## Gloucester Diocesan Board of Finance Annual Report & Accounts 2023
## **Board of Trustees**
The Rt Revd Rachel Treweek (President) Canon Karen Czapiewski (Chair) The Ven Phil Andrew The Revd Andrew Blyth Prof Patricia Broadfoot Mr George Collins The Revd Henry Curran The Ven Hilary Dawson The Revd James Faragher Mr Chris Hill Mr Martin Kingston Mr Robert McNeil-Wilson
The Revd Dr Sunkanmi Osunsanmi (resigned 6 March 2023) The Revd Jo Pestell The Revd Ed Sauven The Revd Canon Katrina Scott The Rt Revd Robert Springett The Revd Canon John Swanton Mr Alastair Taylor Mrs Emma Taylor (resigned 29 March 2023) Mr Kevan Taylor Mr Andy Wilson
## Contents
|Contents|||
|---|---|---|
|Board of Trustees and Principal Officers||...1|
|Summary results||.2|
|Trustees|....3-14||
|Independent Auditors|15-18||
|Consolidated statement of financial activities||19|
|Summary income & expenditure account||20|
|Consolidated balance sheet||..21|
|Parent balance sheet||22|
|Consolidated cash flow statement|...|23|
|Accounting polici|24-27||
|Notes to the financial statement|...28-60||
## **Principal Officers**
Benjamin Preece Smith _Diocesan Secretary_ Lucy Taylor _Deputy Diocesan Secretary_ Lisa Gardner _Chief Financial Officer_
## **Solicitor**
Jos Moule; Diocesan Registrar Veale Wasborough Vizards LLP Orchard Court, Orchard Lane Bristol BS1 5WS
## **Bankers**
Barclays Bank plc 288 Britannia Warehouse The Docks Gloucester GL1 2EH
## **Registered office**
Church House College Green Gloucester GL1 2LY
## **Auditors**
Haysmacintyre LLP 10 Queen Street Place London EC4R 1AG
## **Investment managers**
CCLA Investment Management Ltd 80 Cheapside London EC2V 6DZ
Company limited by guarantee Registered number 00162165 Registered charity number 251234
1
## How have we done some hi hli hts g g
number of stipendiary clergy funded by the GDBF
2023: 2022: change: - 126 126
Stipendiary vacancies at 31st December 2023 were 11 (2022:11)
parish share contributions
2023: 2022: change: -1.5% £6.5m £6.4m
extra parish share needed to fund parish ministry:[1]
2023: 2022: change: +13% £1.6m £1.91.9m
**----- Start of picture text -----**
£1.91.9m
**----- End of picture text -----**
balance sheet value (net assets)
2023: 2022: change: +11% £95m £106m
> 1 page 8.
2
## Trustees
## _for the year ended 31 December 2023_
## Structure, Governance and Management
The Gloucester Diocesan Board of Finance (GDBF) is a company limited by guarantee and a registered charity. Its governing instrument is the Articles of Association. These were revised and updated in 2019 and formally adopted by members on 9 March 2019. Printed copies of the revised Articles of Association are available from the Secretary on request. The G membership comprises:
- The Bishop of Gloucester as president, ex-officio
- Each and every member for the time being of the Diocesan Synod
- Members co-opted to ensure that lay members constitute a majority of the GDBF
Elections and co-options take place every three years. The current triennium started in November 2021. The GDBF, which meets three times each year, is the principal policy making body. It takes advice from its Board of Trustees, constituted as the Bisho and makes recommendations. The Council also takes executive action in certain matters and deals with day-to-day issues. Members serve as both directors under the Companies Act and trustees under the Charities Act. Membership is as follows:
## _Ex-officio members:_
- The Bishop of Gloucester Rt Revd Rachel Treweek
- The Chair of the GDBF Canon Karen Czapiewski
- The Bishop of Tewkesbury - Rt Revd Robert Springett
- The Archdeacon of Gloucester Ven Hilary Dawson
- The Archdeacon of Cheltenham Ven Phil Andrew
- The Vice-President of the House of Clergy of the Diocesan Synod Revd Canon Katrina Scott
- The Vice-President of the House of Laity of the Diocesan Synod
_Members elected by the GDBF House of Clergy_
- Two clergy members of the GDBF from the Archdeaconry of Gloucester Revd Jo Pestell and Revd James Faragher
- Two clergy members of the GDBF from the Archdeaconry of Cheltenham Revd Andrew Blyth and Revd Canon John Swanton
- One Proctor in Convocation from among the members of General Synod - Revd Henry Curran
## _Members elected by the GDBF House of Laity_
- Three lay members of the GDBF from the Archdeaconry of Gloucester Mr Chris Hill, Prof Patricia Broadfoot and Mr Andy Wilson
- Three lay members of the GDBF from the Archdeaconry of Cheltenham Mr George Collins, Mr Martin Kingston and Mr Alastair Taylor
- One lay member from among the members of General Synod Mr Robert McNeil-Wilson
3
## Trustees
_for the year ended 31 December 2023_
## Structure, Governance and Management cont.
_Co-opted members and nominations_
- Up to two members may be coMrs Emma Taylor (resigned 29 March 2023) and Mr Kevan Taylor
- Up to two members may be nominated by the Bishop - The Revd Dr Sunkanmi Osunsanmi (resigned 6 March 2023) and the Revd Ed Sauven.
Trustees are recruited, as indicated above, through a mixture of ex-officio positions, elections, and nominations. The Diocesan Secretary oversees membership elections.
An induction pack for trustees is available for new trustees which includes key documents, minutes and strategic discussions. This is supplemented by an invitation to meet with the Secretary to discuss any matters arising or explore further induction.
The GDBF was assisted in its work during the year by the following of committees:
- Audit Committee (Chair: Tim Greenhalgh) acts as the risk management group and reports to the GDBF on matters relating to the auditors, the annual accounts and internal controls.
- Glebe Committee (Chair: Tony MacFarlane (resigned 29 February 2024), Colin Smith appointed 15 April 2024) acts in all matters relating to the management of glebe property management and the disposal of assets not required for charitable or investment purposes.
- Resources Committee (Chair: Canon Karen Czapiewski) acts on matters delegated by the trustees relating to finance, assets, property, staffing and health and safety.
Emoluments of higher paid employees are determined by the Resources Committee. The terms of praisals, remuneration and salary benchmarking and consequent recommendation of changes. the year for the benefit of the charitable company and its trustees.
The GDBF is the financial custodian for the Diocese of Gloucester, which is an administrative and pastoral area within the Church of England. The GDBF therefore has important relationships with the national institutions of the Church of England, specifically:
- national training of ordinands and the activities of the various national boards and councils, as well as General Synod.
- Church Commissioners, from which the GDBF receives grants, and which acts for tax and national insurance purposes as the pseudo-employer of diocesan clergy. The GDBF pays for clergy stipends through the Church Commissioners.
- Church of England Pensions Board, which provide pensions for clergy and GDBF
4
## Trustees
_for the year ended 31 December 2023_
## Structure, Governance and Management cont.
## Public Benefit
Locally, the GDBF works with Parochial Church Councils (PCCs) which are legally independent bodies that pay contributions, based on an apportionment system, to the GDBF to fund its activities. The GDBF is a tenant of the Dean and Chapter of Gloucester Cathedral, from whom it rents office accommodation. The GDBF manages various charities on behalf of their respective trustees, for which management charges are paid, namely the Voluntary Schools Fund (VSF) and the Charity of Ann Edwards (AEC).
The GDBF is a public benefit entity, and the Trustees on public benefit and the supplementary guidance for charities whose aims include advancing religion and have regard to that guidance in their administration of the charity.
## Strategic Aims
The objects of the GDBF, as set out in its Articles of Association, are:
- To promote and assist the work, objects, and purposes of the Church of England for the advancement of the Christian religion in (but not limited to) the Diocese of Gloucester.
- To advance such other objects or purposes which are exclusively charitable according to the law of England and Wales in any part of the world and in such manner as the Trustees may in their absolute discretion consider may be expedient for the better promotion and assistance of the work of the Church of England.
In pursuing these objects, the GDBF acts as the financial executive of and employer for the Gloucester Diocesan Synod. As such it undertakes three principal activities:
- It funds costs associated with the vast majority of Church of England clergy in the Diocese.
- It is responsible for the custody and management of the synod's funds.
- It provides services to other organizations within the Diocese, primarily PCCs and schools.
- In pursuing its objectives and undertaking these activities the GDBF is informed by the diocesan vision, LIFE Together. For more information see: https://www.gloucester.anglican.org/about-us/our-vision/
## Strategic Report
## _**Vision: LIFE Together**_
The LIFE Vision developed during 2022 brings more focus to relationships and gathering as communities, especially worshipping communities.
There are five commitments in LIFE Together:
5
## Trustees
_for the year ended 31 December 2023_
## Strategic Report cont.
- Being advocates for flourishing through initiatives which combat injustice, environmental destruction, exclusion and isolation.
- Encouraging new and courageous ways of worshipping in different places which connect with more people.
- Nurturing everyday discipleship.
- Investing in people and programmes which excite young people to explore and grow in faith.
- Developing diverse lay and ordained leaders.
Substantial resourcing has been made available to specific projects working to this vision, notably Deanery Strategic Planning, Sportily and Church Army Centres of Mission.
## _**Deanery Strategic Planning**_
The process of identifying a deliverable strategic plan for each deanery has been significantly interrupted by Covid. Initial plans which had originally been expected in 2022 were received in 2023. Four emerging issues have been established which are currently under discussion for strategic support from the Board.
- Management, use and maintenance of church buildings.
- Deployment of increasingly scarce ordained ministry alongside alternative forms of ministry. Professional support for ministry to manage increasing administrative requirements against a background of decreasing availability of qualified volunteers.
- Financial concerns, particularly around the affordability and viability of Parish Share to act as a single funding model for ordained ministry in the Diocese.
Two missional focus areas were also identified by many deaneries:
- Young People
- New Housing Areas
These are currently being digested , Deanery Leadership Teams and the Board to develop strategic responses, including remodelling the use of reserves and the structure of staff teams employed by the Board.
## _**Sportily**_
Sportily is a wholly owned subsidiary of the GDBF aimed at working with young people to explore life, community and faith with a strong focus on sport as a place of engagement and connexion. It works on a
monastic communities.
Sportily was launched in 2021 with a multi-year commitment of financial support from the Diocese to work across the Diocese with local churches and communities as well as regional charitable, commercial and civic partners. It is currently working in nine hubs spread across the Diocese as well
6
## Trustees
_for the year ended 31 December 2023_
## Strategic Report cont.
as running diocesan wide events.
At the end of 2023 the CEO for Sportily (David Thorpe) stepped down. David was instrumental in delivering the project proposal that established Sportily and the Board is thankful for his wisdom and leadership in this start-up phase. Options are under consideration for how the leadership of Sportily is shaped and staffed for the next phase of its growth and mission.
## _**Church Army Centres of Mission**_
This is a local expression of a national lay evangelism programme led by Church Army. The two initial locations in the Diocese identified as Centres for Mission were Matson and Coleford.
The Centre in Matson has partnered with the Grace Network and others to develop a social enterprise hub and mission centre in the community. This has proved successful in connecting with and developing discipleship in a community that has lost much of its connexion with the Church. Work is being planned to make this work more resilient and independent over the next few years. The Centre at Coleford struggled to thrive due to the pandemic and has now been closed. An alternative Centre has now been established in the South-Central area of Gloucester City led by the Revd Sonya Newton.
## _**Grace Network**_
Grace Network is a Christian-led social enterprise co-operative based in Brimscombe which builds community and from that new monastic community. Their main engagement and funding come from ethical businesses sharing resources a model.
