BIRMINGHAM CATHEDRAL ANNUAL REPORT & ACCOUNTS...

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BIRMINGHAM CATHEDRAL

ANNUAL REPORT & ACCOUNTS

2015

The Cathedral Church of St Philip, Colmore Row, Birmingham B3 2QB

“You are the light of the world. A town built on a hill

cannot be hidden. Neither do people light a lamp and

put it under a bowl. Instead they put it on its stand, and it

gives light to everyone in the house. In the same way, let

your light shine before others, that they may see

your good deeds and glorify your father in heaven”

Matthew 5:14-16

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Letter from the Dean

2015 was a year of great mission opportunity and achievement for Birmingham Cathedral. The

300th anniversary of the building gave new scope for growing the ministry of the cathedral and

attracting additional grant funding to support additional work. The Chapter identified clear aims

for the celebrations: to celebrate Christian faith and the life of the region; to raise awareness of

the cathedral; to forge new relationships and partnerships and strengthen existing relations; to

make connections between communities in our diverse city; to foster links between spirituality

and the arts and to grow our congregations.

Much has been achieved. Notable progress was made in all of the tercentenary aims during the

year creating a lasting legacy through greater public awareness of the cathedral and new

partnerships forged, through the work of our heritage officer and through our interfaith arts

project ‘Something Good’

The awarding of a government grant enabled major interior restoration during 2015 (this work

had been anticipated to take place in 2016). Whilst this presented a funding and cash flow

challenge, we now enter 2016 with a building fit for major public events.

The finances supporting the cathedrals work continue to create a modest surplus and we are

working to create sustainable financial growth year on year to enable a growing cathedral

ministry.

Birmingham is a place of great and vibrant energy. It is also a place of great need both materially

and spiritually. In 2015 we were able to prove the scale of our vision. We are ‘back on the map’

and growing in our mission to serve the diverse communities of our city and diocese.

Catherine Ogle, Dean of Birmingham Cathedral

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Objectives & Activities

Mission Statement

Birmingham Cathedral is a house of Christian prayer and the seat of the Bishop of Birmingham.

Mother church to Birmingham Diocese, the cathedral is a treasured sacred space for Anglican

worship and Christian discipleship in this great and diverse city ‘where the world meets’. As

Anglican Christian church we are also privileged to offer hospitality as a place of gathering and

connection for all faiths and none in order witness to Gods love for all and to serve the common

good.

Our purpose is to worship God, share the gospel of Jesus Christ, welcome and offer hospitality

to all who come, celebrate and pass on our rich Christian heritage and discover the Kingdom of

God in our contemporary city context. We support the mission and ministry of the Bishop of

Birmingham and the parishes of the diocese. We seek to fulfil our unique vocation and bring

our distinct gifts and resources to the diocese, other Christian churches and faith communities,

institutions and charities as a valuable, effective and innovative ‘team player’ in the life of our

region.

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Main Priorities for 2015:

As we started 2015 our ambition was to make the most of the opportunities for mission afforded

by the cathedral tercentenary anniversary. We sought to extend an invitation to ‘Come and See’

in the spirit of our patron saint, St Philip. In addition to our normal and regular cycle of activities

and events that preach the gospel and serve our bishop, city and diocese, through the

tercentenary engagement and celebration we sought to raise our profile and impact; strengthen

relationships and work more effectively with partners; support growing congregations; share the

Christian imagination through the arts.

Our intentional plans for 2015 were:

We will celebrate the 300th anniversary of Birmingham Cathedral in order to celebrate

our Christian faith and the life of our city and region, past, present and future.

We will raise our profile, the profile of Christianity as a living faith, the morale and

confidence of the Christian church. We will grow into closer mutual relationship with

the parishes of the diocese.

We will invite support and make firmer friends and partners from across the city and

diocese. We will gather together people of good will, from all backgrounds for the

common good.

We will support and work with the arts and artists and explore the natural links between

the arts and spirituality. We will surprise people with the spirit of Christian imagination

We will grow our Cathedral congregations and be a blessing to our city and diocese.

ARTS HERITAGE PILGRIMAGE SPECIAL

EVENTS

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Achievements & Performance

Some highlights of 2015

New Year’s Eve Light Switch On Our 300th anniversary year began with a New Year’s Eve watch night service and a ceremonial ‘switch on’ of the

restored flood-lights to the cathedral tower. The repair of all the cathedral external lights over the last 4 years has

resulted in the building being a beacon at night and improving the sense of a safe and welcoming public space. A

cathedral Canon commented: ‘It feels like a proper place now’.

24 Hours of Prayer It was such a simple idea for the first month of the tercentenary year and the week of prayer for Christian unity.

24 one hour slots led by a wide variety of churches and organisations. We were overwhelmed by the love and

care with which people responded. Prayers were offered with silence, or with great and joyful noise; we sang Taizé

chants and prayed the Luminous Mysteries of the Rosary; we formed a prayer tunnel to surround one another in

prayer and took part in inter-active prayer stations; teenagers prayed through the night in the comfort of onesies

and just as we were flagging, at 8.00am the Salvation Army turned up with a nine-piece brass band! People dropped

in for minutes and, in some cases, stayed for hours.

The event will now become an annual event in the city, creating a great wave of prayer for our city, region and

world, united in a common faith in Jesus Christ and expressing the diversity of the Christian Church

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Archbishop of Canterbury Visit The cathedral tercentenary was the focus for an inspiring four day, 18 event, visit to Birmingham city and diocese

by the Most Revd Justin Welby, Archbishop of Canterbury, during which he preached at the cathedral, led a

Bishops study day and led the annual Birmingham Prayer Breakfast at the ICC. At the end of the visit the

Archbishop challenged Birmingham to follow its unique vocation to model how people of many faiths and

backgrounds can model living together in peace, to the world.’

Solar Eclipse viewing By happy co-incidence the heavens laid on a spectacular solar eclipse for our tercentenary year. The gathering at

the Cathedral was organised to launch our ‘Something Good’ arts programme and also expressed our desire to

host large-scale outdoor events to bring diverse communities of Birmingham together. A crowd of over 2,000

gathered in Cathedral Square to view the eclipse through our free eclipse glasses, which were shared throughout

the crowd. A wonderful sense of shared awe and wonder was the overarching feeling of the morning.

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Festival of Voices 3 centuries, 3 venues, 3 heritage concerts telling the story of ‘the church which became a cathedral in the town

which became a city’ through drama, music, photography and narrative. We were greatly honoured to have local

historian Dr Chris Upton as narrator for the first two concerts and were greatly saddened by his death. Heritage

Manager Jane McArdle and Canon Janet hosted the final concert of the series.

The Cathedral choir sang a vast range of music from Haydn to the Beatles. Five schools took part singing a

specially composed Opera and part of the Birmingham Cantata and the Wragge, Graham Lawrence and Co

Chorus joined the second concert. Everyone had the opportunity to join in some hymns and modern songs.

The Festival Players were formed to provide short dramatic sketches which punctuated each evening including the

glow-in the-dark Hula Hoop Artist! We were grateful for the support of Lloyds Bank (celebrating their 250th

anniversary), the Limoges Trust and Chris Owen who generously sponsored these events.

Heritage We have been establishing a deeper understanding of the cathedral’s heritage significance and sharing it in as many

ways as possible. Reflecting on the church that became a cathedral in a town that became a city. Working with the

following partners we have broadened the reach of the cathedral’s heritage offer and have extended ongoing

dialogues with partners across the city. We are actively engaging widely. A new history of the cathedral has been

written by Dr Terry Slater and a new Guide Book written. Alongside this a number of films and podcasts has been

created focussing on the story of the cathedral. Delivery of full programme of events for visitors and families took

place with lectures, workshops, “Treasures” events, Open days and walks. The Cathedral took part in

Birmingham’s first Community Heritage Week, Heritage Open Days and The Big Draw. In depth study days with

excellent speakers were held at Birmingham Museum and at The University of Birmingham. Generous funding from

History West Midlands enabled the guide book and the 300 years of Faith film to be produced. Other work has

been funded by the Heritage Lottery Fund.

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Spring Fayre The Spring Fair was held in the grounds of the cathedral in early April, it was the brainchild of the Cathedral

Community Committee who worked hard to ensure its success. Stallholders came from all walks of cathedral life,

choir parents, congregation members, flower arrangers, Traidcraft organisers, Children’s Church as well as

professional stallholders recruited from local Farmers Markets. We made an attractive sight with the gazebos and

decorated stalls. One gazebo proving difficult to erect provided a team building exercise for the numerous people

trying! Thanks to the tireless efforts of volunteers, the fair raised almost £1000 and was enjoyed by all.

Record Bell Ringing

12 valiant ringers started after Morning Prayer and were still ringing at evening prayer. It took approximately 7

hours in total to ring ‘Avon Delight Maximus’ and each ringer had to keep going through the full 7 hours. They did

it! What an achievement – it was a world record.

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Chelsea Flower Show Birmingham City Council’s entry into RHS Chelsea Flower Show 2015 was based on Birmingham Cathedral in

celebration of the Tercentenary. The display, based on the cathedral architecture and features, on Christian

witness in the city and on stories from scripture, brought theology and the arts together in a popular format. The

garden was awarded Gold and Best in Pavilion and the Flower Show offered a week of mission activity by staff and

volunteers in this international arena

Events in Cathedral Square Birmingham Cathedral is uniquely placed at the heart of the busy city surrounded by public green space.

