsford D1¢X￿an Board of Finance Notes to the financial statsments For the year ended 31 December 2021 ANALYSIS OF CHANGES IN NET DEBT Other non- At l Jan 2021 Cashflows cash changes At 31 Dec 2021 'ooo £'ooo £'ooo Cash and cash •qulvalents Cash 85S7 64S 9,202 Cash equNalents 8557 645 9.202 Borrowings Debt due within one yèar D&¢ due after one year (54) (11,801) (11,855) 54 (9.009) 9,009 (9,009) (874) (9,883) 1.918 1.972 Total (3.298) 1617 (681)