iocese in Europe THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT AND FINANCIAL STATEMENTS for the year ended 31 DeGember2023 CompanyNo. 106580 Registered Charity No. 250186 THE DIOCESE IN EUROPE BOARD OF FINANCE CONTENTS for the year ended 31 December2023 Page No. ofAnnual Report Bishop's introduction Annualreport Objectlves Strategic aims Activities and achlevements Future plans External events with an impact on diocesan life Financial review Principal risks structure and govemance Statement of Trustees, responsibilities Administrative details Independent auditor's report 12 13 15 22 24 26 27 29 Flnanclalstatements Statement of financial activities Income and expenditure account Balance sheet Cash flow statement Notes to the flnancial statements 33 34 35 36 38 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for theye8r ended 31 December2023 Foreword from Bishop Robert l am very pleased to introduce this annual report for the Diocese in Europe. In 2023, chaplaincy life largely completed its return to normal after the painful restrictions of the Covid pandemic. It has been a year of revival and recovery. Many people have returned to Church, although rebuilding habits of churchgoing amongst some constituencies, such as young families, takes time. Some chaplaincies continue 'hybrid' services of worship. The impact of Brexit continues, especially on those parts of the Diocese that have significant numbers of British retirees. But overall the Diocese is in good heart. Compared with most English dioceses, we have a relatively high number of working age people and a relatively high level of ethnic diversity. At a diocesan level, there were some notable highlights, such as the Women Clergy and International Racial Justice conferences. The Diocesan Board of Finance is showing a near balanced financial outcorne. This is largely thanks to good Common Fund returns 196%) and generous help from the Church Commissioners, Going into 2024, we have some ambitious lif rather dauntingll plans to invest in Youth Work, New Worshipping Communities and Poor Communities. Bishop David's retirement saw the ending of a distinguished 22 years of episcopal ministry, and the recruitment of a new Suff ragan Bishop is a major task for the coming year. Sadly, the continent of Europe continues to be dominated by the Ukraine-Russia war. Many of our chaplaincies remain involved with the care of Ukrainian refugees. Nonetheless, the Diocese continues to be an encouraging context for church life and ministry. We have highly talented clergy and lay leaders and produce very able ordinands for the wider church. There are exciting mission projects. New folk are joining our congregations and there are many examples of people finding Christian faith. Our overall morale is high. I hope you enjoy reading this report. I trust you are reassured by the care taken over the managemenl of our resources and our efforts to present our results clearly and transparently. I remain thankf ul to God for the vitality of our Diocese in Europe, as evidenced by this report, and pray for its continued flourishing. +Robert Gibraltar 2023AnnualReport and Financial statements THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for theyear ended 31 December2023 The Trustees, who are also Directors for the purposes of company law, present their annual report together with the audited financial statements, for the year ended 31 December 2023. OBJECTIVES The Dlocese in Europe has around 300 congregations in 35 jurisdictions in Europe, Turkey, Russia and North Africa. These congregations are organised within 140 separate chaplaincies. The Company's principal activity is to promote, assist and advance the mission and ministry of the Church of England in the Diocese in Europe by acting as the financial executive of the Dioc8san Synod. The main objectives of the charitable Company, the Diocese in Europe Board of Flnance I'DBF") are: To manage the flnancial aspects of providing a priestly and pastoral presence where needs arise and as resources permit across the Diocese. To provide appropriate personnel, financial grants and other resources including safeguarding to support the mission of the Diocese. To engage with the community as part of the Church's response to God's mission to His people In the area covered by the Diocese. To manage funds on behalf of the churches in the Diocese, and related trust funds. To provide servlces to churches and help the flow of communications across the Diocese, including the provision of various publications. Funds and other support are given to encourage fresh expressions for worship and mission; to support the ongoing rnission of the Dlocese, and to provide a service to our chaplaincies. Priorities for diocesan support are identified at regular meetings of the Bishop's staff and at the Diocesan and Archdeaconry synods. Significant financial issues are delegated to the Finance. Audit and Personnel Committee I'FAPC'I between meetings of the Diocesan Synod and the Bishop's Council. The Terms of Reference and scheme of financial delegation for the FAPC are routinely reviewed by the Bishop's Council. The Trustees aim to operate a balanced budget, meeting current expenditure from current income, so that capital growth can be set aside to support the work of the Diocese in future years and be available at times of particular hardship. This strategy has been very valuable during the years of the Covid-19 pandemic when the DBF was able to pause its programme of increasing revenue through the Common Fund requests and when it used reserves to f und def icits. Financing deficits from reserves enabled the Common Fund request to be frozen in the year5 2020_2022. An increase of 10Yp was requested in 2023. Further Increases are included in the financial plan for the next 3 years and the DBF aims to keep the deficit under £100,000 by 2027 and maintain unrestricted reserves at between 1.5 and 2.0 times the annual unrestricted expenditure of the DBF. For 2024 the increase in the request for Common Fund contributions is 10% (reduced from 15% as per the 2022 plan). 2023 Annual Reportand Financial Statements THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for theyearended 37 December2023 STRATEGIC AIMS The Diocesan Strategy, Walking Together in Faith,, commits the Diocese to: Building up the Body of Christ and fostering growth. Sharing with other churches and agencies in the evangelisation of Europe. Slriving for the creation of a just society and a sustainable environment. Working for reconciliation in communities and in the wider world. Providing the resources to do these things. Across our far-f lung Diocese, the staff team and the chaplaincies work together in fulf illing this strategic vision by making good clergy appointments, fostering vocations, forging partnerships with mission agencies, working with refugees and providing encouragement and support to our communities. Increasingly, this work is supported by pan-diocesan working groups such as the Caring for Creation Group and the Racial Justice Working Party as well as increased co-operation between chaplaincies at an archdeaconry level. The following f our priority areas of actlvlty agreed by the Bishop's Councll contlnue to be a focus for attention within the strategy. 1. The environment and the stewardship of creation. 2. Growing ministry to young people. 3. Growing training and development of both lay leaders and clergy wlth a particular focus on the Ministry of Women and of Black, Asian and Minority Ethnic people both lay and ordained. 4. Increasing our ministry with lower income communities. Although the strategic priorities are clear the resources available to the DBF to help in their delivery are limited. Some funding may be available from the Archbishops, Council and the challenge for the D8F leadership is to access this funding, recruit the right staff and adapt, so that this work can be absorbed within a thin central team. Progress on these objectives by the central DBF team is constrained by the diffuse nature of the Diocese. No changes were recommended following a review of the overall strategy in the Autumn of 2023 by Senior Staff. The DBF is now developing its funding bid to the Strategic Mission and Ministry Investment Board of the Church of England, The areas for development in this proposal will be.. l. Work with chlldren and young people including students; 2. Establishing new worshipping communities in city locations where there are signif icant 'underserved' anglophone populations,. 3. Supporting chaplaincies with increasing numbers of members with low incomes from the Global South in particular, who may be unable to fund ministry themselves in accordance with the normal model in the Diocese. 2023Annual Report and FinancialSt8tements THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for theyear ended 31 Decems)er2023 ACTIVITIES AND ACHIEVEMENTS Mlnlstry The number of clergy in the Diocese holding a Bishop's Ilcence as at 19 April 2024 was 138 12022: 1441. This includes 27 assistant chaplains 12022: 211 as well as the Dean, the 4 Archdeacons and the Director of Ministerial Development. In addition there are 15 curates 12022: 191. At the close of 2023, the Diocese had 29 vacancies12022: 211 which, when filled, will have licensed clergy (including both Chaplains and assistant priests). 77 Readers held a Bishop's licence or Permission to Officiate at the end of the year12022: 721. 21 people were licenced or granted PTO as readers in 2023. There were 26 ordinands in either residential or non-residential training (2022.. 221 at the end of December 2023 and 16 Readers in training12022: 81. Chaplalncy membershlp and altendance The total number on chaplaincy Electoral Rolls is 9,88712022.. 10,0611, a decrease of 1.7%. Overall numbers have recovered since the pandemic and are now only 4% below the 2019 pre-pandemic number, which in itself was the year of a fall as would normally be associated with the creation of new rolls. The normal recovery from a new roll did not happen due to Covid. There were 378 baptisms12022: 3311 and 82 rnarriages12022.' 92) recorded in the Diocese with an additional 167 12022: 921 marriage blessings. The number of marriages and blessings in particular, represents a significant f inancial benef it for some chaplaincies. These events are a source of engagement and income, particularly when families travel from the UK for ceremonies. The recovery in the number of blessings is particularly gratifylng. There were 24 confirmation services held 12022- 341 with 170 candidates {2022: 1731. A practice of combining groups of confirmation candidates from a number of chaplaincies in one service is becoming more common with bigger services and less episcopal travel time. Easter Day attendance was recorded as 13,672 12022: 11,7521. Christmas Day attendance was recorded at 15,69712022: 15.1761. The Usual Sunday Attendance was recorded as 7,901 {2022: 8,8871. Chaplaincies reported 660 attendees, as being the average attendance reported online in 2023 (2022.. 2,4801 as in person worship had returned after the pandemic. These figures overall show a very mixed picture showing evidence of some recovery but also continued f ragility in some chaplaincies following Covid and Brexit. 2023AnnualReport andFinancialStatements THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for theyear ended 31 December2023 ACTIVITIES AND ACHIEVEMENTS (continued) Staff Changes No staff left in 2023. A new Head of Communications, Ruth Blanco, took up her post in January 2023 and Adrian Butcher. who had served as the DBF'S interim Head of Communications in the interiffl, completed his work in the early part of the year. Suffragan Blshop In September 2023 Bishop David Hamid announced his retlrement with effect from February 29, 2024. He had been in post for 22 years and was the longest serving bishop in the Church of England. His pastoral care for all in the Diocese, his expertise, experience, stamina and great good humour will all be much rnissed. Bishop David's chaplain, Revd Canon Deacon Frances Hiller, also announced her retirement having supported Bishop David throughout his term of office. The Bishop's Council unanimously approved the proposal to recruit a new Suffragan Bishop and recommended Ihat the Diocese go further and seek approval from the Dioceses Commission for a second Suffragan Bishop in recognition of the complexity and scale of the Diocese. In December 2023 the Dioceses Commission agreed to the recruitment of a successor to Bishop David and recommended that the post holder be based in Brussels. The Suffragan Bishop's house in Kent is for sale and the proceeds will be reserved to provide for future housing needs. The Archbishop of Canterbury is supportive of the proposal for second Suffragan Bishop but the process of approval for the post and its funding is complex and will continue in 2024. The outcome of the bid f or this post is uncertain. Safeguardlng and the Past Cases Review 2 (PCR2) In May 2023 the final report of the Safeguarding Past Cases Revlew 2 was completed. All personnel files had been independently reviewed in accordance with the Archbishops, Council mandate issued in 2019. The Executive Summary was published on the diocesan website. It concludes- 'At the completion of the review process, it is possible to state that the objectives set by the Archbishops, Council for the project have been met in the Diocese in Europe, namely: All known safeguarding cases have been appropriately managed and reported to statutory agencies or the police where appropriate. That the needs of any known victims have been considered and that sources of support have been identif led and offered where this is appropriate. That all, identified risks have been assessed and mitigated as far as 15 reasonably possible. The report made a series of recommendations which focus on: The administration and management of the Diocese's safeguarding and HR data Ways to further improve the culture around safeguarding. 