The call in action
REPORT AND ACCOUNTS
for the year ended 31 January 2017
churchmissionsociety.org
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) TABLE OF CONTENTS
3 Chair of Trustees’ Report 4 The Strategic Report of the CMS Trustees 4 Introduction 6 Mission Partners 9 Pioneer Mission Education 11 Church and Community 13 Mission Grants 14 Local Partner Programme 17 Enabling Mission Network 19 CMS Strategic Priorities 20 Structure, Governance and Management 25 Financial Review 29 Statement of Trustees’ Responsibilities 30 Independent Auditor’s Report 32 Consolidated Statement of Financial Activities 33 Consolidated and Charity Balance Sheet 34 Consolidated Cash Flow Statement 35 Notes to the Financial Statements 63 Reference Details of Charity and Advisers
2 Church Mission Society - The call in action CHAIR OF TRUSTEES’ REPORT
Once again it is my pleasure to report a good year working with the team in Oxford as well as meeting mission partners, community members and other faithful supporters, in my work as Chair of CMS trustees.
CHARLES CLAYTON on governance matters at the appetite you use a big spoon!’ beginning of the year from Partnership for Missional one of the foremost lawyers in Church (PMC) enables e give thanks to the field and all trustees have individual church members God for all the continued to take a full part and congregations in the UK generous gifts we in the scrutiny and support W to become missional disciples have received and it is good of the work of CMS. A special and is going from strength to to be able to report that we thanks must go to the chair strength. We have received will not need to draw down of our finance committee, good reports from those Professor Ian Jones, who has from our reserves this year. starting on year two, and have just stepped down from the All teams have worked hard three new dioceses signed up to role. This is one of the most to reduce expenditure and a undergo the process. new committee is developing intensive committees to serve the offer we make to churches. on, with the need to review and The mission education team Rather than only a ‘one monitor the legal, charitable saw a very good year with missionary size fits all’ offer, and financial implications of the MA Pioneer programme we hope to interest churches the policies and operation of continuing to grow and now to support an area of work or CMS. Ian served as chair with including a cohort of three perhaps one of our hardworking diligence and humour and we African students. In addition, local partners. The following are sorry to lose his service at a new training hub has begun pages will introduce a few of the end of the year. at the St Cedd Centre in Chelmsford. This will be a these people, who have been Over the last year we have centre for pioneering mission serving faithfully in their own seen work opening up in and will provide training, locations – some of them for Guatemala and Honduras, as encouragement, networking many years. well as two more countries and sharing of good practice in South East Asia; it is good The new trustees have bedded for those who want to reach out to see CMS continuing to in well with some good training into their communities in new expand into countries we ways. have not worked in before. Dennis Tongoi, the director The team has worked hard to of our sister mission society produce a new look to all our CMS-Africa, has reported publications and presentations that people are realising they and, by and large, it has been do have resources and can well received. In addition the change their circumstances. FREE.IN.DEED campaign was One African archbishop, for taken to numerous Christian example, has enabled the festivals, events and churches planting of a million trees in and saw in excess of 1,700 his diocese! Many new Bishops people pledge to put their call being appointed in Africa have into action. been through CMS-Africa’s All in all it has been another training and they are hoping stimulating year and we all look to influence 50 million families forward to seeing what God has into self-sufficiency by 2050. in store for us in 2017-18. Dennis said, on a recent visit to the UK, ‘When you have a big Charles Clayton
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 3 THE STRATEGIC REPORT OF THE CMS TRUSTEES - INTRODUCTION
The Trustees present their report along with the financial statements for the year ended 31 January 2017.
Objectives and Activities
What do we want to see? Our Vision Our vision is to see all God’s people engaged in God’s mission, bringing challenge, change, hope and freedom to the world.
As we join in God’s mission, through Jesus and in the power of the Spirit we see that:
The love of Christ renews people and places
Pioneering leaders forge new paths of transformation
People on the margins flourish
The healing of creation begins
Who are we? Our Identity We are a community of people set free to follow God’s call in mission.
As a community it is God’s mission that is our passion. Our common commitment is:
To participate in mission
To learn from mission
To pray for mission
What are our values? We are people who are:
Pioneering: we try new things, ask questions, cross boundaries
Evangelistic: we share Jesus in word and action
Relational: we get alongside people, becoming a genuine part of the communities where we find ourselves
Faithful: where others have left or given up, we remain committed for the long haul
As a mission community God calls us to be such people. We commit ourselves to live by these values
4 Church Mission Society - The call in action What do we do? Our Call Our call is to see people set free to play their part in the mission of God.
God calls people, both individually and together, to engage in his mission. Our focus is to see both individual disciples and communities of disciples set free to play their part in the mission of God. Our third priority expresses our desire as a community to be as effective as we can be in delivering the first two. Thus we will work to set people free to play their part in the mission of God by:
Raising disciples in mission
Partnering churches in mission
Maximising our effectiveness in mission
Achievements and Performance The following stories illustrate some of the achievements in each of CMS’s areas of activity and celebrate both the impact for individual beneficiaries and the wider benefits for society as a whole To achieve our mission, we work through the following six mission activities:
Mission Partners: Our mission partners are members of the community who feel called to serve alongside local Christians in other cultures, wherever in the world that may take them.
Pioneer Mission Education: Wherever in the world the mission of Jesus takes place, the church needs pioneer mission leaders to break new ground. This fresh and innovative training programme currently offers certification up to MA level and is particularly for those working in pioneering contexts.
Church and Community: We believe in every member of the Church being involved in the mission of Jesus. Over 2,800 CMS members currently live in the UK, so we are concerned for mission locally, as well as in the rest of the world.
Mission Grants: Grants provide seed money and on-going financial support for key projects and ministries.
Local Partners: Local partners are gifted, passionate Christian leaders in Asia, Africa, South America and the Middle East. We assist the churches of those who cannot afford the entire support for this pioneering work.
Enabling Mission Network: CMS is committed to seeing indigenous CMS missions established globally – enabling local mission leaders to follow God’s leading. This network includes CMS Africa, AsiaCMS, CMS New Zealand, CMS Ireland, CMS Australia and SAMS USA
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 5 MISSION PARTNERS
We are thrilled by people responding to God’s call on their lives. As part of this call we currently have 141 mission partners, 132 mission associates; and 20 short termers. In 2016 our mission partners worked in 32 countries. Mission partner numbers show a small decline compared to the previous year. CMS has begun implementing its new recruitment strategy to reverse this decline. This strategy focuses on the areas of proactive recruitment, increased engagement with local churches, a strong and engaging presence at Christian festivals, and measures to shorten the time from selection to deployment. “Our people in Four People in Mission (PiM) conferences were held during the year: two in the UK, one in Uganda, and one in Turkey. These are vital times of mission are training encouragement, building community, reflection and training for PiM. Our two in-house CMS cross-cultural training conferences called forMission for new leaders and making short term volunteers and mission associates were held again in multi faith environments: one in Southall, the other in Bradford. disciples, caring The International Mission strategy continues to be implemented with defined for people at risk, strategic priorities for Asia, Africa, South America, Europe, Middle East and North Africa. This involves CMS working in new pioneering contexts caring for creation, and countries. Our people in mission are training leaders and making disciples, caring for people at risk, caring for creation, promoting peace and promoting peace reconciliation and promoting economic sustainability. and reconciliation We have attracted more people in mission to Latin America and the Middle East over 2016. While we have placed people in more marginalised contexts and promoting in Africa (such as Gambella in Ethiopia) it has been particularly challenging in South Sudan, owing to the political turmoil within the country. Mission economic partners in Africa have been working on informed advocacy to reduce FGM sustainability.” (female genital mutilation) in African countries, training new cohorts of mission leaders and improving maternity services in rural hospitals. In the Middle East and North Africa we have strengthened our cooperation with the Diocese of Jerusalem and placed more people there and in Lebanon. (For example Archbishop Suheil has appointed a CMS mission partner as the vicar of All Saints Beirut.) We have also developed a leadership training programme with an MA certificate in Cairo in partnership with Diocese of Egypt, Vision International University and Europe Middle East Ministries. In 2016 CMS changed its focus from just South America to include other parts of Latin America in its future development. One significant milestone was celebrated in April 2016 with the launch of the whole Bible translated into Enxet, one of the indigenous languages in the Chaco of Paraguay by a long term mission partner. CMS has also engaged more in Brazil as people have engaged with the poor in the favelas through church planting and community development and working with young girls in high risk situations. In Asia we sent several short termers and new mission partners to Nepal and our mission partners in India are continuing to educate and support churches and individuals to halt trafficking of vulnerable people. This is becoming part of the mission focus of the local church along with equipping local leaders to be engaged in holistic mission. In Pakistan we are continuing to support the long term theological development of women and a new initiative has begun in Cambodia.
6 Church Mission Society - The call in action God’s mission in Gambella The Anglican Church in Gambella, Ethiopia, is growing rapidly thanks in part to a large influx of Sudanese refugees. For a long time there was only one Anglican church in Ethiopia, in Addis Ababa. By 2012 there were 53 Anglican churches, which were mostly set up by refugees who fled conflict between Sudan and South Sudan in the 1980s and 1990s and shared their faith among other refugees and local Ethiopians. Today, with a further 300,000 South Sudanese refugees who have crossed into Gambella since December 2013 (doubling the population) there are about 90 Anglican churches, including 35 to 40 in refugee camps throughout the area, while others are in villages and towns. These churches are currently served by just 17 clergy, only one of whom has a theological degree. In 2016, Chris and Suzy Wilson moved to Gambella to help train church leaders at St Frumentius Anglican Theological College. The following is from their first report: The intense heat, the numerous mosquitos and scorpions, and the threat of snakes, amid other challenges made our first few weeks here somewhat overwhelming. But Gambella is beginning to feel more like home. It is beautiful. The impressive Baro River passes through the town and freshly caught fish is served at restaurants. The marketplace is vibrant and bustling one of the few places where you will find highlanders, Nuer, Anuak and Opo people together. On the church compound where we live, a myriad of stunning birds can be found among shady trees. There are plenty of colourful butterflies and lizards that our daughter Abigail loves to chase. In the distance the highlands can be glimpsed. We have planted papaya, mango and banana trees around our house and although we will wait a few years for the fruit, the prospect of investing that amount of time here feels natural and exciting. Chris has been teaching two courses at St Frumentius. There’s a great bunch of students and it’s a Above: Ruth privilege to be working with them. Slightly more than half are refugees from South Sudan; others are Sayers in Ethiopians from the Gambella region. The college is unusual in that it’s the only place, as far as we Plymouth know, where Anuak and Nuer students are gathering daily to worship, pray and study together. Many Below: Chris and people in Gambella believe the two ethnic groups should live, worship and study separately. Suzy Wilson in A highlight of the week is our evenings of food and fellowship with some Mabaan students. They Ethiopia are South Sudanese refugees who all hope to go back and help further establish and strengthen the church in their home country. Our times of worship together have always lifted our spirits. It is exciting that these humble and inspiring men are being further equipped to help lead the church in South Sudan. In studying with them, our eyes are being opened to how much of the Bible is about people who are displaced, and how these texts can encourage those who find themselves in similar situations. Chris once asked the students what they thought of Moses as a leader. One student – a refugee – answered that when you find yourself leading a church of people who have fled into the bush and have no food or water, there’s a lot you can learn from Moses. Suzy spends the days taking care of Abigail and Matthew. We really want to invest in friendships, which requires us to learn Anuak, a very difficult language. However, we are enjoying our lessons. There are lots of days when it feels easy to be here, and there are times when we wish we were somewhere else. But we are confident that, for now, we are just where we should be.
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 7 God is moving through people movements The following is written by a couple who are helping to train people in mission for challenging North African contexts: Several months ago, we sat in our team’s training centre in Europe with a group of around 10 people who had joined us from around the Muslim world to learn more about people movements. The seminar shared some keys to helping people make communal – rather than individual – moves towards Christ. This is something that is happening with considerable momentum in certain parts of the world. Just weeks before hosting this training, we welcomed a new staff couple into our team. H is a Kabyle Berber from North Africa and is a living testimony of just such a people movement. Over the past 20 years, thousands of Kabyle people have come to faith in Jesus. Many recognise their calling to share their knowledge of Christ, both locally and to “the ends of the earth”. H has joined us because he wants to be part of communicating the gospel to other North Africans. It is not easy for H and his wife B (who is European) to leave their people, culture and language and to become part of our multi-cultural team. We cannot overestimate the significance of North African believers participating with workers from other parts of the world to enable people to encounter Christ – it is both very significant and very challenging. Please pray for all of us to learn from one another in humility and love. We believe we are laying the foundation for more partnerships between western and North African believers, so that the grace shown to the Kabyle Berbers can be experienced by other people groups in the region. For example, we would love to see Algerian Kabyle Berber believers working among the Tuareg of Niger. The indigenous Berbers have retained their own culture and language over centuries and are revered by the Tuareg people. Kabyle believers could be part of the key to unlocking the Tuareg in large numbers to the Lord. Pray for this movement of cross- pollinating believers across the Sahara region.
Olympic opportunity The Olympic and Paralympic Games in Rio de Janeiro, Brazil, provided the Church Mission Society team at Christ Church with many chances to carry a torch for the gospel. Alex and Jane Cacouris and Jess and Mark Simpson report: After an initial lukewarm interest, the nation really got behind the Paralympic Games, captivated by the gritty perseverance and passion of the competitors. As a church it was fantastic to applaud those in our community with disabilities and to think about how to involve them more actively in church life. There’s a man in the church, Willy, who has Down’s syndrome and is 27, and for various reasons he would never stay in the main church service, but “We can often take for rather head out to join the children’s church gathering. After talking with him, he was able to ‘graduate’ from children’s church and is now helping granted what others in the main church service. gasp for in their lives: It was so encouraging for us as a church community to host up to 50 new people from around the world during the Games. With coffee and love, happiness, joy” cake tables at the back of church, we extended our welcome to various
8 Church Mission Society - The call in action visitors, including relatives of competing athletes and personnel involved in cultural events. On Super Saturday of the Olympics and Super Sunday of the Paralympics we hosted two Family Fun Days in the grounds of the church, which contain an open-air basketball court. At the heart of these was the chance to invite the community to celebrate life, see what church looks like and, we pray, give them a glimpse of what God is like. The Christ Church family put on an amazing couple of parties with crafts, face painting, games, balloon sculpting, a trampoline, a big screen television showing the Games, candy floss and a barbeque that saw over 300 people come along, of which half do not attend church. After the first festival a lady who is not a Christian, texted: “Thank you for probably one of my best afternoons ever. So many lovely people, so much love, so much happiness. My boys and I loved it. My heart was so happy this afternoon. Thank you.” We can often take for granted what others gasp for in their lives: love, happiness, joy. This whole experience has been a huge boost to the congregation. Off the back of the fun days we ran another Alpha course with about 20 people as well as a Messy Church nativity event.
PIONEER MISSION EDUCATION
During the year 97 students studied with CMS on the pioneer course. This included 27 on postgraduate programmes, 40 on undergraduate programmes, and 15 ordinands. Nine students graduated, two were ordained and three admitted as lay pioneers. Fourteen students have joined the first year of the St Cedd Centre in Romford – the first pioneer hub and they are piloting the new CMS certificate in pioneering mission. Ten mission partners completed a term’s study with CMS and the programme underwent a review after its initial year.
Above left: a Record enrolment street in North The 2016 academic year has seen a Africa record number of students enrol on Above right: Church Mission Society’s Pioneer Mission Olympic outreach Leadership Training course – with a total at Christ Church, of 28 new people signing up to train as Rio mission pioneers, mission ordinands and lay pioneers. This represents a significant Right: Pioneer increase from previous years. graduation 2016 Jonny Baker, director of mission education at Church Mission Society and pioneer training programme leader, said: “This year’s intake
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 9 is a fabulous endorsement of the quality of the training that Church Mission Society provides and a recognition of the effectiveness of pioneering as an authentic mission route.” The course – designed by pioneers for pioneers – aims to equip Christians for ground-breaking, Below: The St transformational and sustainable mission both in the UK and around the world. Cedd centre’s first intake of students This year’s intake is an eclectic bunch – including Will, who is developing a mission community house on a new estate, and Anita, who leads a town centre chaplaincy team. Tracey works with children and families in a semi-rural context and Jo is considering how to blend mission and business on a Derbyshire housing estate. Nick ran a ‘pantomime church’ for 11 years and has now set up an arts centre. There are also three African-born students on the MA programme; they are exploring how to do mission in a multicultural UK context. Since the course began in 2010 it has seen a steady increase in numbers, reflecting a surge of popularity for pioneer ministry.