Throughout the year the Square was actively managed by the cathedral to create a safe and welcoming space for all

people, inspired by scriptural descriptions of the heavenly city. 94 charitable, artistic and information events took

place to support the common good and cathedral worship took place more frequently outside during the

renovations. Craft space, an annual opportunity for arts graduates to engage the public with their work, took the

tercentenary as theme to spectacular effect, interpreting the cathedral heritage in stitch, pewter, clay, wool and

printing (photo).

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Deanery Pilgrimages All 13 Deaneries within the Diocese have, or will be, coming to the cathedral on a pilgrimage with Bishop David,

strengthening our family ties and celebrating our shared faith. Those who have been to the cathedral so far have

enjoyed the experience of coming to the cathedral and worshipping together. Many have commented on how

fulfilling the day was for them and how much they enjoyed the warmth of welcome and hospitality of the mother

church of the diocese. The legacy of these pilgrimages from the deaneries is much to give thanks for and much to

build on across the diocesan family.

Photography competition and exhibition More than 50 images were entered into the ‘Faith in Focus’ photography competition. The competition aimed to

encourage a wide range of people to engage creatively with the idea of faith in our city, and was judged by the

Dean, Stacey Barnfield (Director of Edwin Ellis Creative Media) and Jas Sansi (Photographer). A month-long pop up

exhibition at the New Library celebrated the winning images and engaged new audiences. Many photos were taken

by photographers with no prior connection to the cathedral, some of whom have since volunteered to photograph

other cathedral events. The high quality images we received continue to help us tell the story of the cathedral.

Competition Entry: ‘Taking a Leap of Faith’ by Sonia Oliver

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Flower Arrangers Our team of volunteer flower arrangers worked hard to produce wonderful displays in challenging circumstances

this year. Harvest decorations adorned the scaffolding, and despite the limitations on space, the flower arrangers

produced a series of displays, amongst other things celebrating the life and work of Edith Cavell. The volunteer

team also contributed to the ‘Cathedral Treasures’ series with an informative and enjoyable insight into Cathedral

Flower arranging.

Cathedral Choir Through most of the year the Cathedral Choir maintained a rhythm of five choral services per week.

In addition, special services included a service for Passiontide sung jointly with the Choir of St Chad’s RC

Cathedral, Compline sung in various churches in the Diocese, Tenebræ on Good Friday, Ordinations in St

Martin’s Church, Festival Evensong at Temple Balsall for Heritage Weekend, the Annual Justice Service at the Law

Courts, the Advent Procession by Candlelight sung jointly with the Choirs of the Blue Coat School, and two

Festivals of Nine Lessons & Carols. Concerts have included Britten’s Ceremony of Carols in January, two

Tercentenary Festivals of Voices, Fauré’s Requiem in April, a summer concert at St Laurence’s Northfield, and a

concert at St Chad’s Cathedral for the British Organfest Weekend. In October the Choir travelled to our twin

city of Leipzig, singing in the Thomaskirche (where J S Bach was Cantor) and Naumburg Cathedral. Recordings

were made in January for a film, in September for Dan Jones’ specially commissioned Skyline Symphony, and in

December – a carol service for Radio WM.

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‘Something Good’ Tercentenary Arts Festival During the year the cathedral engaged with diverse groups across the neighbourhoods of the city and diocese,

culminating in a spectacular weekend of visual and audio art in cathedral Square. Mohammed Ali, the Arabic graffiti

artist took ‘Nomad’ across the city painting large canvases outdoors and bringing them back to the weekend

cathedral festival (phot). Poet Mandy Ross wrote poetry based on the contributions of the people of Birmingham

that gave further inspiration to Mohammed’s work. Sound artist Dan Jones created a ‘Skyline Symphony’

broadcast at dawn, noon and dusk from the roof tops of the high buildings around Cathedral Square, featuring

Birmingham voices reading Mandy’s poetry. During the weekend we hosted conversations in the Square between

our diverse communities and a carnival atmosphere was enjoyed by thousands of people. This collaborative work

across communities was enabled by, and further facilitated relationships of trust and raised the cultural profile of

the cathedral in the city.

Soul Boats

Artist Jake lever invited the people of Birmingham, of all faiths and none, to create ‘Soul Boats’, through a series of

community workshops, installed in the cathedral December 2015 – March 2016. This great flotilla of 2000 golden

boats hung high in the nave of the cathedral as a beautiful prayer from the people, with hopes and prayers, dreams

and sadnesses inscribed on the inside of the boats, seen only by God. This installation was the culmination of the

Something Good arts festival and enabled the cathedral to demonstrate its ability to unite diverse people around a

common goal and in creating great art. Soul boats amazed visitors and worshippers, attracted much national press

interest and set a high standard for cathedral art installations in the future.’

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Education / School Tours The Education department has continued to expand and thrive within the boundaries of refurbishment work. We

have welcomed parties from schools, colleges and adult local interest groups. The majority of our work is with

children who come to find out about Christianity in the context of the cathedral space. The ten guides who give of

their time and expertise are very experienced in talking with children to give them an understanding of Christian

beliefs and practices. This work is often in the context of children with other faith or no faith backgrounds. Work

has also been carried out in schools where we have led assemblies and historical talks/workshops. An exciting

development for us will be the appointment of a new Education Officer in 2016 to build on our existing

engagement and outreach.

Diocesan Services The Licensing of Readers was the first big service of the year. The cathedral is always full and it is a privilege to

‘launch’ them into this ministry and learn of their faith journeys. Due to the building work within the Cathedral, the

ordinations were moved to St Martin’s and we were delighted that they ran so smoothly thanks to excellent joint

working. The Annual Justice Service was held in the Victorian Lay Courts and the wonderful acoustic lent itself

beautifully to the choir and solo violinist.

In December, amid our busy Advent/Christmas schedule we celebrated Bishop Anne’s Welcome service which

received this feedback from a priest, ‘You struck the right balance between the necessary formality and a delightful

informality. I have been to many inaugurations and this was the least stuffy and most welcoming.’

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Relationships:

Birmingham Cathedral maintains a number of key relationships, in the civic, educational and

theological life of the diocese. Throughout 2015 Cathedral clergy supported events and services

throughout the Diocese on 65 occasions; Cathedral staff also participated in 44 inter-faith events,

and 20 ecumenical events. The Cathedral also hosted in excess of 100 charitable events or

opportunities (such as collecting in Cathedral Square) to support local, national and international

charities. We have forged ever deeper links with partners in Birmingham City Council’s parks

and events departments. Our working relationship with Midland Heart’s Street Link operatives

helps us to offer support and direction to individuals sleeping rough in Cathedral Square. We

work closely with West Midlands Police to ensure the security, safety and enjoyment of all who

visit Cathedral Square.

Cathedral Choir singing at the Annual Justice Service

In 2015, in excess of 64,000 people visited Birmingham Cathedral, despite periods of closure

during the significant internal works project. Of these visitors, over 1,500 were children and

students attending on an organised tour delivered by our team of Educational Guides. We

continue to form close relationships with schools visiting the Cathedral, for educational visits, as

well as Carol Services during Advent. In developing our Heritage Work stream throughout 2015

we have worked closely with Birmingham Civic Society and Heritage West Midlands exploring

our shared heritage and offering opportunities for this to be explored.

During 2015 Birmingham Cathedral received significant funding from Arts Council England and

the Heritage Lottery Fund in order to deliver work through our Arts and Heritage work streams.

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Volunteers

Birmingham Cathedral operates with a significant team of over 80 Volunteers offering their

support in a variety of roles; Visitors’ Chaplain duty; cleaning; welcome desk; heritage and

education guides; stewarding, Warden duty; Bell-ringing; Flower-arranging; Cash counting; Making

Choir Teas; Chaperoning. Between these volunteers, they provide in excess of 6,000 hours of

support to the Cathedral annually.

Congregations

The Cathedral electoral roll has 156 members, and the average annual attendance across all

congregations was 155. In 2015, as a result of building work, 3 services were held outside the

Cathedral. 35 special services were held, along with 12 Diocesan Services (including Readers’

Licencing, and the Welcome Service for Bishop Anne.

Cathedral Community Committee consists of a minimum of nine people elected at the APCM to

represent the views of the congregations. All clergy licenced to the parish, church wardens,

readers licenced to the parish and the Deanery Synod representatives of the parish sit on

Community committee. The committee held a ‘Community Day’ and a successful fundraising ‘Spring Fair’ during 2015.

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Inventory

There were no additions to the Cathedral inventory during 2015. Chapter disposed of 2 Bench

Fronts which were the remains of a matching set, from which the pews had long since been

disposed of.

Fabric Repairs

In 2015 we embarked on an ambitious project to relight, rewire and redecorate the Cathedral.

Whilst this was a project we had planned for 2016/17, generous support from the WW1

Cathedral Fabric Repair Fund enabled us to proceed more quickly than anticipated. Our grateful

thanks are extended to local businesses, grant-making bodies, and our generous congregation for

their support in helping us to meet the financial challenges of bringing this project forward by 12

months! Despite the challenges of this project, the results are an agreeable surprise to all those

who enter, and the Cathedral space has been significantly enhanced with the use of sensitive

lighting, redecoration and careful craftsmanship.