2023AnnualReport and Financial Statements THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for theyear ended 31 Dec&mber2023 ACTivrriES AND ACHIEVEMENTS (continued) Safeguardlng and the Past Cases Revlew 2 (PCR2) (continued) The implementation process for all the recommendations started immediately and the action plan has been completed and signed off by the Safeguarding Advisory Committee IDSACI. Work recommended by the report has now become part of the normal practices and plans of the Diocesan Safeguarding Team. The DBF benefits from the expert oversight of DSAC, which met 4 times in 2023 including an in-person development day held in London. This independent scrutiny and challenge is an essential contribution towards achieving best practice in safeguarding. The Eden Voice Group is now established to bring a clear informed focus to the work with regard to victims and survivors. Its chair is also an independent member of DSAC. In 2023, 341 people completed 28 Safeguarding Leadership training courses, 2 Safeguarding conferences were attended by 113 Chaplaincy Safeguarding Officers, and 374 safeguarding checks were completed. Progress towards Net Zero Carbon Target The Diocese continues lo pursue its objective of reaching Net Zero Carbon by 2030. Implementation of the Programme of Activities has started, and a first progress report was presented to Diocesan Synod in June 2023. The commitments contained therein enabled the Diocese to access £130,000 of capacity building funding in autumn 2023 which is being used to f und a part-time Net Zero Officer (recruited April 2024) and to undertake energy audits in those buildings with the highest emissions. The diocesan travellexpenses policy has been revised to emphasise sustainable travel options, accepting that these may be more expensive. The emissions generated by travel to the 2023 Diocesan Synod were calculated and in autumn 2023 travel recording guidance was rolled out across the Diocese. Systematlc quantification of travel emissions started in January 2024. A growing understanding of the buildings used throughout the Diocese, and progress in quantifying their emissions, opens further funding opportunities which are being actively pursued. The Net Zero Officer, together with the Diocesan Caring for Creation Working Group, continue to spearhead these activities, along with encouraging chaplaincies to work towards Ecochurch awards. Women Clergy Conference: Challenges In Contemporary Europe: Diversity and Public Theology through the lens of women's experlences The latest of the conf erences for female clergy in our Diocese, held in Hamburg in April 2023, was planned by a team of six, spread across the Diocese frorn Norway to Greece and Germany to Geneva. We were privileged to have as the guest speaker Reverend Dr Simone Sinn, who teaches ecumenical theology at Bossey and combines her teaching at the Ecumenical Institute with programme executive responsibility of WCC'S Faith and Order Commission. Stimulating conversations following the lectures centered around harnessing the rich diversity of our Diocese to build the kingdom of God amongst the communities we serve. 2023 AnnualReportand Financial Statements THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for the yearended 37 December2023 ACTIVITIES AND ACHIEVEMENTS (conllnued) Women Clergy Conference: Challenges In Contemporary Europe: Dlverslty and Public Theology through the lens of women's experlenceg (contlnued) The days were framed by worship throughout the day, a core part of the time together, and offered the opportunity to celebrate the cliaconal and priestly ministry of women. One of the gifts of the conference was time away, for wisdom to be heard and shared. 18 members of our female clergy were able to participate in the conference along with the Head of Communications for the Diocese. We also welcomed a representative from CCLA, who was the conference sponsor, and to whom we are immensely grateful. The conference offered a snapshot of the diversity of the Diocese and an opportunity for worship and listening within this group. The time spent together is a rare opportunity in a Diocese where people work at great distance from one another. The next conference in 2025 is in the early planning stages, with a slightly enlarged team to include an even wider representation from all areas of our Diocese. Racial Justlce Conference In Frelbury In November 2023 the Racial Justice Working Group of the Diocese organised a conference under the title 'God's Kaleidoscope, The International and Ecumenical call to Racial Justice., 100 people attended from the Diocese and the wider Anglican Communion as well as partners from the Porvoo Communion and the Evangelische Kirche in Deutschland. USPG and ttte Racial Justice Unit of the Church of England along with ecumenical partners were present and assisted with funding. 30% of the participants who were under 30. This Conference was rooted in prayer, scripture and music from around the world. The vibrant bible studies from Prof. Dr Sathianathan Clarke re-examined key passages in Scripture, offering fresh perspeclives and expanding our horizons on what scripture teaches us about Racial Justice. It was a space to share experiences, ask difficult questions, pray and reflect and to forge way forward together. The conference had a clear focus each day, looking at grieving the past, challenging the present and envisioning the future, and enabled those present to move together from reflection on past experiences to joining in tasks of advocacy and aff irming that a racially just tomorrow is possible. The conference went beyond existing policy frameworks such as "Breathing Life" from the Diocese and "Lament to Action" for the National Church with fresh perspectives in theology, Christian witness, mission and engagement. The Conference Statement is on the diocesan website here . The Racial Justice Working Group is already building on the results of the Conference and a follow-up event is planned. 2023 Annual Report and Financial Statements THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for theye8r ended 37 December2023 ACTIVITIES AND ACHIEVEMENTS (continued) Rooted In Unity (part of the World Youth Day 2023), Sl George's. Lisbon History was made in the Diocese in Europe on August 1, 2023, when the first week-long event for young people was held at the Anglican Church of St George, Lisbon in partnership with the French Catholic community Chemin Neuf. 250 young people from a range of church backgrounds made the effort to be in community with their f riends in faith 150me travelling over 20 hours to get lo Lisbonll. Teaching was offered by the Archbishop of York, Archbishop lan Ernest of the Anglican Centre in Rome, Tabea Oppliger lan entrepreneur in Israel providing work for women who were escaping the sex trade) and Joe Tosini from John 17. There were important times of worship and the opportunity for young people to experience different eucharists from different denominations. A prayer tree, provided a focal point where new friendships were formed, faith stories shared and where the young people Inspired and encouraged each other. The Pope has deemed 2025 "The Jubilee of World Youth" and it is hoped that a similar event may take place in Rome. New dlocesan webslte at www.euro e.an lican.or The diocesan website is the hub of our digital presence, which is more important than ever in such a geographically diverse diocese. It provides key resources for all chaplaincies as well as being the window to the world to showcase the work and mission which is carried out across our vibrant and diverse communities. The website redesign and rebuild was a signif icant project involving an Investment of t5me, focus and finances, but an essential one given the reliance on online resources for everyone. The project, including the new branding, was funded by a generous grant from the Benefact Trust. The new site launched in June 2023. It includes a complete update of the Dlocesan Handbook, and re-design of the key forms and resources used so by chaplaincy councils. A church finder tool was created using A Church Near You and Google mapping data. A review of all chaplaincy data was conducted. Feedback on the site has been very positive. Improvements continue to be made iteratively. 350,000 web page views were generated and there was a 24Yo increase in Social Media followers. A pilot project to discover what help can be given with redesigns of chaplaincy websites has been undertaken in partnership with chaplaincies in Geneva and Nice. 2023Annual Reportand Financialstatements THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT lor theyear ended 37 December2023 ACTIVITIES AND ACHIEVEMENTS (conllnued) Fundralslng advice and resources for chaplalncles Individual giving is a vital means of resourcing mission and ministry across our chaplaincies. The DBF was successful with a bid to the Archbishops, Council for funding of £80,000 over five years towards the costs of a part-time Fundraising Adviser (Juliet Evans). She will work across the Diocese to increase income to chaplaincies from congregations and other sources. This role, recruited in late 2022, is closely associated with the Church of England Giving Team's strategic work in areas such as tax eff icient giving, digital and regular giving, f undraising and legacy giving- all of which are vital to the resourcing of mission and ministry across our chaplaincies. To support the Fundraislng Adviser in the work, a small Fundraising Reference Group consisting of clergy and lay members from across the Diocese- was convened to offer input and advice. 2023 Priorities and Activilies l. Understanding chaplaincies through a fundraising questionnaire, to benchmark current activity, find and share good practice and to understand chaplaincy priorities. The results fed into a strategic plan for 2024-2027 2. Setting up communications channels 3. Encouraging chaplaincies to look at three 'quick win, activities: Thanking people for their financial giving. Improving communications to explain the difference people's generosity makes. Taking a 'next step, in engaglng congregations in regular giving. ivin In an increasingly cashless society, the way people use money, and therefore the way people give, is changing and this needs to be acknowledged in the mechanisms we offer. Therefore, in addition to the above, work commenced on preparing for the launch of the Church of England's digital giving rollout project across the diocese in 2024. The project wlll provide 30 heavily subsidised card reader devices for chaplaincies as well as support the wider adoption of online giving. A card reader device, 5Ultable for European use, was identified and successf ully piloted in three chaplaincies ahead of the rollout. 2023 Annual Report andFin8ncial Statements THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for the yearended 31 December 2023 ACTIVITIES AND ACHIEVEMENTS (continued) Events Ministr Ordinations were celebrated in Rotterdam and Brussels . The new Chancellor of the Pro Cathedral of St Paul's Valetta, Fr David Wright, was licensed in September. IME2 residential training events were held in Woking and in Cologne. The Minlstry Experience Scheme pilgrimage to the Holy Land included interns and a number of others. Bishop Alison White became the first woman to be an Honorary Assistant Bishop in the Diocese. The last 2 modules of the Dlocese's lay learning course 'Walking Together in Faith" were completed. Revd Louis Darrant was appointed LGBTQi+ Liaison Officer. New initiatlves The misslon to refugees in Calais was extended wlth the appointment of a refugee officer Bradon Muilenburg funded by the Diocese, the Diocese of Canterbury and USPG. New courses were held for serving clergy on neurodiversity and for all involved in appointrnents about unconscious bias. New registration of all French Chaplaincies and creatlon of a Union Natlonale for the Church of England in France was completed. Diocesan Synod agreed changes to the Diocesan Constitution to allow for the possibility of a wide range of meetings to take place remotelylby electronic means, where that is the preferred mode. A significant advance in ecumenical work will be achieved wlth the creation of two split role Ministers with French Protestant Churches in Lyon and Strasbourg. A pilgrimage to the 'Seven Churches of Asia, was organised for clergy in the Diocese by Revd James Buxton in Izmir and attended by 22 clergy and partners. Public Prof ile The BBC Radio 4 Sunday Worship programme was broadcast from venues across the Diocese, preceded by a week of Daily Services from Oslo, Brussels, Tenerife, Lisbon and Malaga. The National Church of England online service was broadcast from St Edmund's Oslo. A podcast series was presented by the Diocesan Director of Ordinands about the Coronation. 2023 AnnualReportand Financial Statements 10 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT lor the year ended 31 December2023 ACTIVITIES AND ACHIEVEMENTS (contlnued) Events (continued) Celebrations Smitha Prasadam left St Alban's Copenhagen and was consecrated Bishop of Huddersfield in June 2023 alongside two other new bishops. Bishop David was the preacher at York Minster. The small church at Urbanizacion Lago Jardin in the Torrevieja chaplaincy re-opened for worship in December and celebrated its centenary. The Intercontinental Church Society which supports 40 chaplaincies across the Diocese124 as patron), celebrated its 2001h anniversary. The Friends of the Diocese held their flrst in-person Annual Service since 2019 at Southwark Cathedral. In the King's Birthday Honours, Revd Canon Malcolm Rogers was awarded an MBE for 'services to the British and Commonwealth community and to the Anglican Church in Moscow, Russia., Alison Rogers was awarded the British Empire Medal IBEMI for 'services to the British community in Russia., In May the Eucharist was celebrated for the first time In 15 months at Christ Church Kyiv. Chaplaincies hosted visits from the Archbishop of Canterbury to Istanbul and Bucharest, and the Archbishop of York to Paris, Rome and Lisbon. Bishop Robert and Archdeacon David Waller each took long-awaited 3-month sabbaticals which are an important contribution to the welfare of long-serving clergy. 2023 Annual Report andFin8ncial Statements THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for the year ended 37 December 2023 FUTURE PLANS These Include: The appointment and consecration of a new Suffragan Bishop. The appointment of a new Senior Chaplain at the Pro Cathedral in Brussels. The appointment of the Carbon Net Zero Officer funded by the national church A second Clergy pilgrimage in Turkey. Significant growth in work with children and young people supported with funding from the Archbishops. Council. Broadcast services on the BBC from chaplaincies in Paris during the Olympic Games. Archdeaconry and Deanery Synods to be held In-person in Tallin, Belgrade, Rome, Drongen, Belgium. Diocesan online service for Safeguarding Sunday. Podcasts for the anniversary of the Coronation. A follow-up event to the Racial Justice Conference. A youth synod and training event for leaders of work with children and young people. 2023AnnualReportand Financial Statements 12 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for the yearended 37 December 2023 EXTERNAL EVENTS WITH AN IMPACT ON DIOCESAN LIFE War In Ukraine and the appeal forfunds The war in Ukraine has a significant impact on life in the Diocese. The chaplaincy of Christchurch, Kyiv continues to meet and hold services as well as maintaining an online community. In late 2023, a new chaplain was appointed to Warsaw who will travel to Kyiv at least once a month for services as well as offering some pastoral care for the community. The Diocese remains committed to supporting resident stipendiary ministry in Kyiv when this is possible. 