1. Purpose of Financial Management of Church Funds
1.1 General
The Parochial Church Council is an independent charity accountable to the Charity Commission.
All members of the PCC are trustees of the charity, which is established as a Charitable Incorporated Organisation (CIO). Trustees of CIOs are not personally liable for the finances of the CIO but they are responsible for ensuring that: the finances of the church are used to further its aims. They also need to ensure that policies are put in place to support the long-term health and growth of the resources available for ministry and to avoid the misuse of the finances.
The PCC has overall responsibility for the stewardship and application of church funds. That includes any groups that come under the control of the PCC and the members of which are therefore required to abide by these policies.
1.2 Aims of the Charity
The PCC is registered as a charity with the Charity Commission of England and Wales under the title of The Parochial Church Council of the Ecclesiastical Parish of St Mary, Bitton, in the Diocese of Bristol. The principal purpose of our charity is listed as the advancement of religion through the provision of church services, pastoral care. Ministry, education etc.
It also has two other charitable aims: the first, in regard to culture, the arts, and heritage in maintaining and looking after a building of significant heritage with grade 1 listing; and second, in the support of the community by providing a church hall, equipping and enabling our resources to be used for community benefit and activities.
Funds may be raised to support any of these charitable aims and the PCC needs to ensure that funds raised are used effectively for the purposes for which they have been designated.
1.3 Organisation of Finances
(1) Standing Committee: The PCC delegates authority to the Standing Committee to maintain a strategic oversight of its finances, and to take any urgent decisions relating to financial matters.
(2) Treasurer: The PCC will elect a Treasurer each year immediately after the Annual Parish Meeting (APM), who will have overall responsibility for handling of the church finances and advising the PCC on its financial position. The Treasurer will be either a member, or ex-officio member, of the PCC and Standing Committee. The PCC will ensure the Treasurer is equipped with the necessary software and filing facilities to enable this role to be carried out effectively. It is expected that the Treasurer will normally give good notice of his/her intention of standing down to allow for a successor to be found and inducted into the role.
The Standing Committee may appoint one of the churchwardens or another suitable person to work with the Treasurer and maintain oversight of the church’s financial position and to ensure continuity and contingency if the Treasurer is temporarily unable to fulfil his/her duties in full.
(3) Delegation to Groups or Committees: The PCC may delegate certain operations to individuals or groups with delegated financial authorities. These are listed at Appendix A of this policy with a named budget holder who must abide by this policy.
2. General Accounting Principles and Reporting
The PCC follows the following principles and procedures taking account of Charity Commission and Church of England regulations and guidance:
2.1 General
As a charity our accounting is based on the principle that money must be used in line with the stated purpose for which it was given.
Funds held by the PCC fall into the following types:
- General – money that can be used for any purpose that furthers the aims of the charity. This money is a type of Unrestricted Fund;
- Designated – money that has been set aside by the PCC to cover any predicted future costs. This money can be transferred back into the general fund by the PCC and is therefore a type of Unrestricted Fund;
- Restricted Fund – money that has been given for a specific purpose (e.g. roof repairs) and can only be used for that purpose;
- Endowment – an amount of money that has been given to the church and that cannot be spent. Generally, endowments come with an agreement that the interest can be spent on the church or for a specific (i.e. restricted) purpose.
While there is no requirement for a separate bank account be opened for different types of account, the PCC has over many years, identified a range of different accounts and funds in which money is held. For accounting purposes these funds are drawn together but must be shown in a manner that makes clear the purpose of all monies held.
2.2 Cash Accounting
Due to the size of the charity (income of less than £250,000pa) the Treasurer will use cash accounting rather than accruals. Income and expenditure will therefore be shown within the quarter that any monies were received or left an account.