A well-resourced and fully operational building is integral to our strategic plans for the coming

years, enabling us to relate to and serve our local community in a responsive way. Our beautiful

building has been enhanced by sensitive lighting, creating a welcoming and uplifting space for the

people of Birmingham.

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Fundraising

During 2015, the congregation contributed generously to the internal works project. As the

Director of Fundraising began acting into the role of Cathedral Administrator very early in

2015, plans for fundraising were somewhat put on hold. However, we maintained good

relationships with generous local and national funders supporting specific projects. Notable

contributions include;

£500,000 from the WW1 Cathedral Fabric Repair Fund to support Internal Restoration

Work

£25,000 from Edward & Dorothy Cadbury Trust to support Internal Restoration Work

£30,000 from Jerusalem Trust to support Tercentenary ARTS celebrations

£7,500 from The Mercers Foundation to support 12 Deanery Pilgrimages

£10,000 from Lloyds Bank to support Festival of Voices

£25,000 from The Headley Trust to support Monument Repairs

£30,000 from Friends of Cathedral Music to support the work of the Cathedral choirs.

£12,000 from the Westhill Endowment to support ‘Soul Boats’ Art Installation

Our thanks to these and many other funders whose generous contribution supports

these specific projects.

Stewardship giving by our congregations increased, offering us invaluable unrestricted

funding to support the daily work and ministry of the Cathedral.

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Future Plans

Our strategic plans for the coming period of 2016-202 seek to build on the legacy of

our tercentenary experiences. The Mission & Purpose of Birmingham Cathedral:

1 Living Worship: we worship God daily in the steady rhythm of Anglican prayer and in

our corporate worship rejoice in the riches of the Anglican choral tradition. 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. We cherish periods of silence

each day enabling private prayer for our visitors. We celebrate the contribution of the arts to

spiritual life.

2 Growing Disciples: We seek to grow in number and in depth of discipleship in order

to witness to Christ more effectively. We enable people to encounter God and grow in faith

and discipleship by our welcome and through offering pastoral care, and opportunities for

conversation, learning and voluntary service.

3 Connecting Communities: as a place of connection in the city, we work in active

partnership with other churches, institutions and faiths for the common good, to foster

understanding, respect, inclusion and cohesion among the diverse communities of our diocese

and region. To offer a place of safety and hospitality for all.

The mission will be enabled and supported through our commitment to:

1 Care for our building: We conserve, develop and interpret our building and

environment as an icon of Gods holy and loving presence in our city. We strive for the highest

standards of care as an aspect of worship.

2 Sustainable financial growth; we steward our resources prudently and ethically,

with the intention of achieving sustainable growth to support a growing ministry.

3 Good order: we 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.

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Structure, Governance & Management

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

incorporating the Cathedral Measure Act 1999. The statutes were reviewed during 201,

and dated 3rd March 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 Bishop’s appointment). The Chapter is chaired by the Dean.

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. In 2015 two Chapter members and one lay member of staff

attended the training.

o Chapter have adopted two Schemes of Delegation; Delegated Authority form

Chapter to Director of Resources (Cathedral Administrator); and Delegated

Authority from the Director of Resources to other budget holders.

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.

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During 2015 there was no change in clergy. In January 2015 Ruth Harvey left her post as

Cathedral Administrator. Anna Pitt (previously Director of Fundraising) acted into the

role until August 2015 when Chapter made the appointment permanent.

Chapter has commissioned a review of lay salaries, including benchmarking, to take

place in 2016.

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FINANCIAL REVIEW

Financial performance

The Cathedral’s headline income rose to £1,621,796 in 2015 compared to £1,034,660 the

previous year. However this overall income in 2015 figure does includes significant restricted

grants and fundraising for both the tercentenary programme (£114,895) and the interior works

project (£737,525).

On an ongoing basis, the Cathedral’s largest source of income is from investments in equities,

fixed-interest securities and property. The Church Commissioners provide for the stipends of

the Dean and two Residentiary Canons and the Cathedral also receives a grant towards the

cost of the lay salaries. The remainder of its income comes from congregational giving,

donations from visitors, fees for special services and trading income from the gift shop and use

of the Cathedral as a concert venue. This income in 2015 held up well at £400,289 with a slight

decrease of £15,369 against a back drop of challenging investment markets and a cathedral shut

to visitors for certain periods of time during the interior works project.

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

grant making trusts and individual donors who are sharing our mission vision.

Overall expenditure is £ £1,905,865 compared to £1,066,742 in 2014. Our focus on community

outreach as part of our tercentenary programme; together with the interior lighting works

were our major areas of expenditure in 2015. These two areas at £1.2milliom represented 66%

of our total expenditure for the year. Expenditure in the remaining core areas have been

contained at 2014 levels.

This gives an overall deficit for the year of £382,271, which does include spending funds raised

in 2014 towards both the tercentenary programme and the interior lighting project. As a

Cathedral, our key “acid test” of financial health and performance is the result on our

unrestricted general funds which gave us a pleasing surplus of £27,992 for the year.

As noted elsewhere in this report, the interior lighting project was brought forward by a year

in its delivery due to the short term availability of funding from the WWI Cathedral Fabric

Repair Fund. This was a challenging task to manage both operationally and financially. We are

grateful for the support of The Birmingham Diocesan Board of Finance in the provision of a

£200,000 project funding loan.

Transitional adjustments to Financial Statements

We have adopted for the first time this year as required, the financial reporting and accounting

requirements of the updated Regulations on Accounting and Reporting by English Anglican

Cathedrals 2015. This takes into consideration the updated Statement of Recommended

Practice for Charities (SORP2015) which takes into account a number of changes contained

Financial Reporting Standard 102 (“FRS102”), with the restatement of 2014 comparative figures.

The main impact of this new requirement has been the recognition on the balance sheet of our

liability to fund deficit pension contributions to the lay workers’ pension scheme. As at 31

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December 2015, this liability amounted to £11,000. Further details of the pension liability and

the impact of transition to FRS102 and are given in notes 21 and 22 to the financial statements

respectively.

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 £6,287,492 (2014:£6,669,765 restated

after taking into account the lay worker’s pension scheme liability of £32,000), 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 £6,135,496 (2014:£6,198,553). Much of the reminder of the assets shown in the balance

sheet are held in restricted funds and cannot necessarily be used for the general purposes of

the cathedral.

There is currently a historical deficit on the cumulative unrestricted fund, which Chapter are

keen to rectify by robust monitoring of unrestricted expenditure and generation of unrestricted

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

£27,992 in the year has aided the reduction of the deficit to £259,276 as at 31 December 2015.

Reserves Policy

Free reserves are maintained for the following purposes:

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

To provide for emergencies

The reserves policy of Chapter 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”

Due to difficult past economic conditions, the Cathedral continues to find itself with a 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.

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 Development Fund which amounts to £46,702 as at 31 December

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2015. This is likely to be utilised in the forthcoming year towards the cost of a replacement

boiler.

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 2015 restricted funds totalled £335,556 (2014:

£627,052) and endowment funds totalled £6,135,497 (2014:£ 6,198,553). 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 short the valuation went from £3,553,852 to £3,425,648 in the year, a fall of 4.1%. The PII

Balanced Index (which has a higher Bond content) was down by 3.4%. Total income remitted

was £137,845. Yield 3.9% net of tax deductions at source (actually tax credits) on equities

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.

24

Principal Risks and Uncertainties

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.

Chapter has committed to review its Risk Register in 2016 annual risk analysis exercise.

Quarterly 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 5 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. Whilst the resister is still a work in progress, the

headline risks and associated mitigation are detailed below:

Area Mitigation strategies

Operational Risk: Adherence to Health &

Safety Regulations in a large public access

building

New Role of Cathedral Facilities

Manager with responsibility for Day to

Day Oversight of H&S

Health & Safety Review undertaken by Ecclesiastical Insurance alongside

Cathedral Administrator

Financial Risk: Reliance on Investment Income & subject to fluctuations in the

market

Finance & Risk Committee meeting quarterly with responsibility for financial

oversight

Decision to re-tender for Investment

Management in 2016 to ensure best

provision of that service

Governance / Compliance Risk:

Responsibility for Safeguarding of children

and vulnerable adults

Internal Safeguarding Audit in February

2016

Senior staff involved in Diocesan

Safeguarding Review in April 2016.

Review of options for Safeguarding administration within the Cathedral team

Reputational Risk: Negative publicity

regarding Cathedral / Staff / Clergy Sound policies in place for ‘Use of

Cathedral’ both building & Square.

Weekly Staff meetings including

discussion on diary events

Part time Marketing & Comms Manager handling external publicity

Media training for senior staff members

25

Legal/Regulatory Risk: Failure to identify

pertinent changes in laws and regulations

affecting the Cathedral.