80%1£280,000) of the funds raised in partnership with USPG Iunited Soclety Partners in the Gospel) in 2022 for work with refugees has been distributed. The remaining amount is for small projects as they emerge and for ministry in Kyiv. This means that the target of allocating the appeal funds in 2 years has been met. The main projects supported are linked to chaplaincies in Helsinki, Warsaw, Budapest, Prague, Riga and Bucharest. The needs of refugees are not declining and there is still a need for further funding. The projects supported by the DBF are aware that the appeal funds will not be available beyond the latest distributions they have received. The Coronation The death of Queen Elizabeth 11 put signlficant demands on many chaplaincies and clergy across the Diocese. Clvic services and media commentary were requested in many places and events were well supported. This experience was repeated with the Coronation of King Charles 111 which was celebrated across the continent. Media training for the event was provided by the former interim Head of Communications, Adrian Butcher. The Diocesan Director of Ordinands, Revd Canon William Gulliford, used his considerable expertise to give information and training about the liturgy and history of the Coronation Service. William also compiled a series of highly original and authoritative podcasts on the topic. Cost of Ilvlng and inflation The rate of inflation across Europe began to rise rapidly in the first quarter of 2022, This brought signif icant challenges to some chaplaincies which continued through 2023. That said, there were fewer applications to the Hardship Fund as a result of inf lation than were expected. The rate of inflation across Europe almost halved in the last 6 months of 2023 to 3.4% (Source.. Eurostatl although the increased prices from the previous high rates have now become a norm. The DBF forecasts are based on a 5% rate for 2024 and 2025 mainly linked to likely pay rises. These relate to DBF Staff, Archdeacons and clergy on the Ministry Team. When the financial plan is reviewed in October 2024 the rate of inflation will be reassessed, however recent experience appears to show that costs of travel and accommodation, which are two big costs alongside staff pay, are still rising at rates above the overall indexes. 2023 Annual ReportandFinancialStafements 73 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for theyear ended 37 December2023 EXTERNAL EVENTS WITH AN IMPACT ON DIOCESAN LIFE (continued) Brexit Covid-19 and then the war in Ukraine obscured the true effects of Brexit on the life of the Diocese in Europe. Many members of chaplaincies who did not qualify for residency are now limited in the amount of time they can spend in the European Union. This is reported to have reduced attendance at some chaplaincies particularly in the south of the Diocese as seasonal residents do not return as f requently or f or as long as they did in the past. The true impact of this on the Electoral Rolls will only be revealed when the rolls are renewed in 2025. The DBF may need to offer support to chaplaincies who are experiencing higher costs of vlsas and other requirements when appointing new chaplains. There are also language qualif ications in some jurisdictions that were not a factor prior to Brexit. Despite Brexit, it is gratifying that strong candidates continue to apply for roles and manage to overcome the hurdles in their way. Clergy across the Diocese are a more diverse group than ever with an increased number of appointments of Anglicans from across the globe. The Wlder Church of England Two issues dominated synodical and other debates within the Church of England in 2023 namely"Living in Love and Faith" I'LLF" the Church of England's discernment process about identity, sexuality, relationships and marriage), and the structure of safeguarding provision. In the Diocese in Europe concerns have been expressed by clergy and chaplaincies both that the proposals for Prayers and Services to celebrate same sex relationships go too far and also that they do not go far enough. We appreciate the depth of feeling behind these issues, but can say that, thus far at least, discussions are not Causing significant issues for the D8F. The National Church is considering the recommendations of the Jay Report about independence in safeguarding and the Wilkinson Report about the disbanding of the Independent Safeguarding Board. Proposals have been made to establish two new charities for the oversight and for the provision of safeguarding services across the Church of England. The implications for the Diocese in Europe are particularly complex given the untypical clrcumstances in which the Oiocese operates contrasting with the risks inherent in safeguarding being delivered by an organisation which operates only in a UK context. Senior staff and clergy of the Diocese continue to maintain a high profile within the Church of England. Bishop Robert is chair of the Faith and Order Commission I"FAOC"}, the vice chair of the Council for Christian Unity and a member of the Clergy Discipline Commission. As FAOC Chair he is, ex officio, a member of the House of Bishops Standing Committee and was co-opted onto the LLF Implementation Group. He is the co-chair of the Reuilly conversations between the Anglican Churches of the British Isles and the French Protestant Churches, and a member of the Central Committee of the World Council of Churche5. He has recently been appointed co-chair of the International Anglican Roman Catholic Commission for Unity and Mission IIARCCUMI. The Head of Safeguarding sits on a number of National Advisory groups and the Diocesan Secretary is a member of the National Diocesan Secretaries Liaison Group. The Archdeacon of France and Switzerland is a member of the executive committee of the College of Archdeacons. 2023 AnnualReportand Financial Statements 14 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT lor fheyear ended 37 December2023 FINANCIAL REVIEW Summary The net deficit for the year before investment gains for the Unrestricted Fund {including Designated Funds) was £27,961 (2022: £212,133). The improved position is principally the result of a sustainability grant of £150k received by the DBF from the Archbishops, Council. The outcome was also helped by better than forecast income from investments and interest on cash balances and substantial cost savings against the budget in all departments. The DBF has consistently kept costs down and staffing levels remain lower than any other diocese in the Church of England, apart from Sodor and Man. Th8 underlying health of chaplaincy finances is hard to assess as figures for 2023 are not yet available. The picture is very uneven with some chaplaincies recovering better from the pandemic than others and experiences varying between the North and the South and between urban and rural areas. It is hard to build the detailed picture of the variable f inancial experiences across the Diocese but overall chaplaincy income rose by 11.8% in 2022. Nevertheless, Common Fund payments from chaplaincies were 96% of the amount requested. This was an extremely positive result, reflecting generosity across the Diocese by many chaplaincies who continue to face challenging financial circumstances. The DBF continues to make hardship grants to assist chaplaincies facing big unexpected financial challenges. A designated f und was established in 2020 to assist with the effects of Covid-19. So far £417k has been distributed. In 2023 the amount was £57k, which was lower than expected with fewer requests being made. There is £332k left in the fund which includes an anonymous donation of £100k received in the year. Unrestricted listed investments are managed by fund managers at CCLA. They performed well against comparable fund managers and the capital value of our investments rose by £359k18%1 in the year, compared to a decrease in value of £605k in 2022. This Annual Report reflects the considerable generosity of chaplaincies, and the careful stewardship of the DBF with the funds provided. However, without the Archbishops, Council grant, the outcome would have been a considerable deficit. There is no doubting the impact and vibrancy of much chaplaincy life across the Diocese. The challenge for the DBF is how to continue its work on very limited resources at a time when the demands placed upon staff are increasing. That challenge ha5 to be balanced with the financial concerns of the chaplaincies, which are the principal contributor of funds. Unrestricted Funds were £4,643,838 (2022: £4,318,548) and Total Net Assets including Restricted and Endowment Funds were £12,150,62912022: £11.363,6461. 2023 Annua/Report and Financialstatements 15 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for the year 8nded 37 December 2023 FINANCIAL REVIEW (continued) Common Fund and other Income Total income for the year was £2,365,832 12022: £2,263,011). This includes unrestricted income of £1,739,182 12022.. £1,598,194) and restricted income of £626,650 {2022: £663,834) received from a number of activities such as the training of ordinands and Strategic Ministry Funding for Curates (See Note 18al. There was an increase in the year in contributions from chaplaincies through the Common Fund, from £912,142 to £927,430. (The Common Fund represents 68% of the unrestricted income of the DBF, reported in the quarterly management accounts). 96% of the amount requested was paid in 2023. Chaplaincies were assisted by the introduction of a cap of 10% on the increase in requests to any individual chaplaincy that would have been occasioned by the return to the use of the Common Fund Formula which had not been used in 2020- 2022. The capping meant that the overall amount requested was £72k less than the budgeted figure. In 2024 the cap on increases has been set at 15%. The concept of the capping of increases, and the way it is applied, will be reviewed annually. Capping should be phased out over time as we move closer to requests made on the basis of the Common Fund formula only. Support from the Natlonal Church The Diocese in Europe is generally treated in a similar way to all other dioceses in the Church of England with regard to grants that are available from the National Church via the Archbishops, Council. The DBF is active in applying for support on all fronts. The following support has been received. Sust8inability Grant £150k. The programme was a continuation of help that was offered during the pandemic and was extended to assist with rising costs due to inflation. The programme is unlikely to be extended further. Lowlncome Communities Funding. £185k. This is guaranteed through to and including 2025 with inflationary increases. Discussions regarding the next triennium are starting in 2024. Strategic Ministry Funding. £173k. The Ministry Division gives support that represents 70% of the f ull cost to a chaplaincy of a stipendiary curate. This includes housing, local taxes and pension contribulions. 4 curates were supported and a further cohort of 3 will join the scheme in 2024. Net Zero Carbon. £15k. An initial enabling grant was received in 2023 in support of the Diocese's objective of being Carbon Net Zero by 2030. A further grant of £130k was agreed to cover the costs of a part time Net Zero Officer and other consultancy work that may be needed over the next 2 years. Racialjustice. £10k was contributed towards the costs of the Racial Justice Conference held in Freiburg in November 2023. 2023 Annual Report and Financialstatements 16 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for th8 year ended 31 December2023 FINANCIAL REVIEW (continued) Support from the Natlonal Church {contlnued) Strategic Mission and Ministry Investmenf. Negotiations are beginning for a grant to assist with new diocesan initiatives focussed on Children and Young People, establishing new worshipping communities in cities where the Diocese has no presence, and supporting chaplaincies with growing communities of migrants and asylum seekers who have very little money to support ministry costs. The DBF is also working hard to secure a grant from the Buildings for Mission Fund which was inltially allocated only to 'mainland' dioceses. Grants from the Archbishops, Council are specifically targeting objectives set under the Church of England Vision and Strategy. These funds, with the exception of the Low Income Communities Fund, though welcome do not cover the day-to-day regular costs of the DBF. They also take considerable effort to acquire and to manage and at times they may not fit the particular operational structure of the Diocese in Europe. In common with all dioceses in the Church of England, the Archbishops, Council funds costs in relation to the Diocesan and Suffragan Bishop. This includes stipend, pension and off ice costs. In the case of Bishop Robert this is funded through a Belgian charity (The Office of the Bishop in Europe ASBLI. Although the Diocese benefits considerably from the activitles of its Bishops, it does not bear the substantial costs associated with these activities. Expendllure Total charitable expenditure was £2,478,62112022: £2,429,864), made up largely of direct ministry and mission costs and grants. Included in this was total expenditure of £247,094 from designated funds 12022: £316,530) and restricted expenditure of £711,478 12022: £619,537). See Notes 8 and 18a for further details. The DBF off ices in14 Tufton Street are still to be refurbished by the landlord, the Corporation of Church House, so staff are in other rooms in Church House. The rent did not change in 2023. Flnanclal Governance Flnancial oversight is provided by the Finance, Audit and Personnel Committee I'FAPC'I which met formally online five times during the year as well as providing advice through correspondence. The Committee is a source of essential expertise and challenge to the executive, as well as representing the concerns of chaplaincies about financial matters. Revd. Richard Williams stood down frorn the committee and a new member with a strong accountancy background will be co-opted. The Committee gave detailed consideration to the notion of capping increases in Common Fund requests to individual chaplaincies and recommended to the Trustees that no Chaplaincy should face an increase, derived from the forrnula, in excess of 10% in 2023 and 15Ya in 2024. It was agreed that any shorttall against the budget as a result of this proposal would be funded from reserves. 