Parish Accounting Newsletter
Looking Ahead to 2019
This is our first newsletter for 2019 and what a busy and exciting year 2018 was!
After a relaxing break, the Parish Accounting team is back in the office ready for the challenges 2019 will bring.
The team finished the year with the Parish Accounting Roadshows which were very well attended. Many questions were raised around GST and withholding tax on payments to specified occupations and to volunteers.
Do not hesitate to contact your Parish Accountant if you still have any queries or need any clarification on the topics we covered. Copies of the presentation are available so please contact us if you have missed out.
We are also organising an open day in April so you have the opportunity to come to our offices in Newmarket and meet the Parish Accounting team. Further communication will be sent closer to the time.
Did you know that we could tailor your monthly reports to suit your requirements?
Do you want your reports on one page, with a larger font or with black ink so they can photocopy easily?
Do you want a comparison with year to date budget or last year’s results?
Do you want to see your expenses as a percentage of last year's budget?
This is all possible!
In our next quarterly newsletter, we will have examples of reports, but in the meantime do not hesitate to contact your Parish Accountant to discuss your requirements.
New Taxation Bill
Registered charities are able to access a range of tax benefits.
Typically, this means your charity’s income will be tax exempt, your charity’s bank will not need to deduct resident withholding tax from its interest income, your charity may not need to pay fringe benefit tax on some benefits provided to its employees, your charity can access GST concessions, and your charity may be able to issue donation receipts so that its donors can claim donation tax credits or gift deductions.
The Taxation Bill, (Annual Rates for 2018-2019, Modernising Tax Administration and Remedial Matters)was introduced on 28 June 2018 and has been referred to Parliament’s Finance and Expenditure Committee for public submissions.
The bill contains a number of remedial changes to address unintended gaps in the current law governing the tax treatment of charities and not-for-profit entities.
One area relevant to our ministry units is that it will become easier for donors to claim donation tax credits: the bill proposes measures to simplify tax returns for individuals.
This includes letting individuals scan or photograph and upload copies of their donation receipts directly into myIR either during the year or at the end of the year.
This change will apply from 1 April 2019.
Charities Act 2005
The Community and Voluntary Sector Minister, Hon Peeni Henare, announced that public consultation for the Charities Act review will take place over March and April 2019.
Community meetings and hui will be held throughout the country as part of the consultation process. Those wanting to give feedback can ask questions, learn more about the review process, and feel encouraged to make quality submissions in response to a public discussion document.
The definition of ‘charitable purpose’ is specifically excluded from scope. This means the review will not consider the ‘four heads’ of charity (relief of poverty, advancement of religion, advancement of education, and any other matter beneficial to the community).
Given the strongly held and diverse views of stakeholders on this issue, there would be little chance of consensus and the debate could overshadow other important matters within scope.
Meet Mandy Wan,
Mandy is one of the newest members of the Parish Accounting team. Mandy is originally from China and came to New Zealand to study. She has a bachelor of Accounting and Commercial Law from Victoria University in Wellington and since starting with Trust Management has commenced her Chartered Accountancy studies.
Mandy looks after 15 Auckland Parishes and 3 Waikato Parishes.
Mandy enjoys the relationships she has built up with the treasurers of her parishes and recently attended our Thames roadshows to get to know the treasurers of her Tairua and Mercury Bay parishes.
Despite her short time with Trust Management, Mandy has proved herself to be an accountant of a very high calibre and onboarded new parishes to the Parish Accounting team with the treasurer of the newly onboarded parish relieved to have the accounts looked after and appreciative of the expert advice.
In her spare time when she is not studying, Mandy enjoys short away breaks with her husband and loves going to the beach.
Annual Financial Statements
The Parish Accounting team is now busy preparing your annual financial statements so remember to send all year end information as soon as possible so we can have your accounts ready for the AGM in plenty of time.
We asked for feedback on the format of the annual financial statements so let us know if you have any suggested improvements or clarification that would be of benefit to all ministry units.
Some Parishes have queried the valuations of the investments in the accounts. The unit price for each Fund is determined at the end of each month by dividing the current value of the assets of the Fund, after liabilities and expenses of the Fund, by the number of units the Fund has issued. The number of units you have, when multiplied by the unit price, gives the total value of your investment in any one Fund.
KPMG, the auditors of the Diocese, are visiting selected parishes as part of the audit. Their programme includes sighting fixed assets purchased during the year, requesting selected staff’s employment contracts and testing a sample of income and expenditure transactions to source document. They rotate the ministry units they visit every year so be assured that you will get to meet them at one point in the future.
Treasurers will be aware that the insurance period runs from 1 April to 31 March each year. The insurance arrangements for Parishes are governed by Statute and managed by Anglican Trusts Board Services Limited (‘the Fund’) who appoint brokers, valuers and other experts to assist in ensuring the insurance arrangements are best practise and achieve the best possible rates. In 2016, the Fund was able to secure a very good rate from an insurer keen to gain more market share, in order to ensure the rate wasn’t an attempt to simply secure our business, we required the insurer to offer to fix their fee for three years. The result has been very positive for the Diocese, as market rates have continued to climb over the three year period. Unfortunately however, the three year fix period is expiring, and there will be a correction to market. We recommend Ministry Units allow for additional insurance costs in their budgets.
The table above shows the Fund’s fixed rate over the past three years vs the market rate. These rates relate to insurance premiums, excluding government levies, fire service levies, EQ levies and Fund costs. Consequently the impact of rising insurance premiums will be mitigated in part by other levies and costs remaining at similar levels for this renewal.