Chapter receive regular minutes from

AEC Meeting

Dean actively participates in Dean’s

Conference annually

Cathedral Administrator is actively networked via CAFA with other

administrators and Cathedral HR

practitioners

Annual retention with Keelys for

Employment Law advice

26

Chapter Members

The Very Revd Catherine Ogle

The Revd Canon Janet Chapman

The Revd Canon Nigel Hand

Sandra Bailey

Helen Blundell

Judith Whalley

Richard Brooks

Andrew Harrison (from January 2015)

*Chair of Finance & Risk Committee

Sue Davis (from April 2015)

Anne James (until XXXX)

Members of Finance & Risk

Committee

Andrew Harrison

*Chair


The Revd Canon Janet Chapman

Sue Davis

Melanie Crooks

Anna Pitt

27

Members of Fabric Advisory

Committee


Canon Dr Terry Slater

*Chair

Jeffrey Haworth (until October 2015)

Robert Kilgour

Dr Paul Spencer-Longhurst

Kristina Williamson

James Whiteman (until February 2016)

Clive England (in attendance)

Mary Trumper (Secretary, not voting)

Cathedral Administrator (Director

of Resources)

Ruth Harvey (until January 2015)

Anna Pitt (interim from March 2015,

permanent from August 2015)

Director of Music

Canon Marcus Huxley

Auditors

Dains LLP

15 Colmore Row

Birmingham

B3 2BH

28

Bankers

The Royal Bank of Scotland PLC

79/83 Colmore Row

Birmingham

B3 2AP

Relationship Manager: Colin Kilby

Investment Managers

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

29

Architect

Clive England

Thomas Ford & Partners

177 Kirkdale

London

SE26 4QH

Archaeologist

Richard Morriss & Associates

Bromlow House

Upper Bromlow

Minsterley

Shropshire

SY5 0EA

Structural Engineers

Frank W Haywood & Associates

Oxford Terrace

13 Allesley Old Road

Coventry

CV5 8BU

Investment Advisors

EFG Harris Allday

33 Great Charles Street

Birmingham

B3 3JN

Commercial Property Advisors

David Neale Surveyors

Crosby Court

George Street

Birmingham

B3 1QG

30

STATEMENT OF RESPONSIBILITIES OF THE CHAPTER

The Chapter is responsible under requirements laid down by the Church Commissioners under the powers given

by Section 27 of the Cathedrals Measure 1999 for:

a) Preparing and publishing an annual report and audited accounts which give a true and fair view of the financial

activities for each financial year and of the assets, liabilities and funds at the end of each financial year of the

Cathedral and its connected entities;

b) Stating that they have complied in all material respects with the accounting and reporting regulations for

English Anglican Cathedrals or describing which regulations have not been complied with and giving reasons

for the non-compliance;

c) Selecting suitable accounting policies and then applying them consistently;

d) Making judgements and estimates that are reasonable and prudent;

e) Keeping proper accounting records from which the financial position of the Cathedral can be ascertained with

reasonable accuracy at any time; and

f) Safeguarding the assets of the Cathedral and taking reasonable steps for the prevention and detection of fraud

and other irregularities.

For and on behalf of the Chapter

BIRMINGHAM CATHEDRAL CHAPTER

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF BIRMINGHAM CATHEDRAL

CHAPTER

For the year ended 31 December 2015

______________________________________________________________________________________________

31

We have audited the financial statements of Birmingham Cathedral Chapter for the year ended 31 December 2015 which

comprise the statement of financial activities, the balance sheet, the statement of cash flows and the related notes. The

financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting

Standards (United Kingdom Generally Accepted Accounting Practice) including FRS 102 ‘The Financial Reporting Standard

applicable in the UK and Republic of Ireland’.

This report is made solely to Chapter’s members, as a body, in accordance with section 27 of the Cathedrals measure

1999. Our audit work has been undertaken so that we might state to the Chapter’s members those matters we are

required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do

not accept or assume responsibility to anyone other than Chapter and Chapter’s members as a body, for our audit work,

for this report, or for the opinions we have formed.

Respective responsibilities of Chapter and auditors

As explained more fully in the Statement of Chapter’s Responsibilities, the members of the Chapter are responsible for

preparation of financial statements which give a true and fair view.

Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and

International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices

Board’s (APB’s) Ethical Standards for Auditors. This report, including our opinion, has been prepared for and only for the

members of the Chapter, as a body. Our audit work has been undertaken so that we might state to Chapter members

those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent

permitted by law, we do not accept or assume responsibility to anyone other than the Chapter and members of the

Chapter, as a body, for our audit work, for this report, or for the opinions we have formed.

Scope of the audit of the financial statements

An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give

reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error.

This includes an assessment of: whether the accounting policies are appropriate to the charitable company’s circumstances

and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made

by the trustees; and the overall presentation of the financial statements. In addition, we read all the financial and non-

financial information in the Annual Report to identify material inconsistencies with the audited financial statements and to

identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge

acquired by us in the course of performing the audit. If we become aware of any apparent material misstatements or

inconsistencies we consider the implications for our report

Opinion on the financial statements

In our opinion:

the financial statements give a true and fair view of the state of the Chapter’s affairs as at 31 December 2015 and

of its incoming resources and application of resources for the year then ended;

the financial statements have been properly prepared in accordance with Section 27 of the Cathedrals Measure

1999


INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF BIRMINGHAM CATHEDRAL

CHAPTER


______________________________________________________________________________________________

32

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where we are required to report to you if, in our opinion:

the information given in the Chapter Member’s Report is inconsistent in any material respect with the financial

statements; or sufficient accounting records have not been kept; or the 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.

DAINS LLP

Statutory Auditor

Chartered Accountants

Birmingham


STATEMENT OF FINANCIAL ACTIVITIES


______________________________________________________________________________________________

33

Unrestricted funds Restricted Endowment Total Total

Notes General Designated funds funds 2015 2014

£ £ £ £ £ £

Income & Endowments From:

Donations & Legacies 134,699 1,703 27,127 - 163,529 155,116

Grants in support of mission 21,263 - 1,101,421 - 1,122,684 608,322

Charges and fees arising in the course

of mission

9,677 - - - 9,677 5,676

Trading & Fundraising 29,492 9 7,973 - 37,474 50,269

Income from property and investments 201,988 - 11,049 - 213,037 215,154

Other income 3,170 - 23,602 48,623 75,395 123

─────── ─────── ─────── ─────── ─────── ───────

Total Income 2 400,289 1,712 1,171,172 48,623 1,621,796 1,034,660

─────── ─────── ─────── ─────── ─────── ───────

Expenditure On:

Raising Funds 55,344 - 21,009 - 76,353 137,436

Ministry 195,590 - 236,256 - 431,846 409,728

Cathedral and precincts upkeep 87,188 - 1,024,454 - 1,111,642 412,289

Education and outreach - - - - - 23

Community parish and congregation 47,008 22,612 212,283 - 281,903 103,636

Other expenditure 3,972 - 149 - 4,121 3,630 ─────── ─────── ─────── ─────── ─────── ─────── Total Expenditure 4 389,102 22,612 1,494,151 - 1,905,865 1,066,742

Net incoming/(outgoing)

resources

Before investment gains

11,187 (20,900) (322,979) 48,623 (284,069) (32,082)

Net gains/(losses) on investments 5,6,7 - - 302 (4,504) (4,202) 63,784

─────── ─────── ─────── ─────── ─────── ───────

─────── ─────── ─────── ─────── ─────── Net Income/(Expenditure) 11,187 (20,900) (322,677) 44,119 (288,271) 31,702

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

Actuarial gains/(losses) on defined

benefit pension 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) 31,702

Funds brought forward (287,268) 131,426 627,052

6,198,553

6,669,763

6,638,061

─────── ─────── ─────── ─────── ─────── ─────── Funds carried forward (259,276) 75,716 335,556 6,235,496 6,387,492 6,669,763

═══════ ═══════ ═══════ ═══════ ═══════ ═══════


BALANCE SHEET


____________________________________________________________________________________________

34


Notes General Designated funds funds 2015 2014 £ £ £ £ £ £

FIXED ASSETS INVESTMENT ASSETS Property 6 - - - 1,100,000 1,100,000 1,000,000

Investments 7 - - 135,944 3,418,102 3,554,046 3,837,144 ─────── ─────── ─────── ─────── ─────── ─────── - - 135,944 4,518,102 4,654,046 4,837,144 ─────── ─────── ─────── ─────── ─────── ─────── NON INVESTMENT ASSETS Property 8 - - - 1,165,000 1,165,000 1,165,000 Equipment 9 726 - 8,091 - 8,817 8,410

─────── ─────── ─────── ─────── ─────── ─────── 726 - 8,091 1,165,000 1,173,817 1,173,410 ─────── ─────── ─────── ─────── ─────── ─────── TOTAL FIXED ASSETS 726 - 144,035 5,683,102 5,827,863 6,010,554

CURRENT ASSETS Stocks 1,810 - - - 1,810 2,711

Debtors 11 32,653 - 122,389 - 155,042 52,230 Cash at bank and in hand 103 75,716 294,527 321,836 692,182 831,043 ─────── ─────── ─────── ─────── ─────── ─────── 34,566 75,716 416,916 321,836 849,034 885,984 LIABILITIES DUE WITHIN ONE YEAR

Creditors 12 64,010 - 45,395 - 109,405 161,151

─────── ─────── ─────── ─────── ─────── ─────── NET CURRENT ASSETS 64,010 75,716 371,521 321,836 739,629 724,833

Interfund transfer (230,558) - - 230,558 - - ─────── ─────── ─────── ─────── ─────── ─────── TOTAL ASSETS LESS CURRENT

