PCI Statement of Accounts 2016
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GENERAL ASSEMBLY 2017 2017 ACCOUNTS 2016 FOR THE YEAR ENDED 31 DECEMBER 2016 ACCOUNTS 2016 1 THE PRESBYTERIAN CHURCH IN IRELAND SUMMARY INDEX • Introduction to Accounts 2016 • Accounts of the General Assembly of the Presbyterian Church in Ireland incorporating the financial statements of the Trustees, prepared in accordance with the “Statement of Recommended Practice: Accounting and Reporting by Charities” (FRS 102) • Statement of Liquid Funds • General Council • Council for Global Mission • Council for Mission in Ireland • Council for Social Witness • Council for Congregational Life and Witness • Council for Training in Ministry • Accounts of the Trustees of the Presbyterian Church in Ireland, prepared in accordance with the “Statement of Recommended Practice: Accounting and Reporting by Charities” (FRS 102) • The Presbyterian Church Investment Fund (commonly known as the General Investment Fund) • Trust Estate of Mr John Getty • Local Bible Fund • Old Age, Presbyterian Women’s and Indigent Ladies’ Funds • Sir Thomas McClure Bequest • Presbyterian Church in Ireland Pension Scheme (2009) • Certificate from the General Assembly’s Solicitor regarding deeds held in Church House • Published Bequests for the Presbyterian Church in Ireland • Detailed index 2 ACCOUNTS 2016 ACCOUNTS 2016 3 THE PRESBYTERIAN CHURCH IN IRELAND INTRODUCTION TO ACCOUNTS 2016 The Code, the book of the constitution and government of the Presbyterian Church in Ireland, in paragraph Para 272(11)(b) places a responsibility on the General Council to “prepare and present the annual accounts to the General Assembly...”. This Accounts Book includes three sets of summary accounts, (i) the accounts of the General Assembly of the Presbyterian Church in Ireland which incorporate the accounts of the various General Assembly Councils and those of the Trustees (as detailed in (ii)). (ii) the accounts of the Trustees of the Presbyterian Church in Ireland, which incorporate the various Trust Funds they are responsible for such as the Commutation Fund, Magee Fund, Lindsay Memorial Fund, Crescent Loan Fund but excluding the General Investment Fund. (iii) The Presbyterian Church Investment Fund or the General Investment Fund. The General Assembly’s auditors, Ernst & Young, have given their audit opinion on these accounts. The accounts for the General Assembly and the Trustees have been prepared in accordance with the Charities SORP (FRS102) “Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS102) (effective 1 January 2015)”. The Accounts Book also contains individual accounts for the various activities of the Councils of the General Assembly and these have been grouped by Council. Ernst & Young have attached a report to these accounts to confirm they have been incorporated into the consolidated accounts of the Councils of the General Assembly on which they have given their audit opinion. The Accounts Book includes accounts for the Church Pension Scheme, The Old Age, Presbyterian Women’s and Indigent Ladies’ Funds as well as some other Trust Funds although these do not fall under the direct control of the General Assembly. 4 ACCOUNTS 2016 THE PRESBYTERIAN CHURCH IN IRELAND INTRODUCTION TO ACCOUNTS 2016 COMMENTARY ON THE SORP ACCOUNTS FOR THE BOARDS OF THE GENERAL ASSEMBLY During the year, there was a deficit of income over expenditure (before accounting for any change in the value of investments or the pension liability) of £274,279 (2015 – deficit of £931,671). The deficit for the year reflects the decision to utilise reserves within the United Appeal Fund, the cost of ongoing repair work to Union Theological College and timing differences between the receipt of donations in one year and payment of funds in the following year. During 2016 the value of property decreased by £337,500 reflecting a reassessment of the carrying value of land held by the Retired Ministers House Fund. Investments increased in value by £5,019,194 or by 12.2% on the value at the start of the year. In 2016 there was an actuarial loss on the provision for pension benefits of £14,309,627 (2015 gain of £12,075,966). While there has been a significant improvement in investment values this has been more than offset by an increase in the value of pension liabilities. As a result, overall funds have decreased from £46,098,175 to £36,861,590. The following comments explain the main changes in income and expenditure from 2015. Total Income for 2016 was £25,264,986 compared to £26,266,636 for 2015 i.e. a decrease of £1,001,650 (3.8%). The main changes in income are detailed below; – Income from congregational assessments. This decreased by 8.9% from £7,519,059 to £6,850,687. Assessments for all