REPORT AND ACCOUNTS YEAR ENDED 31ST MARCH 2015 · REPORT AND ACCOUNTS YEAR ENDED 31ST MARCH 2015 ....

REPORT AND ACCOUNTS

YEAR ENDED 31ST MARCH 2015

SALISBURY CATHEDRAL REPORT AND ACCOUNTS

YEAR ENDED 31ST MARCH 2015 CONTENTS Page 1-2 Legal and administrative information 3-10 Report of the Chapter 11 Statement of Chapter's responsibilities 12 -13 Auditors' report 14-15 Principal accounting policies 16 Consolidated statement of financial activities 17 Consolidated balance sheet 18 Cathedral balance sheet 19 Consolidated cash flow statement 20-31 Notes to the accounts

SALISBURY CATHEDRAL YEAR ENDED 31ST MARCH 2015

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LEGAL AND ADMINISTRATIVE INFORMATION Full name: The Cathedral Church of the Blessed Virgin Mary Address: 6 The Close, Salisbury, Wiltshire, SP1 2EF Governing statutes: Salisbury Cathedral Constitution and Statutes dated 1st July 2001 Members of Chapter: Dean: The Very Reverend June Osborne Canons Residentiary: Canon T Clammer (Precentor) Canon E Probert (Chancellor) Canon S Mullally (Treasurer) Canons in Holy Orders: Canon Dr J Coates (retired April 2014) The Venerable A Jeans Rev T Woodhouse (appointed May 2014) Lay Canons Mrs J Barker Mr C Hurford – Jones Mr L March Mrs E Turton Executive Director/ Chapter Clerk: Mrs K Sporle

Members of Council: Lord Sharman (Chairman) The Bishop of Salisbury The Dean of Salisbury Canon T Clammer (Precentor) Canon E Probert (Chancellor) Canon S Mullally (Treasurer) Mrs J Barker Mrs K Beckett Madeleine, Countess of Bessborough OBE Mr R Fleck Mr R Key Sir Hayden Phillips (retired September 2014) Dame Rosemary Spencer Mrs E Turton The Venerable S Waine (became Dean of Chichester 2015) Rev T Woodhouse (retired October 2014) Mrs S Woolley Judge K Cutler (appointed August 2014) Mrs S Denniston (appointed August 2014) Lady Phillips (appointed August 2014) Rev Dr D Coulter (appointed September 2014)


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LEGAL AND ADMINISTRATIVE INFORMATION (Continued) Finance Advisory Group: Mrs J Barker (Chairman) The Dean Mr R Creswell Mrs B Hollond Mr J Joll Mr L March Mrs E Osborne Fabric Advisory Committee: Sir Hayden Phillips (Chairman) Dr J Crook Mr P Dean Reverend Dr A Doig (retired September 2014) Dr J Goodall The Very Reverend G Smith (appointed September 2014) The Very Reverend V Stock

Lay managers: Mr D Coulthard, Director of Marketing and Communications (resigned 8 April 2015) Mr D Halls, Director of Music Mr M Field, Director of Development (resigned 31 December 2014) Mrs S Rickett, Director of Learning and Outreach Mr R Gurd, Director of Finance Mrs J Eldridge, Head of Human Resources Website address: http://www.salisburycathedral.org.uk Professional advisers: Bankers: Lloyds plc, 38 Blue Boar Row, Salisbury, SP1 1DB Solicitors: Parker Bullen, 45 Castle Street, Salisbury, SP2 7JR Auditors: Fletcher & Partners, Crown Chambers, Bridge Street, Salisbury, SP1 2LZ Investment managers: Schroders, 12 Moorgate, London, EC2R 6DA Land agent: Strutt & Parker, 41 Milford Street, Salisbury, SP1 2BP Architect: Michael Drury (retired 31 March 2015) St Ann's Gate Architects, The Close, Salisbury, SP1 2EB Izaak Hudson (appointed 1 April 2015) Purcell 35 King Street, Bristol, BS1 4DZ Archaeologist: Graham Keevil, 85 Kynaston Road, Didcot, Oxon, OX11 8HA

http://www.salisburycathedral.org.uk/


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THE GOVERNANCE OF THE CATHEDRAL The governance of the Cathedral is regulated by statute, the principal of which is the Cathedrals Measure 1999. This establishes the basic principles with which all cathedrals must comply and a structural framework to inform governance mechanisms. The Cathedrals Measure requires each cathedral to produce its own separate statutes. These statutes interpret the dictates of the Measure according to local or historic use, and in particular specify the functions and responsibilities of individuals, both clerical and lay, and establish the administrative framework. Cathedral Chapter Salisbury’s statutes were issued on 1 July 2001. They determine that the governing body of the Cathedral is the Chapter, consisting of the Dean, the three Residentiary Canons (Precentor, Chancellor and Treasurer), two non-residentiary canons elected by the clerical members of the College of Canons, two lay members elected by the lay canons of the College and two co-opted members appointed by Chapter. With the exception of the Dean and Residentiary Canons members hold office for three years but are eligible for re-election or re-appointment. Induction and training of new members is the responsibility of the Chapter Clerk who produces a programme of briefings and visits to ensure familiarity with the administration, management and finances of the Cathedral. Chapter undertook a comprehensive review of governance in 2013 following consultation with the Cathedral Council, and adopted a new code of good governance which is still in use and has been used as an example of good practice by the Association of English Cathedrals. Cathedral Council The Cathedral Council was established under the Cathedrals Measure to “further and support the work of the Cathedral, spiritual and temporal, pastoral, evangelistic, social and ecumenical, reviewing and advising upon the direction and oversight of that work by the Chapter”. It met twice during the year under the chairmanship of Lord Sharman, taking reports on the regulation of Cathedrals, the Strategy and Programme, the Cathedral’s strategic risk register and the Cathedral’s Annual Report. College of Canons The Cathedrals Measure requires the Cathedral to establish a College of Canons consisting of every canon of the Cathedral, including the Bishop, the Dean, the suffragan bishops and every archdeacon in the Diocese. In its membership the College expresses the close relationship between the Cathedral and the rest of the diocese of Salisbury. The College met twice during the year installing 4 new canons in 2013 and bidding farewell to 16 members. Executive Chapter is supported by a full team of Executive Directors and staff who undertake the operational administration of the Cathedral. The Executive work in partnership with the Residentiary Canons who provide oversight and, as appropriate, managerial expertise. The Dean chairs both Chapter and the Executive briefings which ensures that Chapter leads and directs and the Executive implements the Cathedral’s objectives. Risk Management The risk register records the principal risks to which the Cathedral’s strategic plan is exposed. This is reviewed regularly by Chapter and the Executive and systems are in place to mitigate risks as they are identified. During the course of the year, and at the instigation of the Cathedral Council, a new overview of strategic risk was developed and implemented. The level and extent of the Cathedral’s insurance cover is reviewed at least annually to ensure that it is appropriate and Chapter’s actions are considered carefully in the light of potential reputational risk.