LIABILITIES

(259,276)

75,716

515,556

6,235,496

6,567,492

6,735,387

LIABILITIES DUE AFTER ONE YEAR

Loans 13 - - (180,000) - (180,000) (48,623) ─────── ─────── ─────── ─────── ─────── ─────── Net Assets excluding pension liability (259,279) 75,716 335,556 6,235,496 6,287,492 6,686764

Defined benefit scheme liability - - - - - (17,000) ─────── ─────── ─────── ─────── ─────── ─────── TOTAL NET ASSETS (259,276 75,716 335,556 6,235,496 6,387,492 6,669,764 ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ THE FUNDS OF THE CATHEDRAL

Endowment funds - - - 6,235,496 6,235,496 6,198,554 General funds (259,276) - - - (259,276) (287,269) Designated funds 14 - 75,716 - - 75,716 131,425

Restricted funds 14 - - 355,556 - 335,556 627,055 ─────── ─────── ─────── ─────── ─────── ─────── TOTAL CATHEDRAL FUNDS (259,276) 75,716 335,556 6,235,496 6,387,492 6.669,765 ═══════ ═══════ ═══════ ═══════ ═══════ ═══════

These financial statements were approved by the Chapter and signed on their behalf on ___________________ 2016


STATEMENT OF CASH FLOWS


____________________________________________________________________________________________

35

Total Total

2015 2014

£ £

Cash flows from operating activities:

Net cash provided by/(used in) operating activities (730,265) (178,455)

Cash flows from investing activities:

Rents received 52,000 58,260

Investment income received 161,662 155,697

Interest & charges paid (149) (138)

Proceeds from the sale of property, plant& equipment - 450,000

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

Proceeds from sale of investments 807,537 435,911

Purchase of investments (628,641) (425,818)

─────── ─────── Net cash provided by/(used in) investing activities 391,403 673,912

Cash flows from financing activities

Repayments of borrowing - 391,984

Cash inflows from new borrowing 200,000 -

Receipt of endowment - -

─────── ─────── Net cash provided by/(used in) financing activities 200,000 (391,984)

Change in cash & cash equivalents in the reporting period (138,862) 103,473

Cash & cash equivalents at the beginning of the reporting period 831,044 727,571

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




____________________________________________________________________________________________

36

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

Total Total

2015 2014

£ £

Net income/(expenditure) for the reporting period (284,069) (32,082)

Adjustments for:

Depreciation charges 599 319

Income added to endowment capital - -

Income from property & investments (213,038) (215,154)

Interest payable 149 138

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

(Increase)/decrease in stocks 901 4,987

(Increase)/decrease in debtors (103,436) 15,862

Increase/(decrease) in creditors (88,746) 47,489

Non-cash movement (42,625) (14)

─────── ─────── (446,196) (146,373)

─────── ─────── Net cash used in operating activities (730,265) (178,455)

═══════ ═══════

Analysis of cash & cash equivalents

Total Total

2015 2014

£ £

Cash in hand/at bank 18,933 18,579

Cash held on deposit 673,249 812,465

Notice deposits (less than 3 months) - -

Overdraft facility repayable on demand - -

─────── ─────── Total cash & cash equivalents 692,182 831,044

═══════ ═══════




__________________________________________________________________________________________

__

37

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 FRS102 for the first time in 2015, all of the accounting policies have been aligned

with the new accounting standard as it applies to Cathedrals. Where these have resulted in a material

change to the amounts, classifications or presentation within the financial statements as at the date of

transition then a transitional adjustment has been made (see note 22) 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 investment 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 results of which are

included in these financial statements. 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 reviews the

carrying valuation of the properties for impairment by reference to the Nationwide House Price Indices.

Depreciation is not charged on the grounds of immateriality. Upon adoption of SORP 2015 (FRS102)

Chapter has 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 assessed by Chapter members.




__________________________________________________________________________________________

__

38

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 FRS102, 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 FRS102 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.




__________________________________________________________________________________________

__

39

Expenditure

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

to 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 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 charged as resources expended represent the Cathedral’s contributions payable in

respect of the accounting period, in accordance with FRS102. 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.




__________________________________________________________________________________________

__

40

2 INCOME AND ENDOWMENTS FROM


General

£

Designated

£

funds

£

funds

£

2015

£

2014

£

Donations and

Legacies

Congregational

collections and giving

83,196 - - - 83,196 81,587

Donations 33,417 - 7,511 - 40,928 41,438

Income from appeals - 703 14,901 - 15,604 1,936

Tax recoverable under

gift aid

17,986 - 1,615 - 19,601 19,870

Income from friends and

local trusts

- - 3,100 - 3,100 -

Legacies 100 1,000 - - 1,100 10,285

─────── ─────── ─────── ─────── ────── ─────── 134,699 1,703 27,127 - 163,529 155,116

═══════ ═══════ ═══════ ═══════ ══════ ═══════

Grants in support of

mission

Church Commissioners - - 276,261 - 276,261 272,924

All Churches Trust 21,263 - - - 21,263 20,500

World War I Grant - - 489,198 - 489,198 -

Heritage Lottery Grant - - 39,200 - 39,200 49,000

Other grants - - 296,762 - 296,762 265,898

─────── ─────── ─────── ─────── ────── ─────── 21,263 - 1,101,421 - 1,122,684 608,322

═══════ ═══════ ═══════ ═══════ ══════ ═══════

Charges and fees

arising in the course

of mission

Facility and other fees 9,677 - - - 9,677 5,676

═══════ ═══════ ═══════ ═══════ ══════ ═══════

Trading and

fundraising activities

Income from lettings of

Cathedral/churchyard

23,923 - - - 23,923 39,043

Gross income of the

shop and other activities

5,569 9 7,973 - 13,551 11,226

─────── ─────── ─────── ─────── ────── ─────── 29,492 9 7,973 - 37,474 50,269

═══════ ═══════ ═══════ ═══════ ══════ ═══════

INCOME

CONTINUED

Income from

property and

investments

Unrestricted

General

£

Unrestricted

Designated

£

Restricted

funds

£

Endowment

funds

£

Total

2015

£

Total

2014

£

Property 52,000 - - - 52,000 58,261

Investments 149,458 - 10,960 - 160,418 155,308




__________________________________________________________________________________________

__

41

Interest receivable on

short term deposits

530 - 89 - 619 1585

─────── ─────── ─────── ─────── ────── ─────── 201,988 - 11,049 - 213,037 215,154

Other income

Insurance recoveries 3,117 - - - 3,117 -

Other items 53 - 23,602 48,623 72,277 123

─────── ─────── ─────── ─────── ────── ─────── 3,170 - 23,602 48,623 75,395 123

═══════ ═══════ ═══════ ═══════ ══════ ═══════

3 PROPERTY INCOME

St Philip’s

House

£

Total

2015

£

Total

2014

£

Rents and Service Charges 52,000 52,000 58,261

Less: overheads - - (8,601)

Less: interest & charges (1,222) (1,222) (3,082)

Less: Service charge on vacant areas -

-

2,585

─────── ─────── ─────── Net income 50,778 50,778 49,163

═══════ ═══════ ═══════

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.

The comparative period included income on 3 Temple Row West which was disposed of during 2014.




__________________________________________________________________________________________

__

42

4 EXPENDITURE ON


General

£

Designated

£

funds

£

funds

£

2015

£

2014

£

Raising Funds

Costs of services directly

recoverable

4,593

-

-

-

4,593

8,105

Gross cost of shop and other

activities

1,784 - - - 1,784 6,491

General marketing costs 1,991 - - - 1,991 1,108

Cost of appeals - - - - - 39,994

Cost of fundraising 6,001 - 9,744 - 15,745 13,634

Investment property costs 1,222 - - - 1,222 9,097

Investment management

costs

7,176 - - - 7,176 6,267

Support costs 32,577 - 11,265 - 43,842 52,740

─────── ─────── ─────── ─────── ─────── ─────── 55,344 - 21,009 - 76,353 137,436

═══════ ═══════ ═══════ ═══════ ═══════ ═══════

Clergy stipends and working

expenses

4,403 - 124,587 - 128,990 124,377

Clergy housing costs 18,843 - - - 18,843 11,586

Clergy support costs 14,438 - 15,739 - 30,177 37,485

Service costs 11,453 - 30,426 - 41,879 57,531

Music costs 113,876 - 54,239 - 168,115 132,001

Support costs 32,577 - 11,265 - 43,842 46,748

─────── ─────── ─────── ─────── ─────── ─────── 195,590 - 236,256 - 431,846 409,728

═══════ ═══════ ═══════ ═══════ ═══════ ═══════ Cathedral and precincts

upkeep

Major repairs and restoration - - 979,690 - 979,690 280,049

Maintenance and interior

upkeep

62,831 - 33,499 - 96,330 93,598

Cathedral insurance 18,927 - - - 18,927 18,095

Support costs 5,430 - 11,265 - 16,695 20,547

─────── ─────── ─────── ─────── ─────── ─────── 87,188 - 1,024,454 - 1,111,642 412,289