In 2022 the Board awarded grant funding of £1.5m to enable this model to expand into two new locations. These sites have now been confirmed as Aston Down (near Minchinhampton) and Cirencester Market Place. Aston Down is focused on delivering a model of monastic community furniture clearance, food delivery and school meals. Cirencester by contrast attempts to increase the retail focus and footfall by taking over a semi-derelict ex House of Fraser building in the prime retail
Aston Down has been operational since mid-2023. Cirencester will be opening in mid-2024.
## _**Church Housing Foundation**_
h the Board has adopted over a number of years it has funded a small expert team led by the Secretary to develop plans for a national approach
7
## _for the year ended 31 December 2023_
## Strategic Report cont.
to a sustainable model for the Church to use its network, assets and moral authority to help make a lasting impact on the housing crisis and providing ministry in deprived communities.
In enacting this strategy three new entities are being created;
- Church Housing Foundation: group.
- Church Housing Association: which will own genuinely affordable, high standard long term rental properties that will also provide for community cohesion and development by funding local ministry within its model.
- Church Development Agency: which will increase the capacity for GDBFs and other Church partners to develop their property assets in a balanced way that increases their financial and missional value.
This work was presented to the Archbisho support of the Archbishops. led proposals are now defunct.
The Board is however still committed to the vision of an ethical, faith led response to the Housing crisis and is continuing the registration of the Church Housing Association and working with its existing subsidiary (Good and Faithful Servant) and dioceses in the West Midlands to develop a regional response.
## Achievements and performance in the year
## _**Ongoing Activities**_
The results for 2023 are consistent with 2022, and 2021.
- Clergy numbers remain constant at 126.
- Parish Share decreased 1.5% from £6.5m to £6.4m.
- The Balance Sheet increased to £106m from £95m due principally to realised gains on the sale of property and investments and unrealised gains on the revaluation of glebe property.
the relative strength of
8
_for the year ended 31 December 2023_
## _**Ongoing Activities cont.**_
## _Fig1: Parish Share Collected cf. Parish Ministry Costs_
||2019|2020|2021|2022|2023|
|---|---|---|---|---|---|
||£m|£m|£m|£m|£m|
|Parish Share|6.6|6.5|6.3|6.5|6.4|
|Resourcing Parish Ministry (Direct)2|(7.6)|(7.8)|(8.1)|(8.1)|(8.3)|
|Deficit|(1.0)|(1.3)|(1.8)|(1.6)|(1.9)|
This consistency, whilst illustrating resilience also indicates the need for a strategic change in the order to see long term flourishing of the Gospel. A recent national review of DBF finances by BDO showed all DBFs are significantly below historic levels of congregational numbers and financial income from Parish Share. This would therefore appear to be a systemic issue in the Church of England which the Board can influence but not control.
time, however the availability of stipendiary clergy for the next decade is a real concern. Developing high quality leadership is fundamental to the growth of the Church and is potentially the single most important focus for the next few years.
## Plans for future periods
The Strategic Report (above) sets out the main approach of the Diocese to addressing its core challenges for the next few years. The Board is committed to using the Unapplied Total Return (UTR) built up over many years to cover the deficits necessary to maintain an appropriate deployment of parish ministry. Whilst change may be necessary to ensure the right pattern of ministry in future the Board seeks to ensure the matter of ministerial deployment is addressed as a missional question that is financially informed but not financially driven.
In the immediate term the Board will focus on its management of assets to ensure the new strategic work can be funded and buy the time for parish ministry to engage with the Deanery Strategic Plan process in meaningful ways that ensure authentic, long-term proposals are agreed for each part of the Diocese.
It is the work of the next year or so to bring together the findings of the Deanery Strategic Planning process, the structural weakness explicit in the wider Church and an assessment of the various forms of ministry the Board has invested in to develop a strategy that maps out a realistic and deliverable model of ministry for the coming decade which ultimately leads to a position of growth from one of main decades of decline.
2 See Note 9
9
## Trustees
_for the year ended 31 December 2023_
## Church Housing Association/Good and Faithful Servant
In early 2024 the Board granted £600k towards the Church Housing Association (CHA) of which it is the corporate member. The CHA is in the final stages of registering as a provider of social housing. Its initial area of operation will be the West Midlands and it is actively exploring sites in the region, including within Gloucester.
Good and Faithful Servant is looking to appoint a new CEO/Surveyor after several years without a such a role. The remit of this CEO is to expand the operation of G&FS into other dioceses with five Diocesan Secretaries keen to have exploratory talks in the summer of 2024 on what this relationship might mean for their DBFs.
## Carbon Net Zero
The Netsince the turn of the century.
Since the early 2000s it has sought to ensure all parsonages are either double or secondary glazed and to ensure lofts and walls are adequately insulated. The Board installed PV panels on all vicarages that were able to accept them for planning purposes in 2012.
The Board also has a policy of converting all empty parsonages to a green energy supplier when in vacancy to ensure all clergy inherit a green energy supply. The main challenge on parsonage stock is heating. This will take time for the market to produce suitable replacement non-carbon-based heating. In the meantime, there is a focus on ensuring the heating system is future proofed.
The Board has been frustrated in its vision by refusal from the DfE for a loan-based scheme to decarbonise Church of England Schools in the diocese. A change in government policy on this is awaited before further progress can be made.
The Board has also committed to a three-way partnership to map its carbon footprint across schools, church buildings and housing in partnership with Hereford and Worcester DBFs with some grant support from the NCIs.
## Principal risks and uncertainties
The Trustees are responsible for the identification, mitigation and management of risk. To achieve this, a register of all the risks identified is maintained and, alongside it, a management and mitigation strategy formed. This is reviewed by the Audit Committee on an annual basis with the responsibility for delivery of the mitigation strategies identified delegated to the Diocesan Secretary.
The risk register identifies eight areas where the risk of either failure to act or the impact of the events These areas and the associated mitigation strategies are:
10
## Trustees
_for the year ended 31 December 2023_
## Principal risks and uncertainties cont.
## _Governance and Management:_
- Loss of key staff: Managed through professional HR resource and appropriate contracts.
- Safeguarding: Managed via a properly resourced independent Safeguarding Board overseeing the work of the HR and Safeguarding Department.
- Acting _Ultra-Vires_ : Managed by the appropriate use of legal advice and all contracts with significant Church legislative implications being undertaken by the Diocesan Registry.
## _Operational Risks_
- Capacity and use of assets: Overseen by a formal Delegation of Authority document with delegations to the Resources and Glebe Committees and the Diocesan Secretary.
- Use of Church Buildings: The Diocesan Advisory Committee for the Care of Churches (DAC) is resourced and staffed appropriately by the Board and operates to national legislation and guidelines.
## _Financial Risks_
- The capacity of Parish Share to fund the current pattern of ministry on the Diocese, particularly in the light of the current cost of living crisis. Alternative models of ministry with different income profiles are being explored and ongoing management of investments and development of glebe supplement Parish Share significantly.
- overseen by the Resources Committee.
- Any change of policy is authorised directly by the Board.
## _External Risks_
- Unexpected changes to the demographic of congregations: The Board has contracted with _Experian_ to receive detailed demographic information on the Diocese of Gloucester.
## Going Concern
The trustees have reviewed the financial position, in the light of its faith in the Risen Christ, its losses from ongoing activities and its long-term balance sheet strength.
Taking account of the satisfactory levels of aggregate reserves (see Reserves Policy note below) and cash, and systems of financial and risk management, it is the truste placed to manage operational and financial risks successfully. Accordingly, the trustees have a reasonable expectation that the charity has adequate resources to continue in operational existence for the foreseeable future and do not believe that there are any material uncertainties as to the going concern of the charity. Therefore, the trustees are content that the charity continues to adopt the going concern basis of accounting in preparing the annual accounts.
11
## Tru
_for the year ended 31 December 2023_
## Investment policy
The Board maintains a review of its investments through the Investment Group which also monitors performance against market benchmarks and considers the adequacy of its investment mix.
The Board also ensures it invests in line with the Church of England Ethical Investment Advisory Group Policy. To achieve this, it uses the investment management skills of a professional fund manager; CCLA.
The table below has been extracted from the quarterly CCLA report at 31 December 2023 reflecting the investment performance.
**----- Start of picture text -----**
Fund total return performance Last three Last five
Current Last twelve years years
Quarter months annualised annualised
CBF Fund holdings within portfolio (%) (%) (%) (%)
Investment +7.72 +12.57 +6.30 +10.13
Fund comparator +6.28 +13.28 +6.02 +7.72
Deposit +1.29 +4.49 +1.93 +1.39
Fund benchmark +1.30 +4.69 +2.03 +1.34
**----- End of picture text -----**
from 2022 which was significantly impacted by the war in Ukraine. The Investment Group has provided comfort to the Board that its assets were invested in line with its ethical policies and financial performance was above the relevant benchmarks set.
Looking forward the Board is keen to consider more social minded and local investments should the predicted cash surpluses from land disposals materialise in the coming years.
## Reserves policy
The policy of the GDBF is to maintain a general fund reserve of between 4 and 8 months of parish share (i.e., between £2.1m and £4.3m) plus any budgeted deficit for the year on the general fund (i.e., for 2023 between £3.0m and £5.9m).
This level is considered prudent to manage for the cash flow deficit experienced each year resulting from parish share contributions being remitted irregularly during the year, (whereas the GDBF expenditure is consistent on a month-by-month basis), and also to allow for unexpected occurrences.
At 31 December 2023, the general fund balance is £4.5m (2022: £8.0m) with free reserves of £2.0m (2022: £2.0m). Although the free reserves are below the target level, funds are held in investments which can be liquidated to ensure the GDBF holds sufficient funds to follow the requirements of the policy. Furthermore, the size of the Unapplied Total Return (UTR) relative to qualifying annual expenditure offers significant comfort that this does not present any operational difficulties.
12
## eport
_for the year ended 31 December 2023_
## Reserves policy cont.
The GDBF holds designated reserves of £6.3m (2022: £5.9m), restricted reserves £5.1m (2022: £4.1m) and endowment funds of £90.1m (2022: £77.2m) at 31 December 2023.
## Fundraising activities
The charity undertakes very limited fundraising activities directly with individuals. The majority of the GDBF GDBF does not use third party professional fundraisers and did not receive any complaints about its fundraising practices during 2023.
## Trustees
## espect of the financial statements
The Trustees
with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). Company law requires the Trustees to prepare financial statements for each financial year, which give a true and fair view of the state of affairs of the GDBF and of the income and expenditure for the period. In preparing those financial statements the Trustees are required to:
select suitable accounting policies and then apply them consistently;
- observe the methods and principles in Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102);
make judgements and estimates that are reasonable and prudent;
- state whether applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charity will continue in operation.
The Trustees are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the GDBF and which enable them to ensure that the financial statements comply with the Companies Act 2006. The Trustees are also responsible for safeguarding the assets of the GDBF and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
## Statements as to disclosure of information to auditors
Each of the Trustees confirms that to the best of their knowledge there is no information relevant to the audit of which the auditors are unaware. The Trustees also confirm that they have taken all the necessary steps to ensure that they themselves are aware of all relevant audit information and that this information has been communicated to the auditors.
13
_for the year ended 31 December 2023_
## Statements as to disclosure of information to auditors cont.
The Trustees are responsible for the maintenance and integrity of the corporate and financial information included on the website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
Trustees port, was approved by the Board of Trustees on **19** September 2024.
## Rt. Rev. Rachel Treweek + Rachel Gloucestr
President, Gloucester GDBF
## Canon Karen Czapiewski
Chair, Gloucester GDBF
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## To the Trustees of Gloucester Diocesan Board of Finance
## **Opinion**
We have audited the financial statements of the Gloucester Diocesan Board of Finance for the year ended 31 December 2023 which comprise the consolidated Statement of Financial Activities, the Income and Expenditure Account, the consolidated and parent Balance Sheets, the consolidated Cash Flow Statement and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion, the financial statements:
- as at 31 December 2023 and of t funds, including the income and expenditure, 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.