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STRATEGY 2013 -17 AND PROGRAMME FOR 2014/15 Our Purpose is: Making a difference for God through exceptional worship and outreach. Our values are: Integrity, reflected in transparent, fair and consistent actions; Generosity, which generates a warm open welcome to all; Compassion, which promotes social justice, equality, diversity, dignity, consideration and respect for all. And our ambition is to be a beacon of confident, open Christianity with a reputation for warmth of welcome and willingness to engage with others. Our purpose, values and ambition are set out in full in our strategy for 2013-17 and Programme for 2014/15, which also articulates the main goals and priority actions we proposed to take to achieve measurable progress. WORSHIP Offering exceptional worship means both cherishing the tradition and being ready to innovate within it. During the year we have continued to sustain the daily and weekly round of worship which is our core purpose, whilst also working to our programmed goals which focus on developing the range and accessibility of our worship, enhancing the environment in which we worship, and building the links between worship and outreach. We continued to enhance the opportunities for worship in private and in small groups by consulting on and undertaking selective re-ordering of the Cathedral. We aimed to further develop the Cathedral’s active role within the parishes and church schools in the Diocese. We set ourselves 14 priority actions all of which were met. They included providing innovative liturgical opportunities to mark the outbreak of World War 1, and beginning to address the use of the Spire Crossing on Sunday mornings. We completed our design for the re-ordered St Michael’s Chapel and expect to be able to dedicate the new hangings early in the new programme year. We completed our experimental re-ordering of the Trinity Chapel. The regular rhythm of the Christian year was well represented by the familiar services at Advent, Christmas and Holy Week, we further developed the Christmas Eve Family Service, and introduced an experimental service marking the Lighting of the Christmas tree, linked with a programme of family events in the afternoon of that day. Our tradition of excellence in Music was maintained with many glorious moments during the year. Once again we had more applications for choristers than places and again we attracted large audiences for our programme of Choral Foundation concerts which included a Remembrance-tide concert, and the St John Passion in Holy Week. A hugely successful Choir Tour to our twin town of Saintes during Passiontide re-launched Chapter’s programme of Choir Touring. All of this takes place within the building, a magnificent gothic Cathedral, as a living monument in stone, glass and wood to the glory of God and a testament to the skills of countless craftsmen and women. FUNDRAISING This has been a very rewarding year for fundraising. Our priority remains the repair and conservation of the precious medieval fabric of the Cathedral and, excitingly, the end stages of the Major Repair Programme are coming into view. Our goal is to reach completion by 2018 and the generous grants and donations which have been a feature of this year mean that this goal is certainly within reach. We were thrilled to be awarded with a grant from the first round of the First World War Centenary Cathedral Repairs Fund. This Fund is a partnership between ChurchCare, the Department for Culture, Media and Sport and the Roman Catholic Church and was set up in recognition of the important role that cathedrals have at the heart of their community, as public spaces for engagement and for the celebration of significant national anniversaries and events. Having been more than a decade since we had any public funding support the grants were very welcome indeed.


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FUNDRAISING (continued) Our Sponsor a Stone initiative, launched at the beginning of the year, has proved immensely popular: donors appreciated the opportunity to have a specific stone carved with the initials of their choice and many also took up the invitation to have a scaffolding tour to see the stones in place. We launched the second phase of the scheme, which covers the South Presbytery Aisle, in January this year at a special party in celebration of the Cathedral being entirely free of visible scaffolding. We have been delighted with the response to this so far as word of the sponsorship scheme has spread. We held two fundraising receptions this year specifically for the Major Repair Programme and we are grateful to the hosts who opened their homes for us. On both occasions we were lucky with the weather and guests were able to mingle in lovely gardens while having a go at carving stone. Donations for the fabric appeal this year amounted to over £400,000 and we are very grateful to all our generous donors and supporters for sustaining and making possible this huge endeavour. Our target for completion is now just under £1m. The Cathedral relies on income from its visitors, donations and legacies. Many people would like to contribute more to the Cathedral than they are able to during their lifetime, and therefore leaving something in their will is a way to do this. It helps us to safeguard the future of the Cathedral for generations to come. A legacy or bequest is often the largest single charitable gift that anyone makes: it is when one truly becomes a ‘benefactor’. We encourage people to let us know if they have left the Cathedral a bequest so that we can say ‘thank you’ and show our appreciation. Benefactors can choose to help maintain the fabric of the building, to support our music, liturgy, education or our work and mission in general. The names of those who have left a gift to the Cathedral in their Will are included in our Book of Remembrance, displayed in the Cathedral as a permanent tribute. The Heritage Lottery Fund awarded us a grant of over £415,000 to deliver a new Magna Carta exhibition and interpretation in the freshly conserved Chapter House and Cloisters, officially opened on 6th March. We are also grateful to Wilsons Solicitors who are our main sponsors for this anniversary year’s varied programme of lectures, educational workshops, events, concerts and outreach initiatives. We are delighted that visitor numbers have greatly increased already due to the attraction of the new exhibition and planned events will reach out to new audiences both near and far. The exhibition in the Chapter House includes artefacts from the Cathedral’s unique archives and, thanks to the generous donation received last financial year from the Sackler Trust, our Librarian has been able to make significant improvements towards the conservation and storage of this collection. The Friends of Salisbury Cathedral have given very valuable support this year with a further donation to the Little Paradise facilities and a grant towards the Cathedral flowers. The Boy Choristers’ medallion scheme took off this year and we were delighted to be able to award two new medallions – one in September and one in February – thanks to generous help from kind individuals. We also had further generous support for our Girl Choristers’ medallion scheme which is administered by the Salisbury Cathedral Girl Choristers Fund. Other support from Trusts and individual benefactors meant that we were able to continue to accept children into the choir from all financial circumstances, who have the potential to be talented choristers. The Cathedral is currently committed to giving 30% of the fees to all choristers to enable them to be a part of the important choral tradition. Looking ahead to next year it would be wonderful to have more medallions for the choristers. We are pleased to report that we have received approximately £47,000 this year for chorister bursaries, music and choir outreach. This has included generous grants from grant-making trusts and there are also many individual benefactors of our music to whom the Cathedral is, as ever, very grateful.


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OUTREACH With Outreach established as a clear objective, the Cathedral has continued to support a variety of ways which provide opportunities for learning, encounter and transformation with visitors, families, young people, the local community and with schools, introducing an increased number of people to the Cathedral and extending our spiritual impact. This year saw a particular emphasis on the World War I Commemoration events. Particularly well received were the reflective events including the collection and reading of names of the fallen from across the Diocese and the significant Roll of Honour For All Wars which attracted visitors from across the world, as well as the film show in the North Chapel covering the north and south Irish troops at the front. There were also opportunities for spiritual engagement through meditations, labyrinth and Easter reflective stations. Targetted outreach projects with young people developing literacy and increasing skills through stone carving added to the ongoing success of the educational work with young people in an increased variety of curriculum-led activity with 10,000 students and schoolchildren taking part across the year. Outreach played a crucial role in securing the Round 2 grant from the Heritage Lottery Fund by devising a highly ambitious and varied Learning and Outreach Plan which involved recruiting 60 new volunteers to support the events programme and training a further 200 existing volunteers. A key part of the project has been the developing relationship with Erlestoke Prison, the Trussell Trust, local community groups and arts partners Bournemouth University and and local schools such as Sarum Academy. The Cathedral experienced an unusual visitor year but despite early worries finished strongly, visitor numbers were just slightly behind last year’s strong showing at 246,000 (-1%). The early part of the year was poor, raising concerns that the new exhibition at Stonehenge with its extended dwell time was leading to tour groups and visitors – especially domestic visitors - leaving the Cathedral out of their itineraries. Problems with visitor routing exacerbated the issue, but with new signage in place matters improved from August and we enjoyed one of our best winters for many years, despite the Magna Carta being absent for almost two months in preparation for the new exhibition. Research suggested an increase in overseas visitors, with the North American market proving stronger than for many years. Donation income rose significantly, with visitors making higher average donations than in previous years. The final figure of £1,162,000 was a new high, and 6% higher than the previous year. The Shop was hit by the lack of spring and early summer visitors. Swift action from the Shop Manager to amend orders and a strong finish to the year resulted in a final turnover of £638,000, just 2% behind budget. The Refectory, buoyed by its recent refit, new seating and new menu, had an excellent year, and was one of only five sites selected by Visit England for its Quality Café Award in November. Overall turnover leapt by 17% to £688,000, with commission for the Cathedral of £139,000, once again demonstrating the strength of the partnership between the Cathedral and its long term partner Levy Restaurants. Planning for the 800th anniversary of Magna Carta in 2015 was a significant feature of the year, with the early months focused on preparing the Heritage Lottery Fund bid. The news of its success arrived in September, signalling the start of a rush to deliver the Cathedral’s extensive plans. The opening by the Dean of Salisbury and British Museum Director Neil MacGregor of the new exhibition, Magna Carta: Spirit of Justice, Power of Words, at the start of March, was the highlight of the year. The exhibition’s designers, Haley Sharpe Design have re-presented the Cathedral’s Magna Carta for the 21st century and early feedback from stakeholders and visitors has been full of praise. Visitor figures from March have also given confidence that the Magna Carta anniversary year and its supporting events programme will indeed bring many visitors to enjoy the Cathedral and ponder the modern day significance of the famous document. The partnership with the British Library and Lincoln Cathedral was also a major project, which came to triumphant climax in February as the four original Magna Carta were united at the British Library for the first time before an audience of scholars, VIPs and 1215 lucky members of the public drawn from a heavily over-subscribed ballot. Despite these successes, much remains to be delivered in 2015, notably the ambitious outreach programme led by the Cathedral’s Learning and Outreach Team, and the anniversary weekend celebrations in June.