═══════ ═══════ ═══════ ═══════ ═══════ ═══════

Education and outreach

Education activities - - - - - 23

Charitable and other giving - - - - - -

────── ─────── ─────── ─────── ─────── ─────── - - - - - 23

═══════ ═══════ ═══════ ═══════ ═══════ ═══════

EXPENDITURE CONTINUED


General Designated funds funds 2015 2014

£ £ £ £ £ £

Community parish and

congregation




__________________________________________________________________________________________

__

43

Tercentenary Events - 22,612 158,671 - 181,283 21,889

Heritage Events - - 39,746 - 39,746 15,762

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

Dean’s awards 291 - - - 291 550

Support costs 6,721 - 13,866 - 20,587 25,439

─────── ─────── ─────── ─────── ─────── ─────── 47,008 22,612 212,283 - 281,903 103,636

═══════ ═══════ ═══════ ═══════ ═══════ ═══════

Other expenditure

Interest and similar charges

payable

3,972 - 149 - 4,121 3,630

─────── ─────── ─────── ─────── ─────── ─────── 3,972 - 149 - 4,121 3,630

═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ANALYSIS OF SUPPORT

COSTS IS:

Support Costs

Raising Funds 32,577 - 11,265 - 43,842

Ministry 32,577 - 11,265 - 43,842

Cathedral and precincts

upkeep

5,430 - 11,265 - 16,695

Community, parish and

congregation

6,721 - 13,866 - 20,587

─────── ─────── ─────── ─────── ─────── ───────

77,305 - 47,661 - 124,944

═══════ ═══════ ═══════ ═══════ ═══════ ═══════ Analysis

Office Rent 23,250 - - - 23,250

Office Running Costs 21,242 - - - 21,242

Staffing Costs 23,010 - 47,659 - 70,669

Governance - Audit 9,081 - - - 9,081

- Non-audit 724 - - - 724

─────── ─────── ─────── ─────── ─────── ───────

77,307 - 47,659 - 124,966

═══════ ═══════ ═══════ ═══════ ═══════ ═══════

The total expenditure for the year of £1,920,865 includes £8,590 irrecoverable VAT.




__________________________________________________________________________________________

__

44

5 INVESTMENT INCOME AND GAINS

Unrestricted

funds

£

Restricted

funds

£

Endowment

funds

£

Total funds

2015

£

Total funds

2014

£

Dividends receivable 120,950 - - 120,950 132,206

Interest receivable 29,038 11,049 - 40,087 24,687

Property income 52,000 - - 52,000 58,261

─────── ─────── ─────── ─────── ─────── 201,988 11,049 - 213,037 215,154

─────── ─────── ─────── ─────── ───────

Realised gains/(losses) - (4,327) 1,173 (3,154) 3,969

Unrealised gains/(losses) - 4,629 (5,677) (1,048) 59,815

─────── ─────── ─────── ─────── ─────── - 302 (4,504) (4,202) 63,784

─────── ─────── ─────── ─────── ───────

Total income and gains 201,988 11,351 (4,504) 208,835 278,938

═══════ ═══════ ═══════ ═══════ ═══════

6 INVESTMENT PROPERTY

Unrestricted

funds

£

Restricted

funds

£

Endowment

funds

£

Total

funds

£

At valuation :1 January 2015 - - 1,000,000 1,000,000

Additions - - - -

Revaluation - - 100,000 100,000

─────── ─────── ─────── ─────── At valuation: 31 December 2015 - - 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 for one hundred and twenty-five years from 25 December 1979. The investment property

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

at 31 December 2015.




__________________________________________________________________________________________

__

45

7 INVESTMENTS

Unrestricted

funds

£

Restricted

funds

£

Endowment

funds

£

Total

funds

£

Investments at market value at 1 January 2015 - 312,174 3,524,970 3,837,144

Additions - - 628,641 628,641

Disposals at opening value - (180,859) (629,832) (810,691)

Net change in market value - 4,629 (105,677) (101,048)

─────── ─────── ─────── ─────── Investment at market value at 31 December

2015

- 135,944 3,418,102 3,554,046

═══════ ═══════ ═══════ ═══════

The investment transactional costs for the year were £7,176 (2014: £6,266).

8 NON INVESTMENT PROPERTIES

Unrestricted

funds

£

Restricted

funds

£

Endowment

funds

£

Total funds

2014

£

Total funds

2013

£

─────── ─────── ─────── ─────── ─────── At Deemed Cost 1 January 2015

and 31 December 2015

- - 1,165,000 1,165,000 1,165,000

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

Deemed

Cost

2015

£

Deemed

Cost

2014

£

For Cathedral use

38 Goodby Road 575,000 575,000

4 Nursery 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 December 2011.

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

previous valuation of the properties as deemed cost.




__________________________________________________________________________________________

__

46

9 EQUIPMENT

Unrestricted

funds

£

Restricted

funds

£

Endowment

funds

£

Total

funds

£

COST

At 1 January 2015 - 8,995 - 8995

Additions 1,006 - - 1,006

─────── ─────── ─────── ─────── As 31 December 2015 1,006 8,995 - 10,001

═══════ ═══════ ═══════ ═══════

ACCUMULATED DEPRECIATION

At 1 January 2015 - 585 - 585

Depreciation charge for the year 280 319 - 599

─────── ─────── ─────── ─────── At 31 December 2015 280 904 - 1,184

═══════ ═══════ ═══════ ═══════ NET BOOK VALUE

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

═══════ ═══════ ═══════ ═══════ At 31 December 2014 - 8,410 - 8,410

═══════ ═══════ ═══════ ═══════

10 STAFF COSTS

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

2015 2014

Clergy 3 3

Vergers 4 5

Music & services 6 6

Administration 4 4

─────── ─────── Total 17 18

═══════ ═══════

Average number of full time equivalent staff

2015 2014

Clergy 3 3

Vergers 2.5 3.5

Music & services 2 3

Administration 3.5 4

─────── ─────── Total 11 13.5

═══════ ═══════




__________________________________________________________________________________________

__

47

Staff costs during the year were as follows

2015 2014

£ £

Salaries and Stipends 344,770 363,412

Employer’s National Insurance 24,967 27,674

Employer’s Pension Contributions 74,974 129,572

Compensation for loss of office 25,000 -

─────── ─────── Total Costs 469,711 520,685

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

Pension contribution costs in 2014 include an element of back dated pension contributions for 4

members of staff.

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 2015 they

were:

The Dean The Very Reverend Catherine Ogle

Canon Liturgist The Revd Canon Janet Chapman

Canon Missioner The Revd Canon Nigel Hand

Director of Resources Anna Pitt – From March 2015

Remuneration, pensions and expenses for these four people amounted to £164,809 (2014: £203,483)

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

Salaries and

Stipends

£

Employer’s

national

insurance

£

Employer’s

pension

contributions

£

Remuneration of members of the Chapter

The Very Revd Catherine Ogle 34,290 3,359 11,310

The Revd Canon Nigel Hand 26,427 2,301 9,048

The Revd Canon Janet Chapman 26,427 2,374 9,048

═══════ ═══════ ═══════

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 provision for, clerical members of the 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 £371 (2014: £1,303) were paid in total to one member

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




__________________________________________________________________________________________

__

48

11 CURRENT ASSETS - DEBTORS

2015

£

2014

£

Trade debtors 4,021 12,788

Other debtors 135,158 26,393

Prepayments 6,574 7,287

Other taxation 9,289 5,762

─────── ─────── 155,042 52,230

═══════ ═══════

12 LIABILITIES DUE WITHIN ONE YEAR - CREDITORS

2015

£

2014

£

Birmingham Diocesan Board of Finance Loan 20,000 -

Trade creditors 21,473 18,330

Other creditors (including Social Security and other taxes) 16,654 42,570

Pension deficit liability 11,000 15,000

Accruals 40,278 85,251

─────── ─────── 109,405 161,151

═══════ ═══════

13 LIABILITIES DUE AFTER ONE YEAR - CREDITORS

2015

£

2014

£

Pension deficit liability - 17,000

Church Commissioners property loan - 48,623

Birmingham Diocesan Board of Finance Loan 200,000 -

─────── ─────── Total borrowings 200,000 65,623

Less: due within one year 20,000 -

─────── ─────── 180,000 65,623

═══════ ═══════ Further to investigation and discussion with Church Commissioners during 2015 it was established that the

property loan previously recognised of £48,623 was no longer a liability of the Cathedral. The reversing of this

loan has been treated as a credit to the endowment funds.

An unsecured loan of £200,000 was advanced by Birmingham Diocesan Board of Finance during the year 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 I Cathedral , this work had to be completed during 2015.

The loan from the 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 4.1% during 2015.