2.3 Setting of an Annual Budget
The financial year of the PCC is the same as the calendar year. The PCC will set an annual budget between October and December in each year for the following 12 months, taking account of:
- All expected income and expenditure
- The amount of Parish Share that the PCC has determined should be gifted to the Diocese of Bristol
- Any foreseen large items of expenditure for improvements or investments that the PCC would like to take forward during the coming year. These may be put forward by any member of the PCC and supported by an Expenditure Requests & Rationale (business case) setting out the costs, benefits and, where appropriate savings). A form for this purpose is given as Appendix B.
The budget will be prepared by the Treasurer and reviewed by the Standing Committee before presentation to the PCC to approve or amend.
2.4 Quarterly Review
The budget will be reviewed quarterly, using a budget tracker usually at the next PCC meeting following the end of each quarter. Accounting officers must provide to the Treasurer in good time before the meeting information about the level of income and expenditure
2.5 Annual Report
Financial Accounts for the preceding year will be published in the Annual Report in accordance with the requirements of the Charity Commission and Church of England regulations. Accounts must be independently audited and approved by the PCC prior to presentation at the Annual Parish Meeting.
2.6 Appointment Independent Auditor, Accountant and Bookkeeper
The Treasurer must arrange for the accounts to be audited and identify a suitable person to do this. The Treasurer may also, with eth approval of the PCC, appoint an accountant and or a bookkeeper to assist in the management of finances and accounts.
3. Financial Procedures
3.1 Delegated authority
Where the PCC has delegated financial authority to a committee or group the Treasurer on behalf of the PCC will set out in writing to the identified budget holder:
- The amount of money that may be spent on any one item or service without further approval being required from the PCC;
- How expenditure may be approved within the group or committee;
- Any items of expenditure agreed by the PCC for the coming year and the maximum that may be spent on each;
- The level of reserve funds authorised by the PCC;
- Any other limits or conditions in respect of the budget held.
A template for the setting of delegated authority is given as Appendix A
3.2 Handling Cash
The policy of the PCC is to minimise the use of cash in transactions, encouraging the use of giving and payment online. It is recognised, however, that many people struggle to use such methods and that for certain events cash may be a preferred option.
Cash placed in donation boxes in the church will be collected by churchwardens or the Treasurer and placed in the safe until they can be banked by the Treasurer in the fund or account to which they have been designated.
St Mary’s only takes collections from the congregation at larger services. Cash taken should be counted in the sacristy (vicar’s vestry) by two sidespersons and bagged ready for collection by the Treasurer. The amount collected should be entered in the Service Register.
3,3 Banking
In addition to a General Account, held and managed by the Treasurer, the PCC may authorise the holding of additional bank accounts (current, deposit or other) that may be held in a commercial bank to enable the good management and day to day operations of church business. A list of the currently authorised accounts is given as Appendix C, together with a list of signatories to the account.
All bank accounts must be manageable online. The Treasurer must be a signatory and have online access to each account.
3.4 Paying an Expenditure
All items or services requiring payment shall be paid on receipt of an invoice or other request for payment from the supplier in accordance with the delegated authority for the budget holder given by the PCC.
Where expenditure is made, on behalf of the church, by a church member, it should be agreed beforehand by the budget holder and a claim for repayment must be made on the form provided at Appendix D attaching any receipt or invoice. Church members are also encouraged to complete a form even if it is their choice not to claim any money, but to make the expenditure as a gift as this enables the PCC to have a view of the full cost of the activities of the church.
3.5 Paying Staff and Expenses
Directly employed staff: The PCC may employ staff directly and must arrange for a payroll service to be provided for the purpose of managing pay tax, national insurance and pension as applicable. The frequency of payment and conditions of employment must be set out in a contract of employment.
Fee paid staff: Fee paid staff will be asked to complete a claims form for the service they complete (Appendix E). Where appropriate deductions may be made for tax, NI etc. Where there is an entitlement to holiday pay or other benefits this should be paid on completion the same form.
Volunteers: Volunteers are those undertaking work for the church without receiving any form of remuneration. For certain purposes (such as liability insurance) they may be considered as staff members, and they may be permitted to claim expenses.