## **Basis for opinion**
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, includ
responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
## **Conclusions relating to going concern**
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 group'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.
15
## ont.
## To the Trustees of Gloucester Diocesan Board of Finance
## **Other information**
The trustees are responsible for the other information. The other information comprises the information included in the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
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 that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
## **Opinions on other matters prescribed by the Companies Act 2006**
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the Annual Report (which includes the strategic report and the Trustees financial statements are prepared is consistent with the financial statements; and
- the strategic report and the Trustees prepared in accordance with applicable legal requirements.
## **Matters on which we are required to report by exception**
In the light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Annual Report (which incorporates the strategic report and the Trustees
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept by the parent charitable company; or
- the parent charitable company financial statements are not in agreement with the accounting records and returns; or
- we have not received all the information and explanations we require for our audit.
16
## Indep ont. To the Trustees of Gloucester Diocesan Board of Finance
## **Responsibilities of trustees for the financial statements**
13, the trustees (who
are also the Trustees of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the trustees are responsible for assessing the group and parent going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the group or parent charitable company or to cease operations, or have no realistic alternative but to do so.
## **responsibilities for the audit of the financial statements**
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud.
Based on our understanding of the group and parent charitable company and the environment in which it operates, we identified that the principal risks of non-compliance with laws and regulations related to safeguarding vulnerable beneficiaries, health and safety, and employment (including taxation), 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 and Church of England Measures.
and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls) and determined that the principal risks were related to fund accounting, including transfers between funds, and revenue recognition.
17
## ont.
## To the Trustees of Gloucester Diocesan Board of Finance
Audit procedures performed by the engagement team included:
- Inspecting correspondence with regulators and tax authorities;
- Discussions with management including consideration of known or suspected instances of noncompliance with laws and regulation and fraud;
-
- Identifying and testing journals;
- Challenging assumptions and judgements made by management in their critical accounting estimates;
- Testing transfers between funds; and
- Cut-off testing in respect of revenue.
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.
A further description of our responsibilities for the audit of the financial statements is located on the part of our report.
## **Use of our report**
This report is made solely to the charitable company's members, as a body, in accordance with Chapter 3 of 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 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 the charitable company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
Adam Halsey (Senior Statutory Auditor)
10 Queen Street Place
For and on behalf of Haysmacintyre LLP, Statutory Auditor London EC4R 1AG
Date 27 September 2024
18
## Consolidated statement of financial activities
_for the year ended 31 December 2023_
**----- Start of picture text -----**
Total Total
2023 2022
Income & endowments
from
Donations
parish share contributions 1 6,377 - - - 6,377 6,477
church commissioners 2 63 - - - 63 47
grants and other donations 3 188 - 579 - 767 1,207
Charitable activities: statutory fees 611 - 171 - 782 520
and licence to occupy income
Other activities 4 117 - - - 117 154
Investments 5 832 6 233 - 1,071 983
Other 6 12 - 13 1,496 1,521 2,000
Total 8,200 6 996 1,496 10,698 11,388
Ex enditure on
p
Raising funds 7 86 - - - 86 165
Charitable activities 8 10,614 1,345 1,328 29 13,316 12,687
Total 9 10,700 1,345 1,328 29 13,402 12,852
Net (expenditure)/income before
(2,500) (1,339) (332) 1,467 (2,704) (1,464)
investment gains
Net gains/(losses) on investments 20 - - 264 13,158 13,422 (2,969)
Net (expenditure)/income (2,500) (1,339) (68) 14,625 10,718 (4,433)
- - - -
Total return transfer 1,800 (1,800)
Net (expenditure)/income after
(700) (1,339) (68) 12,825 10,718 (4,433)
total return transfer
Transfers between funds 20 - 23 (2,789) 1,760 998 31 - -
Other recognised gains 26 - - - - - 695
Net movement in funds (3,489) 421 930 12,856 10,718 (3,738)
Total funds brought forward 7,982 5,864 4,150 77,237 95,233 98,971
Total funds carried forward 4,493 6,285 5,080 90,093 105,951 95,233
General fund Designated funds Restricted funds Endowment funds
Notes
**----- End of picture text -----**
19
Consolidated summary income & expenditure account _for the year ended 31 December 2023_
||**2023**
_2022_|
|---|---|
|||
|Total income|9,202
_10,408_|
|Expenditure|(13,373)
_(12,949)_|
|_Operating (deficit) for the year_|(4,171)
_(2,541)_|
|Net gains/(losses) on investments|264
_(374)_|
|**Net (expenditure) for the year**|**(3,907)**
_(2,915)_|
|**Other comprehensive income:**
Net assets transferred from endowments
Actuarial gains on defined benefit pension schemes|1,769
_5,883_
-
_608_|
|**Total comprehensive (expenditure)/income**|**(2,138)**
_3,576_|
The income and expenditure account is derived from the Statement of Financial Activities with movements in endowment funds excluded to comply with company law.
All income and expenditure is derived from continuing activities.
Full comparatives for the year to 31 December 2022 are shown in note 28.
The notes on pages 24 to 60 form part of these financial statements.
20
_as at 31 December 2023_
_Company number 00162165_
## Consolidated balance sheet
**----- Start of picture text -----**
2023 2022
Tangible assets 15a 48,203 48,602
Investments 16a 52,904 40,029
Fixed Assets 101,107 88,631
Stock and work in progress 17 43 23
Debtors: amounts falling due after one year 18a 494 503
Debtors: amounts falling due within one year 18a 1,760 608
Cash at bank and in hand 3,772 6,815
Current Assets 6,069 7,949
Creditors: amounts falling due within one year 19a (751) (873)
Net Current Assets (Current assets less creditors <1 year) 5,318 7,076
Total Assets less current liabilities (Fixed Assets plus NCA) 106,425 95,707
Creditors: amounts falling due after one year
Other creditors 19a (474) (474)
Net Assets 105,951 95,233
Endowment funds 20,23 90,093 77,237
Restricted funds 20,22 5,080 4,150
Designated funds (unrestricted) 20,21 6,285 5,864
General fund (unrestricted) 20 4,493 7,982
Total funds 105,951 95,233
Notes
**----- End of picture text -----**
Approved by the Board of Trustees on 19 September 2024 and signed on its behalf by
Canon Karen Czapiewski, Chair
_The notes on pages 24 to 60 form part of these financial statements._
21
## Parent company balance sheet
_as at 31 December 2023_
**----- Start of picture text -----**
Company number 00162165
2023 2022
Tangible assets 15b 46,863 47,268
Investments 16b 52,738 39,934
Fixed Assets 99,601 87,202
Debtors: amounts falling due after one year 18b 494 503
Debtors: amounts falling due within one year 18b 1,773 613
Cash at bank and in hand 1,756 4,817
Current Assets 4,023 5,933
Creditors: amounts falling due within one year 19b (682) (792)
Net Current Assets (Current assets less creditors <1 year) 3,341 5,141
Total Assets less current liabilities (Fixed Assets plus NCA) 102,942 92,343
Creditors: amounts falling due after one year
Other creditors 19b (474) (474)
Net Assets 102,468 91,869
Endowment funds 89,181 76,396
Restricted funds 2,507 2,382
Designated funds (unrestricted) 6,285 5,864
General fund (unrestricted) 4,495 7,227
Reserves 102,468 91,869
Notes
**----- End of picture text -----**
Approved by the Board of Trustees on 19 September 2024 and signed on its behalf by
Canon Karen Czapiewski, Chair
_The notes on pages 24 to 60 form part of these financial statements._
22
## Consolidated cash flow statement
## _for the year ended 31 December 2023_
**----- Start of picture text -----**
2023 2022
Net cash used in operating activities (6,480) (4,741)
Cash flows from investing activities
Dividends and interest received 5 1,071 983
Proceeds from sale of tangible fixed assets 2,621 3,031
Purchase of tangible fixed assets for use by GDBF 15a (1,108) (2,571)
Purchase of fixed asset investments 16a (23) (294)
Sale and reclassification of fixed asset investments 16a 871 8,698
Net cash provided by investing activities 3,432 9,847
Cash flows from financing activities
Loan repaid to GDBF 25 33
-
Loan advanced by GDBF (20)
-
Loans repaid by GDBF (750)
Net cash provided by financing activities 5 (717)
Change in cash and cash equivalents during year (3,043) 4,389
Cash & cash equivalents at 1 January 6,815 2,426
Cash & cash equivalents at 31 December 3,772 6,815
Reconciliation net movement in funds to net cash flow from operating activities:
Net expenditure for the year (2,704) (1,464)
Adjustments for:
Depreciation and amortisation charges 81 95
Dividends, interest & rent from investments (1,071) (983)
Profit on sale of functional assets (1,195) (1,689)
Profit on sale of investments (301) (282)
(Increase) in stock and work in progress (20) (3)
(Increase) in debtors (1,148) (117)
(Decrease) in creditors (122) (14)
FRS102 pension adjustment (deficit -
(284)
contribution and interest charge)
Net cash used in operating activities (6,480) (4,741)
Analysis of cash and cash equivalents
Cash in bank & in hand 3,772 6,815
Total cash and cash equivalents 3,772 6,815
Notes
**----- End of picture text -----**
23
## Accounting policies
_for the year ended 31 December 2023_
The principal accounting policies adopted are as follows:
## _**Basis of Accounting**_
The accounts have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (2nd edition, effective 1 January 2019) - (Charities SORP FRS 102), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.
These financial statements consolidate the results of the charitable company and its wholly owned subsidiaries on a line-by-line basis. The subsidiaries are Jumping Fish Limited, The Good and Faithful Servant Limited, Sportily Limited and the Ann Edwards Charity. A separate statement of financial activities, or income and expenditure account, for the charitable company itself is not presented because the charitable company has taken advantage of the exemptions afforded by section 408 of the Companies Act 2006. The deficit of the parent charity for the year was £2.753 million (2022: deficit of £514k).
Gloucester DBF meets the FRS102 definition of a Public Benefit Entity.
The principal accounting policies and estimation techniques are as follows.
## _**Income**_
All income is included in the Statement of Financial Activities (SoFA) when the GDBF is legally entitled to them as income or capital respectively, ultimate receipt is probable and the amount to be recognised can be quantified with reasonable accuracy.
Parish Share contributions by parishes are included in the financial statements when there is certainty of receipt. Donations are recognised when received. Legacies are recognised when there is reasonable certainty as to both entitlement and amount. Grants from government bodies and other sources are received for specific projects/costs and are recognised in accordance with their individual terms and conditions. Income is recognised when the Charity has entitlement to the funds which is when any performance conditions attached are met, it is probable that the income will be received and the amount can be reliably measured. Grant income will be deferred if received in advance of meeting performance conditions or if the funder specifically states that the income must be spent in a future accounting period. Contractual income and performance related grants are included in the SOFA only when the related goods or services have been delivered. Interest and dividends are included in the financial statements when receivable. Rental income is recognised in the period to which the rent relates.
Investment income arising upon the Diocesan Stipends Fund is credited to the unapplied total return in the year in which the income is due.
## _**Expenditure**_
Expenditure is included on the accruals basis and has been classified under headings that aggregate all costs related to the Statement of Financial Activity category.
- i) Costs of raising funds are constrained to costs relating to the temporary renting out of parsonages and investment management costs of glebe and any other investment properties.
- ii) Charita on resourcing mission and ministry in the parishes of the Diocese, expenditure relating to the running of the diocesan retreat centre, and expenditure on education and Church of England schools in the Diocese.