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OUTREACH (continued) High quality temporary art installations were once again a feature, with John Maine’s Sanctuary pieces in the Close generating plenty of interaction. The thought-provoking The Apostles Speaking in Tongues Lit by their Own Lamps by Nicholas Pope was installed around Pentecost in 2014 with the support of The Jerusalem Trust and The New Art Centre Roche Court. We are also the proud temporary custodians of the Lynn Chadwick “cloaked figure” who is striding across the Close towards the Cathedral. THE CATHEDRAL SCHOOL In accounting terms the School is financially independent of the Cathedral and its results are not included within these consolidated accounts. In practice, however, the relationship between the Cathedral and the School is both longstanding and profound, and extends beyond the mere provision of choristers. The School has occupied the Bishop’s Palace since 1947 and its current aspirations to improve its buildings are closely associated with the Cathedral’s own aspirations for the Cathedral Close, as set out in its Masterplan document. Chapter and the School’s governors are co-operating closely to provide the School with facilities which will not only complement the beauty of the Close but also help the School retain its attractiveness in a competitive sector. THE CATHEDRAL AND THE CLOSE The Close environment includes the Churchyard, Choristers’ Green and Marsh and Rack Closes: it contains one college, three schools, two museums and two further properties open to the public; management of this environment includes the upkeep and maintenance of the precincts. With the exception of income from car-parking, the cost of maintaining the Close is currently borne entirely by the Cathedral. The Close environment has continued to require attention which at times distracts from the Major Repair Programme. Essential repairs have been done by the Works Department as the need arises but have been limited in extent. The traffic management pilot raised awareness of the need to find solutions to the traffic and pedestrian conflict, particularly at the High Street Gate. We will draw on the lesson learned for future traffic pilot schemes. HUMAN RESOURCES In secular management terms the Cathedral equates to a medium-sized, not-for-profit business and carries all the human resource responsibilities incumbent upon an employer of both industrial and administrative staff as well as over 600 volunteers. In the early part of 2014-15 the newly created posts of Dean’s Verger, Floor Manager and Events Manager were successfully filled; the posts of Dean’s Verger and Events Manager being successfully filled by internal applicants. Both of these internal promotions left gaps which were subsequently filled later in the year. In terms of other staff changes the Works department and Marketing department saw the departure of several long serving staff due to personal and/or health related reasons. As always, reviews of the roles and responsibilities of each post took place to ensure they remained fit for purpose. CATHEDRAL COMMUNITY FORUM The Statutes provide for the establishment of the Salisbury Cathedral Community Forum whose membership includes people associated with the Cathedral in the broadest sense, with particular emphasis on congregation, staff and volunteers. The task of the Forum is to:

support the mission of the Cathedral in consultation and cooperation with Chapter

represent to Chapter the views of those who regularly worship or work in the Cathedral

elect two lay members to the Cathedral Council in accordance with Articles 5.2(5) as provided for in article 18 of the Constitution of Salisbury Cathedral 2001.

Chapter has agreed that 5% of the moneys given at the offertory for Advent and Christmas carol services, normal Sunday and weekday services will be available for charitable giving. Proposals for the disbursement of these moneys to appropriate charities are made by the Forum. International, national and local charities received funding in this way during the year. This year the Community Forum supported us in the consultation on our values and undertook to review our material for new members of the Cathedral Congregation. They also took on co-ordination of the collection of food for local charities.


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FINANCIAL REVIEW Results The accounts on page 16 record a surplus of income over expenditure of £363k (2014:£1,699k), before recognising gains on investment properties and investments. Surpluses such as these are most welcome and arise from significant, specific donations and grants for the Major Repair Programme in each year. This year the Cathedral has been in receipt of a substantial legacy of £100k for unrestricted funds. These gifts have to be recorded in the year in which they are received and cannot be carried forward to be matched with the expenditure in future years which they are intended to fund. The accounting treatment gives rise to swings in income and expenditure. The Cathedral has also benefited from a significant increase on its return on investments income. We have also been fortunate during the year to secure Heritage Lottery Funding for the delivery phase of the Magna Carta project receiving £346k, along with a generous gift from an anonymous donor in support of the social justice fund. The Friends of Salisbury Cathedral provided a grant of £74k to repay the endowment funds used for the building of the new toilets known as Little Paradise. The continuing annual commitment to an average spend of £650k on the Major Repair Programme requires donations of equivalent amounts each year to fund it. We are most grateful for the donations received in the year towards these costs. They included a successful application for the WW1 grant with funds drawdown to date of £233k, trusts, sponsor a stone and donations of £171k, from the Ivor Read Charity, Salisbury Cathedral Trust and a grant from the Cathedral Fabric Repair Fund. The Cathedral obtained funding to aid the celebration year of the Magna Carta by successfully receiving three grants from The Magna Carta 800th Committee and the Arts Council England each supporting learning and outreach activities. INVESTMENTS The Statement of Financial Activities discloses that the Cathedral made unrealised gains of £1,120k on its investments in the year. These gains are "unrealised" because they reflect the change in the market valuation of the Cathedral's investment portfolio between 31st March 2014 and 2015. Details of the movements in investments in the year are shown in note 8 to the accounts. The primary purpose of the investment portfolio is to generate income to support the Cathedral's activities. The stated investment objective is ‘to maximise total return whilst adopting a moderate approach to risk’. There is a requirement for a relatively high level of income. These objectives should be achieved through an income-biased balanced portfolio of equities, property and cash. Given the long-term time horizon of the Cathedral, the investments are mainly concentrated in equity funds with a bias towards higher yielding equities. A fluctuation in the capital value of the equity fund holdings may lead to unrealised gains or losses but not necessarily change their ability to generate income. Our portfolio is managed by professional investment managers and their performance is monitored on behalf of Chapter by the Cathedral's Finance Advisory Group. The Cathedral has set an ethical investment policy (which draws on guidance given by the Church Commissioners)


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FINANCIAL REVIEW (continued) Reserves and investment policies The Consolidated Accounts have been prepared in compliance with the Accounting and Reporting Regulations for English Anglican Cathedrals as promulgated by the Association of English Cathedrals. It is important to note that

the majority of investments are held on endowment and the capital cannot be realised to meet ordinary expenditure

the greater part of the endowment consists of the Close properties, a number of which are let on long repairing leases

the majority of the increase in funds includes unrealised gains of £1,120k (2014: £1,020k) on the revaluation of investments.

Endowed capital cannot be used to repair the Cathedral or Close properties. Under The Cathedrals Measure 1999 Chapter may invest the Cathedral’s funds in any of the following:

land

investments in which trustees may invest under the general power of investments in the Trustee Act 2000

the improvement or development of property belonging to the Cathedral, except that endowed funds may not be used to improve or develop the Cathedral itself or its ancillary buildings without the express authority of the Church Commissioners.

The Cathedral's Endowed Funds, both income and capital, may be used to improve the freehold properties owned by the Cathedral. During the year income was received from the Friends of Salisbury Cathedral of £74k for the Cathedral toilets known as Little Paradise. Expenditure was primarily for improvement works to houses in the Close occupied by members of the clergy and the tea rooms, along with investment management fees which resulted in a deficit of £120k for the year before gains on investments were taken into account. The sale of one freehold and a deed of grant issued in the year returned a realised surplus of £27k. The proceeds constitute endowed funds and so their use is restricted as set out above. OVERALL OUTCOMES AND LOOKING FORWARD The Cathedral’s unrestricted funds are those funds that are available to carry out its day to day ministry, education and outreach activities together with the basic upkeep of its buildings and precincts. Income is principally derived from visitors, property rents, investments and trading activities. Given the fluctuations in its income streams that are largely outside of its control, Chapter has an objective to retain in unrestricted reserves an amount equivalent to six months’ annual expenditure in order to maintain these necessary activities in times of income shortfall. The Cathedral has after many years attained this target and with continued careful financial management the Cathedral has been able to maintain these activities and is actively planning to augment its funds through fundraising, cost control and income generation. The 2015/16 budget aims to continue to achieve a routine surplus along with meeting the goals set in the programme for 2013 -2017.This will be a challenging year, with the celebrations of the Magna Carta year alongside the usual activities undertaken by the Cathedral. The Cathedral will be committing specific funds to carry out the planned Magna Carta 2015 programme. The Library and archives will also be further developed using the funds from The Sackler Trust. The Heritage Lottery Funds will be used for the varied activities promised within the bid. The Cathedral will also wish to invest in the Master Plan projects centred on property developments within the Cathedral portfolio, to allow for a stable base for future planning; part of this will be investing in the Ladywell complex, along with traffic management, flood plan and landscape proposals. The Cathedral is immensely grateful for the faithful financial provision of its congregation and longstanding supporters, both personal and corporate. It continues to widen that circle of support through its fundraising initiatives, and through an attractive and compelling set of goals.