New pioneer learning hub opens in Essex In October 2016, a new pioneer learning hub opened its doors to receive its first intake of students, who are embarking on a journey to become mission pioneers. The St Cedd Centre for Pioneer Mission is a joint initiative between Church Mission Society and Chelmsford Diocese. Based at the Church of the Good Shepherd in Romford, it will train locally-based mission pioneers and entrepreneurs. There are 14 students doing this 18-month training programme, which has been developed by CMS and an implementation group from St Cedd’s. The programme is divided into six modules, covering a range of topics, including the Bible and mission theology, mission entrepreneurship and spirituality. Alongside classroom studies, students will also work on a pioneering mission initiative of their choice. The Bishop of Chelmsford, the Rt Rev Stephen Cottrell, said that establishing St Cedd’s reflected the strategic need to shift more resources towards mission pioneers, whose focus is “the world as it could be” rather than “the church as it is”. Opening this centre is a key element of CMS’ long-term plan to equip a new generation of mission pioneers. Future hubs are being explored in other parts of the country.
SHARING FAITH & In my own experience, applying skills of listening has fostered more discussion, respect, and depths of LEARNING TO LISTEN conversations and relationships, than my practice of evangelism ever has. ‘Evangelism’ and ‘listening skills’ are most often separate workshops on training schedules. Budding Which leads me to consider, is there a way in which evangelists are tutored in speaking, declaring and these two skills might be brought together as we Anvil arrives telling the good news of the gospel of Jesus Christ. share our faith? Listeners are coached to enable others to tell their Three recent encounters for me highlight the need to own story; to ask questions which clarify meaning explore this question more deeply – in thought, and in and to journey with the speaker as they make their lived experience. own discoveries. Church Mission Society is now home My first encounter happened during the middle of our Both practices are valuable for mission and ministry. 11pm – 1am churches together outreach where we give Yet rarely, are they set alongside each other. Rarely are out hot drinks for free in the middle of our town. The to Anvil: Journal of Theology and connections made between the two. Yet, also rarely, in team aims to be a consistent, loving Christian presence, my own experience, has any conversation, evangelistic and though not evangelistic in design, the prayers or not, had any value, unless there has been listening. said before and after the outreach are for people to, somehow and eventually, come to faith. Mission, which will be published SO WHY THE SEPARATION? On what was a fairly quiet evening, a man, who looked Much depends, as ever, on our tradition and formation. between 35 and 40 received his hot drink, and appeared The evangelistic training I mostly received has been to want to chat more. He began to share some of his online three times a year. The based upon the verse in 1 Peter 3: ‘Always be prepared current life situation. Some of it involved a dilemma of to give an answer.’ Over the years I have been furnished whether to send his child to a faith school or not. Some SHARING FAITH with diagrams, set-phrases, defensive arguments, of it was reflecting on his own experiences of church new-look edition was launched plans for how to share my testimony, and well-honed as a child. Some of it was around how he and his wife metaphors which all relay something of the biblical ANVIL were struggling a bit at Journalthe moment with of three Theology young and Mission narrative. Some of these tools have been helpful, children. Some of it was around how he isn’t really AND LEARNING particularly when evangelism has been encouraged enjoying his job. in early November 2016 at as part of a specific event or outreach; when ‘telling the gospel’ has been part of my own, and my hearers’ Whilst listening in to this conversation, I was startled by expectations. However, in everyday conversations, the way in which one of our team members responded churchmissionsociety.org/anvil these tools have felt rather awkward as I’ve tried to to what had been said. It followed something like this: TO LISTEN shoe-horn them in. This style of training has meant Man: ‘I’m really not sure what to do about sending my kids that, for me, thoughts of evangelism are often to a faith school or not.’ accompanied with a level of fear – a sense that I need to The theme was Learn, Pray and Team: ‘Well it’s all to do with what you think about Jesus.’ revise my answers in case I get it wrong. My training in listening, however, has nurtured a desire Man: ‘Yeah I mean, I did go to church as a kid. There’s a Participate in Mission. Anvil’s for openness and discovery – of the world getting good school down the road, or the faith school’s further bigger as I engage with another. It has taught me to away. My wife isn’t bothered, but…’ respond to the other person, rather than direct them. Team: ‘You mean, she has no faith? I guess you just need to To ask questions and wait for answers rather than be pray for her, we’ll pray for her if you like.’ editorial team includes Cathy Ross, quick to give them. For me, walking with another and Man: ‘Yeah it’s a bit tough at the moment, we just don’t see listening to them and to God with and for them, has each other that much’ felt like a more loving experience. Many involved in Jonny Baker, Craig Holmes and Tom mentoring, coaching and counseling are promoting Team: ‘We’ll definitely pray. Do you ever go to church? You ANVIL: Journal of Theology and Mission listening skills more than ever – recognising them as might find some kind of support there? It’s so good to be essential to transformative encounters in conversation somewhere you can learn more about God and who Jesus VOL 33, ISSUE 2 and relationships. is, and what he did for us on the cross. I know that’s why I Wilson as book reviews editor. 1 Beth Rookwood Beautifullove church. You Witness: should go!’ evangelism
33 ANVIL: JOURNAL OF THEOLOGY AND MISSION 1 See for example Keith E. Webb, The Coaching Workshop for Christian Leaders,www.creativeresultsmanagement.com , 2015 – VOLUME 33: ISSUE 2 used by Fresh Expressions to train Missional Coaches. VOL 33, ISSUE 2 CHURCHMISSIONSOCIETY.ORG/ANVIL – MISSIONAL ENTREPRENEURSHIP 34 10 Church Mission Society - The call in action CHURCH AND COMMUNITY
In 2016-17 over 50 new members joined the 2,803 members of the CMS community and there were 21 Encounter trip participants. Also More than 60 churches in the UK are currently participating in Partnership for Missional Church. The CMS rebrand was launched in June 2016 with the new website and the new flagship publication The Call. We are delighted with the look and focus of our rebrand and the way in which the communications team have delivered it. The response from our various stakeholders has largely been very positive. The number of media opportunities to share about Church Mission Society’s work has continued to increase thanks to the work of our PR consultant, including good public profile opportunities for Philip Mounstephen as leader of CMS. These include UCB radio, Premier Radio, local BBC Radio and online blogs. The community team in Oxford continued to connect with many members around the country, encouraging them in their passion to pray for mission, learn from mission and participate in mission through participating in various local, regional and centrally organised events. The team have also been working to develop a CMS community handbook (a guide to our community life with a rhythm of prayer and more) which CMS launched in March 2017 and to conduct a feedback survey for members. “The community team In the summer we launched ‘FREE.IN.DEED’ at a number of festivals: a in Oxford continued campaign to help people recognise God’s call to mission on their life and set them free to live it out. The campaign has been communicated to connect with many across print and digital communications and people have been encouraged to explore their call with the FREE.IN.DEED web app. Over members around the 1,700 people have engaged with the campaign, exceeding our target of country, encouraging 1,000. Following the November 2015 launch of the St Cedd Centre, our first them in their passion regional pioneer hub outside of Oxford in partnership with Chelmsford to pray for mission, Diocese, we ran a Lent course there attended by over 50 lay people interested in exploring pioneer mission. Since then thirteen people were learn from mission selected to join St Cedd’s learning community and commenced the CMS certificate award course in October 2016. Already we are seeing and participate in that learning from the course is being practically applied by students mission...” to their new pioneering mission projects. The potential for starting other regional hubs has also been explored and fruitful dialogue has ANVIL commenced regarding a hub in the north of the country. Journal of Theology and Mission We have now completed a full year of delivering Partnership for Missional Church in Oxford and Durham dioceses. Partnership for Missional Church (founded by Church Innovations) takes churches on a three year mission journey: noticing God’s activity and discovering the joy of joining in. We have continued to advocate for this process at senior diocesan level in a number of places and it continues to be highly valued where it is offered. Both Oxford and Durham have agreed to continue with the three year process with another set of churches, and three new dioceses have indicated they would Beautiful Witness: evangelism like to start the process in 2019. VOL 33, ISSUE 2
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 11 FREE.IN.DEED succeeds Christian festivalgoers during summer were delighted by the Church Mission Society FREE. IN.DEED stand, which proved to be one of our most engaging ever. Staff and volunteers who represented CMS at five Christian festivals, including Big Church Day Out, New Wine and Greenbelt reported a marked lack of reluctance as they invited people to have their ‘mugshot’ taken as if in a police line-up. But rather than ‘putting them away’, we invited them to be ‘set free’ to pursue their own mission call. Participants were initially asked to select a preferred location, area of focus and skill from a list of options. “It was a pleasure to feel people really did want to find their calling and think about their passion,” reported one volunteer. The positive vibes were borne out by the numbers. The total of 1,781 people who took part in FREE.IN.DEED easily surpassed the goal of 1,000. They received followup emails tailored to their interests, with links to a personalised FREE.IN.DEED web page. The recruitment team followed up some participants by phone. Thomas Fowler, church mission manager at CMS, said, “It is too early to map the impact on recruitment, fundraising and community membership but we hope to build on the impact of The Mission Experiment, our 2015 festival stand, which has already been a contributor to a 100 per cent increase in recruitment enquiries from the previous year.”
“Going organic” with Partnership for Missional Church Bishop Andrew Proud has seen the deep change Partnership for Missional Church provokes and has become a champion of the process. A cluster of churches in his area are now almost halfway through this three-year journey of discovering and joining in with what God is doing in their community. He spoke to Church Mission Society, which recently began hosting and running Partnership for Missional Church in the UK: What makes Partnership for Missional Church different is that it is not a take-off-the- shelf programme that you can complete in six months but a much more organic, intuitive thing. It is something you need to keep working on and as you work on it, it is going to change you. The church as a whole needs Partnership for Missional Church because we’re in a sticky position. The Archbishop of Canterbury has said that for the first time the numbers of people attending church in our country is below a million and in 30 years that’s going to halve….We’re going to need to be thinking differently about ministry for mission. Partnership for Missional Church is to my mind just the process that we need to engage a changing environment where we don’t know what the future is going to look like in five years’ time, let alone 10. Above: People I’m enthusiastic about PMC because it’s enjoyed aimed at getting deep culture change in a ‘mugging’ for congregation – it’s not a quick fix. The change the camera and I have seen so far is in the quality of the considering conversations that we have when we dwell in mission at the word together, when we talk about God at festivals work together. People are talking theologically Left: Rt Rev in a way in which they never imagined that Andrew Proud, they could. We are seeing lay people growing in Bishop of confidence, talking about what they are seeing Reading and PMC God doing. advocate My hope is to see confident churches where
12 Church Mission Society - The call in action the lay people’s ministries are of equal importance to that of the clergy, congregations that are outward looking, and working beyond the walls of their churches with people in the local community who like them want to make a difference, and recognising God is deeply involved with all of that and to see these people rejoicing that they are doing what God is doing. My hope for the communities around the church is to discover a new sense of hope and purpose: to be less anxious about things like isolation and identity and discover a stronger sense of who they really are. One of the lovely things about Partnership for Missional Church is that it focuses on us as Christians remembering whose we are; I think one of our key missional tasks as a church is to help people beyond the walls of the church to discover what it means to be truly human. I think the result is going to look different in every place where God’s people are growing and flourishing. I am just trusting that it’s going to be good.
MISSION GRANTS
During the year support for 69 projects totalled more than £0.5m across Africa, Asia, Europe, Middle East and Latin America. These grants support work serving a variety of strategic partners around the world; some support projects where CMS mission personnel currently serve as well as projects and partners where CMS has had a long–term relationship and donors and individual supporters continue to fund the work. These grants included one that used a large legacy to renovate a hospital maternity ward in Uganda, another grant to support a programme for vulnerable and HIV positive people in Tanzania. In Asia we continued to support and develop the SACYN (the South Asian Christian Youth Network); which goes from strength to strength. In the Middle East we supported the Diocese of Jerusalem hospital Al Ahli in Gaza, and the Holy Land Institute for the Deaf in Jordan. In Latin America we have helped resource a big conference for the Northern Argentina AMARE (Mothers’ Union) group, providing mattresses and other essentials.
Young Asian Christians creatively address accessibility In July 2016, nearly 50 young church and mission leaders from India, Nepal, Sri Lanka, Bhutan, Myanmar, Bangladesh and Pakistan travelled across borders and over mountains to meet in the lap of the Himalayas at Nagarkot, Nepal for this year’s South Asian Christian Youth Network (SACYN) leadership conference. SACYN, which holds a conference and leadership training programme annually, is a strategic partner of Church Mission Society and Asia CMS. Former CMS regional manager for Asia, Adrian Watkins, (affectionately known as ‘the father of SACYN’) helped set up the network 14 years ago.
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 13 This year’s delegates – aged between 18 and 30 – gathered for six days; the conference theme was Accessible South Asia: creative responses for mental health and differently-abled people. In addition to worship and workshops, the programme included presentations by experts in physical and mental disorders. According to the Asia CMS website, the 2016 theme was selected due to awareness that mental health issues are on the rise. Delegates confronted the issue of stigma and proposed solutions for people who are differently-able – often incredibly marginalised in their societies – to participate with dignity in God’s kingdom. Church Mission Society’s Raj Patel, regional manager for Asia, and Mark Berry, community mission mobiliser, attended. Mark described the event as “forward-thinking”. He explained: “Being differently-able is a growing issue in the majority world. It is a challenge for the church: how do we see people who are differently-abled? How do we value people as ‘different’? But rather than setting about ‘solving the problem’ of disability, this conference focused on celebrating people who are differently-able: their life, their journey and how God is working through them.” The conference included field trips to see God at work in surrounding areas, including a visit to Sundar Dhoka church, which provides support, care, financial assistance and rehabilitation for people who are differently-able. Mark summarised: “In addition to a change in mind-set towards differently-able people, there were thoughtful, simple touches to make the building more user-friendly. This included wider doorways, ramps and moveable rugs to give wheelchairs enough space for worship. Differently- able people don’t have to worry and can just be themselves.”
LOCAL PARTNER PROGRAMME
This programme supports local mission leaders in Asia, Africa, South America, Europe, the Middle East and North Africa in pioneer settings and there is much potential to expand it further in the future. We are conducting a review of the Local Partner Programme which will be completed during 2017. There were 63 Local partners in 28 countries with local partners in reasonable numbers now in each CMS region. The calibre and work of these local partners is excellent. In Africa and Asia the selection of Local Partners is done in close collaboration with CMS-Africa and AsiaCMS respectively who are developing these programmes regionally. The spectrum of their ministries is diverse and highly relevant for their specific contexts. They range from peace and reconciliation in D R Congo, developing the CMS-Africa Samaritan Strategy in Tanzania, developing refugee support in Jordan, leadership training in Nepal, church planting in Romania, indigenous leadership training in Argentina, and combating sexual abuse of children in Sri Lanka.
14 Church Mission Society - The call in action Promoting peace after terror In the wake of the April 2015 terror Left: SACYN attacks on Christian students at Garissa conference University in Kenya, many were fearful delegates discuss and angry. “There was talk of retaliation, disability even among some church leaders,” said Right: Garissa Duncan Olumbe, the Kenyan leader of attack memorial Mission Together Africa (MTA). service Among the 142 students killed at the Below: Pakistani university were a number of Christian youth with a Union members who were at a prayer message meeting. Duncan and his team visited several Christian Unions to support and encourage them. “We wanted to promote a different message than the prevailing angry rhetoric,” said Duncan. “Our message was that we need to love our enemies while at the same time preparing adequately so we can increase security and understand how to respond after terror if it happens.” Duncan and his colleagues took this message to approximately 10 Christian Unions and various FOCUS (Fellowship of Christian Unions) Kenya events. “Many of the Christian students who were so traumatised started being encouraged to reflect deeply on these matters. As we approached the first anniversary of the attacks, it was encouraging to see the slow but sure healing progress that a number of Christian students and parents affected are experiencing. It is humbling to have been a part of this process.” MTA, which connects African Christians with opportunities and resources for cross-cultural mission, continues, in partnership with FOCUS Kenya, to work towards the development of a “Christian Security Handbook and Response Mechanism to Terror”. Duncan says, “We are committed to helping raise an appropriate biblical response to terrorism in colleges and churches.”