2023 AnnualReport and Financial Statements 17 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for the year ended 31 December2023 FINANCIAL REVIEW (continued) Flnancial Governance (conllnued) The FAPC recommended the slrategic f inancial planning objective of plannlng for a deficit below £100k by the end of 2027 and ensuring that at least 1.5 years of annual expenditure remains in the unrestricted reserves at that time. 80th of these objectives are incorporated in future financial plans. The objective in setting the Common Fund request is to raise sufficient funds to support the agreed aclivities of the DBF whilst keeping it as low as possible to give the chaplaincies the best chance of remaining f inanclally sustainable. The FAPC aims to make grants from the Mission Opportunities Fund to promote chaplaincy growth and from the Hardship Fund to help chaplaincies in unexpectedly difficult clrcumstances. So far a total of £417k has been distributed from the Hardship Fund to 32 chaplaincies. £332k remains in the fund and this Is expected to be used over the next 3 years. A £100k anonymous donation was received in the year. Priority in hardship grants will continue to be given to covering stipendiary clergy costs, subsidising housing costs and bills for those with part time or house for duty licences. Chaplaincies with 4-6 months or less expenditure in reserve will be the priority for such grants. Loans and LiquSdlty The D8F took out a loan from CCLA of £500k in January 2021 and pays back £50k a year. £350k was outstanding at the end of 2023. The rate payable is 0.55% above the Bank of England Base rate. The DBF had sufficient liquidity such that no investrnents needed to be sold In the year. The DBF has availed itself of the interest bearing deposit accounts at CCLA, which returned 5.25% on cash invested as of April 2024. Dlocesan Investmenls Diocesan unrestricted investments were monitored weekly throughout the year and their value was reported regularly to the FAPC. The DBF'S investment manager, CCLA, attended FAPC meetings to update the committee on investment performance and strategy. In the view of the FAPC, the fund managers are doing a very effective job on behalf of the DBF frequently outperforming many other UK Fund Managers and guaranteeing a strong ethical investment approach in line with the policies of the Church of England. The DBF has no investments in fossil f uels. 2023 Annu81 Reportand Financi8lStatement5 18 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for the year ended 31 December2023 FINANCIAL REVIEW (continued) Remuneration of key management personnel The responsibility for setting salaries for all staff, including senior personnel, lies with the Finance, Audit and Personnel Committee I"FAPC"I, subject to the overall budget parameters approved by the Trustees. Prevailing market conditions are taken into account. In 2023 the pay rise for DBF Staff and stipends paid direct from the DBF was 5Y.. Grant maklng pollcy The Trustees award grants principally through the FAPC. These are normally to establish new chaplaincies via the Diocesan Development Fund or develop new mission initlatives within a chaplaincy or archdeaconry via the Mission Opportunities Fund. Investment pollcy The policy of the Trustees is to Invest in a dlversified portfollo of quoted equity and fixed interest securities. They take into account the requirements of the law in relation to the investment of charitable monies, while seeking the best possible returns and having due regard to preservation of capital. Investment decisions also take account of the funds, ethical policies and ensure that these fall within the guidelines approved by Church of England General Synod. The Company invests through cornmon investment funds and does not invest directly in the stock market. For operational reasons, it also has certain limited interests in property. The portfolio held is diverse and designed to withstand pressures that may come in various parts of the global economy. Reserves pollcy The Trustees consider it important to hold reserves to cover unforeseen eventualities and the possibility of future operating deficits, taking into account the fact that more than half of all funds are endowed for specific purposes. In the case of unrestricted funds, the Trustees seek to maintain general reserves Ihat will support the ongoing mission of the Diocese in support of the chaplaincies and allow the Company to operale as a going concern. The amount held in reserve is a relatively high multiple of annual expenditure compared to other dioceses. However, the Diocese in Europe has few other assets such as land or buildings and little flexibility in its cost base. Hence these funds are the only sources of finance in the event of significant financial challenges such as have been experienced in recent years and they derive significant income through dividends and interest. Current financial planning envisages further deficits being funded from reserves. However, Trustees approved the annually revised long term financial plan in 2023 which targets a reduction in the annual deficit to less than £100k by 2027. At this point the policy of maintaining unrestricted reserves of at least 1.5 times annual unrestricted expenditure will be fulf illed. 2023AnnualReportandFinancial Statements 79 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for theyear ended 31 December2023 FINANCIAL REVIEW (continued) Penslons The Church of England Funded Pension Scheme no longer requires deficit contributions as it is in surplus. For Chaplaincies with clergy in the Church of England Pension Fund, the annual contribution has reduced by £3,015 or 25Yo since 2021 with a further 3% reduction due in 2024. The standard pension contribution is now £8,784 per year and is based on 25Yo of the Minimum Stipend 8enchmark of the Church of England. Sources of funding All chaplaincies in the Diocese are required to be financially self-suff iclent. They are funded largely by donations from members and visitors and in some cases by returns on investments and local commercial activity. Some chaplaincies receive signif icant support from rnission agencies working in the Diocese, including Mission to Seafarers (which funds several port chaplains), and the Intercontinental Church Society (which retains patronage of 24 churches and supports some seasonal workl, and the Benefact Trust (formerly Allchurchesl which supports both the DBF and Holy Trinity Cathedral in Gibraltar. USPG have provided funds for the work with refugees in Calais and the work of the Community Kitchen in Brussels. USPG has partnered the DBF in the Ukraine Appeal. Volunteers The DBF is dependent on the huge number of people involved in chaplaincies. The number of active volunteers lor volunteer hours) dedicated to the mission and ministry of the church is a key indicator of the health of a church. The service provided to a cornmunity through church volunteering also has a significant impact on people's relationship to the church particularly at times of crisis. Within this context, the DBF greatly values the considerable time given by all Committee members and other volunteers across the Diocese in pursult of the church's mission. Measuring in a meaningful way the in-kind value of volunteer tlme to the operations of the DBF is particularly diff icult. It is for this reason that no estimate of the value of this time has been included in the financial statements. Volunteer recruitment is now carried out in a way that seeks to take account of the Church of England guidelines on Safer Recruitment. 2023 Annual Report and Financial Statements 20 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT or theyear ended 31 December 2023 FINANCIAL REVIEW (continued) Going concern The financial position and forecasts are reviewed annually, taking into account the levels of reserves and cash. As a result of the current review, the Trustees believe that the Diocese will be able to manage operational and financial risks successfully for the foreseeable future. It continues to be the Trustees, policy to invest surplu5 funds in fixed asset investments for the long-term so that the best returns are achieved. The Trustees are confident that the DBF can access these resources at short notlce should the need arise to satisfy current liabilities. 2023AnnualReport andFinancialStatements 27 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for the year ended 31 December2023 PRINCIPAL RISKS The Trustees are responsible for maintaining a sound system of financial control to safeguard the Company's assets. The FAPC identifies the major risks to which the Company is exposed, and such systems and procedures as are practicable to put in place to mitigate those risks. A formal risk assessment review is conducted annually at the Winter meeting of FAPC, which monitors the risks and the effectiveness of the system of internal control operated by the Company. The most signif icant risks are as follows: Safeguarding failure Adverse findings from a big case could have a significant reputational or financial impact. This risk is mitigated by strong leadership from the Diocesan Safeguarding Advisory Committee together with the engagement of professional safeguarding staff, Diocesan safeguarding policy and training and the DBF'S insurance. The Past Cases Review 2 gave confidence that historic cases have been dealt with appropriately and that required action has been taken. Investment underperformance Poor Investrnent performance could have an adverse effect on the ability of the DBF to meet its financial commitments. To mitigate this risk funds are invested with an established and reputable fund manager. Funds are widely spread, and performance is monitored. Chaplaincy finances Chaplaincies face a range of issues, including 8rexit, which in some cases make payment of Common Fund very challenging. This is mitigated by prudent financial planning and encouragement of appropriate stewardship and giving. Communication with chaplaincies about the Diocesan finances has improved in recent years and there is sorne evidence that greater understanding has assisted in chaplaincies in being more prepared to contribute. Reliance on key staff The DBF is run by a small number of staff. Changes to, or unavailability of, senior staff has potentlal to seriously hamper Diocesan operations. Staff resourcing is currently being reviewed to ensure that the Diocese has sufficient cover for unexpected absences. Globalpand8mic The widespread impact of the virus may continue for 2-5 years with an impact on chaplaincy and hence Diocesan income. This might be partially mitigated by improved stewardship by chaplaincies and improved cost control at all levels within the Diocese as well as some changes in the pattern and deployment of ministry in chaplaincies. 2023Annual Reportand Financial Statements 22 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for the year ended 31 D8cember2023 PRINCIPAL RISKS (contlnued) Insurance The DBF has only limited legal insurance for its staff and activities outside the UK. Chaplaincies are required to insure their assets and activities locally. Appropriate insurance Is hard to acquire and in some jurisdictions it is far from easy for chaplaincies. The DBF is seen as the'payer of last resort" which may not be a sustainable position. Further work has commenced on this matter with a new insurance broker. Hazards The Diocese has insurance in place wilh a reputable insurer to cover catastrophlc risks such as fire, flood and computer failure. The Diocese Is a tenant of Church House in Westminster and uses services provided by Church House. It can therefore rely on disaster recovery and computer back-up routines employed by the National Church Institutions. Costs related toproperty held by the D8F Properties in the Diocese, both churches and accommodation are normally maintained by the chaplaincy which uses them. There are a small number including a church and a cemetery in Italy which do not have that cover and which may incur unexpected costs. The DBF is seeking to divest itself of such properties. Funds held as custodian frust88 The DBF holds investments and cash on behalf of chaplaincy councils. Care is taken to ensure the f unds are managed correctly and that sufficient liquidity is maintained to ensure any demands for repayment can be met. This matter was reviewed by the FAPC in 2023. 2023Annual Report and Financialstatemenfs 23 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for theyear ended 37 December 2023 STRUCTURE AND GOVERNANCE The Diocese in Europe Is 8 diocese of the Church of England in the Province of Canterbury. The legal framework for the Diocese is the 'Diocese in Europe Measure 1980, and the Constitution of the Diocese 1995. While The Diocese in Europe Board of Finance is autonomous for most practical purposes, decisions may be influenced by those taken by the Church of England. The D8F is a Company, which is limited by guarantee and which does not have share capital. It is incorporated in England and Wales with the registration number: 106580. Dlrector8 and Trustees Under the Memorandum and Articles of Association, members of the Bishop's Council ar8 designated as Directors for the purposes of the Companies Act 2006 and are Trustees under charity law. The members of the Diocesan Synod are the members of the Company. The members of the board may derive no benefit, income or capital interest from the Company's affairs from their position, other than the reimbursement of out-of-pocket expenses. The exception to this is for Archdeacons who are members of the board but are paid a stipendiary salary and pension for their roles as archdeacons. In the event of the Company being wound up, each member, who is a member at that time, has undertaken to contribute £1 to the Company. Constllullon The constitution of the DBF is set out In its memorandum and articles of association. Episcopally led, the DBF'S activities are directed by the Diocesan Synod and Bishop's Counc51 which also meets as the Board of the DBF and as the Trustees of the charity {together'The Trustees"}. The constitution was amended in 2023 to allow for online governance meetings. Organlsation and declslon-making structure Members of Diocesan Synod are also members of the Company and the charity. They set priorities and the overall financial strategy for the DBF in its prime imperative to participate in God's mission by and to Anglicans across the area covered by the Diocese in Europe. The Trustees meet at least once a year at Bishop's Council and approve the budget for the following year. They also consider strategic financial matters and monitor the implefflentation of financial policies. Members of the Company meet annually during Diocesan Synod to approve the Annual Report and Financial Statements and consider the forecasts. The FAPC meets at least four times a year to review the DBF'S overall activities against budget, consider investment policy and performance, and approve requests for grants. It also reviews the budgets prior to their presentation to Bishop's Council and the Annual Report prior to its presentation to the DBF members at the Diocesan Synod. Membership of the Committee is a balance of ex-off icio appointments and members elected by the Trustees every three years. 