2016 ANNUAL REPORT & ACCOUNTS Annual Report and...

BIRMINGHAM CATHEDRAL CHAPTER 2016 ANNUAL REPORT & ACCOUNTS

Annual Report and

Accounts for

Birmingham Cathedral

2016

The Cathedral Church of St Philip, Birmingham Colmore Row, Birmingham B3 2QB Tel: 0121 262 1840 Email: [email protected]

Website: birminghamcathedral.com Facebook: Birmingham Cathedral St Philip’s Twitter:

@bhamcathedral



Chapter Annual Report


Letter from the Acting Dean

2016 was a year of coming and goings proving that

life never stands still in the life of Birmingham

Cathedral.

Being situated at the highest point in the city and surrounded by the ever-

growing business and commercial life of what is the youngest city in Europe

makes for a busy, exciting life.

2016 saw our Canon Liturgist, Janet Chapman move on back into parish life

to St Laurence Church in the diocese and the Dean, Catherine Ogle, prepare

to move to Winchester Cathedral to become Dean. Both played a major part

in making the cathedral ‘fit for purpose’ producing a reordered well-

functioning building and a place of welcome and a house of prayer at the heart

of the city. Their ministry in Birmingham is greatly appreciated, and we send

them to St Laurence and Winchester Cathedral with our prayers and best

wishes.

We continue our daily round of prayer each day for the world, the city the

church and many come in throughout the week to pray. Our visitors now

number in excess of 100,000 per year, with 20,000 pedestrians each day

walking through Cathedral Square.

The ministry of the cathedral is a team effort and couldn’t exist without the

committed and supportive staff of vergers, Administrator, communications,

education, heritage and office staff. On top of the weekly services, the

Wardens and Deputies, flower arrangers, bell ringers, those who regularly

clean and many others are involved in numerous extra services, memorials

and special occasions that are part of our broad ministry.

We look forward to a new year with new possibilities of connecting more

within the city and the Diocese, with the Good News of Christ. We look

forward to deepening our existing relationships, and being a beacon to the

Diocese for the renewed ‘Transforming Church’ strategy.

The Revd Canon Nigel Hand


Report from the Cathedral Administrator

We end the year with a small financial in-year surplus of £4.4k in our

unrestricted funds against budget, which is an incredibly positive result in a

year where we absorbed the £58k cost of new Cathedral boilers which hadn’t

been budgeted for; we also end the year much warmer than we started!

Financially, we were also able to meet the small shortfall in the Internal

Works Project. This positive result is due to a combination of good

stewardship of our resources, consistent and generous support through

planned giving, and financial discipline. 2016 has been a year of quiet

consolidation, reflecting retrospectively on a year of huge activity in 2015,

and considering opportunities to grow and nurture the seeds of that fruitful

year.

2016 saw the completion of the Internal Works project, which began back in

May 2015. The culmination of the project was the installation of new

electronic glass doors in the main entrance porch. The doors, whilst offering

much easier access for all, also offer a clear line of sight into the Cathedral; a

welcoming invitation to enter the building.

Our relationships and partnerships within the Diocese and City continue to

flourish. The St Basils Sleep Out was a hugely successful night, and one of the

highlights of 2016 with 650 people sleeping out in Cathedral Square; a

powerful and poignant evening. Our relationship with local partners (Colmore

BID, WM Police and BCC Parks Department), have ensured consistent and

careful custodianship of Cathedral Square for the benefit of the tens of

thousands of people who use the space daily.

The Cathedral Staff Team continues to grow, and are a daily blessing to the

ministry of our Cathedral. We have recruited into 3 new lay roles, increasing

the capacity of the team; Stephen Brooker joined us as Facilities Manager;

Louisa Harrop joined as Education Officer and Ailsa Lightfoot joined as

Administrative Assistant. Ashley Wagner also joined the music department as

Organ Scholar. I wish to express my sincere gratitude to the whole lay staff of

the Cathedral, together with our marvellous volunteers, for the grace,

commitment and passion that each bring to their role. Our 2016-2020

Strategic Plan has been instrumental in highlighting the distinct areas where

our lay team are bringing their gifts to bear with excellent results.

“Each of you should use whatever gift you have received to serve others, as faithful

stewards of God’s grace in its various forms”

Peter 1 4:10

Anna Pitt


Main Priorities for 2016

2016 was an opportunity to embed the grounding principles of our Strategic Plan into the

daily life and rhythm of the Cathedral:

Living Worship - Growing Disciples - Connecting Communities

These principles have shaped the strategic and operational decision-making, and have added

structure to the growing partnerships which have been nurtured.

Living Worship

‘Mindful of the invitation of our Patron Saint to ‘Come and See’, we seek to offer a growing

diversity in worship offering rich opportunities for encounter with God, for all ages.’

Take the opportunity to respond to ‘missional moments’ of WW1 Anniversary

(Commemoration of the Battle of the Somme) and Queen’s 90th Birthday

Participate in the National ‘Thy Kingdom Come Initiative’; continued clergy involvement in

‘Pray for the City’; diverse spread of visiting preachers; engaging with unique worship

opportunities such as hosting Roger Hiorns’ ‘Lying Down Evensong’


Growing Disciples

‘We seek to grow in number and in depth of discipleship in order to witness to Christ more

effectively’

We will employ a Cathedral Education Officer, continue to grow the number of Visitors’

Chaplains and volunteers; Annual Pentecost Birthday Party for school children; Annual

Community Day; Support for Christian Aid, St Basils, and other charities; continued ministry

of healing; continued engagement with and promotion of heritage, enriching the visitor

experience.

Connecting Communities

‘Birmingham is the place ‘where the world meets’ and, as Archbishop Justin memorably told us in

2015, Birmingham has perhaps a unique opportunity to show the world how people can live

together in peace’

We will work towards establishing the Cathedral as a forum for Public Theology; continue

collaborative working with Diocesan Directors and parishes; hosting charitable events in the

Cathedral and on Cathedral Square; work with Colmore BID to create safe and welcoming

space in Cathedral Square; deepen partnerships with Heritage organisations; Continue to

develop ‘Something Good’ and the work of Cathedral ARTS Group.


Good Order

‘We seek to achieve good order in the governance of the Cathedral to reflect the good order of

God’s creation and to enable the Cathedral to model good working practices, good working

relationships for staff, volunteers and good communications fostering mutual understanding and

respect.’

Cathedral Safeguarding Audit; Annual review of Chapter policies; regular review of staff

terms and conditions; review and benchmarking of lay salaries; Clergy participation in

national cathedral life Conferences and AEC; establish a new Cathedral database.

Care of our Building and Environs

‘We strive for the highest standards of care as an expression of our faith and worship’

Complete the second phase of internal restoration works (new glass doors, porch mat,

entrance furniture); commission new candle stand; review liturgical furniture; Progress the

implementation of a planned maintenance programme; replacement of boiler, update of

security systems; appointment of a Cathedral Facilities Manager; review shop/welcome desk.

Sustainable Financial Growth

‘We will steward our resources prudently and ethically, with the intention of achieving sustainable

growth to resource growing ministry’

Support the work of the stewardship committee; update legacy policy and information;

explore ways of generating further generating income from fee paying events and

commercial income; increase in grant income; purposeful management of investment and

review of investment policy; review St Philip’s House management and income; review

regular contractors;


A Year in View: Highlights of 2016

Mothers’ Union Street Party - to

celebrate 140 years of Mothers’

Union/Queen’s 90th birthday. Red, white

and blue theme. Entertainment for

children and families, picnic facilities and

fundraising activities.

Malawi Fundraising Fair – Event

on Cathedral Square organised by

the Cathedral community to raise

money for our partnership with

Malawi

In:Site Craftspace - Annual

festival of graduate creativity on

Cathedral Square over five days

involving 15 new graduates. Each

day graduates made bespoke

work responding to the site and

its heritage.


Aston University 50th Year

Commemoration Service - A celebration that

marked the 50th anniversary of the University of

Aston and Rededication. The event brought

together current students and former academics.

The Choral Eucharist on Palm Sunday was streamed live

by the Church of England, and the live broadcast of

Choral Evensong on BBC Radio 3 in October received

many complimentary comments from listeners.

Over 600 people slept out in Cathedral

Square to raise nearly £140,000 for St

Basils, the West Midlands youth

homelessness charity. The cathedral

building was open throughout the night

and hosted a candlelit carol service at

midnight. The Sleep Out was returning

to its original home in Cathedral Square

after outgrowing its previous location.


To celebrate Birmingham Poppy Day, The Band of The Royal Logistics Corps played on

Cathedral Square and around the city, raising £43,600 for the Royal British Legion.

As part of Birmingham’s Chinese New Year

celebrations, British-Chinese artist Aowen Jin created

‘Midlight,’ a group of magical sound-reactive light

boxes, which responded to a special service

conducted in the dark in both Chinese and English.

Revd Chris Thorpe and artist Jake Lever led a quiet

day under the Soul Boats installation. Participants

used words, music, creative activity and silence to

reflect on their life journey, exploring the “storms”

that they encounter, the “vessel” that is their own

life, and the “voyage” that they were embarking

upon.

As part of International Dance Festival

Birmingham, Cathedral Square played host

to ‘Phone Box’, an acrobatic dance

performance in and on a vintage red

telephone box.

Cathedral Square hosted performances by

‘The Busquitos’ and ‘Saxitude’ as

part of the Birmingham and Solihull Jazz and

Blues Festival.


.

The ornate brass cross made by John

Paul Cooper, a Birmingham jeweller, has been restored and re-displayed in the

South Aisle. The cross was made to mark

the change from parish church to cathedral

in 1905 and its re-display was made

possible with the generosity of Hortons’

Estate.

The third and final Tercentenary Festival of

Voices was held at the cathedral in February.

The event explored the heritage of the

cathedral through music, word and

performance. This wonderful, celebratory

evening compered by Canon Janet & Jane

McArdle even featured the choir singing a

Beatles medley!

The Pride of the Place by Canon Dr Terry

Slater was published and launched, at the

cathedral in 2016. The comprehensive, fully

illustrated book examines the history and

significance of St Philips since 1715. Terry

entertained a packed cathedral with a lively

talk on the launch evening.