Responsible Manager: The PCC will designate a person responsible for each paid worker and this person will ensure that proper support is given, and that their workload and hours of work are monitored (and are in line with contractual undertakings), that job descriptions or service requirement remains up to date, monitor holidays or other times of absence.
Overtime: Where additional hours are required to cope with exceptional and unforeseen needs the line manger should ensure these are authorised in advance within delegated authority.
Annual Fee review: The pay or fee to staff will be subject to annual review.
Expenses: Expenses may be claimed by staff, volunteers and members of the ministry team for travel or any other legitimate purpose where they have incurred an individual cost or are due a payment for a duty or service carried out on behalf of St Mary’s. A form is provided for this purpose as Appendix F. Set levels of expenses (such as mileage) will be subject to annual review.
3.6 Benefice Expenses
On behalf of the PCC, the Treasurer will agree with the person responsible for the Benefice accounts an amount of money to be paid at regular intervals throughout the year to meet the proportion of costs incurred by the benefice on St Mary’s behalf.
3.7 Borrowing Money
The PCC may borrow money in accordance with the Charity Commission guidelines in order to deliver a stated purpose and may approve the loan from the general fund to finance purchases or services by a delegated fund. There is no delegated authority for the borrowing or loaning of money between other funds.
3.8 Making Donations to other Charities
The PCC will donate each year 10% of its unrestricted income to a selected group of charities. The list of charities that is given in Appendix X will be reviewed at no more than 5 year intervals. Due diligence must be applied to these payments in particular where monies are to be used to finance mission or relief abroad.
3.9 Unplanned / Unforeseen Expenditure Requests outside of Annual Budget Planning
Unplanned expenditure, that requires funding to be approved by the PCC because there is insufficient money in the fund account or that is above the delegated authority of expenditure must be submitted to the PCC with a rationale (business case) setting out why the expenditure is required.
3.10 Reserves
To ensure that the church can make payment to suppliers and be able, reasonably, to meet any unforeseen emergencies, each budget holder may retain up to 50% of their annual expenditure in reserve at any one time. Lower limits may be set for delegated funds.
The PCC may also authorise that unrestricted funds may be set aside for the purpose of building up a fund to pay for a specific item or items of expenditure; to meet a foreseen future payment or provide a specified reserve or income for the future provision of services, maintenance or such other appropriate purpose that could not reasonably be met out of annual funds.
3.11 Legacies
Legacies must be used in accordance with the purpose stated when the gift is given. While those considering leaving a gift to St Mary’s in their will are encouraged to stipulate that it should be for the general benefit of the parish, it is recognised that some may wish to restrict the gift to particular areas of the work fo the church including the maintenance of the church or churchyard, or the church hall. Such wishes must be respected.
Depending on the purpose and sum of money involved the PCC may, on the Treasurer’s advice, invest the money to provide an ongoing source of funding or held in reserve as a designated fund to meet a specified future need.
3.12 Fixed Assets, Investments and Trustee Donations
- Fixed assets: valuable tangible items owned by PCCs with a value exceeding £2,000 must be recorded in the PCC accounts. Such fixed assets must, where appropriate be marked to safeguard against theft and included in any schedule of insurance. Church silver (including chalices, collection plates etc.) are not recorded as fixed assets in the accounts.
- Investments: All investments must be included in the accounts with an indication of their purpose.
- Trustee Donations: donations in excess of £30,000 in any one year, of money given by PCC Members (or close relatives) both one-off donations and/or total regular-giving doantions.to the PCC must be recorded in the accounts as such a sum would make a substantial difference to the PCC income
4. Publication
The main body of this policy will be available online on the church website. For security and safeguarding reasons, some appendices will not be available online but may be provided subject to any reasonable request to the PCC Secretary in paper format.
5. Policy Review
This policy will be reviewed at intervals at not less than 4 years. It was approved by the PCC on 9th February 2026.