__________________________________________________________________________________________

__

49

Included in the above are the following:

2015

£

2014

£

Amounts repayable otherwise than by instalments - 48,623

Amounts repayable by instalments:

Between 1 – 2 years 20,000 -

Between 2 – 5 years 60,000 -

After 5 years 100,000

─────── ─────── 180,000 48,623

═══════ ═══════

14 ANALYSIS OF FUNDS

Balance b/f

At 1st Jan

2015

£

Income

£

Expenditure

£

Unrealised Gain/(Loss)

on

Revaluation

£

Transfer

between

Funds

£

Actual Profit/(Loss)

on

Disposal

£

Balance c/f

At 31st Dec

2015

£

Designated funds Development fund 46,702 - - - - - 46,702 Education Fund 4,344 - - - - - 4,344 Lighting Fund 34,070 703 - - (34,773) - - Tercentenary,

Merchandise, Marketing

Fund

37,238 9 (22,612) - (37) - 14,598

Fabric Fund 9,072 - - - - - 9,072 St Philip’s Singers Fund - 1,000 - - - - 1,000 ─────── ─────── ─────── ─────── ─────── ─────── ─────── 131,426 1,712 (22,612) - (34,810) - 75,716 ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ Restricted funds Mission & Development

Fund 9,370 51 - - - - 9,421

Belliss Fund 2,643 3,764 (5,358) - - - 1,049 Choir Tours Fund 6,964 27,169 (31,467) - - - 2,666 Music Fund 3,137 2,611 - (3,137) - 2,611 St Philip’s Singers Fund 1,096 - - - - - 1,096 FCM Song School Fund 17,001 687 - (507) (687) - 16,494 Ouseley Trust 7,500 - - - (2,500) - 5,000 Flower Fund 2,836 2,347 (2,358) - - - 2,825 Harridine Bequest 17,212 - - - - - 17,212 St Philip’s Education

(Christchurch) Fund 79,935 1,208 - 756 - - 81,899

Bishop of Birmingham’s

Centenary Appeal Fund 9,508 - - - - - 9,508

Tercentenary Arts Fund 78,268 56,875 (144,551) - 9,408 - - Tercentenary Something

to Share Fund

125 222 - - - - 347

Balance b/f

At 1st Jan

2015

Income

£

Expenditure

£

Unrealised

Gain/(Loss)

on

Revaluation

£

Transfer

between

Funds

£

Actual

Profit/(Loss)

on

Disposal

£

Balance c/f

At 31st Dec

2015

£

Tercentenary Festival of

Voices Fund 206 16,900 (13,766) - (1,200) - 2,140

Lighting Fund 5,582 173 - - (5,755) - -




__________________________________________________________________________________________

__

50

Internal Works Fund - 490,080 - - (490,080) - - Tercentenary Heritage

Fund 33,238 41,120 (39,746) - - - 34,612

The Provost’s Book Fund 3,871 20 - - - - 3,891 Arts Council 328 - - - (328) - - Tercentenary

Celebrations Fund 35 35 (107) - 37 - -

FCM Music Trust Fund 22,531 - - - - - 22,531 Howlett Bequest 15,866 - - - - - 15,866 Church Commissioners

Stipends - 124,587 (124,587) - - - -

Church Commissioners

Section 23

- 151,674 (151,674) - - - -

Fundraising campaign: Campaign Other 255,264 246,649 (979,971) - 530,607 (4,327) 48,222

Mission Fund 11,952 - - - - - 11,952 Music Fund 5,653 - (319) - - - 5,334 Music Endowment 30,000 5,000 - 4,380 - - 39,380 ─────── ─────── ─────── ─────── ─────── ─────── ─────── 627,052 1,171,172 (1,494,151) 4,629 31,181 (4,327) 335,556 ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ Endowment funds General endowment fund 6,198,553 48,623 - (5,677) (7,176) 1,173 6,235,496 ─────── ─────── ─────── ─────── ─────── ─────── ─────── 6,198,553 48,623 - (5,677) (7,176) 1,173 6,235,496 ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════

Unrestricted Funds

General unrestricted fund

(287,268) (344,872) 5,947,531 230,865 (44,890) 188,363 (190,088) 33,450 6,165,231

─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── (287,268) (344,872) 5,947,531 230,865 (44,890) 188,363 (190,088) 33,450 6,165,231

═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════

400,289 759303 5,947,531 230,865 (44,890) 188,363 (190,088) 33,450 6,165,231

─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── 400,289 344,872) 5,947,531 230,865 (44,890) 188,363 (190,088) 33,450 6,165,231

═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════

(387,102) 6 5,947,531 230,865 (44,890) 188,363 (190,088) 33,450 6,165,231

─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── (404,102) (344,872) 5,947,531 230,865 (44,890) 188,363 (190,088) 33,450 6,165,231

═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════

6,000 (344,872) 5,947,531 230,865 (44,890) 188,363 (190,088) 33,450 6,165,231

─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── 6,000 (344,872) 5,947,531 230,865 (44,890) 188,363 (190,088) 33,450 6,165,231

═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════

10,805 (344,872) 5,947,531 230,865 (44,890) 188,363 (190,088) 33,450 6,165,231

─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── 10,805 (344,872) 5,947,531 230,865 (44,890) 188,363 (190,088) 33,450 6,165,231

═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════

- (344,872) 5,947,531 230,865 (44,890) 188,363 (190,088) 33,450 6,165,231

─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── - (344,872) 5,947,531 230,865 (44,890) 188,363 (190,088) 33,450 6,165,231

═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════

(259,276) (344,872) 5,947,531 230,865 (44,890) 188,363 (190,088) 33,450 6,165,231

─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── (259,276) (344,872) 5,947,531 230,865 (44,890) 188,363 (190,088) 33,450 6,165,231

═══════

═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════

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.




__________________________________________________________________________________________

__

51

DESIGNATED AND RESTRICTED FUNDS (CONTINUED)

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

Unrestricted Funds Restricted Endowment Total

General Designated Funds Funds 2015

£ £ £ £ £

Tercentenary, Merchandise,

Marketing Fund to

Tercentenary Celebrations

Fund

1 - (37) 37 - -

Tercentenary, Merchandise,

Marketing Fund to

Tercentenary Arts Fund

2 - (1,200) 1,200 - -

Lighting Fund to Campaign –

Other Fund

3 - (34,773) 34,773 - -

Music Fund to General Fund 4 3,137 - (3,137) - -

FCM Song School Fund to

General Fund

5 687 - (687) - -

Ouseley Trust to General

Fund

6 2,500 - (2,500) - -

Tercentenary Pilgrimages

Fund to Tercentenary Arts

Fund

7 - - 5,184

(5,184)

- -

Tercentenary Festival of

Voices Fund to Tercentenary,

Merchandise, Marketing Fund

8 - 1,200 (1,200) - -

Lighting Fund to Campaign –

Other Fund

9 - - (5,755)

5,755

- -

Internal Works Fund to

Campaign – Other Fund

10 - - (490,080)

490,080

- -

Arts Council to Tercentenary

Celebrations Fund

11 - - (328)

328

- -

General Fund to Tercentenary

Arts Fund

12 (2,695) - 2,695 - -


Fund to Tercentenary Arts

Fund

13 - - (328)

328

- -

Endowment Funds to General

Funds

14 7,176 - - (7,176) -

─────── ─────── ─────── ─────── ─────── Totals 10,805 (34,810) 31,181 (7,176) -

═══════ ═══════ ═══════ ═══════ ═══════

1. This represents the balance of expenditure on the Tercentenary Celebrations fund

2. This represents the release of designated funds to the Tercentenary Arts Fund

3. This represents donations received towards the lighting repairs which expenditure has been charged to

the Campaign – Other fund

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

5. This represents income from the investments towards the cost of Choral Scholars

6. This represents part of the grant received from the Ouseley Trust towards the cost of Choral Scholars

7. This represents the costs of Tercentenary Arts works related to the Tercentenary Pilgrimages

8. This represents the cost of publicity for the Festival of Voices events




__________________________________________________________________________________________

__

52

9. This represents donations received towards the lighting repairs the expenditure of which has been charged

to the Campaign- other fund

10. This represents donations and grants received in respect of the internal restoration works which

expenditure has been charged to the Campaign – Other fund.

11. This represents the balance of the Arts Council grant towards the cost of “In The Marvellous Moment.”

12. This represents a contribution from the Cathedral general funds towards the Tercentenary Arts Fund

expenditure

13. This represents part of the George Fentham Trust grant towards the cost of the Tercentenary Arts Fund

expenditure

14. This represents the costs relating to the purchase and selling of investments during 2015

Designated Fund Purpose

Development Fund This fund is to support future developments and improvements in the

Cathedral and Churchyard.

Lighting Fund

Fabric Fund

Education Fund

Tercentenary

Merchandise/Marketing/Literature

Fund

This fund is to support work to lighting of the building in 2015

The Fabric fund is for the upkeep of the Cathedral’s fabric.

The Education department’s income and expenditure raised by school visits

and other works

This fund is for the purchase of merchandise and marketing material for the

Cathedral’s tercentenary and to support the Marketing Manager’s post

Restricted Fund Purpose

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

the Belliss monument in good order.

FCM Song School and FCM Choral

Scholarship Funds

These funds represent grants from the Friends of the Cathedral Music, which

are devoted to these purposes.

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

and other sources to fund their tours.

St Philip’s Singers Fund This fund comprises money raised by the St Philip’s Singers that will be used

for their needs.

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

choirs and music.

St Philip’s Education (Christchurch)

Fund

This fund is to support the Cathedral’s education work.

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

with his research.

DESIGNATED AND RESTRICTED FUNDS (CONTINUED) Restricted Funds

(continued)

Church Commissioners’ Stipends

Purpose

This fund relates to stipends, employer’s National Insurance and pension

contributions provided for the Dean and the two Canons.




