GENERAL ASSEMBLY 2019 2019 ACCOUNTS 2018 FOR THE YEAR ENDED 31 DECEMBER 2018 ACCOUNTS 2018 1 THE PRESBYTERIAN CHURCH IN IRELAND SUMMARY INDEX • Introduction to Accounts 2018 • Accounts of the General Assembly of the Presbyterian Church in Ireland incorporating the financial statements of the Trustees of the Presbyterian Church in Ireland, prepared in accordance with the “Statement of Recommended Practice: Accounting and Reporting by Charities” (FRS 102) • Statement of Liquid Funds • General Council • Council for Global Mission • Council for Mission in Ireland • Council for Social Witness • Council for Congregational Life and Witness • Council for Training in Ministry • Accounts of the Trustees of the Presbyterian Church in Ireland, prepared in accordance with the “Statement of Recommended Practice: Accounting and Reporting by Charities” (FRS 102) • The Presbyterian Church Investment Fund (commonly known as the General Investment Fund) • Trust Estate of Mr John Getty • Old Age, Presbyterian Women’s and Indigent Ladies’ Funds • Presbyterian Church in Ireland Pension Scheme (2009) • Certificate from the General Assembly’s Solicitor regarding deeds held in Church House • Published Bequests for the Presbyterian Church in Ireland • Detailed index 2 ACCOUNTS 2018 ACCOUNTS 2018 3 THE PRESBYTERIAN CHURCH IN IRELAND INTRODUCTION TO ACCOUNTS 2018 The Code, the book of the constitution and government of the Presbyterian Church in Ireland, in paragraph Para 272(11)(b) places a responsibility on the General Council to “prepare and present the annual accounts to the General Assembly....”. This Accounts Book includes three sets of summary accounts, (i) the accounts of the General Assembly of the Presbyterian Church in Ireland which incorporate the accounts of the various General Assembly Councils and those of the Trustees (as detailed in (ii)). (ii) the accounts of the Trustees of the Presbyterian Church in Ireland, which incorporate the various Trust Funds they are responsible for such as the Commutation Fund, Magee Fund, Lindsay Memorial Fund, Crescent Loan Fund but excluding the General Investment Fund. (iii) The Presbyterian Church Investment Fund or the General Investment Fund. The General Assembly’s auditors, Ernst & Young, have given their audit opinion on these accounts. The accounts for the General Assembly and the Trustees have been prepared in accordance with the Charities SORP (FRS102) “Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS102)”. The Accounts Book also contains individual accounts for the various activities of the Councils of the General Assembly and these have been grouped by Council. Ernst & Young have attached a report to these accounts to confirm they have been incorporated into the consolidated accounts of the Councils of the General Assembly on which they have given their audit opinion. The Accounts Book includes accounts for the Church Pension Scheme, The Old Age, Presbyterian Women’s and Indigent Ladies’ Funds as well as some other Trust Funds although these do not fall under the direct control of the General Assembly. 4 ACCOUNTS 2018 THE PRESBYTERIAN CHURCH IN IRELAND INTRODUCTION TO ACCOUNTS 2018 COMMENTARY ON THE SORP ACCOUNTS FOR THE BOARDS OF THE GENERAL ASSEMBLY During the year, there was a deficit of income over expenditure (before accounting for any change in the value of investments or the pension liability) of £515,817 (2017 – deficit of £965,771). The deficit for the year reflects the conclusion of the refurbishment of the ground floor, or former Spies Mall, area of Assembly Buildings, the final phase of a refurbishment programme at Derryvolgie Halls of residence for students and timing differences between the receipt of donations in one year and payment of funds in the following year. During 2018 the value of Investments decreased by £2,760,002 (2017, increase of £3,518,041). In 2018, there was an actuarial loss on the provision for pension benefits of £6,857,478 (2017 a gain of £20,370,233). The loss arose primarily from a reduction in investment values. As a result, overall funds have decreased from £59,504,860 to £48,855,041. The following comments explain the main changes in income and expenditure from 2017. Total Income for 2018 was £27,209,447 compared to £27,756,833 for 2017 i.e. a decrease of £547,386 (2.0%). The main changes in income are detailed below; – Income from congregational assessments. This was consistent with the previous year decreasing slightly from £7,067,771 to £7,048,446. Assessments for all funds, other than the Pension Scheme Fund, are based on a percentage of a congregation’s assessable income. The assessment bands and rates for 2018 and 2017 were as follows Assessment Assessable Assessable 2018 2017 Band Income From