Young people in Pakistan bring disability stigma to centre stage Young people in the rural Sindh, Pakistan, are using theatre to reduce the stigma surrounding disability. And hundreds of people are getting the message. “Disability is taboo here,” says L, a local partner who heads up the Primary Education Project (PEP) in the rural Sindh. “There is no approval in society for those who have mental or physical disabilities. It is felt the only way to survive is to be shut away from society. The families of disabled people feel shame.” L reports that a young group of graduates from the PEP schools of Khowaja Goth are determined to inspire communities to stop treating disability as a taboo, because they believe people with disabilities are just as important as other members of society. “These graduates have joined together from the 12 PEP schools of Khowaja Goth and formed a theatre group that serves to raise awareness on different social issues in rural Sindh. Their recent theatre on disability left the audience in complete awe. “A total of 1,066 students from the community watched the performance along with other community members. Audience members were asked to do a self-assessment of how they perceive and treat disabled people, and sadly many of the people accepted their participation in making disability a taboo. They promised to work on their behaviour towards disabled people and encourage disabled children to join PEP schools.”
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 15 PEP promotes peace and harmony through working with local communities to provide education in Pakistan’s most ignored, impoverished and marginalised places. To date, more than 100 village schools have been started, along with other empowerment programmes.
Training church leaders for rural Chile Written by local partner Bishop Abelino Apeleo: There are around 40 churches in Araucania, the Ninth Region of Chile. There is great socioeconomic diversity among the churches and they tend to be isolated. Every year the archdiocese of Araucania sets itself the great challenge of training leaders. The objective is to strengthen pastoral care in these remote congregations. We recognise that stable, growing churches are those with their own pastor or at least a trained leader. On the contrary, others are in danger of stagnation or closure because they lack pastoral care. It is a worry that many rural leaders are now elderly. For these reasons we run an annual training course at the Rural Bible Institute and invite leaders with sufficient experience in their local churches to attend. They are generally eventually ordained to pastoral ministry. We visit churches throughout the year, looking for faithful people with a desire to serve the Lord. It has never been easy because candidates are normally married and working to support their families. So we must ensure financial help for them. We currently have three students in the 2016 intake. Jose Luis travels the furthest. His home in Repocura is around 100km from Temuco. There is a bus from his community once a day but it is hard to get to. Jose Luis travels home just once a week to see his wife and children. Roberto is about 30km from Temuco and also lives in a community where travel is slow. He also has to leave his family. Omar lives in another city around 30km away and travels in daily as he has three children and needs to take care of their education and other needs. Classes are held from Monday to Thursday. The four days are intense and students are expected to work on demanding research projects. It has been a most enriching experience for us pastors and lecturers to get to know the candidates and to encourage them in their calling.
Lights, camera, gospel in action A Church Mission Society local partner working in the Middle East and North Africa has helped produce an evangelistic film depicting the life of famous fourth century Christian theologian and philosopher St Augustine. Son of Her Tears was filmed in North Africa and released in October 2016. Plans for distribution throughout North Africa are going forward.
16 Church Mission Society - The call in action ENABLING MISSION NETWORK Left: a church in a remote parish in Chile The CMS mission network continues to collaborate in mission with its Below left: filming Son of Her Tears emphasis on the sending and receiving of mission personnel, training Right: Shaping local leaders, and equipping the church in cross-cultural skills. mindsets: We continue to invest through major Denise Katungu Mission Support Grants to CMS Africa Kahamba (left, and AsiaCMS as they develop their CMS in blue), a mission entities. Both CMS-Africa and mother of four, AsiaCMS have developed a portfolio of in her Kinshasa excellent training programmes and built pharmacy, which strong regional partnerships. AsiaCMS she now runs on continues to develop and provide high the principles quality training programmes in Asia of ‘business as such as: the Asia Gateway training mission’ after based in Kuala Lumpur for leaders from going through many Asian nations, Reconciliation several CMS- and Conflict transformation training in Africa training Nepal, and SACYN training for younger programmes. mission leaders focusing on mental Below right: health and disability. CMS-Africa has Chhinho and launched a major building project which Kang San Tan in is intended to make them financially Cambodia self-sufficient. CMS-Africa’s ministry of training in holistic transformation and economic empowerment is flourishing and they are now developing an integrated portfolio, bringing together their different training streams in a more coherent way. There was a successful network meeting in Santiago Chile in November 2016. This was combined with a meeting of the South American Mission Society (SAMS) International network and both were parallel to the House of Bishops’ meeting of the Province of South America. Some of the members stayed on for the Provincial Synod at which resolutions were passed to study further the subject of International Discipleship and to explore the possible formation of a CMS Missional Community in Latin America.
Asia CMS helps equip Cambodian mission leaders Asia CMS’s goal to see mission leaders in Asian countries equipped to reach their own people with the gospel is gathering pace with a joint training venture recently completed in Cambodia. Asia CMS teamed up with Chhinho Saing, founder and director of Shalom Mission Cambodia (SMC), and held a Missional Leadership Training event in May 2016. Together with Chhinho, who is also an Asia CMS local partner, Asia CMS executive director Dr Kang San Tan and training director Loun Ling Lee taught training sessions held at SMC’s School of Ministries in Phnom Penh. There were two training courses: one on Mission of the Church in Asia: Contemporary Challenges
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 17 and Issues and the other on Missional Leadership in a Buddhist Context. About 25 pastors and church leaders from SMC churches came for the first course and an additional 20 from different organisations and churches for the second. Chhinho explains: “Cambodia is 95 per cent Buddhist and most of us Christians are converts from Buddhist backgrounds, but before the course we had little real understanding about Buddhism and even less about the best approaches to Buddhists with the gospel.” Churches in Cambodia are young – both in history and faith and are crying out for training. Chhinho oversees 32 churches planted by SMC in nine provinces throughout Cambodia. His vision is “to plant a church in every province in Cambodia, and develop true disciples of Jesus Christ who will transform their communities holistically”. Chhinho said: “Dr Kang San and Loun Ling gave us space for reflection and group work which enabled us to think about our real life experiences, difficulties and possible solutions, which we had never done before. Now we are much more confident about raising spiritual issues with our fellow Cambodians and explaining how they can know Jesus as their saviour.”
CMS-Africa builds for sustainability CMS-Africa is closer to its vision of making mission by Africans economically sustainable. Building work is underway on a new nine-storey office block in Nairobi, which includes rentable space to generate income. Like many building projects it has been a long journey to reach this point. One of the biggest challenges for CMS-Africa has been finding the right investors so it was an answer to prayer when a partnership with Truestone Impact investment company, and a number of Kenyan investors, was finalised earlier in the year. The building project is also underpinned by an appeal by CMS-Africa called the Footprints campaign. The building will house CMS-Africa’s offices and training centre (CMS-Africa’s key strategy is training and capacity building for transforming mission) on one floor, while the income received by renting out other floors should allow CMS-Africa to become financially autonomous and to support CMS-Africa missionaries working throughout Africa. CMS-Africa international director Dennis Tongoi said: “Growth in Christianity in Africa is largely attributable to western missionaries. To sustain this in the face of shrinking mission resources from the west in light of global economic downturn, there is a need to put in place mechanisms for continued missionary work that would ensure sustained impact of Christianity. “The Footprints campaign seeks to transform lives for the better by ensuring continued engagements with the church not just today but in years to come. Now more than ever in its eight-year history, CMS-Africa is determined to execute strategies that will ensure millions of people across Africa and beyond develop home grown solutions to address their needs.” Above: Dennis Tongoi
18 Church Mission Society - The call in action CMS STRATEGIC PRIORITIES 2016-17 SAW SIGNIFICANT DELIVERY ON THE ORGANISATIONAL STRATEGIC PLAN.
Progress made on 2016-17 What we said we would do strategic priorities
Deliver the ‘Free.In.Deed’ campaign in the This campaign was delivered in the summer context of the development of the recruitment and autumn of 2016 and engaged over 1,700 strategy people, helping them to explore their own calling into mission
Deliver the newly designed CMS branding with The new CMS brand was successfully launched associated revised publications and website in June 2016. All CMS publications were reviewed and streamlined into two main publications. This included the release of CMS flagship publication, ‘The Call’. A new website has also been developed and created
Develop and pilot an impact assessment system The impact assessment group has successfully completed its pilot year. A system is now in place to assess the impact of our mission partners. Following a review of the pilot year, which is currently underway, we will undertake a systematic assessment of each of our programmes. The local partner programme was the first to take this assessment in early 2017
Expand the local partner programme The number of local partners has not grown in the year due to funding constraints. This programme still remains a strategic priority, and the ambition to expand it in the future remains a key strategic priority
Engage strategically with a number of dioceses A full year of delivering Partnership for to facilitate the roll out of Partnership for Missional Church in Oxford and Durham Missional Church (PMC) and the development of dioceses has been completed. A number of new Pioneer Hubs dioceses began the process to take it on in the future
Monitor performance against a new range of key This is now in place. A rigorous review of our performance indicators (KPIs) KPIs is undertaken by the senior management team and trustees every six months. This clearly identifies the areas of our work which need attention
Strategic priorities for 2017-18 As we move into year two of our five year organisational strategy we continue to implement its key elements. One of our key aims for the upcoming year, following our review of our KPIs in 2016-17, is the need to
19 Church Mission Society - The call in action align our funding base with the different areas of mission we are involved in. This is highlighted in the below table. The five year strategy sets out CMS’s aims for the period 2016 to 2021, and at its heart the strategy is seeking to do three things:
Raise Disciples in Mission Partner Churches in Mission Maximise our Effectiveness for Mission
We will be tracking progress against these objectives through the use of KPIs. In the broader context of the delivery of the organisational strategy the particular foci in 2017-18 will be as follows:
2017-18 strategic priorities The continued embedding, and planning for the long term expansion, of the local partner programme Expansion of our pioneer work, including establishing a pioneer hub in the North of England, youth pioneer training and degree provision within the pioneer leadership programme The transition to a new donor database (ThankQ) during the year Mobilise and sensitise the UK church to mission through the MissionIS campaign Revise our fundraising strategy to ensure our funding model better aligns with the breadth of mission CMS is engaged with. Develop and deepen our partnership with Asia CMS and CMS Africa
Longer Term CMS’s vision is to see all God’s people engaged in God’s mission bringing challenge, change, hope and freedom to the world.
The organisational strategy sets out a clear strategy for the period to 2021, organised under the three headings above. We are quite clear this is an agenda that needs to be measured, hence the setting of KPIs and the development of an impact assessment framework. We can therefore be confident in our stewardship and that we are achieving high levels of economy, efficiency and effectiveness (which equals value for money). We are also clear that this is an agenda for growth, giving CMS the opportunity to make an ever greater impact and to ensure its ongoing sustainability. STRUCTURE, GOVERNANCE AND MANAGEMENT
Legal Status Church Mission Society is a registered charity (England and Wales (RCN: 1131655), and Scotland (RCN: SC047163)) and a company limited by guarantee (Company Number 6985330) established as a Charity and Company Limited by Guarantee on 8 August 2009. Charitable Objects Church Mission Society’s object is as a community of people in mission obeying the call to God, to proclaim the gospel in all places and to draw all peoples into fellowship with the Lord Jesus Christ. Patron The Most Rev and Rt Hon Justin Welby, Archbishop of Canterbury
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 20 CMS governance arrangements CMS is an Association of Members, whose business is governed by its Memorandum and Articles of Association and by a Board of Trustees. The Trustees of CMS aim to have high standards of accountability as well as proper and ethical performance of their duties. The process for appointing the Board of Trustees is as follows:
The Board of Trustees of CMS is made up of up to 15 CMS members elected by the CMS membership (including not more than three co-opted members) with a Chair appointed by the Board
The elected members of the Board of Trustees are subject to a fixed term appointment of four years, with the opportunity to be elected for one further term. Elections take place every two years
Co-opted trustees are subject to a fixed term appointment of two years, renewable a maximum of twice
The Chair of Trustees is selected by the Board of Trustees following a public recruitment and selection process.
The Board of Trustees meets four times a year, including one meeting focussing on trustee development. This is part of the wider induction and training process that is in place for trustees which includes consideration of governance, Board operations, the role of trustees, organisational strategy, the CMS ethos and risk management.
The Board has established two sub-committees each with specific terms of reference, these are:
The Finance Committee The Community Life and Mission Committee
The Finance Committee reviews all aspects of finance, fundraising and monitoring performance, the human resources (HR) function and facilities, charity law and regulation and information technology (IT). In this the committee is advisory, making recommendations to the whole Board. For the more technical areas of accounting, auditing, investment and property, the committee exercises insight, aligning decision making with expertise and knowledge. The Community Life and Mission Committee develops and reviews all aspects of CMS community life including international and UK mission. The committee is advisory, making recommendations to the whole Board. THE BOARD OF TRUSTEES
The Trustees of CMS are also its legal company directors. A list of the trustees who served during the year and up to the date of signing of the accounts are included below.
Member of The Member of the Finance Community Trustee Committee Life and Mission Committee Mr Charles Clayton (Chair) Dr Jonathan Brant (Chair) Mr Craig Hampton Mr Peter Hyatt (Chair for 2017) Prof Ian Jones (Chair/member to December 2016) Mrs Dione McDonald
21 Church Mission Society - The call in action Dr Salim Munayer Rev Jane Shaw Rev Ian Wallace Mr Anthony Bargioni Mr Beauman Chong Mrs Lonah Hebditch
The Chair of Trustees is responsible for ensuring the members of the Board of Trustees collectively contribute the broad range of skills and experience necessary for its effectiveness. The Trustees are responsible for developing strategic vision, articulating policy, managing risk and ensuring effective governance. The Board is assisted in implementation of policies and strategies by the Executive Leader who is supported by the wider CMS Senior Management Team. In addition to trustees, both committees (Finance Committee and Community Life and Mission Committee) have co-opted members from the CMS community. CMS Senior Management Team Executive Leader Rev Canon Philip Mounstephen Director of International Mission Rev Paul Thaxter Mission Director for Latin America Rt Rev Henry Scriven Director of Church and Community Mission Mrs Debbie James Director of Mission Education Mr Jonny Baker Director of Fundraising for Mission Mr Jim Barker Director of Finance and Corporate services Mr Charles Walker
The Executive Leader is responsible to the Board of Trustees for the management of CMS. He leads the Senior Management Team, which is shaped around the following responsibilities:
International Mission – responsible for CMS engagement in international mission in partnership with churches, and other agencies of mission worldwide, including members of the CMS Mission Network* Church and Community Mission – connecting with and supporting CMS members and churches enabling them, in a variety of ways, to engage in mission both globally and locally Mission Education – overseeing the selection and formation of people in mission, both as Pioneers and as Mission Partners Fundraising – broad base fundraising from individuals, churches, trusts and major donors Finance and Corporate Services – supporting CMS with expertise in finance, ICT, HR, facilities and legal compliance
*The CMS Mission Network is a network of independent and interdependent CMS mission agencies sharing the same values and vision and engaging in their own distinctive way to ensure that mission is from everywhere to everywhere. In 2016 this network consisted of CMS, CMS Africa, AsiaCMS, New Zealand CMS, CMS Australia, CMS Ireland and SAMS USA. Key Management Personnel Remuneration Policy The board of trustees and the senior management team (SMT) are the key management personnel of CMS, in charge of directing and operating the charity. All trustees give of their time freely and no trustee remuneration was paid in the year. Details of trustee expenses and related party transactions are disclosed in note 15 to the financial statements. Salaries of all staff, including the SMT, are reviewed annually taking inflation and the overall financial position of CMS into consideration. Remuneration levels are also benchmarked with Croner’s charity pay and benefits report every four to five years to ensure that the level of remuneration set for key management is in line with roles in similar size organisations.