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53

Church Commissioners’ Section 23

This fund relates to a grant provided by Church Commissioners to pay salaries

or emoluments of any lay person employed in connection with a Cathedral.

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

the proposed Birmingham Cathedral Music Trust.

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.

Bishop of Birmingham’s Centenary

Appeal Fund

This fund contains donations raised during the Centenary Appeal towards

improving access and welcome for visitors.

‘B1 Church’ project: This fund consists of income from the St Martin’s Trust, and matching

expenditure on the employment of staff for B1 Church.

Mission and Development Fund

Ouseley Trust


Flower Fund

Arts Council

Harridine Bequest

Tercentenary Arts Strand

Something to Share

Tercentenary Pilgrimages

Restricted funds

(Continued)

Tercentenary Festival of Voices

Lighting Fund

Internal Works Fund

External Works 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.

Grant received towards choral scholarships

Grants received in connection with the Tercentenary celebrations

Funds received specifically towards the provision of flowers in the Cathedral

Grant received towards “In The Marvellous Moment” Christmas art project

A bequest received towards the cost of building a new cathedral

Grants received in connection with arts events to do with celebrating the

Cathedral’s tercentenary

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, Growing Younger initiative run by

Birmingham Diocese and the Cathedral

Grants received to help towards the cost of arranging pilgrimages from all

Birmingham Deanery’s to their mother church

Purpose

Grants and sponsorship received in connection with the three concerts

celebrating the life of the Cathedral over 300 years

Donations and grants received towards the lighting improvements

Donations and grants received towards the internal refurbishment of the

cathedral

Grants received in connection with the external works carried out during 2014

Fundraising campaign:

Music fund This fund consists of campaign donations made to support music in the

Cathedral.




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54

Music Endowment Fund This fund consists of capital fund for income to be used towards the music of

the Cathedral.

Mission fund This fund consists of campaign donations made to support the mission

objectives of the campaign.

Fabric fund This fund consists of campaign donations made to support the fabric objectives

of the campaign.

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 LIABILITIES There were no known contingent liabilities at the balance sheet date.

16 CAPITAL COMMITMENTS

There were no capital commitments which were contracted for but not provided in the financial statements as at

31December 2015 (2014: £nil).

17 OPERATING LEASE COMMITMENTS

At 31 December 2015 the Chapter had annual commitments under un-cancellable operating leases as follows:

2015

£

2014

£

Expire date

Within 1 year - 1,010

Between 2 to 5 years 6,935 1,300

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 2015 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 at 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 Section

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.




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55

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 Statement of Financial Activities in the year are contributions payable

towards benefits and expenses accrued in that year, plus any impact of deficit contributions (see below).

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 Cathedral’s

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

Following the valuation, the Cathedral 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 1.5 years from 1 April 2015 in respect of the shortfall in the

Cathedral sub-pool. This obligation has been recognised as a liability within the Cathedral’s financial statements.

The movement in the provision is set out below.

2015

£

2014

£

Balance sheet liability at 1 January 32,000 46,000

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

Interest cost - 1,000

Impact of change in discount rate used to value the balance sheet liability (6,000) -

─────── ─────── Balance sheet liability at 31 December 11,000 32,000

═══════ ═══════

This liability represents the present value of the deficit contributions agreed as at the accounting date and has

been values using the following assumptions, set by reference to the duration of the deficit recovery payments.

Discount rate

31 December 2013 1.70%

31 December 2014 1.10%

31 December 2015 0.00%

Pension Builder 2014 section.

From 1 July 2015, Birmingham Cathedral (PB 2014) participated in the Pension Builder 2014 Scheme section of

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.

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

at retirement. It is classed as a defined benefit scheme.

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




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56

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 the Pension Builder 2014 section.

The scheme is considered to be a multi-employer scheme as described in Section 28 of FRS102. This means it is

not possible to attribute the Pension Builder 2014 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 Statement of Financial Activities in the year are contributions payable.

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 Church Workers Pension Fund valuation date of 31

December 2016.

19 RELATED PARTY TRANSACTIONS

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

£23,250 (2014: £23,250) in respect of this.

Common fund paid to the Birmingham Diocesan Board of Finance for the year ending 31 December 2015 was

£40,000 (2015: £40,000).

An unsecured loan of £200,000 was advanced by Birmingham Diocesan Board of Finance during the year 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 I Commemoration Fund for Cathedrals, this work had to be

completed during 2015. The loan from the 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 4.1% during 2015.

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:

2015

£

2014

£

Gross income 1,520 2,721

Expenditure 52 71

Amount paid to the Cathedral 8,242 2,000

Funds b/fwd 20,649 19,999

Funds c/fwd 13,875 20,649




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57

21 TRANSITION TO FRS102

This is the first year the Cathedral has presented its results under FRS102 and SORP 2015. The last

financial statements under previous UK GAAP were for the year ended 31 December 2014. The date

of transition to FRS102 was 1 January 2014. Set out below are a reconciliation of the deficit for the

year and the reserves from the amounts previously stated in the 2014 financial statements following

the change in accounting policies.

Unrestricted Restricted Endowment Total


£ £ £ £ £

Reconciliation of

the net income for

the financial year as

previously stated

(Deficit)/surplus as

previously reported

(before investment

gains)

(68,445) 4,588 17,776 - (46,081)

Defined benefit

pension scheme

(14,000) - - - (14,000)

─────── ─────── ─────── ─────── ─────── Net income for the

year under FRS102

(before investment

gains)

(82,445) 4,588 17,776 - 60,081

═══════ ═══════ ═══════ ═══════ ═══════

Unrestricted Restricted Endowment Total


£ £ £ £ £

Reserves reconciliation – 1

January 2014

As at 1 January 2014 – as

previously reported

(257,925) 140,300 636,456 6,165,230 6,684,061

Defined benefit scheme (46,000) - - - (46,000)

─────── ─────── ─────── ─────── ───────

As at 1 January – restated (303,925) 140,300 636,456 6,165,230 6,638,061

═══════ ═══════ ═══════ ═══════ ═══════

Reserves reconciliation – 31

December 2014

As at 31December 2014 – as

previously reported

(255,268) 131,426 627,052 6,198,553 6,701,763

Defined benefit pension scheme (32,000) - - - (32,000)

─────── ─────── ─────── ─────── ───────

As at 31 December 2014 –

Restated

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

═══════ ═══════ ═══════ ═══════ ═══════




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58

Recognition of the liability to fund pension fund deficits on defined benefit pension schemes

FRS102 requires an entity that has entered in to an agreement to reduce the historic deficit on a multi-

employer pension scheme to recognise the liability in accordance with FRS102 section 28,13 and 28,

14A. The Cathedral has a payment plan with the Church of England’s Pension Board to pay the CWPS

deficit over by 2016. Upon transition, the Cathedral has recognised the present value of deficit funding

contributions. As at 31 December 2015 this amounted to £11,000 (2014: £32,000).




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59

22 PRIOR YEAR COMPARATIVE STATEMENT OF FINANCIAL ACTIVITIES RESTATED Unrestricted funds Restricted Endowment Total

Notes General Designated funds funds 2014

£ £ £ £ £

Income and Endowments From: 2

Donations and Legacies 132,800 10,285 12,031 - 155,116

Grants in support of mission 20,500 - 587,822 - 608,322

Charges and fees arising in the course

of mission

5,676 - - - 5,676

Trading and Fundraising 49,869 177 223 - 50,269

Income from property and investments 206,690 - 8,464 - 215,154

Other income 123 - - - 123

─────── ─────── ─────── ─────── ─────── Total Income 415,658 10,462 608,540 - 1,034,660

─────── ─────── ─────── ─────── ───────

Expenditure On: 3

Raising Funds 98,765 - 38,671 - 137,436

Ministry 213,179 - 196,549 - 409,728

Cathedral and precincts upkeep 97,841 - 314,447 - 412,289

Education and outreach 23 - - - 23

Community parish and congregation 56,803 5,874 40,959 - 103,636

Other expenditure 3,492 - 138 - 3,630

─────── ─────── ─────── ─────── ─────── Total Expenditure 470,103 5,874 590,764 - 1,066,74

Net incoming/(outgoing)

resources

Before investment gains

(54,445) 4,588 17,776 - (32,082)

Net gains/(losses) on investments 4,5,6 - - 21,496 42,288 63,784

─────── ─────── ─────── ─────── ─────── ───────

─────── ─────── ─────── ─────── Net Income/(Expenditure) (54,445) 4,588 39,272 42,288 31,702

Gross transfers between funds 14 71,102 (13,464) (48,674) (8,964) -

Other recognised gains/(losses):

Gains/(losses) on revaluation of fixed

assets

Actuarial gains/(losses) on defined benefit pension schemes

- - - - -

Other gains/(losses) - - - - -

─────── ─────── ─────── ─────── ─────── - - - - -

Net movement in funds: 16,657 (8,876) (9,402) 33,324 31,702

Funds brought forward (303,925) 140,301 636,456

6,165,231

6,638,063

─────── ─────── ─────── ─────── ─────── Funds carried forward (287,269) 131,425 627,054 6,198,555 6,669,765

═══════ ═══════ ═══════ ═══════ ═══════




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