- iii) Grants 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 performance or other discretionary requirements to the satisfaction of the GDBF, such grants being recognised as expenditure when the conditions attaching are fulfilled. Grants offered subject to such conditions which have not been met at the year-end are noted as a commitment, but not accrued as expenditure.
24
## Accounting policies
_for the year ended 31 December 2023_
## _**Expenditure cont.**_
- iv) Support costs consist of central management, administration and governance costs. The amount spent on raising funds and other activities is considered to be immaterial and all support costs are allocated to the purpose of charitable activities. Costs are allocated wherever possible directly to the activity to which they relate, but where such direct allocation is not possible, the remainder is allocated on an approximate staff time basis.
- v) Pension contributions. The GDBF's staff are members of the Church Workers Pension Fund and Clergy are members of the Church of England Funded Pensions Scheme (see note 25). The pension costs charged as expenditure represent the GDBF's contributions payable in respect of the accounting period, in accordance with FRS102. Deficit funding for the pension schemes to which GDBF participates is accrued at current value in creditors distinguished between contributions falling due within one year and after more than one year.
- vi) Employee benefits. Short term employee benefits including holiday pay are recognised as an expense in the period in which the service is received. Termination benefits are accounted for on an accruals basis and in line with FRS 102.
## _**Going concern**_
The Trustees going concern. The review of its financial position, levels of reserves and future plans give the Trustees confidence the charity remains a going concern for a period in excess of 12 months from the date of approval of these accounts. This review has included an assessment of cash flow forecasts.
## _**Depreciation**_
Depreciation on equipment is calculated on a straight-line basis at annual rates estimated to write off the assets over their respective expected useful lives, as follows:
|Leasehold property improvements|5%|Assets under construction|0%|
|---|---|---|---|
|Office equipment|20%|Office furniture
|12½%|
|Telephone equipment|20%|Computer equipment
|25%|
|Solar PV panels|25 years|||
No depreciation is provided on clergy houses. As the remaining useful life of these assets exceeds 50 years and a programme of planned maintenance ensures that the residual value does not fall below the carrying value, any depreciation would be immaterial. An annual impairment review is carried out in accordance with FRS102.
## _**Tangible fixed assets**_
Tangible fixed assets with a useful life of over 1 year and costing £1,000 or more are capitalised and recognised when future economic benefits are probable and the cost or value of the asset can be measured reliably.
Clergy houses owned by the Board as corporate property are included in the financial statements at historical cost.
Clergy houses owned by benefices are included in the financial statements at a carrying value established by the Trustees and based on a professional valuation in December 2000. Houses acquired since that date are included at cost, and any major improvements are capitalised to the extent that the carrying value does not exceed the estimated net realisable value. Although the Board does not own these houses, it has the responsibility for maintaining them and receives any sale proceeds on disposal if the
25
## Accounting policies
_for the year ended 31 December 2023_
## _**Tangible fixed assets cont.**_
house becomes surplus under a pastoral scheme. Under FRS102 the Board considers that it has access to the benefits of these houses and also the associated risks and therefore needs to recognise them as assets in the financial statements. Solar PV panels installed on clergy houses are included within the asset value of the house and depreciated on a straight line basis over 25 years.
## _**Fixed asset investments**_
Listed investments are stated at open market value at the balance sheet date with the gain or loss arising on the investment funds representing the Diocesan Stipends Fund, taken directly to the unapplied total return and others to the Statement of Financial Activities. For units held in managed funds of the Central Board of Finance this is the published bid price. Investment properties, which comprise the glebe portfolio, are stated at Trustees professional advice and is reviewed each year. Certain short-term cash deposits, which are held for long term investment purposes, are included in fixed asset investments.
## _**Financial Instruments**_
The charitable company only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently carried at either amortised cost or fair value as noted below.
## _**Stock and Work in progress**_
Stock and work in progress are valued at the lower of cost and net realisable value. Cost includes all direct expenditure and an appropriate proportion of fixed and variable overheads.
## _**Debtors**_
Trade and other debtors are recognised at the settlement amount due after any trade discount offered. Prepayments are valued at the amount prepaid net of any trade discounts due. At the end of each reporting period debtors are assessed for evidence of impairment. If an asset is impaired an impairment loss is recognised in the Statement of Financial Activities.
## _**Cash**_
Cash at bank and cash in hand includes cash and short term highly liquid investments with a short-term maturity.
## _**Creditors**_
Basic financial liabilities, including trade and other payables and bank loans, are recognised where the charity 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 obligation can be measured or estimated reliably. Creditors and provisions are recognised at transaction price.
26
## Accounting policies
_for the year ended 31 December 2023_
## _**Fund accounting**_
The resources of the Board are classified according to restrictions imposed on their use by donors or by legislation, and in accordance with the SORP, as follows:
- Endowment funds represent money that must be permanently held as capital and may not be spent as income. Expendable endowment may, however, be spent as income under certain circumstances.
- Restricted funds may only be used for the purposes for which the money was originally gifted or bequeathed to the Board, or as expressed in the trusts under which the funds are held.
- Unrestricted funds are monies available for use at the discretion of the Board. The General Fund is for the day to day running of the Board and is primarily funded by the parish share. However, certain funds have been earmarked for particular purposes, and these are termed designated funds. Such funds are kept separate for administrative purposes but do not constitute legally separate funds.
During 2019, Bishops Council approved a total return approach to investment for the investments held as one of the GD the Diocesan Stipends Fund (DSF). This change in policy took effect from 1[st] January 2019 and since then GDBF has operated a total return approach to the management of the investment portfolio attributable to the DSF. Using this approach, GDBF is required to analyse the fund between the amount held for investment (non-distributable funds) and the unapplied total return. GDBF is permitted to allocate from the unapplied total return element, such sums as the Board see appropriate, provided that the Board exercise their statutory duty to be even handed as between present and future beneficiaries and that they maintain the unapplied total return at such a level as to ensure it remains positive, after having due regard to the volatility of the investment -distributable funds in real terms.
## _**Operating leases**_
Rental payments under operating leases are charged to the Statement of Financial Activities on a straightline basis over the term of the lease.
## _**Judgements and estimates**_
In the application of the accounting policies, the Trustees are required to make judgements, estimates, and assumptions about the carrying value of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are continually evaluated. Revisions to accounting estimates are recognised in the period in which the estimate is revised.
## _Significant judgements:_
Valuation of investment properties - Investment properties are stated at trustees appropriate professional advice.
Depreciation of clergy houses - The Trustees consider that residual value of freehold properties is equivalent to the carrying value and depreciation would not be material.
## _Sources of estimation uncertainty:_
In the view of the Trustees there are no sources of estimation uncertainty affecting assets or liabilities at the balance sheet date that are likely to result in a material adjustment to their carrying amounts in the next financial year.
27
## Notes to the financial statements
_for the year ended 31 December 2023_
**----- Start of picture text -----**
Note 1
Parish Share
2023 2022
Gloucester City 545 571 - 571 569
Severn Vale 608 606 - 606 602
Forest South 370 358 - 358 381
Wotton 571 586 - 586 614
Stroud 596 598 - 598 609
Cheltenham 1,277 1,291 - 1,291 1,319
North Cotswold Deanery 901 883 - 883 886
Cirencester 867 929 - 929 914
Tewkesbury & Winchcombe 571 550 - 550 576
Other - 5 - 5 7
Parish Share contributions 6,306 6,377 - 6,377 6,477
2023
Deanery
Confirmed
Allocations for
Received in 2023 re 2023 Received in 2023 re prior years
**----- End of picture text -----**
||**Note 2**
**Income from the Church Commissioners**|**2023**
_2022_|
|---|---|---|
||||
||**Church Commissioner grants received**||
||||
||||
||||
||||
||||
||||
||||
||||
||||
||||
||||
||||
||||
28
## Notes to the financial statements
_for the year ended 31 December 2023_
**----- Start of picture text -----**
Note 3
Grants and other donations Total Total
2023 2022
Ecclesiastical Insurance Group grant 84 - - - 84 96
Voluntary Schools Fund grants - - - - - 240
Other grants 21 - - - 21 54
- - 131 - 131 -
Other restricted grants/donations - - 270 - 270 436
Sportily grants - - 178 - 178 103
Energy grants - - - - - 197
Other donations 83 - - - 83 81
Grants and donations 188 - 579 - 767 1,207
Unrestricted Designated Restricted Endowment
**----- End of picture text -----**
**----- Start of picture text -----**
Note 4
Other activities
Total Total
2023 2022
Rental of vacant housing 89 - - - 89 118
Property development: G&FS* - - - - - -
Educational services: JF Ltd* 20 - - - 20 18
Other income 8 - - - 8 18
Total 117 - - - 117 154
Unrestricted Designated Restricted Endowment
**----- End of picture text -----**
In 2022, £146k of other activities income was unrestricted, and £8k was designated.
*The principal activity of Good & Faithful Servant (G&FS) is the development of property, whilst (JF Ltd) is the publication of educational materials and professional services, for advertisement of the Christian religion.
29
## Notes to the financial statements
## _for the year ended 31 December 2023_
**----- Start of picture text -----**
Note 5
Investments 2023 2022
Income from fixed asset investments 1,028 949
Other interest receivable and similar income 3 4
Rent receivable 40 30
Investments 1,071 983
**----- End of picture text -----**
In 2023, £832k (2022: £810k) of investment income was unrestricted, £6k (2022: £4k) was designated and £233k (2022: £169k) was restricted.
**----- Start of picture text -----**
Note 6
Other 2023 2022
Gain on disposal of tangible fixed assets* 1,195 1,971
Gain on investment property 301 -
Miscellaneous income 25 29
Other 1,521 2,000
**----- End of picture text -----**
In 2023, £12k (2022: £15k) of other income was unrestricted, £nil (2022: £995k) was designated,
£13k (2022: £10k) was restricted and £1,496k (2022: £980k) was endowed.
* The gain on disposal of tangible fixed assets in 2023 included in endowment funds comprised the sale of four clergy houses (two surplus and two replaced) for the GDBF. The gain on disposal of tangible fixed assets in 2022 comprised the gain on the sale of five surplus clergy houses for the GDBF.
||**Note 7**
**Raising funds**|**2023**
_2022_
57
_111_
14
_41_
15
_13_
**86**
_165_|
|---|---|---|
||Tenancy costs associated with the letting of vacant properties||
||Property development
G & FS Limited|14
_41_|
||Educational services
Jumping Fish Limited|15
_13_|
||||
||**Raising funds**||
||||
||||
||||
30
## Notes to the financial statements
## _for the year ended 31 December 2023_
**----- Start of picture text -----**
2023 2022
Note 8
Charitable activities
Council:
National Church responsibilities 210 - - - 210 213
Training for Ministry 319 - - - 319 308
Training of Ordinands support 155 - - -
155 227
grants
- - -
Pooling of Ordinand support costs (42) (42) 16
Mission agencies pension 10 - - -
10 13
contributions
Retired clergy housing costs 121 - - -
121 115
(CHARM)
773 - - - 773 892
Resourcing Ministry & Mission:
Stipends, employed Clergy and 3,500 - - -
3,500 3,404
National insurance
Clergy pension contributions 772 - - - 772 1,209
FRS102 adjustment clergy - - - - - (284)
pension
Housing costs including removal 1,945 - - -
1,945 1,635
and resettlement grants
Parochial fees payable to PCCs 287 - - - 287 -
6,504 - - - 6,504 5,964
Support costs 3,337 83 318 29 3,767 3,816
9,841 83 318 29 10,271 9,780
Expenditure on Education:
Grant to DBE (note 11) - 115 - - 115 351
Grant to DGAT (note 11) - 16 - - 16 -
Other Expenditure:
Grants awarded (note 11) - 1,131 31 - 1,162 889
Charitable activities of Ann - - 102 -
102 73
Edwards charity
Charitable activities of Sportily - - 877 - 877 702
10,614 1,345 1,328 29 13,316 12,687
Unrestricted Designated Restricted Endowment
**----- End of picture text -----**
31
_for the year ended 31 December 2023_
## Notes to the financial statements
**----- Start of picture text -----**
Note 8 cont.