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 22 Fundraising CMS has three sources of donation income to sustain its mission, these are; Churches, Individuals and Trusts. The income from these sources is split 43% Churches, 50% Individuals and 7% Trusts. There is also income from legacies, kindly left to Church Mission Society, by supporters in their will. This equates to between 10 and 20 percent of our total income in any one year. The balance is from other income such as education fees and trading income. During the year CMS spent £842k (10.9% of total income) on fundraising activity and the majority of this effort concentrated on raising support for CMS mission partners. During 2017/18 CMS will be revising its fundraising strategy to include plans on communicating, and fundraising for the other core areas of work, such as the local partner programme, and the pioneer leaders programme undertaken by Church Mission Society. Use of Volunteers The Church Mission Society is a membership society and relies heavily on the voluntary support of its members and others as community members, trustees and committee members, in local members groups, in mission service globally and locally as advocates for CMS in churches, and in working in the offices in Oxford. Public Benefit In compiling this report, Trustees have given due regard to the public benefit guidance as issued by the Charity Commission. As ‘a community of people in mission obeying the call of God to proclaim the gospel in all places and to draw all peoples into fellowship with the Lord Jesus Christ’, CMS works out its Public Benefit in a number of ways. CMS believes the Christian faith is of benefit to society, and individuals, bringing a vision of transformation for peace and social harmony which grows from what Christians believe is God’s ultimate purpose: to bring all things into unity and perfection in Jesus Christ. People are likely to become disciples of Jesus if Christians “live a Christ-like life amongst them, share the good news of Jesus, demonstrate God’s love and prayerfully expect the Spirit’s power to transform individuals, communities and whole nations”. CMS seeks to demonstrate this benefit through its wide range of mission activities both in the UK and internationally as detailed throughout the Strategic Report. Trading Subsidiary On 1 February 2015, a wholly-owned, newly incorporated, trading subsidiary, CMS House Enterprises Limited (a company limited by guarantee - Company Number 09376700) began to trade. This subsidiary is undertaking trading activities such as conferencing and shop sales that may not otherwise fall within CMS’s primary purposes. It is expected that any surpluses generated within CMS House Enterprises Limited will be gifted to CMS in accordance with the Gift Aid requirements. During the year, the directors of CMS House Enterprises agreed to close the main shop operation, which ceased trading at 31 January 2017. Details of results are described in note 28 to the financial statements. Risk management policy and internal control The Trustees manage the internal and external risks to CMS through the regular review of the financial position and internal control environment. CMS operates a comprehensive annual planning and budgeting system and any significant changes to these plans are subject to the specific approval of Management and Trustees. The financial reporting system compares results with these plans on a monthly basis. A formal risk management process has been developed and Trustees continue to consider the principal risks to which CMS is exposed, assess the likelihood of the risks occurring, and the level of impact the risks pose. They have also considered the controls in place for these risks and have identified any necessary areas for action. In a rapidly changing world, with extremists putting mission personnel in all parts of the world in increased danger, the principal risks identified by the Board now include the need for an enhanced crisis response capability. Current risks and the corresponding mitigating controls are set out below, in no order of priority: Income As a charity, CMS is dependent on the continuing financial support of its donors. The fundraising team continue to implement their recently developed strategy. Gathering and sharing the stories of
23 Church Mission Society - The call in action CMS’ mission activities is a key focus within the strategy to continue, grow and renew this support along with the continued additional diversification of our income base. Pensions CMS’s defined benefit schemes are open to risks on their liabilities and assets as a result of changes in life expectancy, inflation, discount rates, future salary increases and the value of investments. The impact of any negative movements in the pension scheme is likely to result in increased repayments from CMS. These schemes are now closed to new members and closed to future accrual. CMS works with the pension scheme trustees and its own actuarial consultants to understand and mitigate these risks wherever possible. Recruitment An inability to attract high quality mission partners would lead to difficulty in sustaining CMS’s current financial model and a high priority is therefore given to the recruitment of personnel across all teams in CMS. Reputation Damage to reputation is a risk for any organisation and particularly important for a charity. Well- developed communication and safeguarding processes, both internal to CMS and with network partners, are key to minimising this risk. Violent Crises In response to the increasing awareness of the security issues faced by CMS mission partners, robust security procedures have been put in place, security training has been rolled out to relevant high risk personnel and a Crisis Management Team, with clear contingency plans for emergencies, has been implemented.
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 24 FINANCIAL REVIEW
The report and financial statements of Church Mission Society group (CMS), consolidates the results of Church Mission Society, The Church Mission Society Trust, The South American Mission Society (SAMS) and CMS House Enterprises Ltd. The financial context within which CMS operates is challenging and this is likely to increase with the uncertainty of Brexit looming. The charitable and mission agency context is competitive, and despite a growing UK economy there has been a reduction in the general fund giving of individuals, churches and trusts across the sector. Despite the political uncertainties of 2016, however, the financial markets have performed strongly. CMS listed investments portfolios performed strongly during the year with a capital return of £373k, which has more than offset the negative returns experienced in the prior year. Total income in the year, however, has dropped. The review below provides some more detailed analysis.
Donations and Legacy Income
Donations from Donations from Legacies William Leech Donations from churchs and individuals Benefactions grant making groups trusts
Incoming Resources Total incoming resources were £7.7m (2016: £8.4m) a reduction of £0.7m from the previous year. Donations and legacies income reduced by £0.8m to £6.6m in 2017 (see note 3). The main reasons for the reduced income were a reduction in legacy income (£0.6m) and donations from individuals (£0.2m) Donations from churches have seen a marginal reduction in the year, but giving from individuals has reduced by £236k (9%) compared to the previous year. This is largely as a result of a reduced number of long term mission partners during the year, although general fund giving from individuals has actually increased marginally over the period. Donations from trusts have increased by £27k in the period and we continue to see small but growing success in this part of our fundraising work. The results clearly show the importance of our legacy income within CMS, representing 23% of the overall income during this financial year. The Trustees are extremely thankful for the generosity of those who leave legacy gifts – often following a lifetime of faithful, prayerful service to God including support of CMS’s work. Such gifts are important for sustaining our efforts to share Jesus and change lives. Charitable Activity Expenditure Total resources expended amounted to £7.5m (2016: £7.2m). This is an increase of £0.3m on the prior year. The 4% increase in total expenditure largely relates to our mission partners expenditure which reflects in part increased pension costs, and the impact of the devaluation in sterling following the Brexit vote in June 2016, but is also due to timing differences on the restricted funds. The recruitment,
25 Church Mission Society - The call in action training and support of Mission Partners are CMS’s most significant areas of operation with 60% of charitable expenditure relating to this activity. The majority of this spend supports 141 long-term mission partners working in a range of activities in 32 different countries. In addition CMS has a Local Partner Programme, with total expenditure of £0.44m, which supports over 60 local mission leaders around the world.
Charitable Expenditure
People Mission Mission Local Enabling Church and in mission Education Grants Partners Mission Community Network
Mission grants expenditure, totalled £0.5m on 69 projects that CMS supports around the world (see note 13). Grants are also paid to CMS Africa and AsiaCMS as part of CMS’ Mission Network. These grants are included in the Enabling Mission Network activity. However, the committed support to AsiaCMS for five years totalling £1m was accounted for in full in the year ended 31 January 2013 and so no additional cost was expensed in the Statement of Financial Activities. The other main area of expenditure is the CMS Church and Community work (£0.7m) and the Mission Education work (£0.7m). Expenditure within the mission education team relates to the recruitment, teaching and support of our students on the Pioneer leadership programme. This has primarily involved the running of the programme at the CMS offices, but it also includes the work being undertaken by CMS pioneer hubs. The Church and Community work involves resourcing and mobilising the church in the UK, and the CMS community, into mission. CMS streamlined its publications during the year with its flagship publication ‘The Call’ now published every quarter. CMS also worked closely with two dioceses during the year on the partnership for missional church programme. CMS Defined Benefit Pension Scheme At the year-end the liability recognised in the balance sheet relating to the CMS Pension Scheme (Defined Benefit Scheme) came to £5.94m (2016: £0m) in accordance with FRS 102. The main reason for the liability was the net impact of changes in the financial and demographic assumptions contributing to an increase in the present value of the Scheme’s liabilities from £61.7m, to £77.7m (see note 26A). This was partially offset by an increase in the value of the scheme assets, from £65.1m to £71.8m (note 26A). The financial statements are based on the triennial valuation of the scheme, dated 31 March 2013 and showed a deficit of £8.3m. This deficit is being paid off over a maximum of 18 years. Contributions in the three years to 31 January 2017 are £500,000 per year, although in certain circumstances the contribution for any of those years can increase to a maximum amount of £700,000, which it has done in the last two financial years. The 31 March 2016 valuation was still ongoing as at 31 January 2017 and agreement was concluded on a new recovery plan in June 2017, contributions made by CMS continue at £500,000, with variable payments on top of that if certain income thresholds are hit. Church of England Defined Benefits Scheme CMS has deferred members and pensioners, some previously employed by SAMS, in the Church of England Defined Benefit Scheme (DBS) within the Church Workers Pension Fund (see note 26C) which
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 26 is a multi-employer scheme. The latest valuation of the scheme was conducted in December 2013, and showed a deficit of £1.5m for the CMS portion of the scheme. Deficit contribution payments of £150,600 per year have been agreed for 12.75 years from 1 April 2015. The current contribution rate is therefore £161,000 including administration costs. In accordance with FRS 102, SAMS includes a provision in the balance sheet for its obligations to make deficit payment as this is a multi-employer scheme. The provision for 2017 was £1,486,000 (2016: £1,513,000). In addition the current SAMS employees are also part of the Pension Builder Scheme (PBS), a hybrid scheme within the Church Workers Pension Fund. The latest formal valuation of the scheme at 31 December 2013 shows that the scheme is in surplus. Discussions in relation to the 31 December 2016 valuation have only just started and will need to conclude by 31 March 2018. Investment policy and review of investment performance CMS manages its investments according to the CMS Statement of Investment Principles and the Trustees have authority to invest the monies of the Group, not immediately required, on such investments as they think fit. The Statement of Investment Principles includes details of CMS’ socially responsible investment policy. During the year the management of CMS listed investment portfolio transferred to C. Hoare and Co. This decision was taken by trustees following a review of selected investment managers by the finance committee. The Trustees have delegated the day-to-day management of the CMS investment portfolio to C. Hoare and Co. The investment manager’s delegated authority is operated in accordance with the CMS Statement of Investment Principles. Since the year end, the management of the listed investment portfolio was transferred to Cazenove Capital, following the decision by C Hoare and Co to transfer its investment management function to Cazenoves As at 31 January 2017, CMS had listed investments of £3.2m (2016: £3.0m), £10.5m (2016: £9.4m) of unlisted investments and £0.2m (2016: £0.1m) of cash held within the investment portfolio. This total of £13.9m of investments includes £8.1m of endowed funds where the capital is not available to be spent. Further details of investments can be found in note 17 of the financial statements. Income from the investment portfolio of CMS, contributed to a total investment income of £0.5m in the Statement of Financial Activities (2016: £0.5m). Further details of the makeup of this investment income can be found in note 6 of the financial statements. The net gain on investments in 2017 was £1.4m (2016 loss of £0.5m), as such it has been a strong year for the CMS portfolio, and the listed holdings have outperformed their long term target of RPI plus 4%. These positions are regularly reviewed by the Finance Committee and during the year C. Hoare and Co. attended the Finance Committee to explain how the listed investment portfolios have been performing. Movement in funds Taking CMS’s funds in total, there were net incoming resources of £1.5m during the year ended 31 January 2017, and an actuarial loss on the CMS Pension Scheme of £6.2m. The overall position was therefore a net reduction in total reserves of £4.7m.
Reserves policy and financial position General Funds The trustees have adopted a reserves policy, which they consider appropriate to ensure the continued ability of CMS to meet its objectives. The policy is reviewed annually, by the Trustees, in conjunction with a broader review of the financial strategy. The policy for general reserves is for CMS to aim to hold a minimum of three months of General Fund revenue expenditure as free reserves. These reserves are held in order to maintain the operation of CMS and to provide some surety against adverse financial events, such as rising pension liabilities, income targets not being achieved or unbudgeted expenditure being required. As at 31 January 2017 unrestricted general funds, excluding the pensions reserve and designated funds, were £4.3m as all of which were free reserves (2016: £4.0m) available to be applied to the general purposes of CMS. Free reserves as at 31 January 2017 represented 16 months of general fund revenue expenditure (2016: 15 months) and are above the target set in the reserves policy. These additional funds will enable CMS to transition from running a deficit budget in the short term to
27 Church Mission Society - The call in action closing the gap between income and expenditure and looking to grow in the coming years. Endowment Funds Included in the balance sheet are Endowment Funds totalling £8.2m, the capital of which is not available to be spent. Restricted Funds The reserves policy for restricted funds is for sufficient assets to be held to meet the obligations of each fund and this is the case as at 31 January 2017. Designated funds During the year the Trustees have set aside funds from the General Fund for unrestricted tangible fixed assets to ensure the general reserves policy is not skewed by holding these funds (see note 25). Shares in William Leech (Investments) Limited purchased before 15 October 1996 are also included within the designated fund following receipt of legal advice confirming their status in June 2016.
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 28 STATEMENT OF TRUSTEES’ RESPONSIBILITIES
The Trustees (who are also directors for the purposes of company law) are responsible for preparing the Trustees’ Annual Report and the financial statements in accordance with applicable law and United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards). Company law requires the Trustees to prepare financial statements for each financial year. Under company law the Trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the charitable company and the group and of the incoming resources and application of resources, including the income and expenditure, of the charitable group for that period. In preparing these financial statements, the Trustees are required to:
select suitable accounting policies and then apply them consistently observe the methods and principles in the Charities SORP make judgments and estimates that are reasonable and prudent state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charitable company will continue in business
The Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the charitable company’s transactions, disclose with reasonable accuracy at any time the financial position of the charitable company and enable them to ensure that the financial statements comply with the Companies Act 2006 and the provisions of the charity’s constitution. They are also responsible for safeguarding the assets of the charity and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
In so far as each of the trustees is aware:
there is no relevant audit information of which the company's auditor is unaware each of the trustees has taken all steps that he/she ought to have taken to make himself/ herself aware of any relevant audit information and to establish that the auditor is aware of that information
Auditors Crowe Clark Whitehill LLP has indicated its willingness to be reappointed as statutory auditor. The Trustees’ Report, including the strategic report on pages 4 to 29, was approved by the Board of Trustees on 28th July 2017 and signed on their behalf by:
Charles Clayton - Chair of Trustees
29 Church Mission Society - The call in action INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF CHURCH MISSION SOCIETY
We have audited the financial statements of Church Mission Society for the year ended 31 January 2017 which comprise the Consolidated Statement of Financial Activities, the Group and Charity Balance Sheets, the Group Consolidated Statement of Cash Flows and the related notes numbered 1 to 29. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102.The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice) This report is made solely to the charitable company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed. Respective responsibilities of trustees and auditor As explained more fully in the Statement of Trustees' Responsibilities, the trustees (who are also the directors of the charitable company for the purpose of company law) are responsible for the preparation of the financial statements and for being satisfied that they 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 Ethical Standards for Auditors. 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 Trustees’ 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.
30 Church Mission Society - The call in action Opinion on financial statements In our opinion the financial statements:
give a true and fair view of the state of the group’s and the charitable company’s affairs as at 31 January 2017 and of the group’s incoming resources and application of resources, including its income and expenditure, for the year then ended; have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and have been prepared in accordance with the requirements of the Companies Act 2006.
Opinion on other matter prescribed by the Companies Act 2006 In our opinion based on the work undertaken in the course of our audit
the information given in the Trustees' Annual Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and the Trustees’ Annual Report has been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception In light of the knowledge and understanding of the group and parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the trustees’ annual report. We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
the parent charitable company has not kept adequate accounting records, or returns adequate for our audit have not been received from branches not visited by us; or the parent charitable company financial statements are not in agreement with the accounting records and returns; or certain disclosures of trustees' remuneration specified by law are not made; or we have not received all the information and explanations we require for our audit.