2023 Annual Report and Financialstatements 24 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for the year ended 37 December 2023 STRUCTURE AND GOVERNANCE (continued) Appolntment and Inducllon of Trustees At the start of each new triennium new Trustees and members participate in an induction process and receive information about roles and responsibilities. A new triennium begins in November 2024 and consideration will be given in the corning year as to how induction might be enhanced for the new cohort. This may include reference to statutory regulation such as that provided by the Government, the National Church and the Charity Commission. other organlsatlons wlth whlch the Board co-operates In achlevlng its objectlves Ttte Company's activities involve regular and routine f inancial transactions with chaplaincy councils in the Diocese, as well as the central Church authorities, though none of these bodies are a connected charity as defined by charity law. In addition, there are links lin respect of finance and activities) with various related agencies, together with Diocesan-wide voluntary and statutory organisations. Declslon making and delegation pollcy Diocesan Synod sets and approves strategy and pollcles. The Board sets the annual budget and makes decisions on the financial policy for the Diocese. The day-to-day management and implementation of agreed strategies and policies 15 undertaken by senior staff. Funds held as Custodlan Trustee on behalf ol others The DBF holds investments and cash as custodian Trustee on behalf of its chaplaincy councils and trusts. Where amounts owed to chaplaincies and trusts are matched by specific investment and cash balances these are excluded from the D8F's balance sheet and are recorded in Note 21. Public beneflt The Trustees are aware of the Charity Commission's guidance on public benefit 'Th8 Advancement of Religion for the Public Benefit" and have regard to that guidance in their administration of the charity. The DBF believes that this report provides evidence of the public benefit of the charity's work in 2023. As described more fully throughout the report, the DBF provides funds to support the work of Anglican Chaplaincies in Europe, part of North Africa and Russia. The vast majority of churches are available to the public at large and none is restricted to members of the Church of England. Trustees, Indemnlty The D8F provides insurance to Trustees agalnst liability in respect of actions brought by third parties, subject to the conditions set out in the Companies Act 2006. Such qualifying third-party indemnity insurance remains in force as of the date of approving the Trustees, Annual Report. 2023AnnualReport and Financi3lSt8tements 25 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for theyear ended 31 December2023 STATEMENT OF TRUSTEES, RESPONSIBILITIES The Trustees (who are also the directors of the charitable company for the purpose of Company lawl are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations. Company law requires Trustees to prepare financial statements for each financial year. Under that law the Trustees have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (UK Accounting Standards and applicable law). The f inancial statements are required by law to give a true and fair view of the state of affairs of the DBF and of the surplus or deficit of the DBF for that perlod. In prepar5ng these f inanclal statements the Trustees are required to: Select suitable accounting policies and apply them consistently. Observe methods and principles in the Charities SORP. Make judgements and estimates that are reasonable and prudent. State whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements. Prepare the financial statements on a going concern basis unless it is inappropriate to assume that the Company will continue in operation. The Trustees are also responsible for keeping proper accounting records that dlsclose with reasonable accuracy at any time the financial position of the DBF and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the DBF and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. Thls report has been prepared In accordance with the special provisions relating to small companies withln Part 15 of the Companies Act 2006. Slalement of disclosure to Ihe Auditor As far as the Trustees are aware. there is no relevant audlt Information of which the charitable Company's auditor Is unaware. The Trustees have taken all steps that they ought to have taken as Trustees in order to make themselves aware of any relevant audit information and to establish that the charitable Company's auditor is aware of that information. Appolntment of Audltor A resolution to reappoint Haysmacintyre LLP as auditor to the Company will be proposed at the Annual General Meeting. On behalf of the Board of Trustees on 12 June 2024 M Fegan- Chair 2023AnnualReport andFinan¢i8lStatements 26 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT for fheye8r ended 37 December2023 ADMINISTRATIVE DETAILS Trustees No Trustee had any beneficial interest in the Company during the year. The following served as Directors and Trustees throughout the year, except where stated. Triennial Electlons to Diocesan Synod were held in the Summer of 2021, and will be held again in 2024. Ex off Icio Mr. M Fegan (Chairl The Right Rev'd Dr. R Innes- Bishop of Gibraltar in Europe The Right Rev'd Dr. D Hamid - Suffragan Bishop (retired February 2024} The Venerable P Hooper- Archdeacon of France The Rev'd Canon S Prasadam (Chair, House of Clergy) - Ireslgned June 2023) The Rev'd Canon E Bendrey (Chair, House of Clergy) - (from June 2023) The Venerable L Nathaniel- Archdeacon of the East, Germany & Northern Europe Ms. M Talbot Ichair, House of Laity) The Very Rev'd l Tarrant- The Dean The Venerable S Van Leer- Archdeacon of North West Europe The Venerable D Waller- Archdeacon of Gibraltar and Archdeacon of Italy and Malta Eh¢ted- Ho￿e ofLafty Ms S. Boyd Mr. D Bean Mrs. J Berry Ms. J Cole Mr R. Hall Mrs. M Kopetzky Mr S Urquhart Elected- House of Clergy The Rev'd Canon C Cooke The Rev'd Canon D Flach The Rev'd R Gardener The Rev'd G Read The Rev'd R Seabrook The Rev'd R Warren The Rev'd Nathanial Nathanial 2023AnnualReport8ndFinancialStatemenfs 27 THE DIOCESE IN EUROPE BOARD OF FINANCE ANNUAL REPORT lor theyear ended 31 December2023 ADMINISTRATIVE DETAILS (continued) Trustees (continued) Nominatedby the Bishop of Glbraltarln Eumpa Mr. D Coulston Mr. D White The Revd T Makipaa Flnance, Audlt and Personnel Commltlee I"FAPC") The following served on the FAPC throughout the year and to date, except where otherwise stated: Mr. M Fegan (Chairl The Rt Rev'd Dr. R Innes- Bishop of Gibraltar in Europe The Rt Rev'd Dr. D Hamid- Suffragan Bishop (resigned February 20241 Ms. J Almvang Mr. D Bean The Rev'd Canon Dr. P Hooper- Archdeacon of France Ms R Pearce Fr R Seabrook Rev'd R Williams (resigned December 20231 Senlor staff and prlnclpal advisers A Caspari - Chief Operating Officer (Diocesan Secretary) I Company Secretary Registered offlce 14 Tufton Street London, SW1P 3QZ Telephone.. 00 4410)207 898 1155 e-mail,. bron.panter@churchof8ngland.org www.europe.anglican.org Independent Audltor Haysmacintyre LLP 10 Queen Street Place London EC4R 1AG Investment manager CCLA Investment Management Ltd Senator House 85 Queen Victoria Street London EC4V 4ET Bankers Barclays Bank plc Media, 27 Soho Square London W1D 3QR Legal registrar Aiden Hargreaves-smith Partner, Winckworth Sherwood Minerva House, 5 Montague Close London SE19BB 2023Annual Report and Financial Statements 28 THE DIOCESE IN EUROPE BOARD OF FINANCE INDEPENDENT AUDITOR'S REPORTTO THE MEMBERS OF THE DIOCESE IN EUROPE BOARD OF FINANCE for theyearended 37 D8cember2023 Oplnlon We have audited the financial statements of The Diocese in Europe Board of Finance for the year ended 31 December 2023 which comprise the Statement of Financial Activities, the Summary Income and Expenditure Account, the Balance Sheet, the Cash Flow Statement and the notes to the financial statements, including a summary of signif icant accounting policies. The f inancial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The FinanclalR8POrtingSt8ndardapplicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion the flnanclal statements: give a true and fair view of the state of the charitable company's affairs as at 31 December 2023 and of the charitable company's net movement in funds for the year then ended,. have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice,. and have been prepared in accordance with the requirements of the Companies Act 2006. Bas18 for oplnlon We conducted our audit in accordance with International Standards on Auditing (UK) I'ISAS IUKI") and applicable law. Our responsibilitie5 under those standards are f urther described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the charitable company in accordance with the ethical requirements that are relevant to our audit of the f inancial statements in the UK, including the FRC'S Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Concluslons relating to golng concern In auditing the financial statements, we have concluded that the Trustees, use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the charitable company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the Trustees with respect to going concern are described in the relevant sections of this report. 2023 AnnualReport and FinanGial Statements 29 THE DIOCESE IN EUROPE BOARD OF FINANCE INDEPENDENT AUDITOR'S REPORTTO THE MEMBERS OFTHE DIOCESE IN EUROPE BOARD OF FINANCE for theyear ended 37 December 2023 other inforrnation The Trustees are responsible for the other information. The other information comprises the information included in the Trustees, Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report. we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility Is to read the other information and. in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude thal there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in thls regard. Oplnlons on other matters prescrlbed by the Companies Act 2006 In our opinion, based on the work undertaken in the course of the audit: the information given in the Report of the Trustees for the financial year for which the f inancial statements are prepared is consistent with the f inancial statements., and the Report of the Trustees has been prepared in accordance with applicable legal requirements. Malters on whlch we are requlred to report by excepilon In the light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Trustees, Annual Report. We have nothing to report in respect of the following rnatters in relation to which the Companles Act 2006 requires us to report to you if, in our opinion: adequate accounting records have not been kept by the charitable company, or returns adequate for our audit have not been received from branches not vislted by us,. or the charitable company financial statements are nol in agreement with the accounting records and returns; or certain disclosures of Trustees, remuneration specified by law are not made; or we have not received all the information and explanations we require for our audit., or the Trustees were not entitled to take advantage of the small companies, exemptions in preparing the Trustees, report and from the requirement to prepare a strategic report. 2023 Annual Report and Financial Statements 30 THE DIOCESE IN EUROPE BOARD OF FINANCE INDEPENDENT AUDITOR'S REPORT TOTHE MEMBERS OF THE DIOCESE IN EUROPE BOARD OF FINANCE for the year ended3T December2023 Responslbilities of Trustees for the financial statement8 As explained more fully in the Trustees. responsibilities statement. the Trustees (who are also the directors of the charitable company for the purposes of company lawl are responsible for the preparation of the financial statements and for being satisf led that they give a true and fair view, and for such internal control as the Trustees determine is necessary to enable the preparation of financial statements that are f ree f rom material misstatement, whether due to fraud or error. In preparing the financial statements, the Trustees are responsible for assesslng the charitable company's ability to contlnue as a going concern, disclosing. as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustees either intend to liquidate the charitable company or to cease operations. or have no realistic alternative but to do so. Audltor'g responslblllties for Ihe audit of the flnanclal statements Our objectives are to obtain reasonable assurance about whether the flnancial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditorfs report that includes our opinion. Reasonable assurance is a high level of assurance. but is not a guarantee that an audit conducted in accordance with ISAS IUKI will always detecl a material misstaternent when it exists. Misstatements can arise from f raud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including f raud is detailed below. Based on our understanding of the charitable company and the environment in which it operates, we identified that the principal risks of non-compliance with laws and regulations related to charity law, and we considered the extent to which non- compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006, the Charities Act 2011, payroll tax and sales tax. We evaluated management's incentives and opportunlties for fraudulent manipulation of the Financial Statements (including the risk of override of controls), and determined that the principal risks were related to the posting of inappropriate journal entries and management bias in accounting estimates and judgements. Audit procedures performed by the engagement team included: 2023 Annu8/ReportandFinancial Statements 37 THE DIOCESE IN EUROPE BOARD OF FINANCE INDEPENDENT AUDITOR'S REPORTTO THE MEMBERS OF THE DIOCESE IN EUROPE BOARD OF FINANCE for the year ended 37 December 2023 Audltor's responsibilities for the audit of the financial statements (contlnued> Reviewing minutes of Trustee and committee meetings for evidence of non- compliance with laws and regulations and fraud; Discussions with management including consideration of known or suspected instances of non-compliance with laws and regulation and fraud; Evaluating management's controls designed to prevent and detect irregularities- Identifying and testing journals, in particular journal entries posted thal significantly impact on the result for the year. posting in areas subject to significant judgements or estimates, postings in accounts that are consldered higher risk,. and Challenging assumptions and judgements made by management in their critical accounting estimates. A further description of our responsibilities for the audit of the f inancial statements is located on the Financial Reporting Council's website at.. www.frc.or .uk auditorsres onsibilities. This description forms part of our auditorfs report. Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. Use of our rep¢xt This report is made solely to the charitable company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and charitable company's members as body, for our audit work, for this report, or for the opinions we have formed. Adam Halsey (Senior Statutory Auditor) for and on behalf of Haysmacintyre LLP, Statutory Auditor Date: 27 August 2024 10 Queen Street Place London EC4R 1AG 2023Annua/Report and Financialstateménts 32 THE DIOCESE IN EUROPE BOARD OF FINANCE STATEMENT OF FINANCIAL ACTIVITIES for theyear ended 31 December 2023 Totsl funds Tolal fund# UnrestrSct•d R•strlthed Endowme funth fvnd$ fvndB 2023 2022 Not8 ￿￿orn• •ndowm•nts from: Donations arKI legaclès Common Fund Archbishops, Council gr8nt Archb15hop5' Councll sustanabllltywant Other donations Charllable aeiivitles Inve$trnent5 Other 927,430 184,968 150,000 230,702 927.430 184,968 150,000 683,619 912,142 178,799 452,917 780,955 14,695 372,558 3,862 242,761 3,321 173,733 418,494 3,321 Toial kncom• 1,739,182 826.880 2.385.832 2,283.011 Exp•ndltur• on: Charitabl8 acisvitles 819 11,767,143> 1711,4781 12,478,621) 12,429,864) N•t Id•llclll b•for• q•kn on Inv•#tm•nt• 127.9SI1 184,8281 1112.7891 1188,8S31 Net gain I (Ioss) on fixed assot InvosimoN$ 540,521 899,772 11,372,812) 14 359,251 N•1 Incom• I Id•ficttl kn y•ar 331.290 {84,8281 540,521 788,983 11,539,86SI Tr4n•l•ri b•h¥••n fvnds 12 16,0001 6,000 N•tmovern•nt kn lund• 325,290 178.8281 $40,521 788,983 11,539,685) Trfall￿Xl$ brought f¢Yward 4,318,S48 530,902 6,514,19e 11,363,648 12,903,311 Totall￿￿¥ carrl•d lo￿1rd 18 4,043,838 452,074 7.054,717 12.150,629 11,383.646 All actlvlties derlve from contlnulng actlvltles. Tho Notes on pages 38 to 58 form part of these flnancial statements. 2023Annua/Report and Financial Statements 33 THE DIOCESE IN EUROPE BOARD OF FINANCE INCOME AND EXPENDITURE ACCOUNT for fh8y8ar ended 31 December 2023 2023 2022 Note Totsl Incom8 2,365,832 12,478,621) 2,262,028 12,429,864) Totsl expendltur8 Opttatknw (doflcltl 1112,789) 1187,8361 Net galn I Ilossl on fjxed asset Investrr*nts 14 359,251 1604,9191 Tol•l ¢ompr•h•Mlv• Incom• I Id•flclt) 248.462 1772,7551 The Income and expendlture account is derlved from the Stat8ment of Financlal Actlvltl¢$ wlth movements In endowment funds excluded to comply wlth company law. All income and expendltur8 Is derlved from contlnulng actlvltles. 2023 AnnualReport andFinancialStatements 34 THE DIOCESE IN EUROPE BOARD OF FINANCE BALANCE SHEET lor the year ended 37 December2023 2023 2022 Ntsta Flxed As$ot8 Tangible fixed ass￿$ Investments 13 14 526,337 11,464,792 536,819 10,886,836 11,991,129 11,423,655 Debtors Short term daposlts and cash at barhk 15 572,126 2,051,288 532,885 1,747,830 2,563,414 12,053,914) 2,280,715 11,940,724) Cradltors.. amounts lalllrhg olue w5tNn one year 16 N•t current a¥ogt• 509,500 339,991 Tot•1 a•••l• l••# Current lablltle• 12,500,629 11,783,646 Cradltors.. amounts falllng (lua after ona yoar 17 1350,0001 1400,0001 Nel A•*•i• 12,150,629 11,383.846 Fund• UnrestrS¢t•d Funds General Dèslgnated Funds 4,168,881 474,957 3,812,282 506,266 18 18 18 4,643,838 452,074 7,054,717 4,318,548 530,902 6,514,19fj Restrlcted Fund$ Endowment Fund5 12,150,029 11.363,646 The notes on pages 38 to 58 form part of these flnancial statements. The flnanclal statements were approved by the Board of Trustees and authorlsed for issue on 12 June 2023. The fSnancSal statements are slgned on behalf of the Board of Trustees by.. Mlke Fegan Chalr Company reg. number: 106580 2023AnnualReport andFlnancia/Statements 35 THE DIOCESE IN EUROPE BOARD OF FINANCE CASH FLOW STATEMENT lor the year 8nded 37 December 2023 2023 2022 Cash flow¥ from op¢ratlng actl¥lll•s- so• A below, for dolail Net cash loutflowl from operatlng actlvities Caih Ilow• from investlng acllvltlo8 Interest and dlvidends rece5ved Proceeds from sale of investments Purehase of.. Tangible flxed assets (384,853) (150.841) 416,494 321,816 372,558 12,0981 Nel cash provlded by Investing aetivitles 738,310 370,460 Cash flows from financing actlvStSes Repayment of borrowlng 150,0001 150,0001 Net cash provlded by financlng actlvltles 150,0001 150,0001 Ch•nge In cash and c•$h •qulvalent• In tho y•*r Cash and cash equivalents at 1 January C••h and ea9h equlv•l•nt• •131 D•cember- 8oe below, for detall 303,457 1,747,830 189,819 1,578,211 2.051,287 1,747,830 2023AnnualReport andFinancial Stat8m8nts 36 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE CASH FLOWSTATEMENT for theyear ended 31 December2023 2023 2022 Rooon¢lllailon of nat In¢om• to nel cash flowfrom operatlng •¢tivili A Net incom before Invostmenl galn¥ for thè y•Ar Adlustrnent5 lor- Depreclallon IGalnl I losson Investments Investment Income Dgcrease I Ilncreasel In debtors Increase In credltors 786,983 11,539,665) 10,482 1899,7721 1416,4941 20,759 113,190 9,278 1,372,812 1372,5581 169,5211 448,813 N•t e•$h (oulllow) from oporatlng aetSvltl•s 1384,853) 1150,8411 2023 2022 B Analy•l• of ca#h and ¢a•h •qulv•l•nls Short term deposlts and cash at bank 2 051288 1747 830 Atl Jan 23 Cash flows At31 Dec 23 Analy81• of chang￿ In nat d•bl Short term depo51ts and cash at bank Loans falllng due after more than one y9ar 1,747,830 1400,0001 303,458 2,051,288 50,000 1350,0001 1,347,830 353,458 1.701.288 2023AnnualReport and Financial Stat¢9ments 37 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December2023 Accountlng Policles a) General Informalion The DBF is a charitable Company limited by guarantee incorporated in England and Wales and registered with the Charity Commission. b) A¢¢ountlng conventlon and bas1$ of preparatlon The financial statements have been prepared under the historlcal cost convention, with the exception of fixed and current asset investments, whlch are included at th8lr market value at the balance sheet date. The financial statements have been prepared in accordance with the Statement of Recommended Practlce for Charities ISORP FRS 1021, second edition effective I January 2019, the Cornpar)ies Act 2006, and appllcabl8 accounting standards IFRS1021. The DBF meets the definition of a publlc benefit entity under FRS102. c) Golng concom The Trustees conslder thal there are no material uncertaSnties regarding the DBF'S ability to continue as a going concern. See page 21 for further d8lails. d) Incomo All incoming resources aro included In the Statement of Flnancial Actlvitles I"SOFA"I when the Board is le9ally entitled to them as income or capital respectively, when ultlmate receipt is reasonably certain and the amount to be recognised can be quantified with reasonable accuracy. The principal source of income of the DBF is Common Fund donations. These monies are recognised in the SOFA in the period for which they are receivable. Monles received after the new Common Fund request is rnade ar8 included in the current year on an entltlemenl basis. Grants recelved which are subject to pre-conditions for entltlement or where use is specSfied by the donor are included in creditors where Ihese pre-condltions have not been met at the balance sheet date. Legacies, contributions and other donatlons are accounted for when conditions for thelr receipt have been met. Investment income is recognSsed when receivable. •) Expondlture Expenditure is accounted for on an accruals basis and has bèen aggregated under the relevant SOFA category. Expenditure includes irrecoverable VAT. Charltable expendifure consists of expenditure on resourcing mlnistry and mission in the chaplaincles of the Diocese. Grants payable are charged In the year when the offer is conveyed to the recipient except in those cases where the offer is conditional on the recipient satisfying perfomiance or other discretionary requirements to the satisfaction of thè DBF. These grants are recognised as expenditur8 when the conditions attaching to the grant are fulf illed. Grants offered which are subjecl to conditions which have not been met al the year-end are noted as commitments, but not accrued as expenditure. Support costs consist of central management, administration and governance costs. Administrative support associaled with making grants is insignificant and all costs are allocated to resourcing mlnistry and mission charitable expenditure. 2023 AnnualReport andFinancial Statements 38 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS lor theyearended 31 December 2023 1 Accounting Poliei•s Icontlnued) f) Tanglble flxed assots Assets In excess of £2,000 are normally capitalised as tangible fixed assets and are stated at cost less depreciation. Depreciation is provided on all tangible fixed assets other than freehold land, at rates calculated to write off the cost of each asset on a straight-line basis over its expected useful life, as follows.. Freehold buildings Leasehold property Leasehold improvements Equipment 100 years Over the term of lease Over the term of lease S years PropertS8s Included in fixed assèts only include thosè properties acquired after1974. The detalls of propertbes owned by the D8F prior to 1974 are recorded In a property register, but the historic cost is not known and therefore not included in the balanc8 sheet. None of these are "Heritage Asset5" g) Investmonts Investments are included In the balance sheet at market valu8 Wlth the galn or loss reported In the SOFA. h} Social Investments Sccial invèstments are at cost less any necessary impairment. They are not amortlsed. l) Leeie8 The DBF Is only party to operatlng leases and has no finance leases. The rental on these operating leases Is charged In full as expendlture in the year to whlch it relates. Where rent free periods are given as part of an operating lease, the impact of this rent free period Is included in the SOFA over the lease term. J) Forelgn exchang• Transactions In foreign currencies are translated at the rate ruling on the date of the transaction. Foreign currency balances are translated at th8 balance sheet date and any differences are included in the SOFA. k) Chaplalncy accounts Where the Diocese invests money on behalf of indlvldual chaplaincies, these assets and the associated liability to the chaplalncy are not included In the balance sheet. However, where the Diocese operates a "current accounv, with a chaplaincy, and the amount owed to a chaplalncy is not covered with specific assets in the chaplaincy name, these liabilities to the chaplaincies are recorded in creditors. If these obligations to chaplaincies were required to be settled, they would be settled out of the general unrestricted assets of the Diocese. 2023AnnualReport and FinancialSt3tements 39 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TOTHE FINANCIAL STATEMENTS for the yearended 31 December2023 Aceountlng Policies (contlnued) l) Penslons The accounting treatment for the pension schemes in which the DBF participates Is descrlbed In detall in Note 24. Actuarial gains and losses are recognised immediately in other recognised gains and losses. Where the scheme is deemed to be in a deficit position, this is recognised in full as a liability. Where the sch8me is determined to be in a surplus position, a surplus is recognlsed as an asset only lo the extent that this can be recovered in future years through reductlon In employer contributions or through a speclflc refund I reimbursement from the scheme. m) Flnancial instrumonts- assets and Ilabilltleg Debtors.. Debtors are reco9nised at the settlement amount due. Cash andcash 8qUIV318nt.' Cash at bank and cash in hand are arnounts held In short term hlghly Ilquid Investments wlth a short maturlty of thr88 months or18ss from the date of acqulsition or opening of the deposit or similar account. Creditors andprovisions.. These are recognlsed wher8 the DBF has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount due to settle the obligatiors can be measured or estimated reliably. They are normally recognised at their settlem8nt amount after allowing for any trade discounts due. n) Fund balance• UnresfrictedFunds The DBF'S corporate funds arè freely available for any purpose withln the Company's objects, at the dlscretion of the D8F. There are two types of unrestricted funds.. GeneralFunds whlch the Diocese Inlends to use for the general purpose5 of the Diocese. Designated Funds which are allocated to a specific purpose but whlch are, nonetheless, unrestricted. RestrictedFunds Income funds subject to condltlons imposèd by the donor as specific terms of trust, or else by legal measure. Endowment Funds Funds held on trust to be retained for the benefit of the donor charlty as a capital fund. In the case of endowrnent funds administered by the DBF, there is no provision for expenditure of capltal and all are classed as permanent endowments. 2023AnnualReport andFinancial Statements 40 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for theyear ended 31 Decemb8r2023 2 Critical accountlng judgemenls and estlmato6 In preparing these financial statements, management has made judgements, estimates and assurnptlons that affect the application of the DBF'S accounting policies and the reported assets, liabilities, Sncome and expenditure and the disclosures made in the financial statements. Estimates and Judgements are continually evaluated and are based on historical experience and other factors, including expectatlons of future events that are believed to be reasonable under the circumstances. Key area subject to judgement and estimation.. Recognition of delin8d benefifpension scheme creditor The DBF is different to many other English dlocesan boards of finance in that the clergy for overseas churches are legal employees of those local churches in order to comply with the dlfferent legal and tax frameworks In place across the wlde geographical area In which the DBF opèrates. Conslstent wlth thls practice, the relevant stlpendiary and pension expenses for overseas clergy are recognised In the financial statements of the local churches and not in the flnancial statements of the DBF. A valuation of the scheme for stlpendiary clergy is carrled out every three years and the most recent valuation completed was as at 31 December 2021. This revealed the scheme was in surplus and Iherefore there is no need to addilional contrlbutions wlth effect from l January 2023 as the scherne was fully funded. The DBF has estimated the asset should not be recognised In Its financlal statements as it 15 dètermined a surplu5 and is only recognised as an asset only to the extent this can be recovered in future years through a rèductlon in contributions or through a specific refundlrelmbursement from the scheme. Thi5 has resulted in the recognltion of a nll balance at the balance sheet date 12022.. £nill. A f ull explanatlon of the DBF'S pension arrangements and the presentation In the financial statements is included In Note 24. 