School visits

The Education team have enjoyed welcoming a large number of schools to visit the

Cathedral, The visits provide children with the opportunity to learn about what it means to

be a Christian. They also learn about what makes the Cathedral a special Christian place of

worship and find out about the significance and symbolism of the windows.

‘Wonder’ Children’s Christmas Craft Event

was a multi-sensory event, for children and families in

collaboration with the Electric Cinema. The

Cathedral was transformed so that families could

enjoy and engage with a range of fun activities such

as den making, whilst encouraging them to reflect

upon the real meaning of Christmas

‘Growing Hope’: Daffodil Bulb Planting by local school

children in Cathedral Square. ‘Growing Hope’ is a project exploring hope, one of the themes of the Easter story,

organised by Birmingham Cathedral and the Church of

England - Birmingham. Children planted daffodil bulbs in

Cathedral Square in mid-October, and will then return in

the spring to see them bloom in the shape of a cross.

The Advent pilgrimages, which start from St

Martin’s in the Bullring, allow children from

Church of England Primary schools the

opportunity to reflect upon the season of Advent

from a Christian perspective. The pilgrimage

enables the children to consider the increasingly

secular portrayal of Christmas, as they travel

through the city centre. They end their journey at

the Cathedral, where they are able to stop and

reflect on what they have seen


Relationships

During 2016, the Cathedral deepened relationships in a number of key areas:

• Education; the appointment of a Cathedral Education Officer has allowed for

increased partnership working with Diocesan education team, collaboration and

learning with other Cathedral education Departments and increasing provision

for working with schools within the Diocese

• Security and Public Space; the appointment of a Cathedral Facilities Manager has

allowed for effective day to day management of Cathedral Square through

partnership working with West Midlands Police; Colmore BID; Anti-terrorism

officers and HOST car team.

• Civic Life; the Cathedral continues to host key civic events, offer chaplaincy to

the High Sheriff, and work closely with the City Council on delivery of key high

profile events (such as Commemoration of the Battle of the Somme).

Volunteers

Birmingham Cathedral operates thanks only to the significant input of volunteers in terms of

energy and time. Thousands of hours of committed ministry across the spectrum of

Cathedral life are volunteered regularly. In 2016 we added capacity with additional

volunteers leading Heritage tours and offering support with cleaning the Cathedral.


Inventory

There were no additions to the Cathedral inventory during 2016. Chapter disposed of two

noticeboards, a pew and a disused altar rail.

Fabric Repairs

In 2016 we completed Phase 2 if the Internal works project, which encompassed the long-

awaited updates to the SW entrance porch.

Following the failure of both Cathedral boilers in December 2015, three replacement

boilers were fitted in February 2016.

Cathedral burglar and fire alarm systems were updated and upgraded to offer a full

comprehensive system.

Fundraising

In 2016 Birmingham Cathedral did not actively fundraise for a particular project. Following a

period of extensive fundraising in 2014/2015, from both external funders and Cathedral

congregations, Chapter took the decision to delay the appointment of a Cathedral

Fundraiser, preferring to prioritise ‘project fundraising’. 2016 was a year of consolidation in

terms of relationships, staff team and governance. The unrestricted income of the Cathedral

was sustained by continued support by way of planned giving.


Future Plans

In 2017 Birmingham Cathedral will seek to continue to work towards the

current 5 year strategic plan. Significant priorities for 2017 include;

• Appointment of a new Dean, following the resignation of Dean Catherine Ogle.

• The launch of ‘Divine Beauty’ a project to restore and clean the Burne Jones

windows.

• Embedding a Planned Preventative Maintenance Plan covering all regular servicing

and contractors

• Appointment of a Cathedral Architect

• Increasing the Capacity for working space for staff in the Cathedral and upgrading

the facilities in Matthew Room. Review of Archive Room and undercroft facilities and

storage

• Undertake a Music review to reflect on and inform the Cathedral’s ongoing music

strategy.

• Appointment of new Cathedral Investment Managers following a thorough tender

process

• Tender process to appoint new Cathedral auditors. (having had a very successful

three year relationship with Dains LLP, a potential conflict of interest forces a retender).


Structure, Governance & Management

• Birmingham Cathedral’s governing document is the Constitution and Statutes,

incorporating the Cathedral Measure Act 1999. The most recent review and update of the

statutes took place in 2015.

• Birmingham Cathedral is an ecclesiastical corporation. The Cathedral has a charitable

purpose as defined in the Cathedrals Measure 1999. As an ecclesiastical corporation the

Cathedral is excluded from the Charities Act 2011 and not regulated by the Charity

Commissioners. However the Cathedral does qualify as a charity for taxation purposes.

Whilst not being registered with the Charity Commission, Chapter has due regard for the

guidance set down by the Commission.

• The Cathedral is Mother Church to the Diocese of Birmingham, a Diocese of nearly

200 parish churches. Cathedral staff share office space at One Colmore Row with Diocesan

colleagues, and share some administrative functions. This makes for effective and dynamic

working relationships, and the Cathedral maintaining a strong presence in the Diocese.

• ‘Body Corporate’ of the Cathedral consists of Cathedral Chapter,

Cathedral Council and Cathedral College of Canons. Cathedral Chapter also has

a Finance & Risk Sub-Committee. Cathedrals are run by their Chapters, which

have the task of administering the affairs of the Cathedral:

• Birmingham Cathedral Chapter is formed of both clergy and lay people, who act as

fiduciaries and manage the cathedrals’ affairs. The Dean and both Residentiary Canons are

members, along with four members nominated by the Cathedral Congregation and

appointed at APCM and two Bishop’s appointments (Chapter currently carries a vacancy for

a third Bishop’s appointment). The Chapter is chaired by the Dean or Acting Dean in

Interregnum.

o Chapter have chosen to send all new Chapter appointments on a residential training

course specifically for Chapter members run by the Association of English Cathedrals.

o Chapter’s Schemes of Delegation; Delegated Authority from Chapter to Director of

Resources (Cathedral Administrator); and Delegated Authority from the Director of

Resources to other budget holders, are reviewed annually.

• Birmingham Cathedral Council meets three times a year to further and support the

work of the cathedral and advise the Chapter. Membership of Cathedral Council consists of;


The Dean, two nominated Chapter Members, two members of the College of Canons,

three lay members representing the interests of the Cathedral congregations, one area dean

from a deanery within the diocese, two lay people appointed by Bishop’s Council, one

person appointed by Birmingham Churches Together, a maximum of six people appointed

by the Bishop. The Council is chaired by Andrew Lancaster, a lay member of Council

appointed by the Bishop David. Bishop David can attend and speak at the Council although

he is not a member.

• The College of Canons consists of the Dean and Residentiary Canons, Bishop Anne,

The Venerable Hayward Osborne (Archdeacon of Birmingham), The Venerable Simon

Heathfield (Archdeacon of Aston) and honorary and lay canons. The College meets once a

year to consider cathedral affairs. It also has the task of electing a new bishop in accordance

with the Appointment of Bishops Act 1533.

• During 2016 there were two clergy resignations. In July 2016, Canon Janet Chapman

(Canon Liturgist) left the Cathedral to take the role of Rector of Northfield (Birmingham

Diocese). In September 2016 Dean Catherine Ogle announced her resignation (effective

from February 2017) to take the role of Dean of Winchester Cathedral.


Financial Review

2016 was always planned to be a year of quiet consolidation and this has been reflected in

our finances, A 2016 headline income figure of £821,807, showing a fall of £799,989 year on

year reflects the contrast between 2016 and the prior financial year. The prior year (2015)

was a year of exceptional activity with the Tercentenary celebrations and major investment

in the Internal Works project - all funded by one off restricted use grants, which can distort

the underlying financial picture. The 2016 finances reflect a year of stability, despite an

emergency replacement of our boiler in January 2016 at the cost of some £58,000.

Our single largest source of income is from our investment and property portfolio. Against

a backdrop of global economic uncertainty, post both the Brexit and US Presidential

elections, the investment income returns from this portfolio have marginally fallen year on

year. However, our core income from congregational giving, donations from visitors, fees

for special services and other trading activities has been pleasingly consolidated at £237,000

compared to £216,000 in 2015. This reflects the ongoing commitment to stewardship and

sacrificial giving amongst the congregation; together with the investment in a Cathedral

Facilities Manager supporting the day to day function, visitor experience and service delivery

of the Cathedral. The Church Commissioners provide for the stipends of the Dean and the

two Residentiary Canons and the Cathedral also receives a grant towards the cost of the lay

salaries.

We are immensely grateful to the Church Commissioners, All Churches Trust, and the

many grant making trusts and individual donors who share our mission vision.

The major single areas of expenditure in 2016 relate to the completion of the Internal

Works Project at £133,809 and the boiler replacement of £58,000. The small growth in the

cathedral staff team as reported in the Cathedral Administrator’s report has been supported

in part by designated and restricted income funds given specifically for the purposes of the

Cathedral’s day to day music and education operations. The Cathedral furthers its missional

outreach by careful stewardship of restricted donations– with a careful “balancing act”

between activities now and in the future.

The net overall deficit of £90,287 for the year, before taking into account the net gains on

the revaluation of the investment portfolio at 31 December 2016, reflects the use of

donations/ grants generated in the prior year to complete the Tercentenary activities and

internal works projects. Taking into account the investment gains, we finished 2016 with a

net increase in funds of £281,195. It was also pleasing to note that our “in-year trading

position” on our unrestricted fund was £4,466 – this is the fifth consecutive year we have

done so and after absorbing the cost of the replacement boiler.