Signed:
Alastair Lyon Senior Statutory Auditor For and on behalf of Crowe Clark Whitehill LLP Statutory Auditor Reading
Date:
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 31 CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES
For the year ended 31 January 2017 (Incorporating an Income and Expenditure Account)
Unrestricted Restricted Endowment Total Unrestricted Restricted Endowment Total Funds Funds Funds 2017 Funds Funds Funds 2016
Note £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 Income and endowments from:
Donations and legacies 3 2,611 3,814 190 6,615 2,883 4,324 180 7,387 Charitable activities 4 120 96 - 216 98 50 - 148 Other trading activities 5 195 3 - 198 207 1 - 208 Investments 6 459 31 - 490 460 57 - 517 Other 7 126 16 - 142 88 14 - 102
Total income 3,511 3,960 190 7,661 3,736 4,446 180 8,362
Expenditure on: Raising funds 9 756 71 15 842 657 78 9 744
Charitable activities Mission Partners 10 1,019 2,991 - 4,010 841 2,962 - 3,803 Mission Education 10 532 127 - 659 534 137 - 671 Church and Community 10 492 246 - 738 482 134 - 616 Mission Grants 10 87 427 - 514 80 471 - 551 Local Partners 10 179 257 - 436 182 281 - 463 Enabling Mission network 10 226 85 - 311 213 93 - 306
Total charitable 2,535 4,133 - 6,668 2,332 4,078 - 6,410 expenditure
Total Expenditure 10,11 3,291 4,204 15 7,510 2,989 4,156 9 7,154
Net gains/(losses) 535 18 857 1,410 (258) 3 (256) (511) on investments Net income/ 755 (226) 1,032 1,561 489 293 (85) 697 (expenditure) Transfers between funds 25 (54) 54 - - 57 (57) - -
Actuarial gains/ 26 (6,205) - - (6,205) (354) - - (354) (losses) on defined benefit pension scheme Other gains/(losses) on 26 - (85) - (85) - 600 - 600 pension scheme deficit reduction provision
Net movement (5,504) (257) 1,032 (4,729) 192 836 (85) 943 in funds
Total funds brought 15,499 2,514 7,164 25,177 15,307 1,678 7,249 24,234 forward Total funds carried 9,995 2,257 8,196 20,448 15,499 2,514 7,164 25,177 forward
The accompanying notes are an integral part of this Statement of Financial Activities. All gains and losses arising in the year relate to continuing activities.
32 Church Mission Society - The call in action CONSOLIDATED AND CHARITY BALANCE SHEET
As at 31 January 2017 Group Group Charity Charity Note 2017 2016 2017 2016
£’000 £’000 £’000 £’000 Fixed assets Tangible fixed assets 16 7,382 7,516 7,382 7,516
Investments: Unrestricted 5,684 5,223 5,684 5,223 Investments: Restricted and Endowment 8,246 7,223 8,246 7,223 17 13,930 12,446 13,930 12,446
21,312 19,962 21,312 19,962
Current assets Stock 3 42 - - Debtors 19 553 621 546 651 Cash at bank and in hand 7,221 7,329 6,333 6,500 7,777 7,992 6,879 7,151
Current liabilities Creditors: amounts falling due within one year 20 (1,211) (1,064) (1,592) (1,379)
Net current assets 6,566 6,928 5,287 5,772
Total assets less current liabilities 27,878 26,890 26,599 25,734
Creditors: amounts falling due after more than one year 21 - (200) - (200)
Net assets excluding pension assets or liability 27,878 26,690 26,599 25,534 Defined benefit pension scheme asset/(liability) 26 (7,430) (1,513) (5,944) -
Net assets 20,448 25,177 20,655 25,534
The funds of the charity: Unrestricted: General fund 25 4,329 4,145 4,339 4,148 Unrestricted: Designated funds 25 11,610 11,354 11,610 11,354 Unrestricted: Pension reserve 25 (5,944) - (5,944) - Unrestricted funds 9,995 15,499 10,005 15,502
Restricted funds excluding pension reserve 25 3,743 4,027 2,454 2,868 Restricted Pension reserve 25 (1,486) (1,513) - - Restricted funds 2,257 2,514 2,454 2,868 Endowment funds 25 8,196 7,164 8,196 7,164
24 20,448 25,177 20,655 25,534
The accompanying notes are an integral part of this Balance Sheet. The financial statements on pages 32 to 62 were approved by the Board of Trustees and authorised for issue on 28 July 2017 and signed on their behalf by:
Charles Clayton - Chair of Trustees
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 33 CONSOLIDATED CASH FLOW STATEMENT
For the year ended 31 January 2017
RECONCILIATION OF NET INCOME TO THE NET CASH FLOW FROM OPERATING ACTIVITIES
2017 2016 £’000 £’000
Net income/(expenditure) for the year (as per the Statement of Financial Activities) 1,561 697
Adjustments for: Investment income (490) (517) Net gains and losses on investments (1,410) 511 Depreciation charge 217 208 (Increase)/ decrease in stock 39 (4) (Increase)/ decrease in debtors 14 47 Increase/ (decrease) in creditors (53) (556) Increase/ (decrease) in pension scheme deficit reduction provision (112) (99) Net charge for defined benefit pension scheme (261) (354) Gains on disposal of tangible fixed assets - (1) Gift of shares (5) (12)
Net cash provided by (used in) the Group’s operating activities (500) (80)
STATEMENT OF CASH FLOWS 2017 2016 £’000 £’000 Cash flows from operating activities: Net cash provided by (used in) operating activities (500) (80)
Cash flows from investing activities: Dividends, interest and other income from investments 544 515 Purchase of tangible fixed assets (83) (255) Proceeds from sale of tangible fixed assets - 2 Purchase of investments (3,975) (1,159) Proceeds from sale of investments 3,906 1,497
Net cash provided by (used in) investing activities 392 600
Cash flows from financing activities: Net cash provided by (used in) financing activities - - Change in cash and cash equivalents in the year (108) 520
Cash and cash equivalents at the beginning of the year 7,329 6,809
Cash and cash equivalents at the end of the year 7,221 7,329
Cash and cash equivalents comprises the amounts shown in the balance sheet as “Cash at bank and in hand”, and includes £96,000 as at 31 January 2017 relating to cash held in an endowment fund (2016: £91,000).
34 Church Mission Society - The call in action NOTES TO THE FINANCIAL STATEMENTS
At 31 January 2017
1. CHARITY INFORMATION Church Mission Society is a registered charity (registered charity number 1131655), a registered company (registered number 6985330) limited by guarantee and is registered as a charity in Scotland (Charity No SC047163). CMS does not have share capital and has approval to omit the word ‘Limited’ from its name. The members of the company are the trustees and members of the CMS community. In the event of the CMS being wound up the liability in respect of the guarantee is limited to £1 per member. Church Mission Society was incorporated on 8th August 2009 and registered as a charity on 16th September 2009. CMS was incorporated to effect the merger between The Church Mission Society Trust (registered charity number 1131655-1) and The South American Mission Society (registered charity number 221328). The Church Mission Society Trust became a subsidiary of CMS under a scheme, agreed with the Charity Commission in 2010, enabling this to take place. The scheme involved a replacement of The Church Mission Society Trust’s objects to mirror those of CMS, and all trustees of The Church Mission Society Trust resigned and were replaced by CMS as corporate trustee. As part of the Scheme, the name of that charity was changed to The Church Mission Society Trust (formerly Church Mission Society) and a uniting direction was put in place for The Church Mission Society Trust to be part of CMS for accounting and legal purposes. Therefore the disclosures in these financial statements for ‘the Charity’ include CMS and The Church Mission Society Trust. CMS is the sole corporate member of The South American Mission Society with the same group of trustees common to both societies and accordingly The South American Mission Society (SAMS) is considered to be a subsidiary undertaking of CMS. Further information about CMS’ principal subsidiary undertakings, SAMS and CMS House Enterprises Ltd, is included in Note 28.
2. ACCOUNTING POLICIES Basis of preparation The financial statements have been prepared under the historical cost convention with the exception of investments that are included at a current market value. The financial statements have been prepared in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102), with the Statement of Recommended Practice "Accounting and Reporting by Charities applicable to charities preparing accounts in accordance with FRS 102" (effective 1 January 2015) and with the Companies Act 2006. Church Mission Society constitutes a public benefit entity as defined by FRS 102.
Assessment of going concern Having reviewed the financial position, the Trustees consider that there are no material uncertainties about the charity’s ability to continue as a going concern and have a reasonable expectation that the charity has adequate resources to continue its activities for the foreseeable future. Accordingly, they continue to adopt a going concern basis in preparing the financial statements.
Accounting estimates and judgements The preparation of the financial statements in accordance with FRS 102 requires the trustees to make judgement, estimates and assumptions that affect the reported amounts in the financial statements. The areas involving a higher degree of judgement, or areas where assumptions and estimates were significant to the financial statements, are disclosed in Note 29.
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 35 NOTES TO THE FINANCIAL STATEMENTS 2. ACCOUNTING POLICIES (continued)
Basis of consolidation The consolidated financial statements of the CMS Group incorporate the financial statements of the Charity (CMS and The Church Mission Society Trust) and its subsidiary undertakings. The Trustees have taken advantage of the exemption conferred by S408(3) of the Companies Act 2006 and accordingly present a consolidated Statement of Financial Activities only. In order to comply with the Charities SORP, the gross income and net incoming resources for the Charity are disclosed in note 25. Donations, legacies and other income Income is recognised in the period in which the Charity has entitlement to the income, it is probable that the income will be received and the amount of the income can be measured reliably. Where income is received in advance of providing goods and services the income is deferred until CMS becomes entitled to the income. Legacy gifts are recognised on a case by case basis following the grant of probate and when the entitlement to the legacy has been established, receipt is probable and amount of the legacy can be measured reliably. In accordance with this policy, legacies are included when the Charity is notified by the Personal Representatives of an estate that a distribution is to be made and the amount involved can be reliably quantified. Financial Instruments Church Mission Society only has financial assets and liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value (including any transaction costs) and subsequently measured at their settlement value (which is also the amortised cost). Financial assets held at amortised cost include cash and bank in hand and the group’s trade and other debtors, excluding prepayments. Financial liabilities held at amortised cost include the group’s long and short term creditors, excluding deferred income. Investments and investment income Investments are initially measured at cost. Listed investments are included at their open market value at the balance sheet date. All gains and losses on investments are taken to the Statement of Financial Activities, including the net gains and losses arising from disposals and revaluations in the year. The income from investments and short-term deposits is accounted for on an accruals basis. The unlisted investment in William Leech (Investments) Limited is included in the financial statements as the Charity’s share of the net asset value shown in that company’s accounts dated closest to the Charity’s year end (31 March). The financial statements for 31 March 2017 are still subject to audit. This investment value has been reduced by the cash held by CMS at 31 January which is invested in William Leech (Investments) Limited prior to their year-end on 31 March as this increases the net asset value of William Leech (Investments) Limited. Fund accounting and the allocation of income and expenditure by fund Income and Expenditure are allocated to three categories of funds: Unrestricted Funds, Restricted Funds and Endowment Funds. Unrestricted funds are available for use to further the Charity’s general purposes and objectives. All income and expenditure associated with the general operation of the Charity has been accounted for within the Unrestricted Funds, including donations and legacies where the donor attaches no specific conditions. A pension reserve is included within unrestricted funds to reflect the pension liability. Designated funds are a portion of unrestricted funds that have been set aside by the trustees for a particular project or purpose. Restricted funds represent income and donations, the use of which has been specified by the donor. Restricted funds are donated for either a particular geographical area or purpose, the use of which is restricted to that purpose or area. Income and expenditure related to CMS’ work in South America is shown within Restricted Funds. The Endowment Funds represent assets, which have the restriction that the revenue generated by holding the asset is available to spend but the capital itself cannot be spent. Income generated from Endowment Funds is applied to Unrestricted or Restricted Funds as appropriate.
36 Church Mission Society - The call in action NOTES TO THE FINANCIAL STATEMENTS 2. ACCOUNTING POLICIES (continued)
Expenditure All expenditure is recognised once there is a legal or constructive obligation committing the charity to that expenditure, it is probable that settlement will be required and the amount of the obligation can be measured reliably. Expenditure is accounted for on an accruals basis. A liability is recognised when a legal or constructive commitment is entered into by the Charity and so a liability exists. All expenses, including support costs and governance costs, are classified to the applicable expenditure headings in the Statement of Financial Activities. Where costs cannot be directly attributed to particular headings they have been allocated to activities on a basis consistent with the use of resources. Cost of raising funds comprises those costs incurred in seeking voluntary contributions and in the management of CMS investments. Governance costs are the costs associated with the governance arrangements of the Charity. Included within this category are costs associated with the strategic as opposed to the day-to-day management of the Charity’s activities. Support and governance costs are allocated across the categories of expenditure on charitable activities and the cost of raising funds. When it is necessary to apportion certain expenses between the different categories of resources expended this is undertaken on bases which are considered appropriate. For example, in the case of salaries and pensions, these are apportioned on the basis of estimated time spent on these activities. The allocation model is reviewed and updated annually to ensure that the apportionments properly reflect the activities of the Charity. Grants payable are recognised during the year in which the Charity enters into a binding commitment to make a grant and this is communicated to the recipient. Foreign currencies Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling at the balance sheet date. All differences are taken to the consolidated statement of financial activities with the relevant charitable activity expenditure for the period in which they occurred. Stock Stock is valued at the lower of cost and net realisable value. Tangible fixed assets and depreciation Tangible fixed assets are shown at their current net book value on an historical cost basis. Assets are capitalised where the value of the asset is greater than £500. The carrying values of tangible fixed assets are reviewed for impairment in periods if events or changes in circumstances indicate that the carrying values may not be recoverable. Tangible fixed assets are grouped by category and depreciated on a straight line basis over the following periods:
Freehold property 30 - 50 years Furniture and office equipment 3 - 10 years Leasehold property shorter of 50 years and the Motor vehicles 4 years period of the lease Computer equipment 3-5 years
Operating leases Rentals payable under operating leases are charged on a straight-line basis over the lease term.
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 37 NOTES TO THE FINANCIAL STATEMENTS 2. ACCOUNTING POLICIES (continued)
Pensions The Charity (CMS) and one of its subsidiaries (South American Mission Society) have members in defined benefit pension schemes, both employees and Mission Partners. For certain other employees and Mission Partners the Charity contributes to personal money purchase pension schemes (defined contribution schemes).
Defined contribution schemes
For defined contribution schemes, the amount charged to the Statement of Financial Activities in respect of pension costs and other post-retirement benefits is the total of the contributions payable in the year. Differences between contributions payable in the year and contributions actually paid are shown as either accruals or prepayments in the balance sheet.
Defined benefit scheme – CMS Pension Scheme The CMS defined benefit pension scheme is funded, with the assets of the scheme held separately from those of the Charity, in separate trustee-administered funds. Pension scheme assets are measured at fair value and liabilities are measured on an actuarial basis using the projected unit method and discounted at a rate equivalent to the current rate of return on a high quality corporate bond of equivalent currency and term to the Scheme’s liabilities. The resulting defined benefit asset or liability is presented after other net assets on the face of the balance sheet, unless a surplus is not recognised in accordance with FRS 102. The current service cost and net interest cost are allocated to relevant expenditure headings within the Statement of Financial Activities, unless the net interest is a credit in which case it is included in ‘Other income’. The change in the value of assets and liabilities arising from asset valuation, actuarial assumptions and any surplus that is not considered recoverable is recognised within the ‘gains and losses’ categories of the Statement of Financial Activities as ‘Actuarial gains and losses on defined benefit pension scheme’.
Defined benefit schemes – multi-employer schemes The South American Mission Society (SAMS) participates in the Church of England Defined Benefits Scheme (DBS) and the Church of England Pension Builder Scheme (PBS), both of which are separate sections of the Church Workers Pension Fund (CWPF). The assets of the funds are held separately from those of the Society. In both cases, the schemes are considered to be multi-employer schemes as described in Section 28 of FRS 102 and as the Society is unable to identify its share of the underlying assets and liabilities, contributions are accounted for as if the Scheme were a defined contribution scheme. In accordance with FRS 102, the pensions costs charged to the Statement of Financial Activities in the year are the contributions payable towards benefits and expenses accrued in that year, plus any charge in respect of the impact of deficit contributions. Where a provision is recognised in respect of any agreed deficit recovery payments, this liability represents the present value of the deficit contributions agreed as at the accounting date and is presented after other net assets on the face of the balance sheet. The classification of the pension scheme deficit reduction provision in the consolidated balance sheet and the related charge in the Statement of Financial Activities has been amended from that used in the previous year’s consolidated financial statements. However there is no change in the amount of the liability, net assets or total funds of the Group or Charity, as the change is presentational only. In addition to these schemes the Charity and SAMS participate in the Church of England Funded Pensions Scheme, also known as the Clergy Pension Scheme, which provides pensions for clergy and licensed lay workers. The Church of England Funded Pensions Scheme is a multi-employer defined benefit scheme but the Charity and SAMS are unable to identify their share of the underlying assets and liabilities. This scheme is therefore accounted for as a defined contribution scheme and follows the treatment adopted for the Charity’s other defined contribution schemes (see note 26).
