PCC Accounts & Returns

Image of an old accounting calculator on a bright yellow background

COVID-19 Update

The deadline for holding Annual Church Parochial Meetings (APCMs) for 2020 is 31 May 2021.  Unlike 2020, there is unlikely to be any extension given for holding APCMs.

PCCs should not delay completing and submitting their 2020 Return of Parish Finance, as this can be done online in the usual way as soon as the PCC's 2020 financial statements have been prepared and independently examined.  

We would ask all PCCs to do their best to submit their 2020 Return of Parish Finance online by 31 May 2021.  (The online return system will close officially on 18 June 2021, and we don't want to miss this deadline!)  This will allow us to have a fairly up-to-date view of parish finances, which will be particularly valuable as we llok to understand more clearly the financial challenges that our parishes may be facing in the coming months.  We would also ask that PCCs to their best to submit their independently examined 2020 Report & Accounts by 31 May 2021.

Please do email a member of the diocesan Finance Team if you have any further questions about this.  Thank you for your continued support during these unusual times.


Year-end Accounts Checklist

To guide a Treasurer through the year-end accounting and reporting process, please refer to and complete our Finance checklist Further guidance on each part of the process is available as follows:

Accounting & Reporting
All Parochial Church Councils in the Diocese of Hereford, regardless of size or whether they are registered with the Charity Commission, are bound by charity law.  This means every PCC has a legal duty to produce a Trustees' Annual Report and Accounts, and make them publicly available, even if the PCC is not required to file them with the Charity Commission. This is because the Commission expects every charity to inform the public each year about its purpose, achievements, and how it has spent its money.  In particular, the annual report must set out the PCC's activities for public benefit.

The Church of England has an excellent publication to help PCCs meet their reporting responsibilities: PCC Accountability: The Charities Act 2011 and PCC (5th edition) can be read online, or purchased from the Diocesan Finance Office for £5.  The book covers all areas of producing the annual report and accounts, including a full set of example accounts.

Two different methods of accounting are permissible, depending on the gross income of the PCC: Receipts & Payments, or Accruals accounts.

 

Receipts & Payments Accounts
If the gross income of your PCC is less than £250,000 you can choose to prepare your accounts on a 'Receipts and Payments' basis. This is a simpler form of accounting which records cash moving in and out of the PCC’s bank accounts during the financial year.  

Receipts & Payments Accounts Template

Accruals Accounts
Parishes with gross incomes greater than £250,000 must produce accounts on the 'accruals' basis, which provides a more accurate view of the PCC’s financial position.
Trustees' Annual Report
Alongside each year’s accounts, a PCC must present a Trustees’ Annual Report.  The Charity Commission has issued some rules on what must be covered. There is also guidance on writing the Trustees’ Annual Report available. All PCC members have collective responsibility for the annual report, although typically the PCC Secretary and Treasurer will take a lead in its preparation, with input and support from the Incumbent or Priest-in-Charge.

The annual report and accounts provide an important opportunity for trustees to 'take stock' of what the PCC has achieved over the last year and to demonstrate to supporters, potential funders and the public that the PCC has met its objectives and managed its resources effectively, and explain the difference that it has made to its intended beneficiaries.

How to calculate gross income
For accounts prepared on the Receipts and Payments basis, gross income is the total receipts shown in the statement from all sources excluding the receipt of any endowment. For accounts prepared on an Accruals basis, gross income is the total incoming resources shown on the Statement of Financial Activities, including any amount transferred to income funds from endowment funds in order to be available for spending, but excluding the receipt of any endowment.
Annual Return of Parish Finance
The Return of Parish Finance provides a valuable, up-to-date snapshot of the financial strength of each parish, allowing the Diocese to respond appropriately to local needs. It also enables central Church of England teams to make informed decisions about resourcing across all dioceses.

We do ask parishes to complete their Return of Parish Finance through the Church of England's online parish return system.  This enables PCCs to access trend information over time, as well as allowing deanery and diocesan teams to view data quickly.

The Return of Parish Finance should be completed via this system once the year-end accounts have been completed.  The deadline for completion of the Return of Parish Finance is the 31st of May each year.

Once in the system, simply click on the ‘Enter your data’ link to start the process of entering your figures. You will note that the layout uses tabs on the left hand side of the screen to show the different parts of the form. As they are filled in, the colour changes from red to orange (partially filled in) or green (fully filled in). Once all the tabs are green you'll be ready to submit your return!

The online form contains simple guidance on the figures to be included under each heading category.  For detailed guidance, you may wish to refer to pages 29-34 of PCC Accountability document. Hard copies of this guide are available on request from the diocesan Finance team.

If you've not completed the Return of Parish Finance online before, you may find this parish returns system guide helpful.

Should you need a reminder of your log-in details for the online parish return system, please email Mrs Kerry Preedy or call her on 01432 373300.

If a PCC is genuinely unable to access the online Parish Returns system, they should download and complete the 2020 Return of Parish Finance form (in Excel) in full, and email the form to the Finance Team or post it to:

Finance Team,
Diocesan Office,
The Palace, Palace Yard,
HEREFORD,
HR4 9BL

Budget

Every PCC should set an annual budget at the start of each year – a plan that sets out:

  • how much money the PCC has
  • how much it plans to raise
  • how much it plans to spend.

The PCC Treasurer should check regularly (at least once a quarter, but more frequently if you're a larger PCC) that income and expenditure are aligned to the budget in any given period, and report on this at PCC meetings.  You should raise any issues (like a significant over- or under-spend) as soon as possible, and take prompt action to address any shortfalls in income and/or reduce or defer expenditure.

Budget template (Excel)

 


Additional Resources