Balance Sheet position

Chapter consider that the balance sheet , together with the notes to the financial

statements show broadly that the restricted and endowment funds are held in an

appropriate mix of investment and current assets given the purposes for which the funds

are held. While the net assets at the balance sheet date totalled £6,668,887 (2015:£

6,287,492), it must be remembered that included in this total are property and investments

that are held within the endowment fund, the capital of which cannot be spent. The


endowment fund’s value amounted to £6,592,610 (2015:£6,235,497). Much of the remainder

of the assets shown in the balance sheet are held in restricted funds and cannot be used for

the general purposes of the cathedral. There is currently a historical deficit on the

cumulative unrestricted fund. Chapter have in place robust systems for financial governance

and monitoring to guard against any future scenario which may result in increased deficit on

the unrestricted fund. Chapter are pleased to note that the generation of an unrestricted

fund surplus of £4,466 in the year has aided the reduction of the deficit to £254,810 as at 31

December 2016

Factors that may impact on future financial performance

There are a number of factors which can impact on the Cathedrals’ ability to meet its

objectives which are outside its direct control. As is the case for all charities with historical

endowment, the Cathedral is vulnerable to changes on the value and returns upon its

investments. This is mitigated by employing specialist fund managers and advisors to help

develop an appropriate investment policy- the Cathedral is in the process of re tendering

for investment management and advice services for implementation during 2017.

The ability of the Cathedral to generate other regular income sources such as event/ special

service hires and congregation giving and donations has a significant impact on the delivery

of the Cathedral’s missional objectives. These factors are managed by building close

partnerships with both Cathedral users and the congregation itself as lifelong disciplines of

Christ.

Reserves policy

Free reserves are maintained for the following purposes:

• To avoid bank borrowing if there is a temporary shortfall in income/ or a surge in

expenditure

• To provide for emergencies

The reserves policy of the Cathedral is formulated in line with recommendations of the

Charity Commission of England and Wales. The basic policy statement is as follows:

“The Cathedral Chapter aims to maintain the equivalent of at least 3 months operating

expenditure in cash and readily liquid assets in the general unrestricted fund. This excludes

all designated funds and loans. The policy is to be reviewed on an annual basis”

The Cathedral Chapter recognises that due to difficult past economic conditions, the

Cathedral continues to fund itself with a historical net deficit on its unrestricted funds. This

position is being actively remedied by Chapter by robust monitoring of unrestricted

expenditure. Chapter, in conjunction with the Church Commissioners is also planning to

undertake a forensic review of its endowment fund origin and historical record keeping

during 2017 to ascertain whether all such funds that are “currently classified” as permanent

endowment funds do indeed meet that definition.


Designated funds

The Cathedral may with the approval of Chapter, designate additional unrestricted reserves

to be retained for an agreed purpose where this is considered prudent. Such designated

reserves are reviewed on an annual basis and returned to the general fund in the event that

the purpose of their destination is no longer considered adequate for their retention. A

description of each reserve with the intended use of the reserve is set out in note 14. The

most significant designated reserve is the Maintenance Fund which amounts to £10,000 as at

31 December 2016. This is part of a planned saving programme towards future major

maintenance expenditure.

Restricted and endowment funds

As set out in note 14 the Cathedral holds and administers a number of restricted and

endowment funds. As at 31 December 2016 restricted funds totalled £310,173 (2015:

£335,556) and endowment funds totalled £6,592,610 (2014:£ 6,235,497). Neither are

available for the general purposes of the Cathedral

Investments powers and policy

Under the Cathedrals Measure 1999 the Chapter may invest the Cathedral’s funds in any of

the following:

• Land;

• Funds administered for the Central Board of Finance of the Church of England by CCLA

Investment Management Ltd;

• Investments in which trustees may invest under the general power of investment in the Trustee

Act 2000; and

• The improvement or development of property belonging to the Cathedral, except that

endowment funds may not be used to improve or develop the Cathedral itself.

The Cathedral’s non-property investments are held with Harris Allday and CCLA. Harris Allday

manages a portfolio on a discretionary basis, with the remaining funds within CCLA on a self-

managed basis.

Management of the Cathedral’s investments is overseen by the Chapter’s Finance & Risk

Committee, which includes members appointed for their relevant expertise and experience.

The relationship with the Cathedral’s investment advisors is governed by a Statement of

Investment Principles. The agreed investment objective is the creation of sufficient income

to enable the Cathedral to carry out its purposes effectively and without interruption, the

level of income to be agreed from time to time with the Chapter on the advice of the

Finance & Risk Committee. A further objective is the maintenance and long-term

enhancement of the capital, and the income derived from this in real terms. In October

2011 the Chapter resolved that to the extent that the Cathedrals Measure of 1999 requires

it, the Chapter's policy will be to repay any borrowings from endowment funds as soon as it

is prudently possible to do so.


Principal Risks and Uncertainties

Chapter reviews the Cathedral Risk Register on a quarterly basis. Reporting to Chapter by

the Finance & Risk Committee will include a consideration of risks (financial/operational/

reputational damage) which could impact seriously on the cathedral’s operation and

development. The Finance & Risk subcommittee oversees the implementation of the

recommendations arising out of this review process.

The risk register is populated with five areas where the risk of either failure to act or the

impact of the events could be ‘high’; Operational Risk, Financial Risk;

Governance/Compliance Risk; Reputational Risk; Legal/ Regulatory Risk.

Area Mitigation strategies

Operational Risk: Unidentified Maintenance

Issue resulting in unbudgeted expenditure • Implementation of Cathedral 20yr

Planned Preventative Maintenance

Scheme

• Implementation of Annual Maintenance

fund (Designated Fund)

• Cathedral Facilities Manager reviewing

Contractors and Service agreements to

ensure thorough and robust scheme of

inspections and reporting.

Financial Risk: Fraud/Error leading to

financial losses • Delegated Authority and controls in

place

• Rigorous cash handling procedure in

place

• Regular review of management accounts

Operational Risk: Threat to Staff and

Building from a Terrorist attack • Working with local Counter-Terrorism

Officers – training for all staff

• Requirement for a Disaster Recovery

Plan

Legal & Regulatory Risk: Safe Storage of

Data. Leaked personal financial information

leading to reputational damage

• New Cathedral Database

• New Diocesan CRM Database

• Close working with PC Support to

move all Cathedral records to cloud

based storage and Drop Box sharing


Remuneration of key management personnel

Emoluments of higher paid lay employees are determined by Chapter with reference to

remuneration and salary benchmarking and consequent recommendation of changes.

Chapter undertook a thorough review of lay salaries during 2016, and adopted clear plans

to bring all lay salaries in line with market rates. The emoluments of Cathedral clergy are set

by and funded by the Church Commissioners on a national basis.

Going concern

After making enquires, Chapter are satisfied that the Cathedral has adequate resources to

continue to operate as a going concern for the foreseeable future and have prepared the

financial statements on that basis.

Statement of Responsibilities of the Chapter

Chapter have overall responsibility for ensuring that the cathedral has an appropriate system

of controls, financial and otherwise. The systems of internal control are designed to provide

reasonable, but not absolute assurance against material misstatement or loss. They include:

• An annual budget approved by Chapter;

• Regular consideration of both financial results and other performance indicators;

• Delegation of authority and segregation of duties.

Statements as to disclosure of information to auditors

Chapter have taken all the necessary steps to make sure that they are aware of any relevant

audit information and to establish that the auditors are aware of that information.

As far as Chapter are aware, there is no relevant audit information of the auditors are

unware.


Chapter Members

The Very Revd Catherine Ogle

The Revd Canon Janet Chapman (until July 2016)

The Revd Canon Nigel Hand

Sandra Bailey

Helen Blundell

Judith Whalley

Richard Brooks

Andrew Harrison

*Chair of Finance & Risk Committee

Sue Davis

Members of Finance & Risk Committee

Andrew Harrison

*Chair


The Revd Canon Janet Chapman (until July 2016)

Sue Davis

Melanie Crooks

Anna Pitt


Members of Fabric Advisory Committee


Canon Dr Terry Slater

*Chair

Robert Kilgour

Richard Morriss

Dr Paul Spencer-Longhurst

Kristina Williamson

Rita McLean (from April 2016)

John Somers (from April 2016)

James Whiteman (until February 2016)

Clive England (Cathedral Architect in attendance)

Mary Trumper (Secretary, not voting)

Cathedral Administrator (Director of Resources)

Mrs Anna Pitt

Director of Music

Canon Marcus Huxley


Auditors

Dains LLP

15 Colmore Row

Birmingham

B3 2BH

Bankers

The Royal Bank of Scotland PLC

79/83 Colmore Row

Birmingham

B3 2AP

Relationship Manager: Chris Richards

Investment Managers

• EFG Harris Allday

Church Mews

Ombersley

Worcestershire

WR9 0EW

• CCLA Investment Management Ltd

Senator House

85 Queen Victoria Street

London

EC2V 6DZ


Legal Advisors

• Shakespeare Martineau

No 1 Colmore Square

Birmingham

B4 6AA

• Keelys LLP

28 Dam Street

Lichfield

WS13 6AA

Cathedral Architect

Clive England

Thomas Ford & Partners

177 Kirkdale

London

SE26 4QH

Archaeologist

Richard Morriss & Associates

Bromlow House

Upper Bromlow

Minsterley

Shropshire

SY5 0EA


Commercial Property Management

CBRE

55 Temple Row

Birmingham

B2 5LS



Chapter 2016 Accounts


2016 Accounts

Unrestricted Funds Restricte

d

Endowme

nt

Total Total

Not

es

General Designat

ed

Funds Funds 2016 2015

£ £ £ £ £ £

Income & Endowments

From:

Donations & Legacies 146,620 - 7,413 - 154,033 163,529

Grants in support of mission 21,795 - 386,428 - 408,223 1,122,68

4

Charges and fees arising in the

course of mission

9,314

1,000

1,073

-

11,387

9,677

Trading & fundraising 45,521 - 4,352 - 49,873 37,474

Income from property &

investments

191,042

-

6,981

-

198,023

213,037

Other income 268 - - - 268 75,395

________

_

________

_

_______

__

_________ _______

_

_______

_

Total Income 2 414,560 1,000 406,247 - 821,807 1,621,79

6

________

_

________

_

_______

__

_________ _______

_ _______

_

Expenditure On:

Raising Funds 59,383 6,539 18,299 - 84,221 76,353

Ministry 191,575 345 204,121 - 396,041 431,846

Cathedral & precincts upkeep 123,942 - 171,597 - 295,539 1,111,64

2

Education & outreach - 4,344 1,804 - 6,148 -

Community, parish &

congregation

45,221 - 74,922 - 120,143 281,903

Other Expenditure 10,002 - - - 10,002 4,121

________

_ ________

_ _______

__ _________ _______

_ _______

_ Total Expenditure 4 430,123 11,228 470,743 - 912,094 1,905.86

5

Net incoming/(outgoing)

resources before

investment gains

(15,563)

(10,228)

(64,496)

-

(90,287)

(284,06

9)

Net gains/(losses) on

investments

5,6,7 - - 5,586 365,896 371,482 (4,202)

________

_ ________

_ _______

__ _________ _______

_ _______

_ Net Income/(Expenditure) (15,563) (10,228) (58,910) 365,896 281,195 (288,27

1)


Gross transfers between

funds

14 20,029 (44,774) 33,527 (8,782) - -

Actuarial gains/(losses) on

defined benefit pensions

schemes

-

-

-

-

-

6,000

Other gains/(losses) - - - - - -

________

_ ________

_ _______

__ _________ _______

_ _______

_ 6,000

Net movement in funds: 4,466 (55,002) (25,383) 357,114 281,195 (282,27

1)

Funds brought forward (259,276) 75,716 335,556 6,235,496 6,387,49

2

6,669,76

3

________

_ ________

_ _______

__ _________ _______

_ _______

_ Funds carried forward (254,810) 20,714 310,173 6,592,610 6,668,68

7

6,387,49

2

=======

=

=======

=

=======

=

======== ======

=

======

=


Unrestricted Funds Restricted Endowment Total Total

Notes General Designated Funds Funds 2016 2015

£ £ £ £ £ £

FIXED ASSETS

INVESTMENT ASSETS

Property 6 - - - 1,100,000 1,100,000 1,100,000

Investments 7 - - 141,531 3,770,196 3,911,727 3,554,046

_________ _________ _________ _________ ________ ________

- - 141,531 4,870,196 5,011,727 4,654,046

_________ _________ _________ _________ ________ ________

NON-INVESTMENT ASSETS

Property 8 - - - 1,165,000 1,165,000 1,165,000

Equipment 9 1,979 - 7,771 - 9,750 8,817

_________ _________ _________ _________ ________ ________ 1,979 - 7,771 1,165,000 1,174,750 1,173,817

_________ _________ _________ _________ ________ ________ TOTAL FIXED ASSETS 5,827,863

CURRENT ASSETS

Stock - - - - - 1,810

Debtors 11 42,049 - 275 - 42,324 155,042

Cash at bank and in hand 159,297 20,714 160,596 411,549 752,156 692,182

_________ _________ _________ _________ ________ ________ 201,346 20,714 160,871 411,549 794,480 849,034

LIABILITIES DUE WITHIN

ONE YEAR

Creditors 12 (152,270) - - - (152,270) (109,405)

_________ _________ _________ _________ ________ ________ NET CURRENT ASSETS 49,076 20,714 160,872 411,549 642,210 739,629

Interfund transfer (145,865) - - 145,865 - -

_________ _________ _________ _________ ________ ________ TOTAL ASSETS LESS

CURRENT LIABILITES

(94,810)

20,714

310,173

6,592,610

6,828,687

6,567,492

LIABILITIES DUE AFTER

ONE YEAR

Loans 13 (160,000) - - - (160,000) (180,000)

_________ _________ _________ _________ ________ ________ Net assets excluding pension

liability

6,287,492

Defined benefit scheme liability -

_________ _________ _________ _________ ________ ________ TOTAL NET ASSETS (254,810) 20,714 310,173 6,592,610 6,668,687 6,387,492

======== ======== ======== ======== ======= =======

THE FUNDS OF THE CATHEDRAL

Endowment Funds 6,592,610 6,592,610 6,235,496

General Funds (254,810) (254,810) (259,276)

Designated Funds 14 20,714 20,714 75,716

Restricted Funds 14 310,173 310,173 335,556

_________ _________ _________ _________ ________ ________ TOTAL CATHEDRAL FUNDS (254,810) 20,714 310,173 6,592,610 6,668,887 6,387,492

======== ======== ======== ======== ======= =======

These financial statements were approved by the Chapter and signed on their behalf on ________12th April______________2017

The Rev’d Canon Nigel Hand

Acting Dean


Total

Total

2016 2015

£ £

Cash flows from operating activities:

Net cash provided by/(used in) operating activities (103,210) (730,265)

Cash flows from investing activities:

Rents received 24,946 52,000

Investment income received 146,023 161,662

Interest & charges paid - (149)

Proceeds from the sale of property, plant & equipment - -

Purchase of property, plant & equipment (1,587) (1,006)

Proceeds from the sale of investments 587,302 807,537

Purchase of investments (573,500) (628,641)

___________ __________

Net cash provided by/(used in) investing activities 183,184 391,403

Cash flows from financing activities:

Repayments of borrowing (20,000) -

Cash inflows from new borrowing - 200,000

Receipt of endowment - -

____________ ___________

Net cash provided by/(used in) financing activities (20,000) 200,000

Change in cash & cash equivalents in the reporting period 59,974 (138,862)

Cash & cash equivalents at the beginning of the reporting period 692,182 831,044

Cash & cash equivalents at the end of the reporting period 752,156 692,182


Reconciliation of net income/(expenditure) to net cash flow from operating activities

Total Total

2016 2015

£ £

Net income/(expenditure) for the reporting period (90,287) (284,069)

Adjustments for:

Depreciation charges 654 599

Income added to endowment capital - -

Income from property & investments (198,023) (213,038)

Interest payable 7,340 149

Loss/(profit) on the sale of fixed assets - -

(Increase)/decrease in stocks 1,810 901

(Increase)/decrease in debtors 139,771 (103,436)

Increase/(decrease) in creditors 35,525 (88,746)

Non-cash movement - (46,625)

___________ __________

(12,923) (446,196)

__________ __________

Net cash used in operating activities (103,210) (730,265)

========= =========

Analysis of cash & cash equivalents Total Total

2016 2015

£ £

Cash in hand/at bank 19,496 18,933

Cash held on deposit 732,660 673,249

Notice deposits (less than 3 months) - -

Overdraft facility repayable on demand - -

___________ ___________

Total cash & cash equivalents 752,156 692,182

========== ==========


1. ACCOUNTING POLICIES

Basis of accounting

The financial statements are prepared in accordance with the provision of the February 2015

Regulations on Accounting and Reporting by English Anglican Cathedrals prepared for the Association

of English Cathedrals and specified by the Church Commissioners under Section 27 of the Cathedrals

Measure 1999. The 2015 Regulations take in to consideration the requirements of the Statement of

Recommended Practices for Charities (SORP 2015) and applicable accounting standards (FRS102).

The financial statements are prepared under the historical cost convention as modified by the

revaluation of investments and certain properties.

Following transition to FRS 102 for the first time in 2015, all of the accounting policies have been aligned

with the new accounting standard as it applies to Cathedrals. The principle accounting policies and

estimation techniques are as follows:

Fund accounting:

The Chapter maintains various types of funds as follows:

Endowment funds:

Endowment funds represent grants, donations and legacies received where the donor has stipulated

that the income may be used for general purposes but the capital must be retained.

Restricted funds:

Restricted funds represent grants, donations and legacies received which are allocated by the donor for

specific purposes.

Unrestricted funds:

Designated funds are amounts which have been put aside out of unrestricted funds at the discretion of

the Chapter for specific purposes.

Undesignated funds represent unrestricted income which is expendable at the discretion of the Chapter

in the furtherance of the objects of the Cathedral Chapter. Such funds may be held in order to finance

both working capital and capital investment.

Tangible fixed assets:

In accordance with FRS 102 investments properties are carried at their fair value and this is considered

by Chapter annually and the aggregate surplus or deficit is recognised in the Endowment Fund. The

investment property was last professionally valued as at December 2015, the next professional valuation

of the property is due at December 2020. No depreciation is provided on investment properties.

Non-investment properties relate to clergy housing. Previously these were carried at market value

based on an external professional valuation every 5 years. In the interim period Chapter reviewed the

carrying valuation of the properties for impairment by reference to the Nationwide House Prices

Indices. Depreciation is not charged on the grounds of immateriality. Upon adoption of SORP 2015

(FRS 102) Chapter elected under the transitional rules to adopt the previous valuation of the properties

as deemed cost. The properties are subject to a quinquennial maintenance programme and maintain a

high residual value.

Depreciation has been provided on office equipment in the first year. Larger items will be depreciated

over the life of the asset, as assess by Chapter members.


The Cathedral building and the inventory as heritage assets

Under S13(1) of the Care of Cathedrals Measure 1990, Cathedrals are required to keep an inventory

of items owned by the Cathedral that are of architectural , archaeological, artistic or historic interest.

The Measure also issues strict guidelines about the acquisition and disposal of such assets.

No value is attributed to these assets on the balance sheet in accordance with section 7.2.2 of the

Accounting and reporting Regulations for English Anglican Cathedrals. The Chapter have further

considered the requirements of FRS 102, which postdates the Regulations and are of the opinion that

the policy is compliant with this standard on the basis that information on cost or valuation of the assets

is not available and could not be obtained at reasonable cost.

The Cathedral churchyard

The historic churchyard of St Philip’s is the Cathedral precinct under the Care of Cathedrals Measure

1990, and like the Cathedral building is of archaeological and historic interest. No value has been

attributed in the balance sheet to the churchyard or any of the items that form part of it.

No value is attributed to these assets on the balance sheet in accordance with section 7.2.2 of the

Accounting and reporting Regulations for English Anglican Cathedrals. The Chapter have further

considered the requirements of FRS 102, which postdates the Regulations and are of the opinion that

the policy is compliant with this standard on the basis that information on cost or valuation of the assets

is not available and could not be obtained at reasonable cost.

Investments

Investments are stated at market value. Realised gains or losses are recognised in the Statement of

Financial Activities when investments are sold. Unrealised gains and losses are accounted for on

revaluation of investments at the year end.

Stocks

Stocks are stated at the lower of cost and net realisable value and represent goods held for resale in

the Cathedral shop.