38 Church Mission Society - The call in action NOTES TO THE FINANCIAL STATEMENTS
3. DONATIONS AND LEGACIES At 31 January 2017
Unrestricted Restricted Endowment Total Unrestricted Restricted Endowment Total Funds Funds Funds 2017 Funds Funds Funds 2016 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Donations 287 1,652 - 1,939 304 1,656 - 1,960 from churches and groups
Donations from 828 1,424 - 2,252 786 1,702 - 2,488 individuals Legacies 1,267 514 - 1,781 1,576 774 - 2,350 William Leech 143 - 190 333 136 - 180 316 benefactions Donations 86 224 - 310 81 192 - 273 from grant making trusts 2,611 3,814 190 6,615 2,883 4,324 180 7,387 Legacies of which CMS has been notified, but not recognised as income, are estimated at £315,000 (2016: £366,000)
William Leech Benefactions Grants are received from two charitable trusts administered by the William Leech Foundation Limited (known as the Foundation Trust and the Charity Trust). The income from the Foundation Trust is distributed in equal portions to CMS and four other charities. The income from the Charity Trust is distributed for charitable purposes at the discretion of the Trustee, which has, since 1973, adopted the policy of giving most of the income to the same five charities. The Charity Trust reviews this policy each year. Following a resolution of the Board of Directors of William Leech Foundation Limited on 15 October 1996, 57% of the grants paid out to the five charities are made on the condition that they are reinvested in shares in William Leech Investment Limited at par, and treated as an addition to the recipient charity’s capital funds.
4. INCOME FROM CHARITABLE ACTIVITIES
Unrestricted Restricted Endowment Total Unrestricted Restricted Endowment Total Funds Funds Funds 2017 Funds Funds Funds 2016 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Mission 120 - - 120 97 - - 97 Education training Partnership - 46 - 46 - 19 - 19 for Missional Church training Events - 19 - 19 - 18 - 18 Short term - 31 - 31 1 13 - 14 mission trips
120 96 - 216 98 50 - 148
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 39 NOTES TO THE FINANCIAL STATEMENTS 5. INCOME FROM OTHER TRADING ACTIVITIES
Unrestricted Restricted Endowment Total Unrestricted Restricted Endowment Total Funds Funds Funds 2017 Funds Funds Funds 2016 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Income from 24 3 - 27 20 1 - 21 sale of books and resources Income from 91 - - 91 104 - - 104 property Use of conference 80 - - 80 83 - - 83 facilities
195 3 - 198 207 1 - 208
6. INCOME FROM INVESTMENTS
Unrestricted Restricted Endowment Total Unrestricted Restricted Endowment Total Funds Funds Funds 2017 Funds Funds Funds 2016 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Income from William 394 - - 394 376 - - 376 Leech (Investments) Limited Investments listed 18 26 - 44 27 54 - 81 on a recognised stock exchange Unlisted securities 3 - - 3 8 - - 8 Interest on cash 44 5 - 49 49 3 - 52 balances 459 31 - 490 460 57 - 517
7. OTHER INCOME
Unrestricted Restricted Endowment Total Unrestricted Restricted Endowment Total Funds Funds Funds 2017 Funds Funds Funds 2016 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Gain on disposal - - - - 1 - - 1 of other fixed assets Net interest on net 13 - - 13 10 - - 10 defined benefit asset Other Income 113 16 - 129 77 14 - 91
126 16 - 142 88 14 - 102
40 Church Mission Society - The call in action NOTES TO THE FINANCIAL STATEMENTS 8. OPERATING LEASES AS A LESSOR
The charity receives rental income from leasing certain residential properties to tenants under non-cancellable operating leases and tenancy agreements. Income received under operating leases is included in the SOFA on a straight-line basis over the period of the lease. At the balance sheet date, the charity had contracted with tenants to receive the following future minimum lease payments:
2017 2016 £’000 £’000
Not later than one year 31 24 Later than one year and not later than five years 32 20 Later than five years 27 31
90 75 There are no contingent rents recognised as income.
9. EXPENDITURE ON RAISING FUNDS
Unrestricted Restricted Endowment Total Total Funds Funds Funds 2017 2016 £’000 £’000 £’000 £’000 £’000
Cost of generating voluntary income 638 70 - 708 655 Cost of activities for generating funds 108 - - 108 74 Investment management costs 10 1 15 26 15
756 71 15 842 744
10. ANALYSIS OF EXPENDITURE
Direct Grants Support Costs Total Total Costs 2017 2016 £’000 £’000 £’000 £’000 £’000 Raising funds Costs of generating voluntary income 540 - 168 708 655 Cost of activities for generating funds 108 - - 108 74 Investment management costs 26 - - 26 15
674 - 168 842 744 Charitable activities Mission Partners 3,237 99 674 4,010 3,803 Mission Education 429 - 230 659 671 Church and Community 532 5 201 738 616 Mission Grants 167 272 75 514 551 Local Partners 136 186 114 436 463 Enabling Mission network 55 225 31 311 306
4,556 787 1,325 6,668 6,410
Total Expenditure 5,230 787 1,493 7,510 7,154
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 41 NOTES TO THE FINANCIAL STATEMENTS 11. SUPPORT COSTS BY ACTIVITY
Premises Governance Facilities and Facilities Development Personnel and Personnel Total Total Finance and ICT Finance 2017 2016 £’000 £’000 £’000 £’000 £’000 £’000
Costs of generating funds Costs of generating voluntary income 54 - 106 8 168 152 Charitable activities Mission Partners 469 34 150 21 674 577 Mission Education 88 21 121 - 230 211 Church and Community 69 17 111 4 201 188 Mission grants 61 - 10 4 75 63 Local Partners 59 - 55 - 114 98 Enabling Mission network 12 13 2 4 31 47
Total Support Costs 812 85 555 41 1,493 1,336
The support costs are allocated on the basis of an estimate of staff time spent, by each team, on each of the activities. Governance costs relate to the running of the Charity and include the costs of the external audits, trustee expenses and the cost of the trustees meetings. Included in the governance costs are the audit fee of £31,000 (2016: £32,000) and non-audit fees of £4,000 (2016: £4,000). Depreciation of £214,000 (2016: £205,000) is included in support costs, with £3,000 (2016: 3,000) included in Mission Partner direct costs.
12. OBLIGATIONS UNDER OPERATING LEASES
The group’s future minimum lease payments on operating leases are as follows:
2017 2016 £’000 £’000
Within one year 9 11 In two to five years 23 32 After five years - -
32 43
Operating lease charges in the year to 31 January 2017 were £10,000 (2016: £8,000).
42 Church Mission Society - The call in action NOTES TO THE FINANCIAL STATEMENTS 13. ANALYSIS OF GRANTS
By category of charitable Grants to Grants to Total grants in year Total grants in year expenditure Institutions Individuals to 31 January 2017 to 31 January 2016 £’000 £’000 £’000 £’000
Mission Partners 27 72 99 71 Mission Education - - - 8 Church and Community 5 - 5 - Mission Grants 230 42 272 335 Local Partners 186 - 186 210 Enabling Mission Network 225 - 225 225
673 114 787 849
By geographical area Grants to Grants to Total grants in year Total grants in year Institutions Individuals to 31 January 2017 to 31 January 2016 £’000 £’000 £’000 £’000
Africa 392 13 405 459 Asia 68 28 96 105 Europe and Middle East 53 17 70 75 Latin America 160 56 216 210
673 114 787 849
Analysis of Grants to Institutions Nature of grant Country Grants to Institutions £’000 Africa Buigiri School for the Blind Mission grants for education Tanzania 25 and disability programmes Association Eklesia Mission grants for building Madagascar 12 Episkopaly Malagasy project and community projects Rugarama Eye Centre Mission grants for community Uganda 44 health projects CMS Africa Local Partners Africa 44 CMS Africa Enabling Mission Network Africa 225 Other Institutions grants Africa 42 under £10k
Total 392
Asia AsiaCMS Local Partners Asia 54 AsiaCMS Enabling Mission Network Asia 200 Grant previously accrued (200) (see note 21) Other Institutions grants 14 under £10k Total 68
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 43 NOTES TO THE FINANCIAL STATEMENTS 13. ANALYSIS OF GRANTS (continued)
Nature of grant Country Grants to Institutions £’000 Europe and the Middle East Evangelical Episcopal Church Mission grants for community Israel 16 in Jerusalem health projects Other Institutions grants under £10k Middle East 37 Total 53
Latin America Asociacion de la Iglesia Anglicana Mission grants for community Argentina 47 projects and Local partners Iglesia Anglicana Episcopal de Bolivia Mission grants for community Bolivia 17 projects and Local partners Corporacion Anglicana de Chile Mission grants for community Chile 18 projects and Local partners Iglesia Anglicana Del Peru Local Partners Peru 16 Other institutional grants 62 under £10k Total 160
Total Institutional Grants 673
44 Church Mission Society - The call in action NOTES TO THE FINANCIAL STATEMENTS
14. STAFF COSTS AND OTHER EMPLOYEE BENEFITS
2017 2017 2017 2016 Staff costs £’000 £’000 £’000 £’000 UK Staff Mission Partners Total Total Salaries and allowances 1,824 1,504 3,328 3,222 Social security cost 175 32 207 204 Employer’s pension contributions 336 239 575 571 (Defined contribution) Employer’s pension contributions - 65 65 65 (Multi employer scheme) Redundancy and relocation costs 18 - 18 3
2,353 1,840 4,193 4,065
An employee whose salary was £34,000, also had a one off housing allowance of £40,400 which put them into the band £70,000 to £79,000. CMS paid no pension contributions for this person. The total amount of employee benefits received by key management personnel for their services during the year is £362,000 (2016: £346,000). The number of volunteers working for Church Mission Society is 25 (2016: 25).
Employees The average monthly number of employees in the year is analysed by function below:
UK Staff 2017 2016 Number Number Raising funds 15 14 Charitable activities 53 51 Governance of the charity 1 1
UK Staff 69 66
Mission Partners 111 122
180 188
15. TRUSTEES’ EXPENSES 2017 2016 £’000 £’000 Expenses incurred by trustees and reimbursed 4 5 by Church Mission Society Expenses incurred by Church Mission Society 3 3 on behalf of the trustees Trustees’ indemnity insurance cover cost 3 3
Number of trustees receiving expenses 5 6
The trustees receive no remuneration for their services, but 5 trustees (2016:6) were reimbursed expenses in respect of travel and accommodation expenses for attending meetings. Charles Clayton (Chair of trustees of CMS) also serves as a Director of CMS Africa (Registered in Kenya). Included in the above is reimbursement of expenses relating to air fare and hotel costs. For more details of transactions with CMS Africa, see note 23.
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 45 NOTES TO THE FINANCIAL STATEMENTS
16. TANGIBLE FIXED ASSETS
The Group and Charity
Long Fixtures, Freehold Leasehold Motor fittings and Property Property Vehicles equipment Total £’000 £’000 £’000 £’000 £’000 Cost: At 1 February 2016 8,490 172 38 1,138 9,838 Additions 4 - - 79 83 Disposals - - (14) (16) (30) At 31 January 2017 8,494 172 24 1,201 9,891 Depreciation: At 1 February 2016 1,313 38 37 934 2,322 Charge for the year 138 3 1 75 217 Disposals - - (14) (16) (30) At 31 January 2017 1,451 41 24 993 2,509
Net Book Value: At 31 January 2017 7,043 131 - 208 7,382
At 31 January 2016 7,177 134 1 204 7,516
(a) Capital expenditure authorised and contracted but not yet incurred for was £114,000 (2016: £nil). (b) The net book value of long-leasehold properties at 31 January 2017 includes two leasehold UK properties (2016: 2).
(c) The net book value of fixtures, fittings 2017 2016 and office equipment comprises: £’000 £’000 Fixtures and fittings 89 103 Office furniture 19 19 Computer hardware/software 87 71 Audio and other equipment 13 11
208 204
46 Church Mission Society - The call in action NOTES TO THE FINANCIAL STATEMENTS
17 INVESTMENTS
The Group and Charity Analysis of Movement in Investments Listed Unlisted Held as cash 2017 2016 Market Value: £’000 £’000 £’000 £’000 £’000 At 1 February 3,037 9,356 53 12,446 13,283 Additions to investments 3,795 185 - 3,980 1,171 Proceeds from disposals (3,991) (69) (4,060) (1,432) Net movement in cash held - - 154 154 (65) by investment manager Net gain/(loss) on investments 373 1,037 - 1,410 (511)
At 31 January 3,214 10,509 207 13,930 12,446
Unlisted Investments (shown at market value) 2017 2016 £’000 £’000 Unrestricted Funds Debentures – Christian Conference Trust - 69 Ordinary shares – William Leech (Investments) Ltd 4,338 3,952 4,338 4,021
Endowment Funds Ordinary shares – William Leech (Investments) Ltd 6,171 5,335 At 31 January 10,509 9,356
Investments – William Leech (Investments) Limited Grants are received from two charitable trusts administered by the William Leech Foundation Limited (known as the Foundation Trust and the Charity Trust, Note 3). The income from the Foundation Trust is distributed in equal portions to CMS and four other charities. The income from the Charity Trust is distributed for charitable purposes at the discretion of the Trustee, which has since 1973, adopted the policy of giving most of the income to the same five charities. The grants are received on the basis that 57% of these grants are invested in William Leech (Investments) Limited at par and treated as an addition to the recipient charity’s capital funds. In accordance with the wishes of the Directors of the William Leech Foundation Limited, 57% of the voluntary income received in 2016-17 has been invested in shares in William Leech (Investments) Limited. The historical cost of the investment and the reinvestment in respect of the year to 31 January 2017 was as follows: 2017 2016 £’000 £’000 At historical cost: Balance at commencement of period 5,985 5,812 Shares purchased at £1 each 185 173
Balance at 31 January 6,170 5,985
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 47 NOTES TO THE FINANCIAL STATEMENTS 17. INVESTMENTS (continued)
The Total Net Assets of William Leech (Investments) Limited in its most recent draft report and accounts (subject to audit) dated 31 March 2017 was £53.3m comprised of Listed securities £40.4m, Property £12.7m, Other net assets £(0.2m) (2016: £46.9m). The Charity is one of five charities which each hold 20 per cent of the issued share capital of the company. CMS’ share of the net assets is therefore £10.5m (2016: £9.4m). The Charity has a representative on the board of William Leech (Investments) Limited but this does not give the Charity the ability to control or exert significant influence over the company’s day-to-day management or financial policies. Church Mission Society received legal advice in June 2016 from Winckworth Sherwood that considered whether the shares in William Leech (Investments) Limited should be treated as part of unrestricted funds or endowment funds in the accounts of Church Mission Society. The legal advice received in June 2016 confirmed that the shares purchased after 15 October 1996 should be treated as an addition to capital (endowment funds) and also advised that shares purchased prior to 15 October 1996 could be treated as part of unrestricted funds, The trustees of Church Mission Society accepted this legal advice in June 2016 and the financial statements continue to be prepared on this basis.
Custodian funds The Group also acts as Custodian Trustee of funds belonging to the Diocese of Uruguay: 2017 2016 £’000 £’000 Value at 31 January 5 5
5 5
These funds are not part of the Group’s net assets and are not included in the Group’s financial statements. At the request of the Diocese of Uruguay they are deposited with CCLA who manage the Central Board of Finance of the Church of England Investment Funds. After the year end Church Mission Society made a social investment and purchased shares in Clean for Good Ltd at a cost of £25,000.