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CONCLUSION This report, as always, describes the rich and varied nature of the life and work of this Cathedral Church. 2014/15 was a particularly busy year which broke new ground in the achievement, for the first time, of a grant from the Heritage Lottery Fund which has enabled us to present, display and interpret Magna Carta to much higher quality standards and has seen the glory of the Chapter House restored in an uncluttered way. The joy that the completed exhibition has brought is palpable, and is reflected in the many positive comments from our visitors both home and abroad. So much of what we do is due to the unfailing and unstinting commitment of our dedicated volunteers, who as always deserve special mention and thanks. The thousands of visitors who come here each year are welcomed by our volunteers; independent research shows not only that our visitors rate their experience highly, but that more and more return for a repeat visit. The Major Repair Programme continues to be the Cathedral’s first call on fundraising and the focus of attention for the Cathedral Works Department of skilled and dedicated craftsmen and women. We have increased the momentum of fundraising and ensured that the conservation of the north side of the Cathedral was completed during the Magna Carta year. We remain on track to complete the Programme entirely by 2018 enabling us to anticipate an exciting new phase in the Cathedrals long life by the preparation of a draft Master Plan for consultation. Much has been achieved and there is still much to do; with confidence and renewed hope we pledge ourselves to the privilege of bringing increasing innovation to the tradition that is Salisbury Cathedral.

The Very Reverend June Osborne Dean of Salisbury July 2015


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STATEMENT OF CHAPTER'S RESPONSIBILITIES FOR THE PREPARATION OF THE ACCOUNTS Members of Chapter are responsible for preparing the annual report and accounts in accordance with applicable law and United Kingdom Generally Accepted Accounting Practice. Under the provisions of the Cathedrals Measure 1999 and the Constitution of Salisbury Cathedral Chapter is required to prepare accounts, for each financial year, which give a true and fair view of the state of the Cathedral's affairs and of its financial activities during the year. In preparing those accounts members of Chapter are required to:

select suitable accounting policies and then apply them consistently;

make judgements and estimates that are reasonable and prudent;

comply with applicable accounting standards and, in particular, prepare the accounts in accordance with the Accounting and Reporting Guidelines for English Anglican Cathedrals prepared by the Association of English Cathedrals, subject to any departures disclosed and explained in the accounts;

state whether the accounting standards and Guidelines referred to above have been followed; and

prepare the accounts on the going concern basis unless it is inappropriate to presume that the Cathedral will continue to be financially viable.

Members of Chapter are responsible for ensuring that the Cathedral keeps proper accounting records which disclose with reasonable accuracy the financial position of the Cathedral and which enable them to ensure that the accounts comply with the provisions of the Cathedrals Measure 1999 and the “Guidelines on English Anglican Cathedrals Accounts”. Members of Chapter are also responsible for safeguarding the assets of the Cathedral and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.


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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SALISBURY CATHEDRAL COUNCIL

We have audited the financial statements of Salisbury Cathedral for the year ended 31 March 2014 which comprise the Consolidated Statement of Financial Activities, the Consolidated Balance Sheet, the Entity Only Balance Sheet, the Consolidated Cash Flow Statement and the related notes. The financial reporting framework that has been applied in their preparation is applicable law, Section 27 of the Cathedrals Measure 1999 and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). This report is made solely to the Chapter's members as a body, in accordance with Section 27 of the Cathedrals Measure 1999. Our audit work has been undertaken so that we might state to the members those matters we are required to state to them in the auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Chapter and the Chapter’s members as a body for our audit work, for this report, or for the opinions we have formed. Respective responsibilities of the Chapter and auditor As explained more fully in the Statement of Responsibilities of the Chapter set out on page 11, the Chapter members 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 (APB’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 Cathedral’s circumstances and have been

consistently and adequately disclosed;

the reasonableness of significant accounting estimates made by the Chapter members; and

the overall presentation of the financial statements.

In addition, we read all the financial and non-financial statements in the Annual Report of the Chapter to identify material inconsistencies with the audited financial statements. If we become aware of any apparent material misstatements or inconsistencies we consider the implication for our report. Opinion on the financial statements In our opinion the financial statements:

give a true and fair view of the state of the affairs of the Cathedral and its subsidiaries as at 31

March 2014 and of the net movement in funds for the year then ended.

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting

Practice and under Section 27 of the Cathedrals Measure 1999.


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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SALISBURY CATHEDRAL COUNCIL (CONTINUED) Matters on which we are required to report by exception We have nothing to report in respect of the following matters where we are required to report to you if, in our opinion:

the information given in the Annual Report of the Chapter is inconsistent in any material respect

with the financial statements; or

sufficient accounting records have not been kept; or

the financial statements are not in agreement with the accounting records and returns; or

we have not received all the information and explanations we require for our audit.

FLETCHER & PARTNERS Chartered Accountants and Statutory Auditor Salisbury


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PRINCIPAL ACCOUNTING POLICIES Basis of accounting The accounts have been prepared under the historical cost convention, modified for the revaluation of properties and investments, and in accordance with applicable accounting standards and the Accounting and Reporting Guidelines for English Anglican Cathedrals prepared by the Association of English Cathedrals, as revised in November 2006. Properties Properties used for the Cathedral's own activities, apart from the Cathedral itself, are shown at existing use value, and investment properties are shown at open market value.

Depreciation is not charged on the properties used by the Cathedral because their values derive principally from their locations and, as a consequence, their residual values are not expected to be less than their current values and their lives are considered indefinite. These properties are revalued every five years and resulting adjustments are made to the carrying values shown in the Balance Sheet. No depreciation is charged on investment properties because their values are adjusted by means of the revaluation.

Other tangible fixed assets Other tangible fixed assets are capitalised and depreciated over their anticipated useful economic lives. The following annual rates of depreciation are used:

Property improvements 2% - 10% straight line basis Cathedral furniture and equipment 10% straight line basis Works department equipment and vehicles 20% straight line basis Office, shop, refectory and computer equipment 20% - 33% straight line basis

Heritage assets The Chapter is responsible for the care and maintenance of the Cathedral Church and its various furniture, ornaments, vestments and vessels. They consider that owing to their incomparable nature conventional valuation approaches lack sufficient reliability and that, even if valuations could be obtained, the costs would be onerous compared with the additional benefits derived by the Cathedral and users of the accounts. As a result, no value is reported for those assets in the Cathedral’s balance sheet. The cost of associated major repairs to the Cathedral Church is reported in the Statement of Financial Activities. Further information is given in Note 10 to the accounts. Investments Investments are carried at mid-market values quoted by the respective fund managers. Realised and unrealised gains and losses in the year are shown on the Statement of Financial Activities. Income from investments is accounted for on a receivable basis. Stock Stock consists of materials held by the works and glazing departments and goods for resale held by Salisbury Cathedral Enterprises Ltd. Work in progress relates to outside contracts. These are all valued at the lower of cost and net realisable value.


15

Funds The funds of the Cathedral are classified according to their permitted usage as follows:

Endowment funds, whose capital cannot be spent, but the income from which may be used for either general or specific purposes

Restricted funds, whose capital and income are available for spending on specific purposes imposed by the original donor

Unrestricted funds, which are available for the general purposes of the Cathedral. These include amounts which have been designated for particular purposes by the Chapter but where the designation may be varied or removed in the future.