Total
Comparative analysis for 2022 2022
Charitable activities
:
National Church responsibilities 213 - - - 213
Training for Ministry 308 - - - 308
Training of Ordinands support grants 227 - - - 227
Pooling of Ordinand support costs 16 - - - 16
Mission agencies pension contributions 13 - - - 13
Retired clergy housing costs (CHARM) 115 - - - 115
892 - - - 892
Resourcing Ministry & Mission:
Parish Ministry
Stipends, employed Clergy and National 3,404 - - -
3,404
insurance
Clergy pension contributions 1,209 - - - 1,209
FRS102 adjustment clergy pension (158) - - (126) (284)
Housing costs including removal and 1,635 - - - 1,635
resettlement grants
6,090 - - (126) 5,964
Support for parish ministry 3,196 - 591 29 3,816
9,286 - 591 (97) 9,780
Expenditure on Education:
Support for church schools - 351 - - 351
Other Expenditure:
Grants awarded (note 11) - 730 159 - 889
Charitable activities of Ann Edwards - - 73 -
73
charity
Charitable activities of Sportily - - 702 - 702
10,178 1,081 1,525 (97) 12,687
Unrestricted Designated Restricted Endowment
2022 2022 2022 2022
**----- End of picture text -----**
32
## Notes to the financial statements
## _for the year ended 31 December 2023_
## **Note 9**
## **Analysis of expenditure including the allocation of support costs**
**----- Start of picture text -----**
Activities Grant
undertaken funding of Support
directly activities costs Total costs
2023 2023 2023 2023
Raising funds 86 - - 86
Charitable activities:
- 773 - 773
Resourcing parish ministry 8,304 83 1,798 10,185
Education - 131 - 131
Other expenditure 778 1,162 201 2,141
Total 9,168 2,149 1,999 13,316
Activities Grant
undertaken funding of Support
Comparative analysis for 2022 directly activities costs Total costs
2022 2022 2022 2022
Raising funds 165 - - 165
Charitable activities:
- 892 - 892
Resourcing parish ministry 8,084 - 1,696 9,780
Education 240 - 111 351
Other expenditure 623 889 152 1,664
Total 9,112 1,781 1,959 12,852
**----- End of picture text -----**
Notes 10 to 14 provide further details on expenditure for 2023.
33
## Notes to the financial statements
## _for the year ended 31 December 2023_
**----- Start of picture text -----**
Note 10
Analysis of support
costs
Unrestricted funds Restricted Endowment Total Total
Funds Funds funds funds
General Designated
2022
2023
Central administration 1,707 - 189 29 1,925 1,897
Governance:
External audit 37 - 12 - 49 46
Chancellor and 14 - - - 14 13
professional fees
Synodical costs 11 - - - 11 3
Total 1,769 - 201 29 1,999 1,959
**----- End of picture text -----**
In 2022, £1,730k of central administration costs was unrestricted, £138k was restricted and £29k was endowed. Of the remaining expenditure of £48k was unrestricted and £14k was restricted.
**----- Start of picture text -----**
Note 11
2023 2022 2023 2022
Summary of grants made: number number
Church repairs 1 1 10 10
DBE Grant 1 1 115 36
Development Grants 25 21 182 159
DGAT Grant 1 - 16 -
Energy Grants 47 252 21 149
Grace Network 1 1 400 250
Housing Initiative 1 1 549 285
Grants made in the year 77 277 1,293 889
**----- End of picture text -----**
34
## Notes to the financial statements
_for the year ended 31 December 2023_
**----- Start of picture text -----**
Note 12
Net movement in funds is stated after charging: 2023 2022
Depreciation 81 95
Auditors remuneration - audit 49 46
Interest on Church Commissioners loans:
Loan for Solar Panel installations 2 13
Value Linked Loans on parsonage houses 30 27
Operating leases: Land and buildings (note 24) 64 64
Operating leases: Other (note 24) 19 19
**----- End of picture text -----**
**----- Start of picture text -----**
Note 13
Interest on long term loans 2023 2022
Interest on loans wholly or partly repayable beyond 5 years 30 27
**----- End of picture text -----**
All interest relates to value linked loans, being equity share loans made to the GDBF by the Church Commissioners in respect of Parsonage Housing.
35
## Notes to the financial statements
_for the year ended 31 December 2023_
|Notes to the financial statements
_or the year ended 31 December 2023_||
|---|---|
|
**Note 14 Staff costs**
_Costs of employees and officer holders_|**2023**
_2022_|
|||
|salaries and stipends|1,793
_2,144_|
|redundancy and termination payments|-
_51_|
|social security costs|181
_227_|
|other pension costs|382
_599_|
|Employees, including clergy in GDBF employment:|**2,356**
_3,021_|
|||
|Stipends|3,078
_2,994_|
|social security costs|278
_275_|
|pension costs|766
_1,034_|
|Parochial clergy funded by the GDBF:|**4,122**
_4,303_|
|||
|_Number of employees including clergy in GDBF employment_|**2023**
_2022_|
||Number
_Number_|
|Average monthly number||
The employer's pension contribution for staff earning over £60,000 was £88,065 (2022: £75,508).
The GDBF acted as a paymaster for the Gloucester Diocesan Board of Education (GDBE) from 1 January 2023. The staff costs are included in the GDBE accounts charity number 1199117.
## **Remuneration of key management personnel**
Key management personnel are deemed to be those having authority and responsibility, delegated to them by the trustees, for planning, directing and controlling the activities of the Diocese. During 2023 they were:
Diocesan Secretary and Company Secretary Canon Benjamin Preece Smith Director of Mission and Ministry Sandra Millar Head of Communications Canon Lucy Taylor Director of People, Pastoral and Safeguarding Canon Judith Knight Chief Financial Officer Lisa Gardner Remuneration and pensions for these five (2022: nine) employees amounted to £499k (2022: £532k).
36
## Notes to the financial statements
_for the year ended 31 December 2023_
**Note 14 Staff costs cont.**
## **Trustees**
No Director/Trustee received any remuneration for services as a Director/Trustee. The Directors/Trustees received travelling and out of pocket expenses, totalling £13k (2022 - £7k) in respect of General Synod duties, duties as Archdeacon or Area Dean, and other duties as Directors/Trustees.
Certain trustees of the Board who are also clergy received benefits during the year from the Board as part of its normal charitable activity of providing a stipend and housing for clergy in the Diocese.
The following table gives details of the Directors/Trustees who were in receipt of a stipend and or housing provided by the GDBF during the year:
||**Stipend**|**Housing**|
|---|---|---|
|The Archdeacon of Cheltenham|Yes|Yes|
|The Archdeacon of Gloucester|Yes|Yes|
|Reverend A Blyth|Yes|Yes|
|Reverend H Curran|Yes|Yes|
|Reverend J Farragher|Yes|Yes|
|Reverend J Pestell|Yes|Yes|
|Reverend K Scott|Yes|Yes|
|Reverend Canon J Swanton|Yes|Yes|
The GDBF is responsible for funding via the Church Commissioners the stipends of licensed stipendiary clergy in the Diocese, other than bishops and cathedral staff. The GDBF is also responsible for the provision of housing for stipendiary clergy in the Diocese including the Suffragan Bishop but excluding Diocesan Bishop and cathedral staff.
The stipends of the two Bishops were paid and funded by the Church Commissioners.
The stipends of the Diocesan Bishop and Suffragan Bishops are funded by the Church Commissioners and are in the range £39,953 - £48,972 (2022 range £38,050 - £46,640). The annual rate of stipend, funded by the GDBF, paid to Archdeacons in 2023 was £40,199 (2022 £37,385).
37
## Notes to the financial statements
_for the year ended 31 December 2023_
**----- Start of picture text -----**
Note 15a Group Assets under Leasehold
Tangible Fixed construction property Freehold Office
Assets improvements Property Equipment Total
Cost or valuation:
At 1 January 2023 25 239 48,692 468 49,424
Additions 4 - 1,075 29 1,108
Disposals - - (1,426) - (1,426)
At 31 December 2023 29 239 48,341 497 49,106
Depreciation:
At 1 January 2023 - 107 321 394 822
Charge for year - 12 29 40 81
Disposals - - - - -
At 31 December 2023 - 119 350 434 903
Net book value:
At 1 January 2023 25 132 48,371 74 48,602
At 31 December 2023 29 120 47,991 63 48,203
**----- End of picture text -----**
The Board has vested in it two redundant churches. One is leased to the Methodist Church on a long lease at a peppercorn rent. The other is held pending disposal. No value is attributed to these properties.
The freehold property disposals made in 2023 relate to the sales of four clergy houses (2022: five surplus clergy houses), two were surplus to requirements and two replaced.
38
## Notes to the financial statements
## _for the year ended 31 December 2023_
**----- Start of picture text -----**
Note 15b Parent Assets under Leasehold
Tangible Fixed construction property Freehold Office
Assets improvements Property Equipment Total
Cost or valuation:
At 1 January 2023 25 239 47,377 432 48,073
Additions 4 - 1,075 12 1,091
Disposals - - (1,426) - (1,426)
At 31 December 2023 29 239 47,026 444 47,738
Depreciation:
At 1 January 2023 - 107 315 383 805
Charge for year - 12 29 29 70
Disposals - - - - -
At 31 December 2023 - 119 344 412 875
Net book value:
At 1 January 2023 25 132 47,062 49 47,268
At 31 December 2023 29 120 46,682 32 46,863
**----- End of picture text -----**
39
## Notes to the financial statements
## _for the year ended 31 December 2023_
**----- Start of picture text -----**
Note 16a Group Assets
Fixed Asset Investments under Total
Properties construction Investments 2023 2022
Market value at 1 Jan 2023 12,950 160 26,919 40,029 51,416
Additions 18 5 - 23 294
Disposal proceeds (871) - - (871) (8,698)
Realised investment gains 301 - - 301 282
Unrealised investment gains/(losses) 10,867 - 2,555 13,422 (2,969)
Reclassification - - - - (296)
Market Value at 31 Dec 2023 23,265 165 29,474 52,904 40,029
Historic cost at 31 Dec 2023 17,342 17,319
Gains on investment assets
Unrealised gains/(losses) (as above) - - 2,555 2,555 (3,617)
Realised gain on Glebe disposal 301 - - 301 282
Glebe revaluation 10,867 - - 10,867 648
Total investment gains 11,168 - 2,555 13,723 (2,687)
**----- End of picture text -----**
In 2024, Bruton Knowles undertook a formal review of one site and a desktop valuation of most of the Glebe sites with the Glebe Committee RICS members reviewing the remainder. This resulted in an increase in valuation of £10,867k.