Income

All income is recognised in the Statement of Financial Activities when the Cathedral 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. Where a claim for repayment of income tax has or will be

made, such income is grossed up for the tax recoverable.

Grant income is accounted for when the amount can be measured reliably and there is clear entitlement

and certainty of receipt. Grants received which are subject to pre-conditions for entitlement or use

specified by the donor which have not been met at year end are included in creditors.

Donations:

Donations and all other receipts from fundraising are reported gross and the related fundraising costs

are reported in other expenditure.

Rent and Investment income:

Rent and investment income is accounted for when receivable. Tax recoverable relating to investment

income is accounted for in the same period as the related income.


Expenditure

Liabilities are recognised as soon as there is a legal or constructive obligation committing the Cathedral

pay out resources. Expenditure is included on the accruals basis under the following headings, all costs

are allocated to a specific category.

Cost of Raising Funds:

These are the costs of managing the Endowment and Restricted funds in investments and properties.

Charitable Activities:

Ministry – these are the direct costs to order the worship and promote the mission of the Cathedral.

These include the costs for the clergy employed by the Chapter, the costs of supporting their work

across the city and diocese of Birmingham and the costs related to services, music and other Cathedral

activities.

Cathedral and precincts upkeep – these are the costs required to ensure the ongoing maintenance and

upkeep of the Cathedral building and fabric.

Education and outreach – these are payments to other local organisations and charities

Community, parish and congregation – these are the costs associated with arts projects, the heritage

project and the annual contribution to Birmingham Diocese.

Other expenditure – this includes the interest on the Chapter’s borrowings, provisions against slow

moving stocks or trade debtors as deemed necessary in the normal course of business.

Support Costs – these consist of central management, administration and governance costs. These are

costs which are incurred directly in the support of charitable activities. These are costs which are

directly attributable to a specific activity.

Value added tax

The Cathedral recovers 45% of all VAT paid, subject to the current partial exemption rules, apart from

that on purchases from the gift shop where 100% is recovered. VAT is charged at full rate on all vatable

sales.

Pensions

The Cathedral contributes to the Church Workers Pension Fund for lay staff. Contributions to the

Church of England Funded Pension Scheme for the Cathedral clergy are fully funded by the (Section 21)

grant receivable from the Church Commissioners. Both these schemes are multi-employer pension

schemes,

The pension costs charges as resources expended represent the Cathedral’s contributions payable in

respect of the accounting period, in accordance with FRS 102. Deficit funding for the lay worker

pension scheme to which the Cathedral participates is accrued at current value in creditors

distinguishing between contributions falling due within one year and after more than one year. Details

of the scheme is given in note 18 to the financial statements.

Deficit funding in respect of the clergy in the Church of England Funded Pension Scheme is fully met by

the Church Commissioners and hence the deficit funding liability is included in the financial statements

of the Church Commissioners who have responsibility for this liability.


2. INCOME AND ENDOWMENTS FROM:

Unrestricted Funds Restricte

d

Endowme

nt

Total Total

General Designat

ed


£ £ £ £ £ £

Donations &

Legacies

Congregational

collections and

giving

85,401

-

-

-

85,401

83,196

Donations 42,505 - 5,625 - 48,130 40,928

Income from

appeals

- - - - - 15,604

Tax recoverable

under gift aid

18,714

-

1,788

-

20,502

19,601

Income from

Friends and local

trusts

-

-

-

-

-

3,100

Legacies - - - - - 1,100

_______

__

_______

__

________

__

_________

__

_______

_

_______

146,620 - 7,413 - 154,033 163,529

=======

==

=======

=

=======

=

========

=

======= ======

Grants in

support of

mission

Church

Commissioners

- - 280,509 - 280,509 276,261

All Churches

Trust

21,795 - - - 21,795 21,263

World War 1

Grant

- - 9,730 - 9,730 489,198

Heritage Lottery

Grant

- - 9,800 - 9,800 39,200

Other grants - - 86,389 - 86,389 296,762

_______

__ _______

__ ________

_ _________ _______

__ _______

__ 21,795 - 386,428 - 430,573 1,122,684

=======

== =======

= =======

= ======== =======

= =======

=


Charges & fees

arising in the

course of

mission

Facility and other

fees

9,314 1,000 1,073 - 11,387 9,677

=======

= =======

= =======

= ======== =======

= =======

=

Trading &

fundraising

activities

Income from

lettings of

Cathedral/church

yard

42,555

-

-

-

42,555

23,923

Gross income of

the shop and

other activities

2,966

-

4,352

-

7,319

13,551

_______

__ _______

__ ________

_ _________ _______

__ _______

__ 45,521 - 4,352 - 49,873 37,474

=======

== =======

= =======

= ======== =======

= =======

=


INCOME CONTINUED:

Unrestricted Funds Restricted Endowmen

t

Total Total

General Designate

d


£ £ £ £ £ £

Income

from

property

and

investmen

ts

Property 52,000 - - - 52,000 52,000

Investments 138,402 - 6,903 - 145,305 160,418

Interest

receivable

on short

term

deposits

640

-

78

-

718

619

________

_

________

_

_________

_

_________

__

________ _______

191,042 - 6,981 - 198,023 213,037

========

=

======== ======== ========= ======= ======

Other

income

Insurance

recoveries

- - - - - 3,117

Other items 268 - - - 268 72,277

________

_ ________

_ _________ _________ ________

_ ________

_ 268 - - - 268 75,395

========

= ======== ======== ======== =======

= =======

=


3. PROPERTY INCOME

St Philip’s Total Total

House 2016 2015

£ £ £

Rents and service charges 52,000 52,000 52,000

Less: interest & charges (3,009) (3,009) (1,222)

_________ ________ _______

Net income 48,991 48,991 50,778

========= ======= ======

The freehold of St Philip’s House, St Philip’s Place is subject to a lease for one hundred and twenty-five

years from 25 December 1979 at a calculated rental of £52,000 per annum, subject to a review every

five years.


4. EXPENDITURE ON:

Unrestricted Funds Restricted Endowment Total Total

General Designated Funds Funds 2016 2015

£ £ £ £ £ £

Raising

Funds

Cost of

services

directly

recoverable

8,772

-

-

-

8,772

4,593

Gross cost

of shop and

other

activities

78

-

-

-

78

1,784

General

marketing

costs

2,545 - - - 2,545 1,991

Cost of

fundraising

4,375 - 9,263 - 13,638 15,745

Investment

property

costs

3,009 - - - 3009 1.222

Investment

management

costs

8,782

-

-

-

8,782

7,176

Support

costs

31,822 6,539 9,036 - 47,397 43,842

________ _________ __________ ___________ ________ _______

59,383 6,539 18,299 - 84,221 76,353

======== ======== ======== ========= ======= ======


Ministry

Costs

Clergy

stipends and

working

expenses

3,975

-

117,001

-

120,976

128,990

Clergy

housing

costs

9,365 - - - 9,365 18,843

Clergy

support

costs

22,148 - 22,975 - 45,123 30,177

Service

costs

17,987 - 26,778 - 44,765 41,879

Music costs 106,278 345 28,331 - 134,954 168,115

Support

costs

31,822 - 9,036 - 40,858 43,842

_________ _________ _________ _________ _________ _________ 191,575 345 204,121 - 396,041 431,846

======== ======== ======== ======== ======== ========

Cathedral

&

precincts

upkeep

Major

repairs &

restoration

-

-

133.809

-

133,809

979,690

Maintenance

& interior

upkeep

100,593

-

28,752

-

129,345

96,330

Cathedral

insurance

19,472 - - - 19,472 18,927

Support

costs

3,877 - 9,036 - 12,913 16,695

_________ _________ _________ _________ _________ _________ 123,942 - 171,597 - 295,539 1,111,642

======== ======== ======== ======== ======== ========


Education

and

Outreach

Educational

activities

- 4,344 1,804 - 6,148 -

Charitable &

other giving

- - - - - -

_________ _________ _________ _________ _________ _________ - 4,344 1,804 - 6,148

======== ======== ======== ======== ======== ========

EXPENDITURE CONTINED:


t

Total Total

General Designate

d


£ £ £ £ £ £

Communit

y, parish &

congregati

on

Tercentenary

events

- - 1,668 - 1,668 181,283

Arts Events - - 30,582 30,582 -

Heritage

events

- - 30,698 - 30,698 39,746

Diocese 39,996 - - - 39,996 39,996

Dean’s

awards

(15) - - - (15) 291

Support costs 5,240 - 11,974 - 17,214 20,587

_______

_ ________

_ _________ _________ ________

_ ________

_ 45,221 - 74,922 - 120,143 281,903

=======

= ======== ======== ======== =======

= =======

=

Other

Expenditur

e

Interest &

similar

charges

payable

10,002

-

-

-

10,002

4,121

_______

_

________

_

_________

_

_________

__

________ _______

10,002 - - - 10,002 4,121

=======

=

======== ======== ========= ======= ======

BIRMINGHAM CATHEDRAL CHAPTER 2016 ANNUAL REPORT & ACCOUNTS ANALYSIS OF SUPPORT COSTS IS:


t

Total Total

General Designate

d


£ £ £ £ £ £

Support

Costs

Raising

funds

31,822 - 9,036 - 40,858 43,842

Ministry 31,822 - 9,036 - 40,858 43,842

Cathedral

& precincts

upkeep

3,877

-

9,036

-

12,913

16,695

Community

, parish &

congregatio

n

5,240

-

11,974

-

17,214

20,587

________

_

________

_

_________

_

__________

_

________ _______

72,761 - 39,082 - 111,843 12,944

=======

=

======== ======== ========= ======= ======

Analysis

Office rent 23,250 - - - 23,250 23,250

Office

running

costs

24,978 - - - 24,978 21,242

Staffing

costs

16,872 - 39,082 - 55,954 70,669

Governanc

e – Audit

7,661 - - - 7,661 9,081

– Non -

audit

- - - - - 724

________

_ ________

_ _________ _________ ________

_ ________

_ 72,761 - 39,082 - 111,843 124,966

=======

= ======== ======== ======== =======

= =======

=


5. INVESTMENT INCOME AND GAINS


t

Total Total

General Designate

d


£ £ £ £ £ £

Dividends

receivable

138,402 - 6,903 - 145,305 160,418

Interest

receivable

640 - 78 - 718 619

Property

income

52,000 - - - 52,000 52,001

________ ________

_

_________

_

__________

_

________ _______

191,042 - 6,981 - 198,023 213,038

=======

=

======== ======== ========= ======= ======

Realised

gains/(losse

s)