funds, other than the Pension Scheme Fund, are based on a percentage of a congregation’s assessable income. The assessment bands and rates for 2016 with comparison for 2015 were as follows Assessable Assessable 2016 2015 Assessment Income Income Assessment Assessment Band From To Rate Rate 1 0 10,999 Nil 14.50% 2 11,000 65,000 14.50% 14.50% 3 65,000 130,000 10.75% 10.75% 4 130,000 195,000 7.25% 7.25% 5 195,000 260,000 3.50% 3.50% 6 260,000 And above 0.00% 0.00% ACCOUNTS 2016 5 THE PRESBYTERIAN CHURCH IN IRELAND INTRODUCTION TO ACCOUNTS 2016 In 2016 a nil rate assessment band was introduced. This followed a decision of the General Assembly to transfer the former Central Ministry Fund “annual bonus” payment to ministers of £1,158 per annum into the stipend paid to ministers. The consequence of this was to increase stipend cost at a congregational level but to reduce the payments made through the Central Ministry Fund. Congregations received relief for the additional stipend cost through the introduction of a nil rate assessment band which reduced the amount they had to pay towards assessments. The amount received from congregations for assessments was allocated to the various funds as follows 2016 2015 Central Ministry Fund 38.78% 55.79% Retired Ministers’ Fund 17.10% 9.66% Widows of Ministers Fund 6.84% 0.54% Prolonged Disability Fund 0.57% 0.54% Incidental Fund 15.96% 16.09% Ministerial Development Fund 2.28% 1.07% Sick Supply Fund 0.34% 0.32% Students Bursary Fund 9.12% 8.05% Assembly Buildings Repairs Fund 8.44% 7.94% Special Assembly 0.57% – 100.00% 100.00% The assessment for the Pension Scheme Fund for 2016 was 24.0% (2015, 27.5%) of the stipend paid to the minister during the year. This reflects the outcome of the actuarial valuation of the Scheme at 31 December 2014. The amounts allocated to each of the assessment funds are shown in note 2 to the accounts. – United Appeal income. Total income from congregations (which includes amounts received late for the previous year’s appeal) increased by 1.2% from £3,286,850 to £3,326,067. While the overall appeal target for 2016 was not reached at the cut-off date a further £141,830 (at date of this report) has subsequently been received giving a total of £3,360,082 against the 2016 “Target of Honour” of £3,400,000. – World Development Appeal. In 2016, £591,352 was raised for the Appeal compared to £559,140 in 2015. – Special Appeals. There was no Special Appeal in 2016 but £82,093 was received during the year in respect of earlier Appeals (£79,582 for Nepal and £2,511 for South Sudan). During 2015 £650,695 was raised - £566,675 for Nepal, £89,130 for South Sudan and £2,630 for the Philippines. – Gifts and Donations. Gifts and donations increased from £542,844 to £610,892. – Legacy Income. This decreased from £286,842 in 2015 to £242,950 in 2016. 6 ACCOUNTS 2016 THE PRESBYTERIAN CHURCH IN IRELAND INTRODUCTION TO ACCOUNTS 2016 – Investment Income was largely unchanged - £1,340,565 in 2015 compared to £1,335.385 in 2016. Investment income includes the dividend on investments held by Councils in the General Investment Fund, which was 26p per share in both years. – Residential Homes etc. There was an increase, of 5.7%, in fee income relating to Residential Homes - from £5,615,418 to £5,934,294. The basic residential fee rate received by Homes in 2016 was £494 (from April 2016) which compared to £470 in 2015 (from April 2015) and £461 in 2014 (from April 2014). Occupancy rates remain at a high level in most facilities. – Income from Church Publications. Sales decreased from £231,707 to £212,268 and subscription rates remained unchanged. Advertising income was £31,139 (2015 - £31,170). – Income from Union Theological College fees, excluding those from the Students Bursary Fund increased from £643,553 to £685,409 reflecting student numbers. Total Expenditure decreased by 6.1% from £27,198,307 to £25,539,265. The main points to note are – The Support Services Committee of the General Council agreed that salaries should increase by 1% (pro-rata for part time staff) from 1 January 2016 with incremental point increases applying for years of service. The pension contribution rate from the Church was 24.0% in 2016 compared to 27.5% in 2015 for those eligible to join the Presbyterian Church in Ireland Pension Scheme (2009). An auto-enrolment pension scheme was introduced on 1 February 2014 in accordance with regulations with the church contributing at the rate of 6%. – The expenditure of the General Council decreased from £5,874,291 to £5,215,877. This includes the expenditure incurred through the various assessment funds. The reduction is mainly due to the aforementioned transfer of the Central Ministry Fund “annual bonus” payment into the stipend paid to ministers.