40
## Notes to the financial statements
## _for the year ended 31 December 2023_
**----- Start of picture text -----**
Note 16b Parent Assets
Fixed Asset Investments under Total
Properties construction Investments 2023 2022
Market value at 1 Jan 2023 12,950 160 26,824 39,934 51,221
Additions 18 5 - 23 294
Disposals (871) - - (871) (8,416)
Realised gain on Glebe disposal 301 - - 301 -
Unrealised investment gains(losses) 10,867 - 2,484 13,351 (2,869)
Reclassification - - - - (296)
Market Value at 31 Dec 2023 23,265 165 29,308 52,738 39,934
Historic cost at 31 Dec 2023 17,646 17,623
Gains on investment assets
Unrealised gains(losses) (as above) - - 2,484 2,484 (3,517)
Realised gains - Glebe 301 - - 301 -
Glebe revaluation 10,867 - - 10,867 648
Total investment (losses)gains 11,168 - 2,484 13,652 (2,869)
Investments comprise: Note 16a Note 16b
Group Parent
2023 2022 2023 2022
(i) Listed investments (equities)
UK Investments 2,222 2,746 2,161 2,746
Non-UK investments 18,571 15,217 18,057 15,217
Listed Investments total 20,793 17,963 20,218 17,963
(ii) Unlisted investments
Property & other 8,032 6,647 7,809 5,902
Cash 649 2,309 631 2,309
(iii) Good and Faithful Servant Ltd - - 650 650
Investments total 29,474 26,919 29,308 26,824
**----- End of picture text -----**
41
## Notes to the financial statements
_for the year ended 31 December 2023_
## **Note 16b**
Fixed Asset Investments cont.
The listed investments are held in the CBF Church of England Investment Fund managed by CCLA. The allocation in (i) represents the asset allocation of the managed portfolio at 31 December 2023.
**----- Start of picture text -----**
The Diocese has four wholly owned subsidiaries:
Subsidiary name Company Charity Share Capital
number number
The Good & Faithful Servant 06258385 n/a £650,100
Limited (GFS)
Jumping Fish Limited (JF) 06672775 n/a £1
Sportily Limited 0550991 1111077 Limited by guarantee GDBF sole
member
The Charity of Ann Edwards (AEC) n/a 263956 GDBF sole trustee of Charity
The transactions and balances for these wholly owned subsidiaries were as follows:-
Income Expenditure Assets Liabilities Net assets
£ £ £ £ £
2023 2022 2023 2022 2023 2022 2023 2022 2023 2022
GFS 0k 6k 14k 41k 646k 660k (3k) (3k) 643k 657k
JF 20k 18k 15k 18k 29k 27k (24k) (27k) 5k 5k
Sportily 948k 783k 885k 709k 885k 866k (39k) (83k) 846k 783k
AEC 109k 91k 114k 91k 2,711k 2,588k (71k) (14k) 2,640k 2,574k
**----- End of picture text -----**
42
## Notes to the financial statements
## _for the year ended 31 December 2023_
**Note 16c Application of the power of total return to the Diocesan Stipends Fund**
**----- Start of picture text -----**
Unapplied Total Total
Trust for Total endowment endowment
investment Return 2023 2022
As at 1 [st] January 2023:
-
Base value of the permanent 12,092 12,092 10,662
endowment
-
Unapplied total return 20,010 20,010 17,594
Total 12,092 20,010 32,102 28,256
Movements in the year:
Investment returns income - 693 693 728
received
-
Unrealised gains for year 2,198 2,198 (3,109)
-
Realised gains for the year 1,991 1,991 7,955
-
Unapplied total return allocated (2,493) (2,493) (1,728)
to General Fund in the year
Add indexation to base level of 624 (624) - -
the endowment
Net movements in the year 624 1,765 2,389 3,846
As at 31 [st] December 2023:
-
Base value of the permanent 12,716 12,716 12,092
endowment
-
Unapplied total return 21,775 21,775 20,010
Valuation at 31 [st] December 12,716 21,775 34,491 32,102
2023
**----- End of picture text -----**
The investment power of total return permits Gloucester DBF to invest the permanently endowed Diocesan Stipends Fund (DSF) to maximise total return and apply an appropriate portion of the unapplied total return each year. Until the power is exercised to transfer a portion of unapplied total return to income, the unapplied total return remains part of the permanent endowment.
An Unapplied Total Return Fund (UTR) of £10,800k was created on 1[st] January 2019, all of which related to the DSF permanent endowment. The base value of the permanent endowment is indexed annually based on the RPI percentage increase over the year. The annual increase in 2023 was 5.16% (2022: 13.41%).
43
## Notes to the financial statements
## _for the year ended 31 December 2023_
## **Note 16c**
## **Application of the power of total return to the Diocesan Stipends Fund cont.**
For the year ended 31[st] December 2023, the Board took the decision to transfer £2,493k (2022: £1,728k) which included investment income of £693k and allocated unapplied total return of £1.8 million from the Unapplied Total Return Fund to the General Fund.
## **Note 17**
## **Stock and Work In Progress**
This comprises work in progress amounting to £32k (2022: £12k) in relation to property developments being undertaken by the Good & Faithful Servant Ltd and £11k (2022: £11k) of education materials held by Jumping Fish Limited.
**----- Start of picture text -----**
Note 18a
Due within one year Due after one year
Consolidated group debtors
2023 2022 2023 2022
Prepayments and sundry debtors 1,657 517 - -
Staff car loans 1 4 - 2
Loans to parishes, Cathedral and other DBF 58 52 494 501
Parish Giving Scheme 44 35 - -
Debtors 1,760 608 494 503
**----- End of picture text -----**
Debtors include £305k (2022: £39k) due from related charities. These charities are administered by staff of the Board, but the trustees are separate from the trustees of the Board.
**----- Start of picture text -----**
Note 18b
Due within one year Due after one year
Parent company debtors
2023 2022 2023 2022
Prepayments and sundry debtors 1,631 493 - -
Staff car loans 1 4 - 2
Loans to parishes, Cathedral and other DBF 58 52 494 501
The Charity of Ann Edwards 21 7 - -
Jumping Fish Ltd 18 22 - -
Parish Giving Scheme 44 35 - -
Debtors 1,773 613 494 503
**----- End of picture text -----**
44
## Notes to the financial statements
_for the year ended 31 December 2023_
**----- Start of picture text -----**
Note 19a
Due within one year Due after one year
Consolidated group creditors
2023 2022 2023 2022
Accruals and sundry creditors 692 812 - -
Taxation and social security 59 61 - -
CBF Loan (Solar Panels) - - 125 125
Value Linked Loans (Church Commissioners) - - 349 349
Creditors 751 873 474 474
**----- End of picture text -----**
Value linked loans from the Church Commissioners are repayable on sale of the property to which they relate. Any capital profit or loss arising on sale of the property accrues to the Church Commissioners and the Board in proportion to the equity invested.
**----- Start of picture text -----**
Note 19b
Due within one year Due after one year
Parent company creditors
2023 2022 2023 2022
Accruals and sundry creditors 593 722 - -
Taxation and social security 59 53 - -
CBF Loan (Solar Panels) - - 125 125
Value Linked Loans (Church Commissioners) - - 349 349
Good & Faithful Servant Limited 8 17 - -
Sportily 22 - - -
Creditors 682 792 474 474
**----- End of picture text -----**
Included in 'Accruals and sundry creditors' is a total of £51k (2022 - £51k) due to related charities which are administered by staff of the Board and whose trustees are separate from the trustees of the Board.
Value linked loans from the Church Commissioners are repayable on sale of the property to which they relate. Any capital profit or loss arising on sale of the property accrues to the Church Commissioners and the Board in proportion to the equity invested.
45
## Notes to the financial statements
## _for the year ended 31 December 2023_
**----- Start of picture text -----**
Note 20
Analysis of net assets by
fund:
Summary Total
Funds at 31 Dec 2023 are
represented by:
Tangible fixed assets 152 170 1,274 46,607 48,203
Fixed asset investments 2,362 5,358 2,096 43,088 52,904
Current assets 2,641 757 1,799 872 6,069
Creditors (662) - (89) (474) (1,225)
Total Funds at 31 Dec 2023 4,493 6,285 5,080 90,093 105,951
Funds include the following unrealised gains on
investments:
Unrealised gains at 1 Jan - - 1,226 21,484 22,710
2023
Net gains on revaluation in year - - 264 13,158 13,422
Gains on disposals - - - (570) (570)
Unrealised gains at 31 Dec 2023 - - 1,490 34,072 35,562
General Fund Designated Funds Restricted Funds Endowment Funds
**----- End of picture text -----**
**----- Start of picture text -----**
Comparative analysis of net assets by
fund:
Summary Total
Funds at 31 Dec 2022 are represented by:
Tangible fixed assets 181 170 1,264 46,987 48,602
Fixed asset investments 5,796 1,477 2,033 30,723 40,029
Current assets 2,788 4,217 943 1 7,949
Creditors (783) - (90) (474) (1,347)
Total Funds at 31 Dec 2022 7,982 5,864 4,150 77,237 95,233
General Fund Designated Funds Restricted Funds Endowment Funds
**----- End of picture text -----**
46
_for the year ended 31 December 2023_
## Notes to the financial statements
## **Note 20 cont.**
_Funds include the following unrealised gains on investments:_
**----- Start of picture text -----**
Summary
Total
- 296 1,644 30,427 32,367
Unrealised gains at 1 Jan 2022
Net losses on revaluation in year - - (374) (2,595) (2,969)
Reclassifications - (296) - - (296)
Gains on disposals - - (44) (6,348) (6,392)
Unrealised gains at 31 Dec 2022 - - 1,226 21,484 22,710
General Fund Designated Funds Restricted Funds Endowment Funds
**----- End of picture text -----**
In 2022 the GDBF decided to undesignate two significant funds which had been set aside for the purposes of holding housing stock for curates and other clergy. At the end of 2022 these funds had a combined value of £14.2m. These funds were released into General Funds. Of these funds some were designated to better reflect decisions made by the Board, including to the Development Fund, for the activities of Sportily, commitments made to support the national Church Housing project and the grant to Grace Network which has not yet been released. By doing this, the inter-fund indebtedness in 2021 has been eliminated in 2022.
The Board also agreed an asset swap between the DSF and General Funds, exchanging property (valued at historic cost) for CCLA investment fund units (held at market value).
47
## Notes to the financial statements
_for the year ended 31 December 2023_
**----- Start of picture text -----**
Note 21
Designated funds
Development Fund 1,311 6 (181) - (183) 953
DBE Repayable Loan - - - - 500 500
Church Housing Association - - - - 1,600 1,600
Loan
Education - - (131) - 131 -
Grace Network 1,250 - (400) - - 850
Group Activities 2,861 - - - (619) 2,242
Hibiscus Fund - - - - 10 10
Housing Initiative 272 - (549) - 181 (96)
Life projects - - (84) - 140 56
Viney Hill Development 170 - - - - 170
Total Funds at 31 Dec
5,864 6 (1,345) - 1,760 6,285
2023
Balance at 1 Jan 2023 Income Expenditure Net gains/(losses) on assets Transfers* Balance at 31 Dec 23
**----- End of picture text -----**
The Development fund has been designated to finance Mission initiatives. Grants are awarded to Life Projects for special projects. Life Projects have been transferred to designated funds from restricted.
The Board has authorised £500k as a repayable loan to support the DBE during its initial restructuring period. This will start to be drawdown during 2024.
£1.6 million has been designated for a loan approved at Bishops Council to the Church Housing Association which will be requested in 2025.
The Education Fund brings together the Education work undertaken by GDBF with income specific to that activity, primarily from the Voluntary Schools Fund and St Matthias Trust. The Diocesan Board of Education (DBE) became a Charitable Incorporated Organisation in May 2022 with a transfer on 1 September 2022. The deficit at 31 August 2022 was covered by a transfer from the general fund and is the portion of this work funded by the general fund. The Board agreed to award an annual grant to the DBE to assist with the costs of the Education Fund.
Grace Network is a Christian-led social Enterprise co-operative based in Brimscombe which builds community and from that new monastic community. Their main engagement and funding come from spaces In 2023 the Board awarded funding of £1.5m to enable this model to expand into two new locations,
48
## Notes to the financial statements
## _for the year ended 31 December 2023_
## **Note 21 cont.**
## Designated funds
planned to be Cirencester and Gloucester. New premises for the first of these will be secured in 2023 with a planned opening in late 2023, early 2024.