Income To Assessment Assessment Rate Rate 1 0 10,999 Nil Nil 2 11,000 65,000 14.50% 14.50% 3 65,000 130,000 10.75% 10.75% 4 130,000 195,000 7.25% 7.25% 5 195,000 260,000 3.50% 3.50% 6 260,000 and above 0.00% 0.00% Rates applied to Assessable income for 2016 2015 ACCOUNTS 2018 5 THE PRESBYTERIAN CHURCH IN IRELAND INTRODUCTION TO ACCOUNTS 2018 As the assessments rates and bands were unchanged in 2018 the overall change in income is due to changes in the level of assessable income and the impact of currency rate moves on the conversion of receipts from congregations in the Republic of Ireland. The allocation of amount received from congregations for assessments was as follows; 2018 2017 Central Ministry Fund 41.29% 41.76% Retired Ministers’ Fund 9.75% 9.28% Widows of Ministers Fund 9.17% 9.86% Prolonged Disability Fund 1.72% 0.58% Incidental Fund 17.20% 15.55% Ministerial Development Fund 2.87% 2.32% Sick Supply Fund 0.23% 0.35% Students Bursary Fund 5.73% 8.62% Church House Repairs Fund 12.04% 10.90% Special Assembly – 0.58% 100.00% 100.00% The assessment for the Pension Scheme Fund for 2017 and 2018 was 24.0% of the stipend paid to the minister during the year. This reflects the outcome of the actuarial valuation of the Scheme at 31 December 2014. The amounts allocated to each of the assessment funds are shown in note 2 to the accounts. – United Appeal income. Total income from congregations (which includes amounts received late for the previous year’s appeal) decreased slightly from £3,461,584 to £3,410,822. While the overall appeal target for 2018 was not reached at the cut-off date a further £125,785 (at date of this report) has subsequently been received giving a total of £3,417,469 against the 2018 “Target of Honour” of £3,500,000. – World Development Appeal. In 2018, £585,685 was raised for the Appeal compared to £551,651 in 2017. – Special Appeals. In 2018, there was a special appeal for Indonesia which raised £268,615. In addition a further £62,077 was received for a prior year appeal for East Africa. In 2017 £635,900 was raised for the East Africa appeal and £15,255 was received for a prior year appeal for Nepal. – Gifts and Donations. Gifts and donations decreased from £682,707 to £590,786. – Legacy Income. This increased from £548,470 in 2017 to £660,968 in 2018 and includes significant bequests for Union Theological College and the Irish Mission. – Grants receivable. The accounts for 2018 reflect a grant in respect of the refurbishment of part of Assembly Building, which is now occupied by the Presbyterian Historical Society, as well as a grant in relation to the new visitor exhibition in the reception area. – Investment Income decreased from £1,384,781 in 2017 to £1,310,696 in 2018. This mainly arises from investments held by Councils in the General Investments Fund and the divided declared was 27p per share in both 2017 and 2018. 6 ACCOUNTS 2018 THE PRESBYTERIAN CHURCH IN IRELAND INTRODUCTION TO ACCOUNTS 2018 – Residential Homes etc. There was a significant increase in fee income relating to Residential Homes from £5,950,656 to £6,551,306. The full year impact of the opening of a new residential home, Trinity House, in Garvagh in 2017 and the closure of Ard Cluan, Londonderry and York House, Portrush, had an impact on overall income levels. The basic residential fee rate received by Homes in 2018 was £537 (from April 2018) which compared to £514 in 2017 (from April 2017) and £494 in 2016 (from April 2016). Occupancy rates remain at a high level in most facilities. Income from the other social witness facilities was consistent with 2017. – Income from Church Publications. Sales decreased from £196,045 to £178,500 with subscription rates remaining unchanged. Advertising income was £27,714 (2017 - £23,727). – Income from Union Theological College fees, excluding those from the Students Bursary Fund decreased from £774,977 to £738,538 reflecting student numbers. Total Expenditure remained consistent with 2017 increasing slightly from £27,722,604 to £27,725,264. The main points to note are – The Support Services Committee of the General Council agreed that salaries should increase by 2.0% (pro-rata for part time staff) from 1 January 2018 with incremental point increases applying for years of service. The pension contribution rate from the Church remained at 24.0% in 2018 for those eligible to join the Presbyterian Church in Ireland Pension Scheme (2009). An auto-enrolment pension scheme was introduced on 1 February 2014 in accordance with regulations with the church contributing at the rate of 6%. – The expenditure of the General Council increased from £6,150,915 to £6,321,785 as a result of the completion of the refurbishment works to the ground floor of Assembly Buildings.