Incoming resources

Voluntary income and grants receivable, including donations, gifts and legacies are recognised when there is entitlement, certainty of receipt and the amount can be measured with sufficient reliability.

Charges in the course of mission and activities for generating funds are recognised as and when the related goods or services are provided.

Property and investment income is recognised on a receivable basis.

Lease premiums The majority of investment properties are subject to long-term leases for which a premium is charged on the grant of the lease. In accordance with the provisions of the Cathedrals Measure 1999 the lease premiums, less associated costs, are credited to endowed capital on receipt. The net proceeds are therefore shown as realised gains of the endowment funds in the year in which the lease premiums are received. Third party receipts and payments and donated goods and services When a third party pays for goods or services on behalf of the Cathedral the cost is shown as both income and expenditure in the Statement of Financial Activities. Similarly, donated goods and services are valued on an arm's length basis and shown as income and either capital or revenue expenditure as appropriate. No monetary value, however, is placed on the services provided by the many Cathedral volunteers. Legacies Legacies are included as income when it becomes reasonably certain that they will be received and the amount to which the Cathedral is entitled can be reliably ascertained. Where they are for specific purposes they are credited to the corresponding restricted fund. Repairs, restoration and maintenance of the Cathedral Expenditure on Cathedral repairs is charged in the Statement of Financial Activities as it is incurred. The costs of routine maintenance and work on the major repair programme are identified separately in notes to the accounts. Pension costs Pension scheme arrangements are operated on the basis of a defined contribution pension scheme on behalf of certain employees and one employee is a member of a defined benefit scheme. The assets of both schemes are held independently of the Cathedral. Contributions are charged to the Statement of Financial Activities in the period for which they are payable for both schemes. Taxation No corporation tax is chargeable as the Cathedral is a charity and its subsidiary companies surrender their profits to the Cathedral under Gift Aid. Income tax recoverable on donations and investment income is added to the corresponding net income. Value added tax Under the special rules applied by HM Customs and Excise the Cathedral is able to recover some of the VAT borne on its expenditure. Irrecoverable VAT is included within the support costs of the cost heading to which it relates.


16

CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES

Note Unrestricted Restricted Endowment Total Total Funds Funds Funds 2015 2014 £000 £000 £000 £000 £000 ______ ______ ______ ______ ______ INCOMING RESOURCES 1 Voluntary income 1,592 551 74 2,217 3,503 Grants receivable 6 832 - 838 376 Charges in the course of mission 161 7 - 168 183 Activities for generating funds 1,115 - - 1,115 1,124 Property and investments 757 118 - 875 637 Other income 50 24 - 74 95 ______ ______ ______ ______ ______ Total incoming resources 3,681 1,532 74 5,287 5,918 ______ ______ ______ ______ ______ COSTS OF GENERATING FUNDS 2 1,338 24 166 1,528 1,559 ______ ______ ______ ______ ______ EXPENDITURE ON MISSION 3 Ministry 694 377 - 1,071 980 Cathedral and precincts upkeep 827 1,192 28 2,047 1,496 Education and outreach 145 80 - 225 162 ______ ______ ______ ______ ______ 1,666 1,649 28 3,343 2,638 ______ ______ ______ ______ ______ GOVERNANCE COSTS 4 52 1 - 53 22 Total expenditure 3,056 1,674 194 4,924 4,219 ______ ______ ______ ______ ______ NET INCOMING RESOURCES 625 (142) (120) 363 1,699 OTHER RECOGNISED GAINS AND LOSSES Investment properties:realised - - 27 27 56 Investment properties:unrealised 7 - 1,149 1,149 - Other properties: unrealised 9 - - 1,294 1,294 245 Investments:realised - - (3) (3) 49 Investments:unrealised 8 - 11 1,109 1,120 1,020 Transfer Between Funds 15 105 - (105) - - ______ ______ ______ ______ ______ Net movement in funds 730 (131) 3,351 3,950 3,069 Balances at 1st April 2014 2,688 2,461 37,458 42,607 39,538 ______ ______ ______ ______ ______ BALANCES AT 31ST MARCH 2015 3,418 2,330 40,809 46,557 42,607 ______ ______ ______ ______ ______


17

CONSOLIDATED BALANCE SHEET Note Unrestricted Restricted Endowment Total Total Funds Funds Funds 2015 2014 £000 £000 £000 £000 £000 ______ ______ ______ ______ ______ FIXED ASSETS Investment assets Property 7 - - 10,557 10,557 9,755 Investments 8 1,837 1,473 16,809 20,119 18,555 ______ ______ ______ ______ ______ 1,837 1,473 27,366 30,676 28,310 Non-investment assets Property 9 - - 13,430 13,430 12,075 Other tangible assets 10 48 - - 48 58 ______ ______ ______ ______ ______ Total fixed assets 1,885 1,473 40,796 44,154 40,443 CURRENT ASSETS Stock 11 164 - - 164 151 Debtors 12 787 - - 787 302 Cash at bank and in hand 1,256 857 13 2,126 2,491 ______ ____ ______ ______ ______ 2,207 857 13 3,077 2,944 CREDITORS: Amounts falling due within one year 13 (674) - - (674) (730) ______ ______ ______ ______ ______ NET CURRENT ASSETS 1,533 857 13 2,403 2,214 ______ ______ ______ ______ ______ CREDITORS: Amounts falling

due after one year 14 - - - - (50)

______ ______ ______ ______ ______ NET ASSETS 3,418 2,330 40,809 46,557 42,607 ______ ______ ______ ______ ______ FUNDS Endowment funds 15 - - 40,809 40,809 37,458 Restricted funds 16 - 2,330 - 2,330 2,461 Designated funds 17 258 - - 258 258 General funds 17 3,160 - - 3,160 2,430 ______ ______ ______ ______ ______ 3,418 2,330 40,809 46,557 42,607 ______ ______ ______ ______ ______ Signed on behalf of Chapter: The Very Reverend June Osborne Jane Barker Dean Chairman, Finance Advisory Group Approved by Chapter: 24th July 2015


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CATHEDRAL BALANCE SHEET Unrestricted Restricted Endowment Total Total Funds Funds Funds 2015 2014 £000 £000 £000 £000 £000 ______ ______ ______ ______ ______ FIXED ASSETS Investment assets Property - - 9,457 9,457 9,084 Other investments 1,837 1,339 15,008 18,184 16,402 ______ ______ ______ ______ ______ 1,837 1,339 24,465 27,641 25,486 Non-investment assets Property - - 13,430 13,430 12,074 Other tangible assets 39 1 - 40 46 ______ ______ ______ ______ ______ Total fixed assets 1,876 1,340 37,895 41,111 37,606 CURRENT ASSETS Stock 10 - - 10 12 Debtors 1,323 - 93 1,416 776 Cash at bank and in hand 1,074 574 - 1,648 2,136 ______ ______ ______ ______ ______ 2,407 574 93 3,074 2,924 CREDITORS: Amounts falling due within one year (865) - (105) (970) (993) ______ ______ ______ ______ ______ NET CURRENT ASSETS 1,542 574 (12) 2,104 1,931 ______ ______ ______ ______ ______ CREDITORS: Amounts falling

due after one year - - - - (50)

______ ______ ______ ______ ______ NET ASSETS 3,418 1,914 37,883 43,215 39,487 ______ ______ ______ ______ ______ FUNDS Endowment funds - - 37,883 37,883 34,732 Restricted funds - 1,914 - 1,914 2,067 Designated funds 258 - - 258 258 Common account 3,160 - - 3,160 2,430 ______ ______ ______ ______ ______ 3,418 1,914 37,883 43,215 39,487 ______ ______ ______ ______ ______ Signed on behalf of Chapter: The Very Reverend June Osborne Jane Barker Dean Chairman, Finance Advisory Group Approved by Chapter: 24th July 2015


19

CONSOLIDATED CASH FLOW STATEMENT Note 2015 2015 2014 2014 £000 £000 £000 £000 _____________________ _______________________ Net cash flow from operating activities 18 (597) 1,437 Returns on investments Rents received net of expenses 158 132 Interest and dividends received 440 527 ______ ______ 598 659 ______ ______ 1 2,096 Capital expenditure and financial investment Purchase of investments (1,068) (5,431) Sales of investments 556 4,426 Additions to non investment property (2) (1,144) Sales of investment properties 289 527 Purchase of plant and equipment (16) (35) Loan repaid (50) (10) ______ ______ (291) (1,667) ______ ______ (Decrease) /Increase in cash 18 (290) 429 ______ ______