The designated fund for Group Activities relates to grants to Sportily (see note 22).
The Trustees designated funds for a Housing Initiative. This offers support to the wider Church in delivering better missional and financial results through asset management by supporting a part time Housing Executive team and making time available from the Bishop of Tewkesbury and the Diocesan Secretary.
The Viney Hill Development relates to a property owned by GDBF but used by Viney Hill Adventure Centre for charitable purposes consistent with those of the GDBF.
**----- Start of picture text -----**
Comparative Designated
funds
Development Fund (325) - (159) - 1,795 1,311
Albright Bequest 472 4 - - (476) -
Houses Capital 6,495 - - - (6,495) -
Curates Housing Reserve 7,723 995 - - (8,718) -
Education - 282 (387) - 105 -
Grace Network - - (250) - 1,500 1,250
Group Activities - - - - 2,861 2,861
Housing Initiative - - (285) - 557 272
Viney Hill Development 170 - - - - 170
Total Funds at 31 Dec
-
14,535 1,281 (1,081) (8,871) 5,864
2022
Balance at 1 Jan 2022 Income Expenditure Net gains/(losses) on assets Transfers* Balance at 31 Dec 22
**----- End of picture text -----**
The Albright Bequest represents monies bequeathed by Miss Albright. The funds came with a request, but not a formal restriction, that they be used for diocesan projects rather than ongoing ministry costs. The trustees have designated these funds to projects in 2022.
The Houses Capital Fund represented the cost, less outstanding loans, of houses owned by the Board to provide accommodation for assistant curates and team vicars. During 2019, the Board decided to make a transfer from the Houses Capital Fund to a new Curates Housing Reserve as part of the work undertaken on agreeing a new policy for the provision of housing for curates. The efficient operation
49
_for the year ended 31 December 2023_
## Notes to the financial statements
## **Note 21 cont.**
of this new policy required the creation of a suitable reserve to enable the Resources Committee to Council. During 2022, the Board decided to transfer the Houses Capital Fund and Curates Housing Reserve from the Designated funds to the Diocesan Stipend Endowment Fund.
**----- Start of picture text -----**
Note 22
Restricted funds
Housing for elderly clergy 142 4 - 5 - 151
Ordination training 206 - (1) - (27) 178
Diocesan pastoral fund 500 70 (78) 156 (77) 571
Stratton Davis fund 240 8 (10) 21 - 259
fund 30 - - - - 30
Ann Edwards Charity 1,768 109 (102) - (47) 1,728
Sportily Limited - 329 (877) - 1,394 846
Ministerial Education Training 123 210 (161) - - 172
Life projects 75 - - - (75) -
Energy Grants 48 - (21) - - 27
854 25 - 81 - 960
Other 164 241 (78) 1 (170) 158
Total Funds at 31 Dec 2023 4,150 996 (1,328) 264 998 5,080
Balance at 1 Jan 2023 Income Expenditure Net gains/(losses) on assets Transfers Balance at 31 Dec 23
**----- End of picture text -----**
Restricted funds may only be used for the purposes for which the money was originally gifted or bequeathed to the Board.
The Housing for Elderly Clergy Fund derives from various bequests and is used to give assistance to retired clergy of the Diocese in difficulty with their housing requirements. The Ordination Training Fund derives from various bequests, principally from the late Mrs. M Harries. The income is used to fund ordination training.
The Diocesan Pastoral Fund is derived principally from the proceeds of sale of surplus parsonage houses as a result of pastoral reorganisations under the Pastoral Measure 1983. Under the Measure, the Fund must be used firstly in connection with expenses relating to pastoral schemes and redundant churches. To the extent that it is considered that any remaining funds are not required, or are not likely to be required, for these purposes then the funds may be applied to any general purpose of the Board.
50
## Notes to the financial statements
## _for the year ended 31 December 2023_
## **Note 22 Restricted funds cont.**
The Stratton Davis Fund arises from a bequest received in 2001 from the estate of the late Mr. David Stratton Davis. The terms of the settlement are that the fund may be used for the repair or restoration
of churches and their fixtures and fittings in the Diocese. The Board has decided initially to use the income to make an annual grant to the Gloucestershire Historic Churches Trust.
2013 and restricted to
The Charity of Ann Edwards restricted funds comprise the Extraordinary Repair Fund (ERF) and the Cyclical Maintenance Fund (CMF). These funds were established in the governing instrument and are for future repairs and maintenance, with transfers being made each year.
The Sportily funds may only be used for the objects of the charity which include promoting and assisting the work, objects and purposes of the Church of England for the advancement of Christian faith, in particular (but not exclusively) by the development of specialist ministries based principally on sports and wellbeing particularly with children, young people and their families in (but not limited to) the Diocese of Gloucester.
The Ministerial Education Training fund relates to Resourcing Ministerial Education introduced in 2017.
The Life Projects fund relates to those special projects funded by the Life Development Fund. This has been transferred to designated funds.
The Energy Grants were distributed to Dioceses to assist Parochial Church Councils cover the increased cost of lighting and heating of church buildings during the Winter.
The Bishop Monk Horfield Trust fund was gifted to the GDBF by a previously independent trust of that name which had managed the ancient legacy of Bishop Monk of Gloucester and Bristol. The funds received by GDBF are restricted to the funding of curates in training.
The Other Restricted funds includes a fund balance of £nil (2022: £nil) for Glebe revenue at 31 December 2023. This relates to glebe rental income less professional fees, repairs and maintenance against Glebe assets (the asset is held in the Glebe Property endowment fund see note 23). Where excess costs create a negative balance these will be offset against any future surplus arising on the sale of Glebe property.
51
## Notes to the financial statements
## _for the year ended 31 December 2023_
## **Note 22 Restricted funds cont.**
**----- Start of picture text -----**
Comparative Restricted funds
Housing for elderly clergy 146 2 - (6) - 142
Ordination training 232 - (1) - (25) 206
Diocesan pastoral fund 1,153 68 (169) (220) (332) 500
Stratton Davis fund 327 6 (10) (29) (54) 240
30 - - - - 30
Ann Edwards Charity 1,750 91 (73) - - 1,768
Sportily Limited (72) 181 (702) - 593 -
Ministerial Education Training 70 297 (244) - - 123
Life projects 91 - (95) - 79 75
Energy Grants - 197 (149) - - 48
957 25 - (114) (14) 854
Other (387) 174 (82) (5) 464 164
Total Funds at 31 Dec 2022 4,297 1,041 (1,525) (374) 711 4,150
Balance at 1 Jan 2022 Income Expenditure Net gains/(losses) on assets Transfers Balance at 31 Dec 22
**----- End of picture text -----**
**----- Start of picture text -----**
Note 23
Endowment funds
Pensions & assistance 368 - - 22 - 390
Benefice property 27,278 6 (29) - 78 27,333
Diocesan stipends fund 32,102 1,189 - 2,198 (998) 34,491
Ann Edwards Charity 841 - - 71 - 912
Glebe property 16,648 301 - 10,867 (849) 26,967
Total funds at 31 Dec 2023 77,237 1,496 (29) 13,158 (1,769) 90,093
Balance at 1 Jan 23 Income Expenditure Net gains/(losses) on assets Transfers* Balance at 31 Dec 23
**----- End of picture text -----**
52
## Notes to the financial statements
_for the year ended 31 December 2023_
## **Note 23 Endowment funds cont.**
Permanent endowment funds represent money that must be permanently held as capital and may not be spent as income. Expendable endowment funds represent money that must be held as capital but may be expended when certain conditions are satisfied.
The Pensions & Assistance Fund is permanent endowment represented by a house used to provide accommodation for retired clergy, and a cash balance arising from the sale of a second house.
The Benefice Property Fund represents the value of benefice houses. These houses are owned by benefices but are recognised as assets by the Board. The fund is classified as expendable endowment as under certain conditions the value of the houses may be realised and the proceeds used as income.
The Diocesan Stipends Fund (DSF) represents ancient endowments and other gifts and legacies. The Fund is governed principally by the Diocesan Stipends Funds Measure 1953 and the Endowment and Glebe Measure 1976, as amended. The Fund consists of Clergy housing and CBF managed funds. Income consistent with that governing the use of income (see below).
During 2019, Bishops Council approved a total return approach to investment for the CBF managed funds of the DSF. This change in policy was to take effect from 1st January 2019. An Unapplied Total Return (UTR) of £10,800k was created on 1st January 2019, all of which related to the DSF.
The Unapplied Total Return comprises that part of the total return on the DSF which has not yet been allocated by the Board to either the General Fund or the Trust for Investment. It can be carried forward if not needed or allocated to be spent as income or reinvested in the DSF Trust for Investment in a particular year.
The value of the Trust for Investment of the DSF is preserved, by an amount equivalent to the application of RPI to the opening balance for the year being transferred from the Unapplied Total Return to the DSF Fund. For the year ended 31st December 2023, the Board took the decision to transfer £2,493k (2022: £1,728k) from the Unapplied Total Return to the General Fund. (see note 16c).
The Endowment Fund of the Charity of Ann Edwards represents the original endowment of the charity, comprising mainly the sale proceeds of Edwards College, the original Almshouse in South Cerney. This money may not be spent as income.
Glebe property represents glebe land previously held by incumbents but transferred to the Board under the Endowment and Glebe Measure 1976. Income derived from rents must be used to fund stipends. Proceeds of sale of glebe land must be transferred to the DSF.
53
## Notes to the financial statements
## _for the year ended 31 December 2023_
## **Note 23 Endowment funds cont.**
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Comparative Endowment funds
Pensions & assistance 399 - - (31) - 368
Benefice property 31,086 694 (29) - (4,473) 27,278
Diocesan stipends fund 30,736 - 126 (3,314) 4,554 32,102
Ann Edwards Charity 941 - - (100) - 841
Glebe property 21,389 578 - 645 (5,964) 16,648
Total Funds at 31 Dec 2022 84,551 1,272 97 (2,800) (5,883) 77,237
Balance at 1 Jan 2022 Income Expenditur e Net gains/ (losses) on assets Transfers* Balance at 31 Dec 22
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|**Note 24**
**Financial Commitments:****_Operating Leases_**
Total commitments under non-cancellable operating leases are as
follows:-
**2023**
Office Equipment where the lease expires:|**Note 24**
**Financial Commitments:****_Operating Leases_**
Total commitments under non-cancellable operating leases are as
follows:-
**2023**
Office Equipment where the lease expires:|**Note 24**
**Financial Commitments:****_Operating Leases_**
Total commitments under non-cancellable operating leases are as
follows:-
**2023**
Office Equipment where the lease expires:|_2022_
_9_
10|
|---|---|---|---|
|Within one year of the balance sheet date
6||||
|In the second to fifth years inclusive of the balance sheet date
4||||
|**Note 25**
**Reconciliation of Net Debt**||||
||_Balance at_
_1 Jan 23_
_Cash Flows_||**Balance at**
**31 Dec 23**|
|||||
|Cash at bank and in hand|6,815
(3,043)||3,772|
|Borrowings excluding overdrafts|(474)
-||(474)|
|||||
|**Net Debt at 31 Dec 2023**|**6,341**|**(3,043)**|**3,298**|
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## Notes to the financial statements
_for the year ended 31 December 2023_
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Note 25 Reconciliation of Net Debt
cont.
Comparative reconciliation of Net Debt
Cash at bank and in hand 2,426 4,389 6,815
Borrowings excluding overdrafts (1,224) 750 (474)
Net Debt at 31 Dec 2022 1,202 5,139 6,341
Balance at 1 Jan 22 Cash Flows Balance at 31 Dec 22
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**Note 26 Post Balance Sheet Non-Adjusting Event Sale of Leckhampton Glebe Land**
On 20 May 2024 the Board completed the sale of a long standing development site in Leckhampton. This site is valued in the accounts for 2023 at £15m, based on a discounted contract price for the risk of non completion. Completion was for £28.6m, payable in two instalments. All proceeds (net of fees) are restricted to the Diocesan Stipends Fund.