- - - (4,064) (4,064) (3,154)

Unrealised

gains/(losse

s)

- - 5,586 369,960 375,546 (1,048)

________

_ ________

_ _________ _________ ________

_ ________

_ - - 5,586 365,896 371,482 (4,202)

________ ________

_ _________ _________ ________

_ ________

_ Total

income &

gains

191,042 - 12,567 365,896 569,505 208,835

=======

= ======== ======== ======== =======

= =======

=


6. INVESTMENT PROPERTY

Unrestricted

Funds

Restricted

Funds

Endowment

Funds

Total

Funds

£ £ £ £

At valuation: 1 January 2016 - - 1,100,000 1,100,000

Additions - - - -

Revaluation - - - -

_________ _________ _________ _________ At valuation 31 December 2016 - - 1,100,000 1,100,000

======== ======== ======== ========

Disclosed within:

Investment assets – St Philip’s

House

1,100,000

========

The Endowment Fund represents the freehold of St Philip’s House, St Philip’s Place which is subject to

a lease of one hundred and twenty-five years from 25 December 1979. The investment property was

professionally valued by Richard Connolly BSc MRICS and Michael Stephens MRICS of CBRE Ltd as at

31 December 2015.

7. INVESTMENTS

Unrestricted

Funds

Restricted

Funds

Endowment

Funds

Total

Funds

£ £ £ £

Investments at market value at 1

January 2016

- 135,945 3,418,102 3,554,046

Additions - - 573,500 573,500

Disposals at opening value - - (591,366) (591,366)

Net change in market value - 5,586 369,960 375,546

_________ _________ _________ _________

Investment at market value at 31

December 2016

- 141,531 3,770,196 3,911,727

======== ======== ======== ========

The investment transactional costs for the year were £8,782 (2015: £7,176)


8. NON INVESTMENT PROPERTIES

Unrestrict

ed

Funds

Restricte

d Funds

Endowme

nt Funds

Total

Funds

2016

Total

Funds

2015

£ £ £ £

At deemed costs 1 January 2016

and 31 December 2016

-

-

1,165,000

1,165,000

1,165,000

Additions - - - -

======== =======

= ======== ======== ========

All non-investment properties are freehold and used as follows:

Deemed

Cost

2016

Deemed

Cost

2015

£ £

For Cathedral use:

38 Goodby Road 575,000 575,000 4 Nursey Drive 295,000 295,000 12 Nursery Drive 295,000 295,000 _________ _________ 1,165,000 1,165,000 ======== ========

The properties are for the use of the clergy of the Cathedral. The occupiers are provided with this

accommodation rent free in order to enable them to perform their duties. Cathedral policy is that

properties which are vacant for short periods are let. The Cathedral shop is within the Cathedral.

These properties were previously included in the financial statements based on formal open market

valuation as determined by Robert Aston and Co Chartered Surveyors as at 31 December 2011.

Following adoption of SORP 2015 Chapter has elected, under the transitional rules, to adopt the

previous valuation of the properties as deemed cost.


9. EQUIPMENT

Unrestricted

Funds

Restricted

Funds

Endowment

Funds

Total

Funds

£ £ £ £

COST

At 1 January 2016 1,006 8,995 - 8,995

Additions 1,587 - - 1,587

________ _________ _________ _________ As 31 December 2016 2,593 8,595 - 11,588

======== ======== ======== ========

ACCUMULATED

DEPRECIATION

At 1 January 2016 280 904 - 1,184

Depreciation charge for the year 334 320 - 654

_________ _________ _________ _________ At 31 December 2016 614 1,224 - 1,838

======== ======== ======== ========

NET BOOK VALUE

At 31 December 2016 1,979 7,771 - 9,750

======== ======== ======== ========

As 31 December 2015 726 8,091 - 8,817

======== ======== ======== ========

10. STAFF COSTS

The average monthly number of employees during the year was as follows:

2016 2015

Clergy 3 3 Vergers 4 4 Music & services 5 6 Administration 5 4 _________ _________ 17 17 ======== ========

Average number of full time equivalent staff:

2016 2015

Clergy 3 3 Vergers 3.5 2.5 Music & services 2 2 Administration 4 3.5 _________ _________ 12.5 11 ======== ========


Staff costs during the year were as follows:

2016 2015

£ £

Salaries & Stipends 339,016 344,770 Employer’s National Insurance 26,603 24,967 Employer’s Pension Contributions 48,287 74,974 Compensation for loss of office - 25,000 _________ _________ Total Costs 413,906 469,711 ======== ========

No-one received emoluments above £60,000 during the year.

Remuneration of key management personnel

Key management personnel are deemed to be those having authority and responsibility delegated to

them by Chapter for planning, directing and controlling the activities of the Cathedral. During 2016

they were:

The Dean The Very Reverend Catherine Ogle

Canon Liturgist The Revd Canon Janet Chapman until Jul 16

Canon Missioner The Revd Canon Nigel Hand

Director of Resources Mrs Anna Pitt

Remuneration, pensions and expenses for these four people amounted to £169,344 (2015: £164,809)

The clergy are also members of Chapter, details of their remuneration is given below:

Salaries &

Stipends

Employer’s

National

Insurance

Employer’s

Pension

Contributions

£ £ £

Remuneration of members of the Chapter The Very Revd Catherine Ogle 34,850 3,462 11,539 The Revd Canon Nigel Hand 26,872 2,334 9,231 The Revd Canon Janet Chapman 17,879 1,603 9231 ======== ======== ========

The Revd Canon Nigel Hand, the Revd Canon Janet Chapman and the Very Revd Catherine Ogle were

also provided with the use of a Cathedral house free of rent and rates in furtherance of their duties.

The remuneration of and pension provided for clerical members of Chapter is paid in accordance with

scales laid down annually by the Church Commissioners, the Archbishops’ Council and the Church of

England Pensions Board. No remuneration was paid to lay members of Chapter in their capacity as

Chapter members

Reimbursement of expenses incurred totalling £488 (2015: £371) were paid in total to two members

of Chapter during the year. Reimbursement expenses comprised refreshments, bar stock etc.


11. CURRENT ASSETS – DEBTORS

2016 2015

£ £

Trade debtors 1,409 4,021

Other debtors 33,665 135,158

Prepayments 7,250 6,574

Other taxation _ 9,289

_________ _________ 42,324 155,042

======== ========

12. LIABILITES DUE WTHIN ONE YEAR – CREDITORS

2016 2015

£ £

Birmingham Diocesan Board of Finance Loan 20,000 20,000

Trade creditors 20,318 21,473

Other creditors (including Social Security and other taxes) 20,511 16,654

Pension deficit liability - 11,000

Accruals 91,441 40,278

_________ _________ 152,270 109,405

======== ========

13. LIABILITIES DUE AFTER ONE YEAR – CREDITIORS

2016 2015

£ £

Birmingham Diocesan Board of Finance Loan 180,000 200,000

_________ _________ Total borrowings 180,000 200,000

Less: due within one year (20,000) (20,000)

_________ _________ 160,000 180,000

======== ========

An unsecured loan of £200,000 was advanced by Birmingham Diocesan Board of Finance during 2015

to facilitate delivery of the interior restoration project. In order for the Cathedral to access grant

funding of £489,189 under the government’s World War 1 Cathedral grants, this work had to be

completed during 2015.

The loan from Birmingham Diocesan Board of Finance is repayable on a quarterly basis over a term of

10 years with interest payable at the average rate declared by The CBF Church of England Deposit

Fund plus 3.45%. This equated to an interest rate of 3.91% during 2016 (2015: 4.1%)

Included in the above are the following:

2016 2015

£ £

Amounts repayable by instalments:

Between 1 – 2 years 20,000 20,000

Between 2 – 5 years 60,000 60,000

After 5 years 80,000 100,000

_________ _________ 160,000 180,000

======== ========


14. ANALYSIS OF FUNDS

Balance

b/f At

1 Jan

2016

Income

Expenditur

e

Unrealised

Gain/(Loss

)

0n

Revaluatio

n

Transfe

r

betwee

n Funds

Actual

Profit/(Los

s)

On

Disposal

Balance c/f

At

31 Dec

2016

£ £ £ £ £ £

Restricted Funds

Mission &

Development Fund

9,421

44

(581)

-

-

-

8,884

Belliss Fund 1,049 12 - - - - 1,061

Choir Tours Fund 2,666 1,960 - - - - 4,626

Music Fund 2,611 20,662 - - (20,611) - 2,662

St Philip’s Singers

Fund

1,096 - (55) - - - 1,041

FCM Song School 16,494 687 - 653 (687) - 17,147

Ouseley Trust Fund 5,000 - - - (2,500) - 2,500

Flower Fund 2,825 3,386 (2,762) - - - 3,449

Harridine Bequest 17,212 - - - - - 17,212

St Philip’s Education

(Christchurch) Fund

81,899

1,999

(1,804)

6,268

-

-

88,362

Bishop of Birmingham’s

Centenary Appeal Fund

9,508

-

-

-

(9,508)

-

- Tercentenary Arts Fund - - (1,480) - 1,480 - -

Tercentenary Something

to Share Fund

347

28

(261)

-

(114)

-

-

Tercentenary Festival

of Voices Fund

2,140

966

(1,335)

-

(1,770)

-

-

Internal Works Fund - 2,136 - - (2,136) - -

Tercentenary

Pilgrimages Fund

1,500

-

(72)

-

-

-

1,428

Tercentenary

Heritage Fund

34,612

11,001

(30,698)

-

-

-

14,915

The Provost’s Book

Fund 3,891 18 - - - - 3,909

FCM Music Trust

Fund

22,531 - - - - - 22,531

Howlett Bequest 15,866 - - - (11,866) - 4,000

Altar Linen Fund - 300 - - - - 300

Boiler Fund - 100 - - (100) - -

Chorister Hardship

Fund

-

-

(320)