20

NOTES TO THE CONSOLIDATED ACCOUNTS Unrestricted Restricted Endowment Total Total Funds Funds Funds 2015 2014 £000 £000 £000 £000 £000 1. INCOMING RESOURCES Voluntary income Congregational collections 235 2 - 237 226 Visitors 1,162 - - 1,162 1,094 Other donations 90 385 - 475 845 Friends of the Cathedral - 3 74 77 462 Cathedral Trust - 20 - 20 75 Ivor Read Charity - 125 - 125 145 Legacies 105 16 - 121 656 ______ ______ ______ ______ ______ 1,592 551 74 2,217 3,503 ______ ______ ______ ______ ______ Grants receivable Church Commissioners - 137 - 137 138 Heritage Lottery Fund - 346 - 346 44 Other grants 6 349 - 355 194 ______ ______ ______ ______ ______ 6 832 - 838 376 ______ ______ ______ ______ ______ Charges in the course of mission Facilities and other fees 133 7 - 140 149 Education centre 28 - - 28 34 ______ ______ ______ ______ ______ 161 7 - 168 183 ______ ______ ______ ______ ______ Activities for generating funds Charges to visitors 98 - - 98 98 Shop, refectory and car park 887 - - 887 901 Masonry and glazing contracts 130 - - 130 125 ______ ______ ______ ______ ______ 1,115 - - 1,115 1,124 ______ ______ ______ ______ ______ Property and investments Property 279 45 - 324 310 Investments 478 73 - 551 327 ______ ______ ______ ______ ______ 757 118 - 875 637 ______ ______ ______ ______ ______ Other income Interest on short-term deposits 46 6 - 52 67 Other income 4 18 - 22 28 ______ ______ ______ ______ ______ 50 24 - 74 95 ______ ______ ______ ______ ______ Total incoming resources 3,681 1,532 74 5,287 5,918 ______ ______ ______ ______ ______


21

NOTES TO THE CONSOLIDATED ACCOUNTS (continued) Unrestricted Restricted Endowment Total Total Funds Funds Funds 2015 2014 £000 £000 £000 £000 £000 2. COST OF GENERATING FUNDS Cost of facilities for visitors 263 21 - 284 269 General marketing costs 92 - - 92 97 Appeals and fundraising expenses 98 2 - 100 143 Shop, refectory and car park 544 - - 544 562 Masonry and glazing contracts 125 - - 125 120 Property expenses 98 - 68 166 178 Support costs 118 1 98 217 190 ______ ______ ______ ______ ______ 1,338 24 166 1,528 1,559 ______ ______ ______ ______ ______ 3. EXPENDITURE ON MISSION Ministry Clergy stipends and expenses 24 139 - 163 162 Clergy housing costs 25 - - 25 23 Clergy support costs 39 - - 39 38 Services and music 447 237 - 684 609 Support costs 159 1 - 160 148 ______ ______ ______ ______ ______ 694 377 - 1,071 980 ______ ______ ______ ______ ______ Cathedral and precincts upkeep Major repairs and restoration - 600 - 600 622 Maintenance and interior upkeep 469 21 - 490 536 Cathedral insurance 51 1 - 52 48 Little Paradise Development - - 28 28 12 Magna Carta: funded by Heritage Lottery Fund - 379 - 379 10 funded by Cathedral and Others 98 98 4 Magna Carta Projects 17 90 - 107 - Precincts security and garden upkeep 85 3 - 88 69 Support costs 205 - - 205 195 ______ ______ ______ ______ ______ 827 1,192 28 2,047 1,496 ______ ______ ______ ______ ______ Education and outreach Educational activities 87 29 - 116 102 Archives and library - 41 - 41 1 Charitable and other giving 27 10 - 37 41 Support costs 31 - - 31 18 ______ ______ ______ ______ ______ 145 80 - 225 162 ______ ______ ______ ______ ______ Total expenditure on mission 1,666 1,649 28 3,343 2,638 ______ ______ ______ ______ ______


22

NOTES TO THE CONSOLIDATED ACCOUNTS (continued) Unrestricted Restricted Endowment Total Total Funds Funds Funds 2015 2014 £000 £000 £000 £000 £000 4. GOVERNANCE COSTS Legal and professional fees 14 1 - 15 14 Advisory committees 3 - - 3 3 Strategic planning and restructuring 35 - - 35 5 _________ ________ ________ ________ ________ 52 1 - 53 22 _________ ________ ________ ________ ________ 5. STAFF NUMBERS AND COSTS The average weekly number of paid staff of all the entities included in the consolidated accounts was as follows: 2015 total 2014 total No’s FTE No’s FTE Cathedral and precincts 42 26 41 27 Visitors and education 42 17 35 16 Works and glazing departments 26 21 24 22 Administration 15 12 11 9 __ __ ___ __ 125 76 111 74 __ __ ___ __ The total staff costs of these persons were as follows: 2015 2014 £000 £000 Wages, salaries and stipends 1,909 1,805 166 Employer's national insurance 152 151 Employer’s pension contributions 85 77 _________ _________ 2,146 2,033 _________ _________ One member of staff received emoluments (excluding employer's pension contributions) of more than £60,000 during the year ended 31st March 2015. The Dean and the three Canons Residentiary were paid stipends (including the related pension provision) in accordance with scales set annually by the Church Commissioners, the Archbishop's Council and the Church of England Pensions Board. The stipends of the Dean and two Canons Residentiary are funded by the Church Commissioners. The amounts paid including employer national insurance during the year ended 31st March 2015 were as follows: Pension Stipend Contribution £ £ The Very Reverend June Osborne (Dean) 35,634 10,615 Canon E Probert (Chancellor) 30,330 8,492 Canon T Clammer ( Precentor) 28,203 8,492 Canon S Mullally (Treasurer) 28,926 8,629 These pension contributions are paid to the Church of England Funded Pensions Scheme. Full details of the Scheme are shown in note 19.


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NOTES TO THE CONSOLIDATED ACCOUNTS (continued) 6. AUDITORS' REMUNERATION The total remuneration of the auditors of all the entities included in the consolidated accounts was: 2015 2014 £000 £000 Audit services 15 15 ______ ______ 7. INVESTMENT PROPERTIES General Choristers' Endowment Endowment Fund Fund Total £000 £000 £000 Valuation at 1st April 2014 9,084 671 9,755 Disposals - - - Transfers from / to non-investment properties (640) 293 (347) Revaluation 1,013 136 1,149 ______ ______ ______ Valuation at 31st March 2015 9,457 1,100 10,557 ______ ______ ______ The properties which are currently held for investment purposes include 30 houses and 1 office within The Close. All are held freehold and the majority are let on long tenant-repairing leases. The General Endowment Fund properties were valued at 31st March 2010 by Strutt & Parker LLP, Chartered Surveyors, on the basis of open market value. The Choristers Endowment Fund property, comprising the Cathedral School boarding house and Wren Hall was valued by Aitchison Raffety in May 2015 and Strutt & Parker in June 2013 respectively. The Cathedral would normally have revalued all the properties both investment and non-investment in

accordance with its policy to revalue every five years. In light of the changes to the accounting

standards used by the Cathedral that will be made next year, the Chapter has decided to postpone the

valuation until the next year end. This will save costs as only the non-investment properties will need to

be revalued. The Chapter have attained advice from Strutt & Parker on market conditions and have

reflected this by the revaluation shown in these accounts.