2023Annual Report andFinancial Statements 41 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for theyear ended31 December 2023 Archblghop•' Coundl In¢¢m• Unrestricted Oe¥ign4t•d R•strleted EThdowment funds fund* fund8 fund Tolal fundB 2023 2023 2023 2023 2023 Lower Income communltles funds Sustalnabllity grant 184,96B 150,LlOO 184,968 150,000 334.988 334,988 2022 2022 2022 2022 2022 Lower Income communitles lunds 178799 178 799 Oth•r d¢natlonB Incom• Unr•$trlct•d D••lgnat•d R•Btrkn•d Endowm•nt funds fund8 nd• funds 2023 2023 2023 Total fund$ 2023 2023 Ordlnation candidates donatlons Other donations Mlnlstry dlvlslon RME Ordinands, grant Dlgital Diocese18enefa¢t grant) Strategic ministry Ivnd MSnlstry Experlence Scheme 96,684 109,101 96,884 134,018 181,324 76,000 173.238 23,355 24,917 181,324 75,000 173,238 23,355 24.917 205,785 452.917 883.819 2022 2022 2022 2022 2022 Ordinatlon candldates donations Other donatlons Ministry dlvision RME Or(Jlnands' grant Digital Diocese18enefact grant) strategic mlnSstry fund Ministry Experlence Scheme 85,544 214,734 85,544 240,574 226,214 25,840 226,214 185,130 43,493 185,130 43,493 25,840 3(X).278 454,837 780,gSS 2023AnnualReport andFinancialStatements 42 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for the year ended31 December 2023 Charitabh xtivrli•• Ineom• Unr••trleled Designated R•$trleted Endowment funds fund• funds fund$ 2023 2023 2023 2023 Total funds 2023 UKNSF IFCDOI grant 2022 2022 2022 2022 2022 UKNSF IFCDOI grant we•tm•nt In¢offl• Unr••tr5ct•d D••lgnat•d R•strtcted Endov•m•nt fvndg fund8 fund¥ fund8 2023 2023 2023 2023 Total fund* 2023 Income from Ilsted Snvestrnents Interest recelvable 237,971 4,790 173,733 411.704 4,790 416,494 242,761 173,733 2022 2022 2022 2022 2022 Incorne from listed Investments Interest receivable 172,483 4,790 194,302 983 387,768 4,790 177,273 194,302 983 372,558 Oth•r kncom• Unr••trlcted D•¥lynat8d R•strkted Endowment fundg fund8 funds fund8 2023 2023 2023 2023 Totsl fundi 2023 Sundry income 3,321 3,321 2022 2022 2022 2022 2022 Sundry incorne 3,862 3,862 2023 AnnualR8POrtand Financial Statements 43 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December2023 Exp•ndliuro on Charltsbl• Aclfvllbo¥ Unresirirted O•slgnated Restr￿t•d Endowment lunds fund¥ funds fund8 Total fvnd• 2023 2023 2023 2023 2023 Ministry and ml$son costs Houslng costs Grants Charitable actlvltle$ Alloeat&d support Costs 768,979 24,477 500,963 1,269.942 24,477 393,215 58,924 734,083 190.170 58,924 203,045 726,593 7,470 1.520,049 247.094 711.478 2.478,621 2022 2022 2022 2022 2022 Mlnlstry and mlsslon costs HousSng costs Grarnts Charitable actlvitles Allocated support costs 793,364 25,344 14,409 200,702 436,484 1,430,550 25,344 251,616 54,877 667,477 78,311 37,517 158,896 17,360 6,797 6eo,680 1,493,797 316,530 619.537 2,429,864 Analy￿* ol •xp•ndllure In¢ludlng allO￿tkIn ol •upport ¢o•t• Actlvttlos und•rtak•n dlr•etty Grant fundlng ol actlvbtl•• Charllobl• tlvbtl•• pport Co•ts Total lund• 2023 2023 2023 2023 2023 Charltable Activitie$ Ministry and mlsslon costs Houslng Grants 1,269,942 24,477 56,924 734,063 2,060,929 24,477 393.215 393,215 1,294,419 393.215 58,924 734,063 2,478.621 2022 2022 2022 2022 2022 Charitable Actlvitles Minlstry and mission c051S HouslThg Grants 1,430,550 25,344 54,877 667,477 2,152,904 25,344 251,616 251,616 1,455,894 251,616 54,877 667,477 2.429,864 2023AnnualReport and FinaneMI Statements 44 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for the yaar ended 31 Qecember2023 10 Analysh of support Costs Unrestricted Design•t•d Restrlcted funds lunds funds 2023 2023 2023 Totsl funds 2023 Central stalf costs Central office and premSses Oepreclatlon Lègal and professional fees Trust management costs Other support costs Governance Auditors fee.. Current year statutory audlt Prlor year statutory audlt Non audit fee payroll 5ervl¢&s Synod and BOshop'$ Council 451,094 51,797 10,482 65,681 451,094 51,797 10,482 85.681 7,470 05,911 7,470 65,911 25,050 1,g80 2,102 52,496 720,593 25,OSO 1,980 2,102 52,498 734.oe3 7,470 2022 2022 2022 2022 Central staff ¢o$ts Central ofllca and premises Depreciation Lagal and prolesslon81 f&e$ Trust rnanagernent ¢osts Other support costs Governanc• Auditors fee.. Current year statutory audlt Non audlt fee payroll servi¢8$ Synod and Bishop's Councll 408,210 51,704 9,278 88,865 408,210 51,704 9,278 88,865 6,7>7 22,880 6,797 22,880 20,790 1,944 57,008 20,790 1,944 57,008 660,680 8.797 667.477 2023AnnualReporf andFinancialStatements 45 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS lor theyear ended 31 December2023 11 St•lf costs 2023 2022 Salaries Social securlly costs Olher penslon costs 490,172 52.322 56.053 408,338 43,108 45,2BI 598,547 496,727 2023 2022 Average number Included in staff costs above durlng the year: 15.0 11.5 Average number of Full Tlme Equivalents in the year.. 12.6 10.3 The number ol staff whose emoluments Ilncludlng beneflts In klnd but excludlng pen51on contrlbutlonsl amounied to more than £60,000 were as lollows.. 2023 Number 2022 Numb É60,001 E70,000 £80,001 £90,000 Romunoratlon of K•y Manaym•ni P•r•onnel Key management personnel are deèmed to be those havlng 8Uthorlty and re5ponsiblllty, delegated lo them by Ihe Trustees, lor planning, direetlng and controlllng aclivltles of the Diocese. The remuneratlon totalled £97,65212022.' £91,960). The Diocesan and Suffragan 8i5hops are stlpend offlce holders In the Dlocese, however unllke other stipended offlce holders, Ihe Diocese Is not asked dlr8Ctly to relmburse the Bishops. ¢osts. Instead, these are met by the Church Commissioners and thus the costs not Included In Ihese ac¢ounts. The three full tirne and one part time Archdeacons are pald a stipend and these costs are included in the Charitable Activilies, Note 8, under Minislry and Mission costs and not included In thls Staff c051S note. Contiactors are not included in the above as they are not staff. Stipends for Archdeacon5 ar8 set using the National Church benchmarks as a gulde. In their ex offlclo roles on the Blshop's Council the Archdeacons exercise no influence on this matter. TruslM$ rolmburged expens•s and r•munerallon Prior to the Covid pandemic, all Trustees usually attended a minimum of two meetings a year in person and received relmbursement for iravel and accommodation costs. Recently Bishop's Councll. FAPC and other meetings have been not held In person but online with the result no costs were incurred. During tho year £4,467 expenses were In¢urred at meeting$12022'. 4,1901. No Trustee was paid any remuneration from the DBF as a result of hislher position. 2023AnnualReport andFinancialStatements 46 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for theyear ended 31 D8cember2023 12 Analysis of transferg betwe•n fundi Unreatrlcted Funds O•n•ral Des19nat•d funds funds R•gtrkttd funds 2023 2023 2023 Oiocesan grants Mlnlstry Experlence S¢hema 110,0001 16,0001 116,000) 10,000 6,000 10.000 6,000 Unre•trlet•d Fund• D••igTrat•d O•n•ral funds fund• R•strkt•d fund• 2022 2022 2022 Transfer from unrestrlcted to deslgnatod funds.. Grants Hard5hlp Fund Safeguar¢JSng Past Casa revlew 2 Transfer from within restricted funds.. UKNSF IFCDOI grant Digltal Dloces* 150,0001 1138,9271 50,000 138,927 13,8161 3,81 {188.9271 188,927 13 T•wlbl• Hx•d A•8•ts Fr￿•￿Id L•as•hold Equlpm•nt Tot*1 Cost Brought forward l Jarwary 2023 Additions Disposals Carry forwar¢ 31 December 2023 885,012 53,390 17,139 755,541 15,4171 15,4171 885 012 750 124 Depr•datlon Brought forward l January 2023 Depreciation chargè for the year Written back on dlsposal 155.820 6,850 S3,390 9,512 3,632 15,4171 218,722 10,482 15,4171 Carry forward 31 Dècember 2023 182 670 223 787 Not bookvafu& At 31 December 2023 522 342 526 337 At l January 2023 529 192 536 819 2023AnnualReport and Financialstatements 47 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for theyear end8d31 December2023 14 knv•$tm•nts Usted investments Soclal Inv•stm•nts Total Unrestricted Re5trietèd Unrestricted erought forward 1 January 2023 Disposal Gain on Investments 4,534,729 6,152,107 1321,8161 540,521 200,000 10,886,836 1321,8161 899,772 359,251 Carry forward 31 December 2023 4,893.980 8.370,812 200.000 11,464,792 The majority of th8 listed investments are held In collectlve Investment funds managed by CCLA. The historlc cost of these Snvestments at 31st December 2023 was £6,164,612 12022.. £6,475,0311. 15 O•btor• 21>23 2022 Amounts due from chaplalncles Prepayments and accrued income Othèr debtors 120,000 151,225 240,901 12S,000 75,151 332,734 512,128 532,885 16 ¢r•ditor#: faHlbYJ du• wlthkn l y•ar 2023 2022 Amounis owed to ehaplaSncSes Othercreditors Accruals and deferred Incom8 1,478,845 174,974 400,095 1,257,914 136,661 546.149 2,053,914 1,940.724 17 Credftwjj: fallrwA du• after mor• I￿n l year 2023 2022 Loan (see note belowl 350,000 400,000 In January 2021 a loan of£S00,000 was obièlned from CCLA, the DBF'S Investrneni managers, under the Diocesan Loan Scherne. The tems are lavourable with an Interest rate of the average daily late declared by their fund over the month plus 0.55%. The maximum term of the loan is ten years, with no requirernent of repayment ol Ca￿ts1 In the interim. The loan is being repaid in 8qual instslrnents of £50,000 overthe 10 year period. Thè interest Is payat4e every months. 2023AnnualReport andFinan¢ialStatements 48 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TOTHE FINANCIAL STATEMENTS for the year ended 31 December 2023 181*1 SummwYolf￿d mov•m•nts- ¢urr•nt y•v Grqnts & InvgStm•nt Itl.1.23 Ineorno Exp•ndSiur• 108808 Tran4f•r• at 31.12.23 O•Mr•llund8.' Dlocesan Fun(J 3,812,282 1,533,397 11,520,0491 359,251 116,OlX)I 4,168,881 Do•lgrnt•dfundx' Ordlnation Candldè¢es Mis$lon Opporlunlti•s Hardship Dlocesan grants 73,529 14S,778 279,859 7,100 96,684 174,2611 1100,8721 156,9241 115,0371 95,952 44,90e 332,036 2,063 109,101 10,000 Total Unr••trl¢t•d Fund• 4,318,548 1,73•.182 11.767,1431 35•,251 11.0001 4,843,838 R••trlct•d fund• Ackland Troyie Tru$1 (Paul All Salnts IDresdenl Tru5l IGermanyl Armsirong Trust Ilsianbull Bagnere5 de &gorre Fund IFr4ne81 Bertle Watson IAlgarv81 Clement JO￿5 Isullraoan Pjshopl Col Doughly Wylle Fund IF¢OI Crimean Meffjorlal Church Ilslanbull Daphne Wllloughby Waler5 (Palrnal D5oeesan Developrnent FurKI Emma Tebbs Trust (Romel Frank Pratt Barlow (Monte Carlol Houlton Fund Imaiial Lindsey Fund (Germany) MMS IGibraltar & Marseillesl Overse8$ 8ishoprics Fund Phllip Coleman Trust (Palmal Ri9a Mlsslon Trust Splcer Trust (Needy dergyl St Andrew's (Tangiwl st Georges (Berfinl Stephenson Bequest IMalag81 Mlnlstry d￿￿$10n RME Ordlnands. gr•nt siraiegSc rnlnlslry fund Digit81 Diocese IBenef8¢t grant) Ministry Experlence Sch￿8 2,12S S,038 5,609 1,751 19,177 2,52S 903 2,593 2,088 15,491 3,783 47,352 1,250 1,732 10,643 8,295 913 21,650 3,107 14,571 2,948 2,192 181,324 173,238 75,000 23,354 15,0381 15,9801 85,473 65,102 52,318 4,870 13,7f I 110,9591 19821 60,538 6,433 13,849 12,5931 12,4541 14,7861 13,7831 185,8631 318 88,190 1481 98,895 18,511 115,4611 32.135 111,5321 116,3501 37,n5 32,075 26,528 13,359 100,3041 11,9051 112,2481 12,9461 12,1921 1200,1781 1172,5991 1108,5861 127,0711 16,5791 27,728 15,684 e8,454 6,455 77,258 46,860 49,600 7,094 43,C72 48,943 6,000 530.902 626.850 1711.4781 8.000 452.074 841&ne• en 4,849,450 2,365.832 {2,478,6211 359.251 5,095,912 2023Annual Report and Financialstatements 49 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTESTO THE FINANCIAL STATEMENTS lor theyear ended 31 December2023 18 141 &mmary offund mov•m•nts- ¢urr•nt y•w l¢oniknuedl eglm•nt galns and om• Expendkw• IoBg•8 Grant• & AB •tl.1.23 Transf*rs *1 31.12.23 Baloneo em 4.84#.460 2.385,832 12.478,6211 359,251 5.0?5,912 Endtywm•nt Funds.. Ackland Troyte Trust (Paul All Salnt5 (Dresden) Trust IGermanyl Armstrong Trust Ilstanbull Bagneres de 8lgorr8 Fund (Fra￿0> Bertie Watson (Algarvel ClÈment Jonès Isuffragan 8lshopl Col Doughty Wylie Fund IFCOI Contlnental Chaplaln¢ies Crimean MEmorlal C￿reh Ilstanbull Daphne Wllloughby- Water5 (Pèlmal Dlocesèn Developrnent Fund Emma Tebbs Trust IRornel Fr8nk Pr8tt Uarlow (Monte Carlol Houllon Endowment Fund (Maltal Llndley Endowment Fund IGermanyl MMS IGlbr<ar & M8rs8lllesl Overseas Blshoprics Fund Phlllp Coleman Tr￿st (Palmal Riga Mission Trust Splcor Trust (Needy cl8rgyl Sl Andrew's ITangierl St. George's 18Èrllnl Stephenson èequest (Malaga) 44,967 160,812 150.653 48,478 538,722 88,059 118.5S6 1,117,790 86,633 116,204 412,574 126,394 1,535,fj13 41,788 57,864 373,655 240,942 39,994 451,132 29,912 496.157 156,948 82.349 4,267 15,282 17,367 4,601 45,424 7,881 4,580 79,796 8,222 9,712 39,214 11,995 160,299 3,96e 5,491 29,082 19,962 2,383 6,805 2,776 46,204 9,287 6,145 49,234 176,074 168,020 53,079 582,146 95,740 123,136 1,197,586 94,855 125,916 451,788 138,389 1,895,912 45,754 63,355 402,737 260,904 42,377 457,937 32,888 542.361 166,235 88,494 8,514,196 S40,1121 7.054,717 Tota fund• 11,383,646 2.385.832 12,478,821) 899,772 12.1SO,62• D•talls of Funds Unrestricted Diocesan Fund The general fund is the DBF'S unrestrf¢ted undesignated fund available for any of the DBF'S purposes without restriction. Ordinar￿n Gandidates Fund This Designated Fund is avallable to support ordination candidat85. Mission Opportunities Fund The Mission Opportunities Fund has been established to fund projects which have the specific objective of growing congregations in thg Diocese. Hardship Fund A Designated Fund established tQ 5UPPOrt chaplaincies with financial issues or an inability to pay their clergy following the outbreak of COVID-19. This will now also cover financial hardship occasioned by the big increase in inflation in 2023. 