-

8,000

-

7,680

Arts – Measure of Us - 30,889 (27,102) - - - 3,787

Arts – Something Good - 2,500 (2,000) - - - 500

Administrative

Support Role Fund

-

-

-

-

7,364

-

7,364

Clergy Moving Costs - - - - 5,000 - 5,000

Church Commissioners

Stipends

-

139,351

(139,531)

-

-

-

- Church Commissioners

Section 23

-

163,508

(151,144)

-

(12,364)

-

-


Fundraising campaign:

Campaign Other 48,222 12,246 (133,809) - 73,339 - -

Mission Fund 11,952 - - - - - 11,952

Music Fund 5,334 1,803 (319) - - - 6,818

Music Endowment 39,380 35,000 - (1,335) - - 73,045

_______

_

_______

_

________ ________ _______

_

________ ________

335,556 428,597 (493,093) 5,586 33,527 - 310,173

======

= ======

= ======= ======= ======

= ======= =======

ANALYSIS OF FUNDS CONTINUED

Balance

b/f At

1 Jan

2016

Income

Expenditur

e

Unrealised

Gain/(Loss

)

0n

Revaluatio

n

Transfe

r

betwee

n Funds

Actual

Profit/(Los

s)

On

Disposal

Balance c/f

At

31 Dec

2016

£ £ £ £ £ £

Designated Funds

Development fund 46,702 - - - (46,702) - -

Education Fund 4,344 (4,344) - - - -

Tercentenary,

Merchandise,

Marketing fund

14,598

(6,539)

-

-

-

8,059

Fabric Fund 9,072 - - - (9,072) - -

St Philip’s Singers

fund

1,000 - - - - - 1,000

Vacancy Repair

Contingency

-

-

-

-

1,000

-

1,000

Maintenance Fund - - - - 10,000 - 10,000

Special Music Fund - 1,000 (345) - - - 655

________ _______

_

_________ _________ _______

_

________ ________

75,716 1,000 (11,228) - (44,774) - 20,714

======= ======

= ======= ======= ======

= ======= =======


Unrestricted

Funds

General

unrestricted fund

(259,276)

414,560

430,123

-

20,029

-

(254,810)

________ _______

_ ________ ________ _______

_ ________ ________

(259,276) 414,560 430,123 - 20,029 - (254,810)

======= ======

= ======= ======= ======

= ======= =======

Endowment

Funds

General Endowment

Fund

6,235,497

-

-

369,960

(8,782)

(4,065)

6,592,610

_______ _______

_ ________ ________ _______

_ ________ ________

6,235,497 - - 369,960 (8,782) (4,065) 6,592,610

======= ======

= ======= ======= ======

= ======= =======

Due to difficult past economic conditions the Cathedral continues to find itself with an historical net

deficit on its unrestricted funds. This position is being actively remedied by Chapter by robust

monitoring of unrestricted expenditure and generation of unrestricted income.

BIRMINGHAM CATHEDRAL CHAPTER 2016 ANNUAL REPORT & ACCOUNTS ANALYSIS OF FUNDS CONTINUED:

Details of inter-fund transfers in the year are as follows:

Unrestricted Funds Restricted Endowment Total

General Designated Funds Funds 2016

£ £ £ £ £

Development Fund to

Campaign Other Fund

1 (46,702) 46,702 -

Fabric Fund to

Campaign Other Fund

2 (9,072) 9,072 -

General Fund to

Vacancy Repair

Contingency Fund

3 (1,000) 1,000 -

General Fund to

Maintenance Fund

4 (10,000) 10,000 -

Music Fund to General

Fund

5 10,000 (10,000) -

Music Fund to General

Fund

6 2,611 (2,611) -

Music Fund to

Chorister Hardship

Fund

7 (8,000) -

8,000

FCM Song Scholl Fund

to General Fund

8 687 (687) -

Ousley Trust Fund to

General Fund

9 2,500 (2,500) -

Bishop of Birmingham


to Campaign Other

Fund

10

(9,508)

-

9,508

General Fund to

Tercentenary Arts

Strand

11

(1,480)

1,480

-

Something to Share

Fund to General Fund

12 114 (114) -

Tercentenary Festival

of Voices Fund to

General Fund

13

1,770

(1,770)

-

Internal Works to

Campaign Other Fund

14 (2,136)

2,136

Howlett Bequest Fund

to General Fund

15 11,866 (11,866) -

Boiler Fund to General

Fund

16 100 (100) -


Section 23 Fund to

Administration Support

Fund

17

(7,364)

7,364 -


Section 23 Fund to

Clergy Moving Costs

Fund

18

(5,000)

5,000

-


Endowment Fund to

General Fund

19 8,782 (8,782) -

General Fund to

Campaign other Fund

20 (5,921) 5,921

________ _________ _________ _________ _________ 20,029 (44,774) 33,527 (8,782)

======== ======== ======== ======== ========

ANALYSIS OF FUNDS CONTINUED:

1. This represents the release of designated funds in respect of the internal restoration works which

expenditure has been charged to the Campaign-Other fund.

2. This represents the release of designated funds in respect of the internal restoration works which


3. This represents the release of general funds to a vacancy contingency fund to cover future costs to the

repair/redecoration of clergy housing upon vacation.

4. This represents the release of general funds to create a maintenance fund for future maintenance costs.

5. This represents a donation received from the Friends of Cathedral Music towards the music costs of

the Cathedral.

6. This represents donations received towards the music costs of the Cathedral.

7. This represents a donation from the Friends of Cathedral Music towards music costs.

8. This represents income from the investments towards the costs of Choral Scholars

9. This represents part of the grant previously received from the Ouseley Trust towards the cost of

Choral Scholars.

10. This represents the release of restricted funds in respect of the internal restoration works which

expenditure has been charged to the Campaign-Other fund and in particular the costs associated with

improving the Cathedral entrance.

11. This represents the release of general funds towards the balance of costs associated with the

Tercentenary Arts Fund.

12. This represents donations towards the Tercentenary Something to Share Fund whose donations were

split between the Malawi Partnership, St Basil’s, Growing younger initiative run by Birmingham Diocese

and the Cathedral

13. This represents administration costs for the Festival of Voices events.

14. This represents donations received in respect of the internal restoration works which expenditure has

been charged to the Campaign-Other fund.

15. This represents the release of restricted funds towards the music costs of the Cathedral.

16. This represents a donation received towards the costs of replacing the boiler, the expenditure of which

has been charged to general funds.

17. This represents part of the additional grant received from Church Commissioners

18. This represents part of the additional grant received from Church Commissioners

19. This represents the costs relating to the purchase and selling of investments during 2016

20. This represents the release of general funds in respect of the internal restoration works which


BIRMINGHAM CATHEDRAL CHAPTER 2016 ANNUAL REPORT & ACCOUNTS ANALYSIS OF FUNDS CONTINUED:

Designated Fund Purpose

Development Fund This fund is to support future developments and improvements

in the Cathedral and Churchyard

Education Fund The education department’s income and expenditure raised by

school visits and other works.

Tercentenary

Merchandise/Marketing/Literature

Fund

This fund was created for the purchase of merchandise and

marketing material for the Cathedral’s tercentenary and the

continued support of the Marketing Manager’s post

Fabric Fund This fund is for the upkeep of the Cathedral’s fabric

St Philips Singers Fund This fund was created from a legacy received from a member of

the St Philip’s Singers

Vacancy Repair Fund This fund is to be used for the re-decoration and any works

required to clergy houses upon vacation.

Maintenance Fund This fund is to be used for rolling maintenance costs

Special Music Fund This fund is used by the Director of Music for special events

requiring additional musicians

Admin Support Role Fund This fund is to be used to pay for the Administration Support

Role

Clergy Moving Costs Fund This fund is to be used for moving costs incurred on the

appointment of the new Canon Liturgist and Dean

Restricted Fund

Mission & Development Fund This fund consists of donations made by the friends and family of

Simon Richmond. It is intended to be used for evangelism and

/or development of the Cathedral in memory of Simon

Richmond.

Belliss Fund This fund was provided on the understanding that the Cathedral

would keep the Belliss monument in good order

Choir Tours Fund The Choir raises money from sales of compact discs, tapes,

raffles, donations and other sources to fund their tours.

Music Fund This fund consists of funds raised or donated in support of the

Cathedral’s choirs and music.

St Philips’s Singers Fund This fund comprises money raised by the St Philip’s Singers that

will be used for their needs.

FCM Song School These funds represent grants from Friends of the Cathedral

Music which are devoted to these purposes.

Ouseley Trust Fund Grant received towards choral scholarships.

Flower Fund Funds received specifically towards the provision of flowers in

the Cathedral.

Harridine Bequest Fund A bequest received towards the cost of building a new Cathedral

St Philip’s Education

(Christchurch) Trust

This fund is to support the Cathedral’s education work

Bishop of Birmingham’s


This fund contains donations raised during the Centenary Appeal

towards improving access and welcome for visitors.

Tercentenary Arts Strand Grants received in connection with arts events to do with

celebrating the Cathedral’s tercentenary

Something to Share Fund During its Tercentenary year the Cathedral is asking people to

donate to its Something to Share Fund which at the end of 2015

will be divided equally between the Malawi Partnership, St Basil’s,

rowing Younger initiative run by Birmingham Diocese and the

Cathedral

Tercentenary Festival of Voices Grants and sponsorship received in connection with the three

concerts celebrating the life of the Cathedral over 300 years

Internal Works Donations and grants received towards the internal

refurbishment of the Cathedral


Tercentenary Pilgrimages Grants received to help towards the cost of arranging

pilgrimages from all Birmingham Deanery’s to their Mother

Church,

Tercentenary Heritage Fund Grants received in connection with heritage projects for the

Cathedral

The Provost’s Book Fund The Provost’s book fund represents funds provided to aid the

former Provost with his research

FCM Music Trust Fund This fund represents a grant from the Friends of Cathedral Music

to support the proposed Birmingham Cathedral Music Trust.