8. INVESTMENTS Unrestricted Restricted Endowment Total Funds Funds Funds £000 £000 £000 £000 MARKET VALUE At 1st April 2014 1,382 1,457 15,716 18,555 Additions 450 - 618 1,068 Disposals - - (559) (559) Increase/(decrease) in cash 5 5 (75) (65) Revaluation - 11 1,109 1,120 ______ ______ ______ ______ At 31st March 2015 1,837 1,473 16,809 20,119 ______ ______ ______ ______ COST At 31st March 2015 1,815 1,426 12,961 16,202 At 31st March 2014 1,365 1,426 13,030 15,821 The market values comprise: Collective Cash investments on deposit Total £000 £000 £000 At 31st March 2015 15,977 4,142 20,119 At 31st March 2014 15,601 2,954 18,555


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NOTES TO THE CONSOLIDATED ACCOUNTS (continued) 9. NON-INVESTMENT PROPERTIES Little Shop and Staff Paradise refectory Offices Houses Total £000 £000 £000 £000 £000 COST OR VALUATION Valuation at 1st April 2014 1,389 877 1,204 9,494 12,964 Additions 2 - - - 2 Disposals - - - (260) (260) Transfers from / to investment properties - - (293) 640 347 Revaluation - - 109 1,185 1,294 ______ ______ ______ ______ ______ Valuation at 31st March 2015 1,391 877 1,020 11,059 14,347 ______ ______ ______ ______ ______ DEPRECIATION At 1st April 2014 12 877 - - 889 Charge for the year 28 - - - 28 ______ ______ ______ ______ ______ At 31st March 2015 40 877 - - 917 ______ ______ ______ ______ ______ NET BOOK VALUE At 31st March 2015 1,351 - 1,204 9,874 13,430 At 31st March 2014 1,377 - 1,204 9,494 12,074 The offices and staff houses were valued at 31st March 2010 by Strutt & Parker LLP, Chartered Surveyors, on the basis of existing use value. The Cathedral would normally have revalued all the properties both investment and non-investment in

accordance with its policy to revalue every five years. In light of the changes to the accounting

standards used by the Cathedral that will be made next year, the Chapter has decided to postpone the

valuation until the next year end. This will save costs as only the non-investment properties will need to

be revalued. The Chapter have attained advice from Strutt & Parker on market conditions and have

reflected this by the revaluation shown in these accounts.

10. OTHER TANGIBLE FIXED ASSETS Workshop Shop and Building equipment Office refectory Cathedral improvements and vehicles equipment equipment inventory Total £000 £000 £000 £000 £000 £000 COST At 1st April 2014 102 194 349 64 276 985 Additions - - 16 - - 16 - - Disposals - - - - - - - - - - ______ ______ ______ ______ ______ ______ At 31st March 2015 102 194 365 64 276 1,001 ______ ______ ______ ______ ______ ______ DEPRECIATION At 1st April 2014 102 179 322 55 269 927 Charge for the year - 5 14 3 4 26 On disposals - - - - - - ______ ______ ______ ______ ______ ______ ______ ______ ______ ______ ______ ______ At 31st March 2015 102 184 336 58 273 953 ______ ______ ______ ______ ______ ______ NET BOOK VALUE At 31st March 2015 - 10 29 6 3 48 At 31st March 2014 - 15 27 9 7 58


25

NOTES TO THE CONSOLIDATED ACCOUNTS (continued) 10. OTHER TANGIBLE FIXED ASSETS (continued) HERITAGE ASSETS NOT RECOGNISED IN THE BALANCE SHEET Construction of the Cathedral Church started in 1220 and it was dedicated in 1258. The spire and tower were added in c1330. The current Constitution of the Cathedral, drawn up under the terms of the Cathedrals Measure 1999, states that it is the responsibility of the Chapter to ensure that necessary repairs and maintenance in respect of the fabric of the Cathedral and its contents and monuments are carried out. The current major repair programme started in the 1980s and now approaching completion, is the latest in a series of repair programmes undertaken over the centuries. As a result of continuing repair and conservation of the Cathedral it has been possible for Christian worship to be maintained in it since 1258. The Cathedrals Fabric Commission for England (CFCE) was established by the Care of Cathedrals Measure 1990 to advise the administrative body of a cathedral church on the care, conservation, repair or development of the cathedral church, and also to consider and determine any application made to it by the Chapter. Under the same Measure all cathedrals appoint an architect to carry out certain statutory duties on behalf of the Chapter, in particular making an annual and quinquennial report on the condition of the fabric. CFCE require that an inventory of the Cathedral’s furniture, ornaments, vestments and vessels be maintained. This inventory contains no cost or valuation information. Particular items of note recorded are the Cathedral’s copy of the original 1215 Magna Carta; the oldest working mediaeval clock in the world; a glass prism by Lawrence Whistler; and a font designed by William Pye and installed in 2008, which was funded by donations. Acquisitions of heritage assets are made through purchase and donation and are intended to complement existing collections or enhance the liturgical life of the Cathedral. 2015 2014 £000 £000 11. STOCK Raw materials 28 29 Goods for resale 132 119 Work in progress 4 3 ______ ______ 164 151 ______ ______ 12. DEBTORS Trade debtors 158 145 Income tax recoverable 54 33 VAT recoverable 16 - Investment income receivable 157 47 Grant receivable 295 - Other debtors 33 17 Prepayments 74 60 ______ ______ 787 302 ______ ______


26

NOTES TO THE CONSOLIDATED ACCOUNTS (continued) 2015 2014 13. CREDITORS: amounts falling due within one year £000 £000 Unsecured loans - 100 Bank overdraft 77 116 Trade creditors 318 236 Other creditors 10 38 Amounts due to the Friends of Salisbury Cathedral 15 15 PAYE and NIC 44 40 Accruals 113 102 Deferred income 97 83 _______ _______ 674 730 _______ _______ 14. CREDITORS: amounts falling due after one year Unsecured loan - 50 (40) (50) _______ _______ - 50 150 _______ _______ 15. ENDOWMENT FUNDS Balance Transfers, gains Balance 1st April 2014 Income Expenditure and losses 31stMarch 2015 £000 £000 £000 £000 £000 Endowed capital 34,732 74 (192) 3,269 37,883 Prebendal Fund 35 - (1) 3 37 Choristers' Endowment Fund 2,307 - (1) 185 2,491 Choral Foundation 384 - - 14 398 ______ ______ ______ ______ ______ 37,458 74 (194) 3,471 40,809 ______ ______ ______ ______ ______ The transfer of £105,000 from Endowed Capital to the Common Account reverses a transaction in 2013/14 which had the effect of capitalising this amount of investment income. 16. RESTRICTED FUNDS Balance Transfers, gains Balance 1st April 2014 Income Expenditure and losses 31stMarch 2015 £000 £000 £000 £000 £000 Specific funds: General fabric legacy fund 1,351 606 (600) - 1,357 Specific legacy fund 524 736 (849) 3 414 Willis organ fund 182 9 (49) - 142 Education fund 9 - (9) - - Prebendal fund 72 5 (2) 6 81 Choristers' Endowment 120 98 (82) - 136 Choral Foundation 202 78 (83) 2 199 Magna Carta Trust - - - - - Specific grants 1 - - - 1 ______ ______ ______ ______ ______ 2,461 1,532 (1,674) 11 2,330


27

NOTES TO THE CONSOLIDATED ACCOUNTS (continued) 16. RESTRICTED FUNDS (continued) Specific funds consist of unexpended donations and legacies for specific purposes, as follows: General fabric legacy fund: the repair and maintenance of the fabric of the Cathedral Specific legacy fund: various specific purposes including maintenance of the Cathedral and Close Willis organ fund: maintenance of the Willis organ in the Cathedral Education fund: the funding of educational activities Prebendal fund: to meet expenditure incurred by non-residentiary Canons and Lay Canons Choristers' Endowment: to fund the fees of boy choristers Choral Foundation: to promote and enhance church music in the Cathedral 17. UNRESTRICTED FUNDS Balance Surplus/ Gains/ Balance 1st April 2014 (deficit) (losses) Transfers 31stMarch 2015 £00 £000 £000 £000 £000 Designated funds: Cathedral interior development fund 31 - - - 31 Property repair reserve 15 - - - 15 General legacy fund 186 - - - 186 Library fund 26 - - - 26 ______ ______ ______ ______ ______ 258 - - - 258 General fund 2,430 625 - 105 3,160 ______ ______ ______ ______ ______ 2,688 625 - 105 3,418 ______ ______ ______ ______ ______ Designated funds consist of income that has been designated for the following purposes: Cathedral interior development fund: for improvements to the interior of the Cathedral Property repair reserve: for repairs to the secular properties General legacy fund: for identifying the capital element of legacies for general purposes Library fund: for the purchase of books for the Cathedral library General fund: the general accumulated fund of the Cathedral.