18. FINANCIAL INSTRUMENTS The Charity has certain financial assets and financial liabilities of a kind that qualify as basic financial instruments. The Charity has the following financial instruments: 2017 2016 2017 2016 Group Group Charity Charity £’000 £’000 £’000 £’000
Financial assets measured at fair value, through profit and loss Unlisted investments 10,509 9,356 10,509 9,396 Other investments 3,421 3,090 3,419 3,090
Financial assets measured at amortised cost Cash at bank and in hand 7,221 7,329 6,333 6,500 Amounts due from subsidiaries - - 18 62 Other receivables (excluding prepayments) 446 556 422 524
Financial liabilities measured at amortised cost Amounts due to subsidiaries - - (412) (356) Other creditors due within one year (1,094) (954) (1,086) (913) (excluding tax and deferred income) Other creditors due after more than one year - (200) - (200)
48 Church Mission Society - The call in action NOTES TO THE FINANCIAL STATEMENTS
19. DEBTORS 2017 2016 2017 2016 Group Group Charity Charity £’000 £’000 £’000 £’000 Trade debtors 101 117 94 100 Taxation recoverable 155 180 154 178 Amounts owed by group entities - - 18 62 Prepayments 106 65 106 65 Accrued income 111 205 95 192 Other debtors 80 54 79 54
553 621 546 651
20. CREDITORS: Amounts falling due within one year
2017 2016 2017 2016 Group Group Charity Charity £’000 £’000 £’000 £’000
Trade creditors 125 128 113 119 Amounts owed to group entities - - 412 356 Accruals for grants payable 495 455 495 455 Other accruals 105 90 97 83 Taxes and social security costs 78 87 72 69 Deferred income 111 110 111 110 Other creditors 297 194 292 187
1,211 1,064 1,592 1,379
Included in ‘Other creditors’ are pension contributions due to the CMS Defined Benefit Pension scheme of £190,000 (2016: £0) and also pension contributions to the Group’s other pension schemes of £36,000 (2016: £57,000). All deferred income as at 31 January 2016 was recognised during the year ended 31 January 2017, with the exception of £3,000 of deferred income that will be recognised in 2017/18. Deferred income relates to amounts received in advance of entitlement.
21. CREDITORS: Amounts falling due after more than one year
2017 2016 2017 2016 Group Group Charity Charity £’000 £’000 £’000 £’000
Accruals for grants payable - 200 - 200
- 200 200
The accrued grant expenditure due after one year relates to the annual operating grant of £200,000 to AsiaCMS that was payable for 5 years from 1 November 2012 and recognised as an expense in CMS’ financial statements to 31 January 2013. At 31 January 2017, one year of the grant remains. The accrued grant amount due to AsiaCMS, due within one year, is included in accruals in note 20.
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 49 NOTES TO THE FINANCIAL STATEMENTS 22. REGISTERED HOLDER The properties and investments of The Church Mission Society Trust are held in trust in the name of Church Missionary Trust Association Ltd.
23. RELATED PARTY TRANSACTIONS There have been no related party transactions that require disclosure other than transactions with the subsidiary companies, The South American Mission Society and CMS House Enterprises Limited, as set out below:
South American Mission Society (SAMS) In 2017 SAMS charged the charity (gift from parent entity) with £388,000, (2016: £393,000). This calculation pertains to the amount of restricted funds received by the Charity (Church Mission Society), but relating to Mission partners employed by SAMS. Each year, the charity transfers a gift to SAMS of restricted funds relating to mission partners who are still employed by its legal entity to reflect the income received by the parent charity.
CMS House Enterprises Ltd In 2017 the Charity charged CMS House Enterprises Limited management fees totalling £4,000 (2016: £4,000). These are calculated as a percentage of external conference and catering services income. In 2017 the Charity charged CMS House Enterprises Limited licence fees totalling £1,000 (2016:1,000). These are calculated as a percentage of total conference and catering services room hire income. In 2017 CMS House Enterprises Limited charged the Charity room hire fees totalling £14,000 (2016: £11,000). These fees are based on usage of rooms hired relating to courses run by the Mission Education team. Other amounts totalling £8,000 were also charged by CMS House Enterprises Limited to the charity relating purchases of stock during the year.
CMS Africa Charles Clayton (CMS Chair of Trustees) was appointed Director of CMS Africa in October 2015, (an independent organisation) based in Nairobi, Kenya. During 2016/17 CMS paid CMS Africa £216,000 (2015/16: £265,000). Included in the amounts paid is £168,750 (2015/16: £225,000) which relates to Mission Support funding, and the remainder is support for the local partner programme plus other grants. Charles is one of seven Directors.
50 Church Mission Society - The call in action NOTES TO THE FINANCIAL STATEMENTS 24. NET ASSETS BY FUND
The Group Unrestricted Restricted Endowment Total £’000 £’000 £’000 £’000
Fixed assets 7,272 110 - 7,382 Investments 5,685 144 8,101 13,930 Current assets 4,107 3,574 96 7,777 Less: Current liabilities (1,125) (85) (1) (1,211) Less: Non-current liabilities - - - - Less: Defined benefit pension liability (5,944) (1,486) - (7,430) Net Assets 2017 9,995 2,257 8,196 20,448 Net Assets 2016 15,499 2,514 7,164 25,177
The Charity Unrestricted Restricted Endowment Total £’000 £’000 £’000 £’000
Fixed assets 7,272 110 - 7,382 Investments 5,685 144 8,101 13,930 Current assets 4,522 2,261 96 6,879 Less: Current liabilities (1,530) (61) (1) (1,592) Less: Non-current liabilities - - - - Less: Defined benefit pension liability (5,944) - - (5,944) Net Assets 2017 10,005 2,454 8,196 20,655 Net Assets 2016 15,502 2,868 7,164 25,534
25. FUNDS Unrestricted Funds: Group
At Incoming Outgoing Net Gain on Transfers Actuarial At 31 1 February Resources Resources investments gain on January 2016 defined 2017 pension scheme
£’000 £’000 £’000 £’000 £’000 £’000 £’000
General fund 4,145 3,498 (2,578) 149 (885) - 4,329 Tangible Fixed Asset 7,402 - (213) - 83 - 7,272 fund (Designated) William Leech Fund 3,952 - - 386 - - 4,338 (designated) Pension reserve: - 13 (500) - 748 (6,205) (5,944)
Unrestricted Funds 15,499 3,511 (3,291) 535 (54) (6,205) 9,995
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 51 NOTES TO THE FINANCIAL STATEMENTS 25. FUNDS (continued)
Unrestricted Funds: Charity At Incoming Outgoing Net Gain on Transfers Actuarial At 31 1 February Resources Resources investments gain on January 2016 defined 2017 pension scheme £’000 £’000 £’000 £’000 £’000 £’000 £’000
General fund 4,148 3,398 (2,471) 149 (885) - 4,339 Tangible Fixed Asset 7,402 - (213) - 83 - 7,272 fund (Designated) William Leech 3,952 - - 386 - - 4,338 Fund (designated) Pension reserve: - 13 (500) - 748 (6,205) (5,944)
Unrestricted Funds 15,502 3,411 (3,184) 535 (54) (6,205) 10,005
The Tangible Fixed Asset Fund represents the net book amount invested in tangible fixed assets other than those covered by restricted funds. The William Leech Fund reflects the element of the grants received from William Leech Foundation Limited prior to 15 October 1996 which have been reinvested in shares in William Leech (Investments) Limited (see note 17). The pension reserve relates to the movement in the defined benefit pension scheme (see note 24).
Endowment Funds The Group and Charity At 1 February Incoming Outgoing Gain Transfers At 31 2016 Resources Resources January 2017 £’000 £’000 £’000 £’000 £’000 £’000
William Leech Capital Fund 5,428 190 - 651 - 6,269 P Fund 892 - (8) 110 - 994 HB Aserappa Fund 461 - (4) 50 - 507 RH Aserappa Fund 303 - (2) 36 - 337 Christava Mahilalayam Fund 62 - (1) 8 - 69 Bell Trust Fund 18 - - 2 - 20
Total Endowment funds 7,164 190 (15) 857 - 8,196
The William Leech Capital Fund reflects the capital element of the grants received from William Leech Foundation Limited after 15 October 1996 which have been reinvested in shares in William Leech (Investments) Limited (see note 17). The P Fund is a permanently endowed fund. The capital of the fund was amalgamated from a large number of small trust funds with Charity Commission approval in 1998. The total value of the P Fund is broken down into the following areas, defined by the restrictions placed on the income generated:
China £132,000 India £335,000 Medical work £272,000 Palestine £36,000 General reserves £219,000 £994,000
The H B Aserappa Fund is for evangelistic work in East Asia or other parts of the world at the Trustees’ discretion. The R H Aserappa Fund is for salaries and disbursements to lay evangelists in Sri Lanka. The Christava Mahilalayam Fund is held for the benefit of the Christava Mahilalayam School in South India. The Bell Trust Fund is for the in-service training of Religious Education teachers in Africa.
52 Church Mission Society - The call in action NOTES TO THE FINANCIAL STATEMENTS 25. FUNDS (continued)
Restricted Funds The Group and Charity At 1 February Incoming Outgoing Gain/ Transfers Pension At 31 January 2016 Resources Resources (Loss) deficit 2017 provision £’000 £’000 £’000 £’000 £’000 £’000 £’000
Mission Personnel Funds 1,097 1,934 (2,135) - 291 - 1,187 South America Funds – Projects 171 103 (106) - (92) - 76 South America Funds – Charity - 208 (185) - (12) - 11 Africa Projects 268 64 (160) - 15 - 187 Asia Projects 193 39 (44) - (35) - 153 Europe & Middle East Projects 60 24 (32) - (6) - 46 Multi Region Projects 147 374 (424) - (24) - 73 Mission Partners’ Fund 236 - - - (150) - 86 St Julian’s Fund 111 - (3) - 2 - 110 Marc Nikkel Fund 23 - (4) - - - 19 Tanzania Education Fund 142 4 (34) 18 - - 130 H B Aserappa Income Fund 27 6 - - - - 33 R H Aserappa Income Fund 17 4 - - - - 21 Christava Mahilalayam Income 9 1 - - - - 10 Partnership for Missional Church 8 53 (48) - - - 13 Mid Africa Fund 1 136 (132) - (5) - - Strategic Mission Fund 284 - (87) - (42) - 155 Madagascar project 35 - (1) - - - 34 Local Partner (Timothy) Fund 3 137 (197) - 57 - - Other restricted funds 36 135 (116) - 55 - 110 Total restricted funds - Charity 2,868 3,222 (3,708) 18 54 - 2,454 South America Funds- Group 1,159 738 (457) - (151) - 1,289 South America Funds – Pension (1,513) - (39) - 151 (85) (1,486) reserve South America Total (354) 738 (496) - - (85) (197)
Total restricted funds - Group 2,514 3,960 (4,204) 18 54 (85) 2,257
Mission Personnel Funds are held as individual restricted funds for the endowment, available for salaries and disbursements to lay evangelists support of CMS Mission Partners. in Sri Lanka. The Christava Mahilalayam Fund is the accumulated income The South America Funds include reserves held by The South American from this permanent endowment, held for the benefit of the Christava Mission Society and are used to support Mission Partners, Latin Partners, Mahilalayam School in South India. Study Partners and projects in South America. Partnership for Missional Church relates to a new partnership to delivery The regional project funds represent various small projects where the training for Dioceses in the UK. beneficiaries of the grants are based in a specific region or cover multiple The Mid-Africa Fund is held by CMS for work in the Mid-Africa region. The regions. Donations and other income is received with a restriction to Strategic Mission Fund was set up following a restricted donation from a support these projects. major donor for new strategic work to be carried out. The Mission Partners’ Fund is a restricted fund to provide support for The Madagascar project relates to a partnership between CMS, SAMS USA Mission Partners. and the support of Bishop Todd McGregor. The monies will be used in part to The St Julian’s Fund represents the property held by CMS for the former help build a Cathedral in Tulear, Madagascar. residents of the St Julian’s Community. This fund is restricted for the time The Local Partners (Timothy) Fund is to support a new generation of gifted that the properties are required by the residents, after which time the and dedicated leaders who are passionate about serving their church in properties will revert to the general fund. some of the world’s financially poorest nations. Other restricted funds The Marc Nikkel Fund is for scholarships for Sudanese students. represent a wide variety of small restricted funds, held and separately accounted for, for some of the current projects that CMS is involved in. The Tanzania Education Fund is for the Buigiri School for the Blind, Diocese Some fund transfers in the year relate to transfers from unrestricted funds of Tanganyika, Tanzania. The H B Aserappa Fund is the accumulated income to finance deficits on restricted funds, in particular mission personnel from this permanent endowment for evangelistic work in East Asia or other restricted funds. Other transfers relate to the movement from programme parts of the world at the Trustees discretion. funds to help support individual mission partners and projects. The R H Aserappa Fund is the accumulated income from this permanent
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 53 NOTES TO THE FINANCIAL STATEMENTS
26. RETIREMENT BENEFITS
The Charity (CMS) and one of its subsidiaries (South American Mission Society) have members in the following defined benefit pension schemes:
A. CMS Pension Scheme (a defined benefit scheme) B. Church of England Funded Pensions Scheme (a multi employer defined benefit pension scheme) C. Church Workers Pension Fund (CWPF) Defined Benefits section (a multi employer defined benefit pension scheme) D. Church Workers Pension Fund (CWPF) – Pension Builder Scheme section (a multi employer defined benefit pension scheme).
The net defined benefit pension liability shown in the Group and Charity balance sheets comprises: 2017 2016 2017 2016 Group Group Charity Charity £’000 £’000 £’000 £’000
CMS Pension Scheme (see Note 26A below) (5,944) - (5,944) - Multi-Employer Defined Benefit Pension Scheme (1,486) (1,513) - - – CWPF Defined Benefit section – Pension Scheme Deficit Reduction Provision (see Note 26C below)
(7,430) (1,513) (5,944) -
For certain other employees and Mission Partners the Charity contributes to personal money purchase pension schemes (defined contribution schemes), as explained in Note 26E below.
A. Defined Benefit Schemes - CMS Pension Scheme (Group and Charity) The Charity contributes to the CMS Pension Scheme, a defined benefit pension scheme, to secure present and future pensions for certain mission partners and staff.
Nature of the Scheme The Church Mission Society Pension Scheme operated by the Society is a funded defined benefit arrangement which provides retirement benefits based on final pensionable salary. The Scheme closed to the future accrual of benefits with effect from 30 June 2011. Accrued benefits of active members continue to be linked to pensionable salaries. The Scheme is a UK registered scheme in accordance with Section 153 of the Finance Act 2004. The Scheme must comply with UK pensions legislation and is regulated by the UK Pensions Regulator. The Scheme is governed by a corporate trustee, CMS Pension Trust Limited, which has 6 directors including 2 member-nominated directors and 2 independent directors. The remaining 2 directors are appointed by CMS. The Trustee is responsible for the administration of the Scheme and for the Scheme’s investment policy. The Trustee, with the advice of the Scheme Actuary and with the agreement of the Employers, determines the contributions that are paid to the Scheme. The calculations for the FRS 102 disclosures have been carried out by running full actuarial calculations as at 31 January 2017.
54 Church Mission Society - The call in action NOTES TO THE FINANCIAL STATEMENTS
Funding Policy Following the cessation of accrual of benefits with effect from 30 June 2011, regular contributions to the Scheme are no longer required. However, additional contributions are still made to cover any shortfalls that arise following each valuation. The funding method employed to calculate the value of previously accrued benefits is the Attained Age Method. The financial statement have used the actuarial valuation of the scheme at 31 March 2013, this indicated that the Scheme had a deficit of £8.3m. The Society and the Trustee of the Scheme have put in place a Schedule of Contributions and a Recovery Plan which detail the contributions that will be made to fund this deficit. These contributions are:
from Church Mission Society: annual payments of £500,000 paid in monthly instalments over the period from 1 February 2014 to 31 January 2017, then annual payments of £400,000 paid in monthly instalments until 31 March 2031. from Church Mission Society Ireland: annual payments of £15,625 paid in monthly instalments over the period from 1 February 2014 to 31 January 2017, then annual payments of £12,500 paid in monthly instalments until 31 March 2031. from Church Mission Society, an additional amount dependent upon the amount of unrestricted legacy income received in any year. If unrestricted legacy income in any year (1 February to 31 January) exceeds £600,000, 50% of the excess will be paid to the Scheme, to a maximum of a total contribution (including the fixed contribution) of £700,000 in any year in the period to 31 January 2017 and to a maximum total contribution of £600,000 in any year from 1 February 2017. in addition, if any of the 5 properties which are owned by Church Mission Society but do not form part of the contingent asset arrangement are sold, with the consent of the Trustee required for the sale to be made, 50% of the proceeds of the sale would be paid to the Scheme, to a maximum of a total contribution (including the fixed contribution and any additional contributions already paid) of £700,000 in any year in the period to 31 January 2017 and to a maximum total contribution of £600,000 in any year from 1 February 2017. from Church Mission Society Ireland, an additional amount dependent upon the additional amount (in relation to legacies and property sales) paid by the Church Mission Society in any year. Church Mission Society Ireland will pay an additional contribution equal to 3.125% of any additional contribution paid by Church Mission Society.