## **Note 27 Pensions**
The GDBF participates in two pension schemes administered by the Church of England Pensions Board, which holds the assets of the schemes separately from those of the GDBF and the other participating employers. One of these is the Church of England Funded Pensions Scheme for stipendiary clergy and the other is the Church Workers Pension Fund (CWPF) for lay staff.
The CWPF has two sections:
1. the Defined Benefits Scheme
2. the Pension Builder Scheme, which has two subsections;
- a. a deferred annuity section known as Pension Builder Classic, and, b. a cash balance section known as Pension Builder 2014.
## **Defined Benefits Scheme**
for lay staff based on final pensionable salaries.
For funding purposes, DBS is divided into sub-pools in respect of each participating employer as well as a further sub-pool, known as the Life Risk Pool. The Life Risk Pool exists to share certain risks between employers, including those relating to mortality and post-retirement investment returns.
The division of the DBS into sub-pools is notional and is for the purpose of calculating ongoing contributions. They do not alter the fact that the assets of the DBS are held as a single trust fund out of which all the benefits are to be provided. From time to time, a notional premium is transferred from -pools to the Life Risk Pool and all pensions and death benefits are paid from the Life Risk Pool.
The scheme is a multi-employer scheme as described in Section 28 of FRS 102. It is not possible to attribute DBS assets and liabilities to specific employers, since each employer, through the Life Risk Section, is exposed to actuarial risks associated with the current and former employees of other entities
55
Notes to the financial statements _for the year ended 31 December 2023_
## **Note 27 Pensions cont.**
participating in DBS. This means that contributions are accounted for as if DBS were a defined contribution scheme. The pensions costs charged to the SoFA during the year are contributions payable towards benefits and expenses accrued in that year (2023: £66k 2022: £63k) plus the figures in relation to the DBS deficit highlighted in the table below as being recognised in the SoFA, giving a total charge of £66k For 2023 (2022: £231k).
If, following an actuarial valuation of the Life Risk Pool, there is a surplus or deficit in the pool, further -pools, or vice versa. The amounts to be transferred (and their allocation between the sub-pools) will be settled by the Church of England Pensions Board on the advice of the Actuary.
A valuation of DBS is carried out once every three years. The most recently finalised was carried out as at 31 December 2019. In this valuation, the Life Risk Section was shown to be in deficit by £7.7m and £7.7m was not -pools to the Life Risk Section. This increased the Employer contributions that would otherwise have been payable. The overall deficit in DBS was £11.3m.
The next actuarial valuation was due at 31 December 2022. The calculations for this are underway. Following the 2019 valuation, the Employer has entered into an agreement with the Church Workers Pension Fund to pay a contribution rate of 34.3% of pensionable salary and expenses of £12,800 per year. In addition, deficit payments of £167,784 per year have been agreed for 5.50 years from 1 April 2021 in respect of the shortfall in the Employer sub-pool.
Due to the improvements in the projected funding position of the Fund, the Church of England Pensions Board agreed that deficit contributions should cease with effect from 31 December 2022 for employers whose pools were estimated to be materially in surplus. As a result, there is no obligation recognised as a liability within the Employer's financial statements as at 31 December 2022. A liability has been recognised at earlier dates.
The movement in the provision is set out below:
|||2023|2022|
|---|---|---|---|
|||||
||Balance sheet liability at 1 January|-|766|
||Deficit contribution paid|-|(168)|
||Interest cost (recognised in SoFA)|-|
10|
||Remaining change to the balance sheet liability*|-|(608)|
||(recognised in SoFA)|||
||Balance sheetliability at 31 December|-|-|
* Comprises change in agreed deficit recovery plan and change in discount rate between year-ends.
This liability represents the present value of the deficit contributions agreed as at the accounting date and has been valued using the following assumptions, set by reference to the duration of the deficit recovery payments:
56
## Notes to the financial statements
## _for the year ended 31 December 2023_
## **Note 27 Pensions cont.**
||December|December|December|
|---|---|---|---|
||2023|2022|2021|
|Discount rate*|N/A|0.00%|1.4%|
* Comprises change in agreed deficit recovery plan and change in discount rate between year-ends
The legal structure of the scheme is such that if another employer fails, the employer could become
## **Church of England Funded Pension Scheme (CEFPS)**
Gloucester DBF participates in the Church of England Funded Pensions Scheme for stipendiary clergy, a defined benefit pension scheme. This scheme is administered by the Church of England Pensions Board, which holds the assets of the schemes separately from those of the Responsible Bodies.
Each participating Responsible Body in the scheme pays contributions at a common contribution rate applied to pensionable stipends.
The scheme is considered to be a multi-employer scheme as described in Section 28 of FRS 102. It is contributions are accounted for as if the Scheme were a defined contribution scheme. The pensions costs charged to the SoFA in the year are contributions payable towards benefits and expenses accrued in that year which were £802k In 2023 (2022: £987k) plus any figures arising from contributions in showed the Scheme to be fully funded and as such in 2023, following the valuation results being agreed, the deficit contributions paid were £nil (2022: £126k).
A valuation of the Scheme is carried out once every three years. The most recent Scheme valuation completed was carried out at as 31 December 2021. The 2021 valuation revealed a surplus of £560m, based on assets of £2,720m and a funding target of £2,160m, assessed using the following assumptions:
- An average discount rate of 2.7% p.a.;
- RPI inflation of 3.6% p.a. (and pension increases consistent with this);
- CPIH inflation in line with RPI less 0.8% 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, with allowance for improvements in mortality rates in line with the CMI2020 extended model with a long term annual rate of improvement of 1.5%, a smoothing parameter of 7, an initial addition to mortality improvements of 0.5% pa and an allowance for 2020 data of 0% (i.e. w2020=0%).
Following finalisation of the 31 December 2021 valuation, deficit contributions ceased with effect from 1 January 2023, since the Scheme was fully funded. The deficit recovery contributions under the recovery plan in force at each 31 December were as follows:
% of pensionable stipends 31 December 2021 7.1% payable from January 2021 to December 2022 31 December 2022 Nil 31 December 2023 Nil
57
## Notes to the financial statements _for the year ended 31 December 2023_
## **Note 27 Pensions cont.**
An interim reduction to deficit contributions to 3.2% of pensionable stipends was made with effect from April 2022, and remained in place until December 2022.
For senior office holders, pensionable stipends are adjusted in the calculations by a multiple, as set out .
Section 28.11A of FRS 102 requires agreed deficit recovery payments to be recognised as a liability. However, as there are no agreed deficit recovery payments from 1 January 2023 onwards, the balance sheet liability as at 31 December 2022 is nil. The movement in the balance sheet liability over 2021 and over 2022 is set out in the table below.
||2023||2022|
|---|---|---|---|
|||||
|Balance sheet liability at 1 January||-|213|
|Deficit contribution paid||-|(126)|
|Interest cost (recognised in SoFA)||-|-|
|Remainingchange to the balance sheet liability*(recognised in SoFA)||-|(87)|
|Balance sheet liability at 31 December||-|-|
* Comprises change in agreed deficit recovery plan and change in discount rate and assumptions between year-ends.
This liability represents the present value of the deficit contributions agreed as at the accounting date and has been valued using the following assumptions. No assumptions are needed for December 2022 as there are no agreed deficit recovery payments going forward. No price inflation assumption was needed for December 2021 since pensionable stipends for the remainder of the recovery plan were already known.
||December|December 2022|December 2021|
|---|---|---|---|
||2023|||
|Discount rate|n/a|n/a|0.0%|
|Price inflation|n/a|n/a|n/a|
|Increase to total pensionable payroll|n/a|n/a|-1.5%|
The legal structure of the scheme is such that if another Responsible Body fails, Gloucester DBF could become responsible for paying a
## **Church of England Pension Builder Scheme (PBS)**
The Gloucester Diocesan Board of Finance participates in the Pension Builder Scheme section (PBS) of the CWPF for eligible salaried employees who commenced employment after 1st January 2013. CWPF is administered by the Church of England Pensions Board, which holds the CWPF assets separately from those of the Employer and other participating employers.
58
## Notes to the financial statements
## _for the year ended 31 December 2023_
## **Note 27**
## **Pensions cont.**
CWPF has two sections:
1. the Defined Benefits Scheme
2. the Pension Builder Scheme, which has two subsections;
- a. a deferred annuity section known as Pension Builder Classic, and,
- b. a cash balance section known as Pension Builder 2014.
## **Pension Builder Scheme**
Both sections are classed as defined benefit schemes.
_**Pension Builder Classic**_ provides a pension, accumulated from contributions paid and converted into a deferred annuity during employment based on terms set and reviewed by the Church of England Pensions Board from time to time. Discretionary increases may also be added, depending on investment returns and other factors.
_**Pension Builder 2014**_ is a cash balance scheme that provides a lump sum which members use to provide benefits 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 considered to be a multi-employer scheme as described in Section 28 of FRS 102. This employers and means that contributions are accounted for as if the Scheme were a defined contribution scheme. The pensions costs charged to the SoFA in the year are the contributions payable (2023: £262k, 2022: £288k).
A valuation of the Pension Builder Scheme is carried out once every three years. The most recent valuation was carried out as at 31 December 2019.
For the Pension Builder Classic section, the 2019 valuation revealed a deficit of £4.8m on the ongoing assumptions used. At the most recent annual review effective 1 January 2024, the Board chose to grant a discretionary bonus of 6.7% to both pensions not yet in payment and pensions in payment in respect of service prior to April 1997; and a bonus on pensions in payment in respect of post April 2006 service so that the pension increase was 5% (where usually it would be calculated based on inflation up to 2.5%). This followed improvements in the funding position over 2023. There is no requirement for deficit payments at the current time.
For the Pension Builder 2014 section, the valuation revealed a surplus of £5.5m on the ongoing assumptions used. There is no requirement for deficit payments at the current time.
The next valuation was due as at 31 December 2022. Calculations for this are currently under way.
The legal structure of the scheme is such that if another employer fails, Gloucester DBF could become responsible for paying a share of that empl
59
## Notes to the financial statements
## _for the year ended 31 December 2023_
## **Note 28**
## **Prior year comparative SOFA**
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Total
2022
Income & endowments from
Donations
parish share contributions 6,477 - - - 6,477
church commissioners 47 - - - 47
grants and other donations 197 274 736 - 1,207
Charitable activities statutory fees
and licence to occupy income 394 - 126 - 520
Other activities 146 8 - - 154
Investments 810 4 169 - 983
Other 15 995 10 980 2,000
Total 8,086 1,281 1,041 980 11,388
Expenditure on
Raising funds 165 - - - 165
Charitable activities 10,178 1,081 1,525 (97) 12,687
Total 10,343 1,081 1,525 (97) 12,852
Net income/(expenditure) before
(2,257) 200 (484) 1,077 (1,464)
investment gains
- -
Net gains on investments (374) (2,595) (2,969)
Net (expenditure)/income (2,257) 200 (858) (1,518) (4,433)
Total return transfer 1,000 - - (1,000) -
Net (expenditure)/income after
(1,257) 200 (858) (2,518) (4,433)
total return transfer
Transfers between funds 13,043 (8,871) 711 (4,883) -
Other recognised gains 608 - - 87 695
Net movement in funds 12,394 (8,671) (147) (7,314) (3,738)
Total funds brought forward (4,412) 14,535 4,297 84,551 98,971
Total funds carried forward 7,982 5,864 4,150 77,237 95,233
General fund Designated funds Restricted funds
Endowment funds
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60