2023AnnualR8port and Financialstatements 50 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for th8year ended 31 December2023 D¢tall$ ol Funds- ¢ontlnu•d Unrestrlcted - continued Safeguarding Past Case Review 2 A Designated Fund to cover the cost of th8 TeqLtlrement to independently revlew flles relatlng lo all serving and p85t Ilivingl clergy & church officers. to ensure safeguarding matters have been approprlately handled. Restrlcted Restrlcted funds may only b¢ applied for the purposes specified in the relevant measures, trust deeds and ecclesiastical statutory r¢gulations. Generally all ineome generaled on restricted funds Is pald to the chaplaincles to which the fund relates. Grants and expenditure Includes a 5% management fee levSed by the Diocose. The management charge Is applled to all trust5 to cover accountancy and admlnlstration for those trusts. This charge has been accounted for as Income to the unreslricled general fund, and as a ¢ost to the funds ¢on¢èrned. The total charge within restrlcted funds was £6,79712022- £6,344). Diocesan Development Fund A Speclal Trust for the purposes of Charltles Acl 2011. Ministry Division RME Ordinands Granr Block grant recelved from the minlstry dlvlslon, Archblshops. Councll, to fund the tralnlng of Ordlnand5. UKNSF (FGDOJ grant A restricted grant from the Forelgn Commonwealth and Development Offlce to help UK natlonals with their residency applicalions ￿n France followlng Brexil. Stfgtegic MinistryFund A fund from the Archbishops, Council to provlde financlal support for growth In the number of stipendiary curates in thè Dlocese. DlgifalDiocese IB8nelact Trust (previously known as Allchurchesj grantj A transformational grant to crea1¢ and distribute Insplrlng conlent that Seeks to build and grow congregations aeross demographl¢ groups. Ministry Experience Scheme A scheme for people aged 18 to 30, who deslr$ to dlsceTn their vocatlon In the Church of England. Endowment Endowment funds may only bo applied for the purposes specSfled In the relevant measures, trust deeds and the ecclesiastlcal statutory regulations. They are generally only available for speclfled purposes. 2023Annual Report and Financialstatements 51 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for the year 8nd8d 31 December2023 18 Ibl Summary of fun41 movgm•nts- pr•vlou$ y•or Inv8$tm8nt galn$and loss•$ A8 Gr•nts& at 1.1.22 Income Exp•ndltur• Transf4rs •t 31.12.22 Unr••trlct¢d Fund$'. G•n•r•llund&' Dlocesan Fund 4,802,009 1,297,918 11,493,797) 1804,9191 1188,9271 3,812,282 Deslgn•t•dlund&' Ordlnation Candldates Fund Mlsslon Opportunltlès Fund Hardshlp Fund Saleguardlng Past Case R¥vl¥w 2 Dlocesan grants 45,640 166,434 112,642 1.775 7.100 85.544 157,65SI 120,6561 137,5171 1200,7021 73,529 1415,778 279,859 154,734 60,000 50,000 138,927 7,100 Total Unl￿tri¢￿d Fund• 5,135.600 1,598.194 11.810.32n 1604,9191 4,318,548 R•Jtrlct•d lund$ Ackland Troyta Trust (Paul All Salnts (Dresden) Trust (Germany) Armstrong Trust Ilstanbull Bagneres de 3lgorrè Fund (France) Bertie Watson IAl9arvel Clement Jones ISulfrag8n 81shopl Col Doughty Wylle Fund IFCOI Crlm8an Memorlal Church 115tanbull Daphne Wllloughby- Waters (Palrnal Diocesan Dovelopment Fund Ernrna Tebbs Trust (Rome) Frank Pratt Barlow Imgnte Carlol Houlton Fund (Maiial Lindlèy Fund (Germany) MMS (Glbraltar 8 Mars8llltsl Oversgas Blshoprlcs Fund Phllip Coleman Trust (Palmal Rig3 MSsslon Trust Spicer Trust (Needy ¢l¢rgyl St Andrew's (Tanglerl St George5 (Berlinl Stephgnson Bequest (Malagal Ministry division RME Ordinand$' gront UKNSF IFCDOI grant strategic rninistry fund Dlgltal Diocese (Benelact grant) Mlnlstry Expedence Scheme 1,565 4,852 5,778 1,741 16,211 2,666 262 2,578 2,146 15,212 3,762 40,194 1,243 1,722 10,428 6,261 1,153 21,387 39,273 10,566 2,956 2,349 31,663 228,214 6,481 14,695 2,000 185,130 115.864 33,929 11,5851 14,8S21 15,9891 65,684 65,473 38,107 4,710 14,482 S2,318 4,870 13,761 12,5061 19831 12,5781 17,1071 15,7611 13,7621 154,9931 11,2431 11,7221 110,5211 S,279 78.739 318 88,190 33,310 18,511 115,3661 25,874 15,461 32,135 11,1531 114,9161 125,8341 16,3651 12,9561 12,3491 1189,4231 117,3601 1180,6751 142,4221 130,7611 25,604 13,087 9,158 32,075 26,S28 13,359 88,454 13,8161 6,455 77,258 46,660 3.816 43,492 486,805 883,834 1619.53n 530.902 B•lan¢• ¢M 5,622,205 2,282.028 12.429,884) {604.9191 4.849.450 2023AnnualReport and Financiaisfatements 52 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS lor the yearended 31 December2023 18 Ibl Summary of fund movwn•nl¥- pr•vlaus year Icontlnued) Inv•$tment galn$ and 1058•1 AS al 1.1.22 Orants & endiiuré As Tr•n8l•r8 •t 31.12.22 Income Balanc• clf S.822.205 2.262.028 12,429.8641 1804,919) 4.849.4SO Endowment Funds: Ackland Troyte Trust (Paul All Saints IDresdenl Trust (Germany) Armstrong Trust Ilsianbull Bagneres d& Blgorre Fund IFrancel B8rtig Wat50n IAlgarvel Clement Jones Isuflragan Bishop) Col Dougttty Wylie Fund IFCOI Contlnental Chaplalnelès Crlmean Mernorlal Church Ilsianbull Daphne Wllloughby- Water5 (Palmal Diocesan Developmènt Fund Emma Tebbs Trust (Romel Frank Pratt 8arlow (Monte Carlol Houlton Endowment Fund (Maiial Llndley Endowm6nt Fund (Gerrnanyl MMS (Gibraltar & Marsèillesl Ov•r5eas Bishoprlcs Fund Phllip Coleman Trust (Palmal Rlga MlssSon Trust Splcer Trust (Needy clergy) Sl Andrew's (Tangier) Sl. Georgè's (Berllnl Stephènson Bequest (Malaga) 50,936 182,180 177,332 54,913 600,261 100,655 134,551 1,238,300 98,134 130,OSO 476,247 143,173 1,669,629 47,335 65,546 418,276 268,88S 46,253 519,108 34,362 560,787 170,251 93,982 15,9691 121,3481 126,6791 18,4351 163,5391 112,5961 115,9951 1120,5101 111,5011 114,8291 183,6731 118,7791 1134,0161 15,5471 17,8821 144,6211 127,9231 ie,2591 167,9761 14,4501 164,6301 113,3031 111,6331 44,967 160,812 150,6S3 48,478 536,722 88,059 118,556 1,117,790 66,633 116,204 412,574 126,394 1,535,613 41,788 57,864 373,655 240,942 39,994 451,132 29,912 496,157 156,948 82,349 983 7,281,108 983 1787,8931 8,$14,198 Total Imd• 12,903.311 2.263.011 12,429,884} 11,372,812) 11,383.848 19 Commltments und•r operatlng leases The lease for the office in Tufton Street explred at the end of 2022 and there is currently a Ilcence to occupy temporary offices in Church House, wlth effect from 15 February 2023. whilst lh& office at Tufion Street is being rgfLbrbished by the landlord. Terms have been agreed In principle for Ihe r8furblshment of 14 Tufton Street at the expense of Ihe landlord and a new flve year lease at highly preferentlal rates will be signed once the building work has been completed by the end of 2024. 2023AnnualReport and Financialstatements 53 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for th8 year ended 37 December2023 20 N•t ass•ts by fund Tanglbl• flx•d as$ots Current ass•t8 Curront Ilabiliti•s Amounts lalling d •lt•r 1 y￿r Inv•stmonts Total Fund* 2023 Unrnstrlct•d General Designated Restricted Endowm¢nl 528,337 5,093,980 952,478 474,957 452,074 683,905 12.053,9141 1350,0001 4,168,881 474,9S7 452,074 7,054,717 6,370,812 528,337 11.464.792 2.563,414 12,053,914) (350,000) Total 12.150,629 2022 Unr•strlct•d General Designat8d Resirlcted Endowm•nt 536,819 4,734,729 881,460 11,940,7261 $06,266 530,902 362,088 1400,0001 3,812,282 506,266 530,902 6,514,196 6,152,108 Total FurKI• 536,819 10,886,837 1280,718 {1,940,7281 (400,000) 11,363,846 21 Fund*h•ld a*cu•todi•ntrust•• 2023 2022 Investments lat Market Value 31st Decemberl Cash On deposit 1,521,427 80S,224 1,602,537 489,941 TOtala￿•1$h•1d onb•hall of chapl•lncl 2,326,651 2,092.478 22 Caplial commltments As at 310e¢ember 2023 there were no capital commitments. 23 Posi balanco sheet events and contlngent liabiliti•s The Suffragan Bishop, Davld Hamld, retired at the end of February 2024 and the recruitment of his replacement is underway. 2023Annual Report andFinancial Statements 54 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for theyearended 31 December2023 24 Pensions The DBF participates in two pension schemes. These are.. 1. Church of England Funded Pensions Scheme I'CEFPS") for stlpendlary clergy and 2. Church Workers Pension Fund I'CWPF'I for Diocesan lay employees (a) Church of England Funded Pen$lon$ Scheme ("CEFPS') The Dlocese In Europe participates in the Church of England Funded Pensions Scheme for stipendiary clergy, a defined benefit penslon scheme. This scheme is administered by the Church of England Pensions Board, which holds the assets of the schemes separately from those of the Responslble Bodies. Each participating Responslble Body in the scheme pays contributlons at a common contrlbutlon rate applied to pensionable stipends. The scheme Is considered to be a multi-employer scheme as described in Section 28 of FRS 102. This means it is not Possible to attrlbute the Scheme's assets and liabilities to each specif ic Responsible Body, therefore contributions are accounted for as if the Scheme were a deflned contributlon scheme. The DBF has 33 members12022: 331. The pensions costs Charged to the SOFA are contributions payable towards benefits and expenses accrued in that year. In 2023 these amounted to £41,00212022: £50,483). The 2021 valuation showed the Scheme to be fully f unded and as such in 2023, following the results being agreed, there were no deficit contributions made In the year12022'. £9381. A valuation of the Scheme is carried out once every three years. The most recent valuation completed was carried out at as 31 December 2021. The valuation revealed a surplus of £560m, based on assets of £2,720m and a funding target of £2,160m, assessed uslng the following assumptions: An average discount rate of 2.7% p.a.- RPI inf lation of 3.6Ya p.a. land pension increases conslstent with thlsl; CPIH inflation in Ilne with RPI less 0.8Y. pre 2030 moving to RPI with no adjustment from 2030 onwards., Increase in pensionable stipends in line with CPIH,. Mortality in accordance with 90% of the S3NA tables, wlth allowance for improvements in mortality rates from 2013 in line with the CM12020 extended model with a long term annual rate of improvement of 1.5%, a smoothlng parameter of 7, an initial addition to mortality improvernents of 0.5% pa and an allowance for 2020 data of 0% li.e. w2020 = OY.). Following the f inalisation of the 31 Decèmber 2021 valuation, deficlt contrlbutions ceased with effect from 1 January 2023, since the Scheme was fully funded. 2023 AnnualReportand Financial Statements 55 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for the year ended 37 Decemb8r2023 24 Pensions (continued) (a) Church of England Funded Pensions Scheme ("CEFPS") (contlnuedl The deficit recovery contrlbutions under the recovery plan In force at each 31 December were as follows: %of enslonable sti ends 7.1% payable from January 2021 to December 2022 31 December 2021 31 December 2022 31 December 2023 An interlm reductlon to deficlt contributlons to 3.2% of pensionable stipends was made wlth effect from Aprll 2022, and remained In place until December 2022. For senlor offlce holders, penslonable stlpends are adjusted in the calculations by a multiple, as set out in the Scheme's rules. Section 28.11A of FRS 102 requires agreed deflcit recovery payments to be recognised as a Ilability. However, as there are no agreed deficlt recovery payments from 1 January 2023 onwards, the balance sheet liablllty as at 31 December 2022 is nil. The movement In the balance sheet liability over 2021 and over 2022 Is set 04Jt In the table below. 2023 2022 Balance sheet Ilability at 1 January 938 Deficit contribution paid Remaining ¢hange to the balance sheet liability* Irecognlsed in SOFA) 11,2121 274 Balance sheet Ilablllty at 31 December Comprises change in agreed def icit recovery plan and change in dlscount rate and inflation assumptions between year ends. No assumptions are needed on liabilities for December 2022 as there are no agreed deficlt recovery payments going forward. No price inflation assumption was needed for December 2021 since pensionable stipends for the remainder of the recovery plan were already known. December 2023 December 2022 December 2021 nla nla 0.0% pa nla nla nla nla nla -1.5% Discount rate Price inflatlon Increase to total ensionable roll 2023AnnualReport andFinancial Statements 58 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for theyear ended 31 December 2023 24 Pensions (contlnuod) (a) Church of England Funded Pension5 Scheme ('CEFPS") (continued) The legal structure of the scheme is such that if another Responsible Body falls, Diocese in Europe could become responsible for paying a Share of that failed Responsible Bodls pension (b) Church Workers Penslon Fund ("CWPF") The DBF participates In the Pension Builder Scheme section of CWPF for lay staff and Is adrninistered by the Church of England Pensions Board, which holds the CWPF assets separately f rom those of the Employer and other participatlng employers. The Church Workers Penslon Fund has two sectlons 1. The Deflned Beneflts Scheme 2. The Pension Builder Scheme, which has two subsectlons; 11 a deferred annuity section known as Pension Builder Classic and lil a cash balance section known as Pension Builder 2014. Penslon Bullder Scheme Both sectlons of the Penslon Bullder Scheme are classed as defined benefit schemes. 1. Pension 8uilder Classic provides a pension, accumulated from contrlbutlons pald and Converted Into a deferred annulty during employment based on term5 set and reviewed by the Church of England Pensions Board from time to time. Discretionary increases may also be added, depending on investment return5 and other factors. 2. Pen5ionSuilder20741s a cash balance scheme that provides a lump sum which members use to provide benef its at retirement. Pension contributions are recorded in an account for each member. Discretionary bonuses may be added before retirement, depending on investment returns and other factors. The account, plus any bonuses declared, is payable, unreduced, from age 65. There Is no sub-division of assets between employers in each section of the Pension Builder Scheme. The scheme is a multi-employer scheme as described in Section 28 of FRS 102. This is because it is not possible to attribute the Pension Builder Scheme's assets and liabilities to specific employers and means that contributions are accounted for as if the Scheme were a defined contribution scheme. The pension costs charged to the SOFA in the year are the contributions payable of £54,26612022'. £39,613). An actuarial valuation of the CWPF is carried out every three years. The most recent was carried out as at 31 December 2022 and revealed that all three sections of the CWPF are now in surplus. 2023 Annual Reportand Financial Statements 57 THE DIOCESE IN EUROPE BOARD OF FINANCE NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 Decemb8r2023 25 Relaled party tran5a¢tlons The Chair of the DBF recelved £3,150 for professlonal consultancy provlded durlng the year 12022.. £6,300). This was the last such payment. There were no other related party transactions (See Note 111. 28 Prlor year comparatlv• SOFA Total fundo 2022 Unrostrktsd funds Ro•trlctod Endowm•rt funds fund• Note kncom• and •ndowm•nts from: DonatSons and 19gacles Common Fund Archblshops. Councll grarbt Other donatlons Challabble activlties Investments Other 912,142 178,799 326,118 912,142 178,799 780,95S 14,695 372,558 3,862 454,837 14,695 194,302 177,273 3,862 983 Total Incom• 1,598.194 683.834 983 2.263.011 Exp•ndltur• on: CharStable activltles 819 11,810,327) 1619,5371 12,429,864) N•t {d•fklll l lur￿8 b•for• gdn on lThv•#tm•nts 983 (212,133) 44.296 (188.853) Net Ilossl on fixed asset investments 14 1604,9191 1767,8931 11,372,812) Not movem•nt In funds 1817,052) 44.298 (766,9101 (1,539.685) 2023AnnualReportand Financialstatements 58