For the years ended 2014/15, 2015/16 and 2016/17, the maximum contributions were payable. The Charity contributed £748,000 to the Scheme in respect of the year to 31 January 2017 including £48,000 in February 2016 in respect of the previous year (2016: £652,000). No contributions were paid by members over the period. The 31 March 2016 actuarial valuation was still ongoing as at 31 January 2017 and agreement was concluded with a new recovery plan in June 2017, under which the fixed contributions made by CMS continue at £500,000, with variable payments on top of that, depending on certain income thresholds. This will affect contributions in the year end 31 January 2018.
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 55 NOTES TO THE FINANCIAL STATEMENTS 26. RETIREMENT BENEFITS (continued)
Scheme Amendments There have been no amendments to the Scheme during the year and no special events have occurred.
2017 2016 Amounts recognised in the balance sheet £’000 £’000
Fair value of scheme assets 71,769 65,093 Present value of funded obligations (77,713) (61,723) (5,944) 3,370 Unrecognised asset – restriction of Scheme surplus - (3,370) (in accordance with FRS 102)
Net defined benefit asset/( liability) recognised in the balance sheet (5,944) -
2017 2016 Amounts charged to the Statement of Financial Activities £’000 £’000
Interest on scheme assets 2,235 1,985 Interest cost on obligation (2,104) (1,940) Interest cost on unrecognised asset (118) (35) Net interest on net defined benefit asset or liability 13 10 Pension scheme administration expenses (500) (308) Included in net income/expenditure (487) (298)
Return on scheme assets (not included in interest) 7,374 (4,247) Actuarial (loss)/gain on scheme obligation (17,067) 6,010 Movement in restriction of scheme surplus 3,488 (2,117)
Recognised in ‘Actuarial gains on defined benefit pension scheme’ (6,205) (354)
Total amounts recognised in the SOFA (6,692) (652)
There are no current service costs of the Scheme included within the Statement of Financial Activities (2016: £nil).
2017 2016 Changes in fair value of scheme assets £’000 £’000
Scheme assets at the beginning of the year 65,093 69,272 Interest on assets 2,235 1,985 Return on scheme assets (not included in interest) 7,374 (4,247) Contributions by CMS 748 652 Contributions by CMS Ireland 23 21 Administration expenses (500) (308) Benefits paid (3,204) (2,282)
Scheme assets at the end of the year 71,769 65,093
Actual return on scheme assets 9,609 (2,262)
56 Church Mission Society - The call in action NOTES TO THE FINANCIAL STATEMENTS 26. RETIREMENT BENEFITS (continued)
Scheme assets The major categories of Scheme assets as a percentage of the total Scheme assets are as follows: 2017 2016 % %
Equities 25 25 Gilts 7 12 Corporate bonds 4 4 Cash and NCA 13 2 Other assets 12 10 Liability driven investments 24 32 Multi class asset funds 15 15
2017 2016 Changes in present value of the Scheme’s defined benefit obligation £’000 £’000
Obligation at the beginning of the year 61,723 68,054 Interest cost on obligation 2,104 1,940 Actuarial loss/(gain) 17,067 (6,010) Contributions by scheme participants 23 21 Benefits paid (3,204) (2,282)
Defined benefit obligation at the end of the year 77,713 61,723
The weighted average duration of the liabilities of the Scheme was 15 years as at 31 January 2017 and 31 January 2016.
Principal Actuarial Assumptions at the balance sheet date used for the FRS 102 disclosures The principal assumptions used by the actuary to calculate the Employee benefit obligation for Church Mission Society in respect for the CMS Pension Scheme were as follows:
2017 2016 %pa %pa
Discount Rate at end of year 2.80 3.50 Discount Rate at start of year 3.50 2.90 Inflation - CPI 2.05 1.35 Inflation - RPI 3.45 2.75 Rate of increase in pensionable salaries 3.45 2.75 Rate of increase in pensions in respect of service: - pre 10 January 1994 3.80 3.50 - between 10 January 1994 and 5 April 2005 3.30 2.70 - after 5 April 2005 2.20 2.00 Rate of increase in deferred pensions in respect of service: - before 1 April 1994 5.00 5.00 - between 1 April 1994 and 5 April 2009 2.05 1.35 - after 5 April 2009 2.05 1.35
The mortality assumptions are based on standard mortality tables which allow for future mortality improvements. The assumptions are that a member aged 65 will live on average until age 88 if they are male and on average until age 91 if female. For a member currently aged 55 the assumptions are that if they attain an age of 65 they will live on average until age 89 if they are male and on average until 92 if female.
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 57 NOTES TO THE FINANCIAL STATEMENTS 26. RETIREMENT BENEFITS (continued)
B. Defined Benefit Schemes - Church of England Funded Pensions Scheme (Group and Charity) In addition to the CMS Pension Scheme the Group has 25 active members of the Church of England Funded Pensions Scheme (also known as the Clergy Scheme) which has approximately 8,400 active members. Contributions for these members of the scheme are paid for by the Archbishops Council on behalf of the Group.
C. Multi-Employer Defined Benefit Pension Scheme – Church Workers Pen- sion Fund Defined Benefits section (Group) The Group through South American Mission Society participates in the Defined Benefits Scheme section of 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 CWPF 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. The Defined Benefits Scheme (“DBS”) section of the Church Workers Pension Fund provides benefits for lay staff based on final pensionable salaries. For funding purposes, the DBS is divided into sub-pools in respect of each participating employer as well as a further sub-pool, known as the Life Risk Pool. The Life Risk Pool exists to share certain risks between employers, including those relating to mortality and post-retirement investment returns. The division of the DBS into sub-pools is notional and is for the purpose of calculating ongoing contributions. They do not alter the fact that the assets of the DBS are held as a single trust fund out of which all the benefits are to be provided. From time to time, a notional premium is transferred from employers’ sub-pools to the Life Risk Pool and all pensions and death benefits are paid from the Life Risk Pool. It is not possible to attribute the scheme’s assets and liabilities to specific employers, since each employer, through the Life Risk Pool, is exposed to actuarial risks associated with the current and former employees of other entities participating in the DBS. The scheme is considered to be a multi- employer scheme as described in Section 28 of FRS 102 and as such contributions are accounted for as if the Scheme were a defined contribution scheme. The pensions costs charged to the SoFA in the year are contributions payable towards benefits and expenses accrued in that year (2017: £10,000, 2016: £10,000), plus any impact of deficit contributions (see below), giving a total charge in the year ended 31 January 2017 of £134,000 (2016: net credit of £536,000). If, following an actuarial valuation of the Life Risk Pool, there is a surplus or deficit in the pool and the Actuary so recommends, further transfers may be made from the Life Risk Pool to the employers’ sub- pools, or vice versa. The amounts to be transferred (and their allocation between the sub-pools) will be settled by the Church of England Pensions Board on the advice of the Actuary. A valuation of the DBS is carried out once every three years, the most recent having been carried out as at 31 December 2013. In this valuation, the Life Risk Section was shown to be in deficit by £4.9m and £4.3m was notionally transferred from the employers’ sub-pools to the Life Risk Pool. This increased the Employer contributions that would otherwise have been payable. The overall deficit in the DBS was £12.9m. Following the valuation, the Group has entered into an agreement with the CWPF to pay expenses of £10,600 per year. In addition deficit payments of £150,600 per year have been agreed for 12.75 years from 1 April 2015 in respect of the shortfall in the Employer sub-pool. This obligation has been recognised as a liability within the Group’s financial statements.
58 Church Mission Society - The call in action NOTES TO THE FINANCIAL STATEMENTS 26. RETIREMENT BENEFITS (continued)
In accordance with Section 28.11A of FRS 102 the agreed deficit recovery payments are recognised as a liability. The movement in the provision is set out below:
Pension scheme deficit reduction provision 2017 2016 £’000 £’000 Balance sheet liability at 1 February 1,513 2,212 Deficit contribution paid (151) (153) Interest cost (recognised in SoFA) 39 54 Remaining change to the balance sheet liability*(recognised in SoFA), 85 (600) comprising the change in agreed deficit recovery plan and the change in discount rate between year-ends
Balance sheet liability at 31 January 1,486 1,513
This liability represents the present value of the deficit contributions agreed as at the accounting date and has been valued using the following discount rates, set by reference to the duration of the deficit recovery payments. 2017 2016
%pa %pa Discount Rate at end of year 1.70 2.70 Discount Rate at start of year 2.70 2.50
The legal structure of the scheme is such that if another employer fails, SAMS could become responsible for paying a share of that employer’s pension liabilities. The next valuation of the scheme is being carried out as at 31 December 2016.
D. Multi – Employer Defined Benefit Scheme – Church Workers Pension Fund – Pension Builder Scheme section (Group) The Group through South American Mission Society also participates in the Pension Builder Scheme section of 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 Group and the other participating employers. The CWPF 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. The Pension Builder Scheme of the Church Workers Pension Fund is made up of two sections, Pension Builder Classic and Pension Builder 2014, both of which are classed as defined benefit schemes. Pension Builder Classic provides a pension for members for payment from retirement, accumulated from contributions paid and converted into a deferred annuity during employment based on terms set and reviewed by the Church of England Pensions Board from time to time. Bonuses may also be declared, depending upon the investment returns and other factors. Pension Builder 2014 is a cash balance scheme that provides a lump sum that members use to provide benefits at retirement. Pension contributions are recorded in an account for each member. This account may have bonuses added by the Board before retirement. The bonuses depend on investment experience and other factors. There is no requirement for the Board to grant any bonuses. The account, plus any bonuses declared, is payable from members’ Normal Pension Age. There is no sub-division of assets between employers in each section of the Pension Builder Scheme.
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 59 NOTES TO THE FINANCIAL STATEMENTS 26. RETIREMENT BENEFITS (continued)
The scheme is considered to be a multi-employer scheme as described in Section 28 of FRS 102. This is because it is not possible to attribute the Pension Builder Scheme’s assets and liabilities to specific employers and accordingly contributions are accounted for as if the Scheme were a defined contribution scheme. The pensions costs charged to the SoFA in the year ended 31 January 2017 are contributions payable of £ 65,000 (2016: £65,000). A valuation of the scheme is carried out once every three years. The most recent scheme valuation completed was carried out as at 31 December 2013. This revealed, on the ongoing assumptions used, a surplus of £0.5m. There is no requirement for deficit payments at the current time. Pension Builder 2014 will be valued in relation to the lump sum payable to members at normal pension age. There are no annual pension benefits. Pension Builder 2014 commenced in February 2014 so the first full valuation of that section will be carried out at the next CWPF valuation date, 31 December 2016.
E. Defined Contribution Schemes (Group and Charity) The Charity contributes to personal money purchase pension schemes (defined contribution schemes) for certain employees and mission partners. 2017 2016 £’000 £’000
Staff and Mission Partners 579 571
579 571
27. Secured Assets CMS House, the Mission and Community House in Oxford and two other residential properties have been pledged as security to the CMS Defined Benefit Pension Scheme. These properties are being used as security to guarantee the Charity’s funding shortfall to the CMS Defined Benefit Pension Scheme.
60 Church Mission Society - The call in action NOTES TO THE FINANCIAL STATEMENTS
28 SUBSIDIARY UNDERTAKINGS
Principal Subsidiaries at 31 January 2017
a) The South American Mission Society
Name Principal Activities Ownership The South American Mission Society To be a community of People in Mission proclaiming 100% the Gospel in all places and to draw all peoples into (RCN: 221328 and Co. No.:65048) fellowship with the Lord Jesus Christ. The main arena of work is South America.
b) CMS House Enterprises Ltd
Name Principal Activities Ownership CMS House Enterprises Ltd Income from craft and books sales and room 100% - £1 share hire of CMS House. This entity started trading capital (Co. No.: 09376700) on 1 February 2015.
Summary of results for the 12 months to 31 January
The Charity The South American CMS House En- Consolidation Total Total Mission Society terprises Ltd adjustments 2017 2016 £’000 £’000 £’000 £’000 £’000 £’000
Total incoming resources 7,208 738 103 (388) 7,661 8,362 Total resources expended (7,293) (495) (110) 388 (7,510) (6,554) Gain/(losses) on investments 373 - - - 373 (511) Actuarial gains/(losses) on (6,205) - - - (6,205) - defined benefit scheme Other gains/(losses) on - (85) - - (85) - pension scheme deficit reduction provision
Net movement in funds (5,917) 158 (7) - (5,766) 1,297
The Charity The South American CMS House Consolidation Total Total Mission Society Enterprises Ltd adjustments 2017 2016 £’000 £’000 £’000 £’000 £’000 £’000
Total fixed assets 20,275 - - - 20,275 19,962 Current assets 6,879 1,314 14 (430) 7,777 7,992 Current liabilities (1,592) (24) (25) 430 (1,211) (1,064) Long term liabilities - - - - - (200) Defined benefit pension (5,944) (1,486) - - (7,430) (1,513) scheme asset/(liability) ------
Net assets/(liabilities) 19,618 (196) (11) - 19,411 25,177
Consolidation adjustments The SAMS’ adjustment in the funds movement relates to transfer of restricted funds relating to Mission partners where the income is received by the CMS (parent charity) (see note 23) and the costs are paid out of SAMS (subsidiary charity) which is the legal employer. CMS bears all other SAMS overheads without charge, apart from the SAMS governance cost.
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 61 NOTES TO THE FINANCIAL STATEMENTS At 31 January 2017
29. ACCOUNTING ESTIMATES AND JUDGEMENTS In preparing the financial statements, the trustees are required to make estimates and judgements. The matters considered below are considered to be the most important in understanding the judgements that are involved in preparing the financial statements and the uncertainties that could impact the amounts reported in the results of operations and financial position. Accounting policies are shown in note 2 to the financial statements.
Pension liabilities – CMS Pension Scheme CMS has recognised its liability to its defined benefit pension scheme which involves a number of estimations, as disclosed in Note 26.
Cost allocation Costs not attributable to a single activity are allocated or apportioned to activities on a basis consistent with identified cost drivers for that cost category. Cost drivers utilised relate to the proportion of time spent by staff across different activities and judgement is exercised in applying cost drivers to cost categories.
Pension liabilities – multi employer defined benefit pension schemes As explained at note 26 there is a deficit reduction plan in place of SAMS membership of Defined Benefits Scheme section of the CWPF and this involves the use of certain estimates.
62 Church Mission Society - The call in action REFERENCE DETAILS OF THE CHARITY AND ADVISERS
Principal Address Church Mission Society Watlington Road Cowley Oxford OX4 6BZ
Principal Professional Advisers Bankers Auditors Principal Solicitors Investment Managers Barclays Bank PLC Crowe Clark Whitehill LLP Anthony Collins Solicitors LLP C. Hoare & Co. Oxford Team Aquis House 134 Edmund Street 37 Fleet Street Wytham Court Reading Birmingham London 11 West Way Berkshire B3 2ES EC4P 4DQ Oxford RG1 1PL OX2 0JB
Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 (Scotland) 63 Church Mission Society Watlington Road, Oxford, OX4 6BZ
T: +44 (0)1865 787400 E: [email protected] churchmissionsociety.org
Church Mission Society is a mission community acknowledged by the Church of England Registered Company No. 6985330 and Registered Charity No. 1131655 (England and Wales) and SC047163 /churchmissionsociety (Scotland) Also part of CMS: The South American Mission Society. Registered Company No. 65048 and Registered @cmsmission Charity No 221328 (England and Wales), The Church Mission Society Trust. Registered charity number 1131655-1 (previously 220297), Registered and principal offices of all above entities: Watlington Road, Oxford, OX4 6BZ.