28

NOTES TO THE CONSOLIDATED ACCOUNTS (continued) 18. NOTES TO THE CASH FLOW STATEMENT Reconciliation of net changes in resources to operating cash flow 2015 2014 £000 £000 Net change in resources before revaluations 362 1,699 Depreciation 54 42 Rents received (324) (310) Investment property expenses 165 178 Interest and dividends received (550) (327) Change in stocks (12) 3 Change in debtors (375) 106 Change in creditors 83 46 __________ __________ Operating cash inflow (597) 1,437 __________ __________ Reconciliation of net cash flow to movements in net funds (Decrease) / Increase in cash (290) 429 Loan repaid 50 10 __________ __________ Change in net funds (240) 439 Net funds at 1st April 2014 5,178 4,739 __________ __________ Net funds at 31st March 2015 4,938 5,178 __________ __________ Analysis of net funds Balance Net cash Balance 1st April 2014 flow 31stMarch 2015 £000 £000 £000 Cash at bank and in hand: Unrestricted funds 1,437 (181) 1,256 Restricted funds 1,054 (197) 857 Endowment funds - 13 13 ______ ______ ______ 2,491 (365) 2,126 Bank overdrafts (116) 39 (77) Investment deposits: Unrestricted funds 467 5 472 Restricted funds 408 5 413 Endowment funds 2,078 (74) 2,004 Debt due within one year (100) 100 - Debt due after one year (50) 50 - ______ ______ ______ 5,178 (240) 4,938 ______ ______ ______


29

NOTES TO THE CONSOLIDATED ACCOUNTS (continued) 19. COMMITMENTS Capital expenditure There were no capital expenditure commitments at 31st March 2015 (2014: nil). Cathedral repair programme The Cathedral Church is currently undergoing a programme of major repairs which is being funded in part by the Cathedral Trust, other grant-making charities, and donations. The Cathedral's share of these works is funded by the general fabric legacy fund, the reserves of which are shown in note 16, and its common account. FRS17 pension disclosure

Salisbury Cathedral participates in the Church of England Funded Pensions Scheme and employs one

member of the Scheme out of a total membership of approximately 8,400 active members.

The Church of England Funded Pensions Scheme is a defined benefit scheme but Salisbury Cathedral is

unable to identify its share of the underlying assets and liabilities - each employer in that scheme

pays a common contribution rate. A valuation of the Scheme was carried out as at 31 December 2012.

This revealed a shortfall of £293m, with assets of £896m and a funding target of £1,189m, assessed

using the following assumptions:

An investment strategy of:

for investments backing liabilities for pensions in payment, an allocation to gilts, increasing

linearly from 10% at 31 December 2012 to 2/3 by 31 December 2029, with the balance in

return-seeking assets; and

for investments backing liabilities prior to retirement, a 100% allocation to return-seeking

assets.

Investment returns of 3.2% pa on gilts and 5.2% pa on equities;

RPI inflation of 3.2% pa (and pension increases consistent with this);

Increase in pensionable stipends of 3.2% pa; and

Post-retirement mortality in accordance with 80% of the S1NMA and S1NFA tables, with

allowance made for improvements in mortality rates from 2003 in line with the CMI 2012 core

projections, with a long term annual rate of improvement of 1.5% for males and females.

For schemes such as the Church of England Funded Pensions Scheme, paragraph 9(b) of FRS 17

requires Salisbury Cathedral to account for pension costs on the basis of contributions actually

payable to the Scheme in the year.

Following the results of the 2012 valuation, Salisbury Cathedral’s contribution rate is due to increase

from 38.2% to 39.9% of pensionable stipends from 1 January 2015 (of which 14.1% will be in respect of

the £293m shortfall in the Scheme and 25.8% is in respect of accrual of future benefits and the day-

to-day expenses of running the Scheme).

Contributions rates will be reviewed at the next valuation of the Scheme, due as at 31 December

2015.

Defined Contribution Pension Scheme. Employees of Salisbury Cathedral may enrol in a group personal pension scheme with Friends Life the assets are held separately from the Cathedral.


30

NOTES TO THE CONSOLIDATED ACCOUNTS (continued) 20. SUBSIDIARY COMPANIES The consolidated accounts include the income, expenditure and net assets of the following 2 companies which are wholly owned by the Cathedral. In both cases figures relate to the year ended 31st March 2015. Salisbury Cathedral Salisbury Cathedral Works Department Ltd Enterprises Ltd £000 £000 Turnover 30 1,038 Expenditure 16 697 ________ ________ Net profit 14 341 Payments under Gift Aid Salisbury Cathedral 14 326 The Friends of Salisbury Cathedral - 15 ________ ________ Retained profit/(loss) - - ________ ________ £ £ Gross assets at 31.3.15 17 432 Net assets/(liabilities) at 31.3.15 - (1) Salisbury Cathedral Works Department Ltd is the trading arm of the Cathedral works department. It carries out outside contracts, principally repairs to historic buildings, on behalf of the works department. Salisbury Cathedral Enterprises Ltd operates the Cathedral shop and the car park, and receives commission from sales in the Cathedral Refectory restaurant which is operated by an independent catering company. It also carries out outside contracts, principally repairs to historic buildings, by the glazing department. 21. CONNECTED CHARITIES For the benefit of the Cathedral There are 4 charities whose objects are primarily or partially to support the work of the Cathedral but which are not controlled by the Chapter and whose accounts are therefore not included in these consolidated accounts. Summaries of their most recent accounts, insofar as they are for the benefit of the Cathedral, are as follows: Salisbury Cathedral The Friends of The Ivor Read Girl Choristers' Trust Salisbury Cathedral Charity Fund £000 £000 £000 £000 Year end: 31.3.15 31.3.15 5.4.15 31.8.14 (draft) (draft) Gross income 9 172 141 84 Net income before grants 8 105 131 80 Grants to or for the Cathedral 20 104 125 81 Gross assets 116 591 4,145 1,548 Net assets 115 521 4,137 1,547


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NOTES TO THE CONSOLIDATED ACCOUNTS (continued) 21. CONNECTED CHARITIES (continued) The grants to the Cathedral shown above do not correspond exactly to the income shown in the Statement of Financial Activities due to timing differences in the recognition of grants. Salisbury Cathedral Trust is an independent charity whose objects are the furtherance of religion and education, in particular by giving priority to the repair and maintenance of Salisbury Cathedral. During the year, 2 of its 4 trustees were members of Chapter. The Friends of Salisbury Cathedral is a members' association whose object is to enhance the fabric, contents, work and worship of the Cathedral. It is an independent charity and is governed by its Executive Council which includes a member of Chapter. The Ivor Read Charity is an independent charity for the maintenance of the fabric of Canterbury and Salisbury Cathedrals in equal shares. During the year, 1 of its 4 trustees was a member of Chapter. The amounts quoted are the Cathedral’s 50% share of the Charity’s income and assets. The Salisbury Cathedral Girl Choristers' Fund is an independent charity whose objects are to pay bursaries for girl choristers at Salisbury Cathedral. During the year 1 of its 7 trustees was a member of Chapter. The grants shown were paid directly to the Cathedral School and are not shown in the Cathedral's accounts. Not for the benefit of the Cathedral The Chapter appoints the Governors of Salisbury Cathedral School, which is a company limited by guarantee of which the Cathedral as a corporation aggregate is the sole member. During the year the Cathedral received rent from the School of £83k under its lease of the School's premises and the Choristers' Endowment Fund received rent of £41k from the School under its lease of 57A The Close which belongs to that Fund. The Cathedral, the Choristers' Endowment Fund and the Choral Foundation paid £140k to the School in respect of choristers' bursaries and the Cathedral paid a further £34k to the School to pay expenses in relation to the choirs. These amounts are included in the cost of services and music. 22. OTHER RELATED PARTY TRANSACTIONS The 4 Principal persons were reimbursed with expenses totalling £8,039 (2014: £6,022).

REPORT AND ACCOUNTS YEAR ENDED 31ST MARCH 2015 · REPORT AND ACCOUNTS YEAR ENDED 31ST MARCH 2015 ....

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