ANALYSIS OF FUNDS CONTINUED:

Restricted Funds

Continued

Purpose

Howlett Bequest Fund This fund is to provide maintenance and cleaning for the Howlett

family grave in Birmingham; to establish the “Seraphim” award used to

promote music in the Cathedral; and to encourage links with Eastern

Europe, Germany and Russia. Having discharged all our

responsibilities with regard to the will the Cathedral’s only remaining

duty is to keep the family grave at Yardley Cemetery in good order.

Therefore £4,000 is to be kept in this fund for this purpose with the

remaining funds being used towards the Cathedral music.

Altar Linen Fund This comprises of a donation toward new altar linen.

Chorister Hardship Fund This comprises grant received from the Friends of Cathedral Music

Arts – Measure of

Us/Something Good Funds

Grants received towards the cost of further arts projects

Fundraising Campaign

Campaign Other Campaign donations received to support the fabric objectives of the

campaign

Mission fund Campaign donations made to support the mission objectives of the

campaign

Music Fund Campaign donations made to support music in the Cathedral

Music Endowment Fund Capital fund for income to be used towards the music of the

Cathedral

Endowment Fund

General endowment fund These are historic permanent endowment funds. The Chapter can

utilise the income generated from these funds towards its general

charitable activities.

15. CONTINGENT LIABILITES

There are no known contingent liabilities at the balance sheet date

16. CAPITAL COMMITMENTS

There are no capital commitments which are contracted for but not provided in the financial statements

as at

31 December 2016 (2015: £nil)

17. OPERATING LEASE COMMITMENTS

At 31 December 2016 the Chapter had annual commitments under un-cancellable operating leases as

follows:


2016 2015

£ £

Expire date

Within 1 year 416 -

Between 2 to 5 years 5276 6,935

18. PENSION COSTS

During the year Birmingham Cathedral participated in the Church Workers Pension Fund (“CWPF”) for lay

staff. The Scheme is administered by the Church of England Pensions Board which holds the assets of the

schemes separately from those of the Employer and the other participating employers.

The Church Workers Pension Fund has a section known as the Defined Benefits Scheme, a deferred annuity

section known as Pension Builder Classic and a cash balance section known as Pension Builder 2014.

Birmingham Cathedral during 2016 participated in both the Defined Benefits Section and the Pension Builder

2014 section.

It was agreed from 1 July 2015 to make all future lay worker pension arrangements through the Pension

Builder 2014 section of the Church Workers Pension Fund. Membership of the Defined Benefits Section

became “frozen” or deferred t that date and all eligible lay workers are now active members of the Pension

Builder 2014 section. Information with regards to both sections of the scheme is given below.

Defined Benefits Scheme

The Defined Benefits Scheme (“DBS”) section of the Church Workers Pension Fund provides benefits for

lay staff based on final pensionable salaries.

For funding purposes, the 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 employers’ sub-

pools to the Life Risk Pool and all pensions and death benefits are paid from the Life Risk Pool.

It is not possible to attribute the scheme’s assets and liabilities to specific employers, since each employer,

through the Life Risk Pool, is exposed to actuarial risks associated with the current and former employees

of other entities participating in the DBS. The scheme is considered to be a multi-employer scheme as

described in Section 28 of FRS 102 and as such contributions are accounted for as if the Scheme were a

defined contribution scheme. The pensions costs charged to the SoFA in the year contributions are payable

towards benefits and expenses accrued in that year (2016: £11,000, 2015: £15,000), plus any impact of deficit

contributions (see below), giving a total charge of £11,000for 2016 (2015: £21,000).

If, following an actuarial valuation of the Life Risk Pool, there is a surplus or deficit in the pool and the

Actuary so recommends, further transfers may be made from the Life Risk Pool to the employers’ sub-

pools, or vice versa. The amounts to be transferred (and their allocation between the sub-pools) will be

settled by the Church of England Pensions Board on the advice of the Actuary.

A valuation of the DBS is carried out once every three years, the most recent having been carried out as at

31 December 2013. In this valuation, the Life Risk Section was shown to be in deficit by £4.9m and £4.3m

was notionally transferred from the employers’ sub-pools to the Life Risk Pool. This increased the Employer

contributions that would otherwise have been payable. The overall deficit in the DBS was £12.9m.


Following the valuation, the Employer has entered into an agreement with the Church Workers Pension

Fund to pay a contribution rate of 24% of pensionable salary and expenses of £2,400 per year. In addition

deficit payments of £14,685 per year have been agreed for 1.50 years from 1 April 2015 in respect of the

shortfall in the Employer sub-pool. This obligation has been recognised as a liability within the Employer’s

financial statements.

Section 28.11A of FRS 102 requires agreed deficit recovery payments to be recognised as a liability. The

movement in the provision is set out below:

2016 2015

£ £

Balance sheet liability at 1 January 11,000 32,000

Deficit contribution paid (11,000) (15,000)

Interest cost (recognised in SoFA) - -

Remaining change to the balance sheet liability* (recognised in SoFA) - (6,000)

Balance sheet liability at 31 December - 11,000

* 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:

December 2016 December 2015 December 2014

Discount Rate 0.00% 0.00% 1.10%

The legal structure of the scheme is such that if another employer fails, the employer could become

responsible for paying a share of that employer’s pension liabilities.

The next valuation of the scheme is being carried out as at December 2016.

Pension Builder Scheme

The Pension Builder Scheme of the Church Workers Pension Fund is made up of two sections, Pension

Builder Classic and Pension Builder 2014, both of which are classed as defined benefit schemes.

Pension Builder Classic provides a pension for members for payment from retirement, 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. Bonuses may also be

declared, depending upon the investment returns and other factors.

Pension Builder 2014 is a cash balance scheme that provides a lump sum that members use to provide

benefits at retirement. Pension contributions are recorded in an account for each member. This account

may have bonuses added by the Board before retirement. The bonuses depend on investment

experience and other factors. There is no requirement for the Board to grant any bonuses. The account,

plus any bonuses declared, is payable from members’ Normal Pension Age.

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

is because it is not possible to attribute the Pension Builder Scheme’s assets and liabilities to specific

employers and 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 contributions payable (2016: £18,304,

2015: £43,528).


A valuation of the scheme is carried out once every three years. The most recent scheme valuation

completed was carried out as at 31 December 2013. This revealed, on the ongoing assumptions used,

a surplus of £0.5m. There is no requirement for deficit payments at the current time.

Pension Builder 2014 will be valued in relation to the lump sum payable to members at normal pension

age. There are no annual pension benefits. Pension Builder 2014 commenced in February 2014 so the

first full valuation of that section will be carried out at the next CWPF valuation date, 31 December

2016.

19. RELATED PARTY TRANSACTION

The Cathedral shares office space with the Birmingham Diocesan Board of Finance and paid an amount

of £23,250

(2015: £23,250) in respect of this.

Common fund paid to Birmingham Diocesan Board of Finance for the year ending 31 December 2016

was £40,000

(2015: £40,000)

An unsecured loan of £200,000 was advanced by Birmingham Diocesan Board of Finance during 2015

to facilitate the delivery of the interior restoration project. In order for the Cathedral to access grant

funding of £489,198 under the government’s World War 1 Commemoration Fund for Cathedrals, this

work had to be completed during 2015. The loan form the Birmingham Board of Finance is repayable

on a quarterly basis over a term of 10 years with interest payable at the average rate declared by The

CBF Church of England Deposit Fund plus 3.45%, This equated to an interest of 3.91% during 2016

(2015: 4.1%), the amount of interest due for 2016 is £7,340

20. CONNECTED ENTITY

The Friends of Birmingham Cathedral is a registered charity that exists wholly for the benefit of the

Cathedral, but is not under its control. Only income received from the entity is included in the financial

statements. Relevant information about its income and assets is:

2016 2015

£ £

Gross income 182 1,520

Expenditure - 52

Amount paid to the Cathedral - 8,242

Funds b/fwd 13,875 20,649

Funds C/fwd 14,057 13,875

21. PRIOR YEAR COMPARATIVE STATEMENT OF FINANCIAL ACTIVITIES

Unrestricted Funds Restricted Endowment Total

Notes General Designated Funds Funds 2015

£ £ £ £ £


Income & Endowments From:

Donations & Legacies 134,699 1,703 27,127 - 163,529

Grants in support of mission 21,263 - 1,101,421 - 1,122,684

Charges and fees arising in the

course of mission

9,677

-

-

-

9,677

Trading & fundraising 29,492 9 7,973 - 37,474

Income from property &

investments

201,988

-

11,049

-

213,037

Other income 3,170 - 23,602 48,623 75,395

_________ _________ _________ _________ ________

Total Income 2 400,289 1,712 1,171,172 48,623 1,621,796

_________ _________ _________ _________ ________

Expenditure On:

Raising Funds 55,344 - 21,009 - 76,353

Ministry 195,590 - 236,256 - 431,846

Cathedral & precincts upkeep 87,188 - 1,024,454 - 1,111,642

Education & outreach - - - - -

Community, parish & congregation 47,008 22,612 212,283 - 281,903

Other Expenditure 3,972 - 149 - 4,121

_________ _________ _________ _________ ________ Total Expenditure 4 389,102 22,612 1,494,151 - 1,905.865

Net incoming/(outgoing)

resources before investment

gains

11,187

(20,900)

(322,979)

48,623

(284,069)

Net gains/(losses) on investments 5,6,7 - - 302 (4,504) (4,202)

_________ _________ _________ _________ ________ Net Income/(Expenditure) 11,187 (20,900) (322,677) 44,119 (288,271)

Gross transfers between funds 14 10,805 (34,810) 31,181 (7,176) -

Actuarial gains/(losses) on defined

benefit pensions schemes

6,000

-

-

-

6,000

Other gains/(losses) -

_________ _________ _________ _________ ________ 6,000 - - - 6,000

Net movement in funds: 27,992 (55,710) (291,496) 36,943 (282,271)

Funds brought forward (287,268) 131,426 627,052 6,198,553 6,669,763

_________ _________ _________ _________ ________ Funds carried forward (259,276) 75,716 335,556 6,235,496 6,387,492

======== ======== ======== ======== =======

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