EAST MIDLANDS SYNOD TRUST NEWSLETTER - SEPTEMBER 2010

Synod is still seeking to appoint a Trust Treasurer following the retirement of Malcolm Littlefair, who is at the present time acting as Synod Fund Manager until the end of this year.  A job description is set out below and if you or anyone known to you would like to consider applying of the position of Synod Trust Treasurer, please contact the Synod Office – Tel: 0115 960 9241 or from 1^st October Malcolm  on either Tel: 0115 931 2225 or email Malcolm [at] litlefair [dot] com. 

Job Specification for Synod Trust Treasurer  

Malcolm’s job specification is given below, but much of this work is already being undertaken by the Synod Accountant and the Synod Bookkeeper, and need not be taken on initially or at all.
 
Annual Accounts
a)  Ensure that the accountant/auditor has all information to prepare draft accounts by mid March
b)  Ensure that the final accounts are ready for the Secretary to issue with the agenda month before the date of the AGM.
c)  Produce a draft Directors Annual Report for approval by mid march.

Bookkeeper
a)  Resolve problems with fund treasurers
 b)  Review internal financial controls with Accountant, Secretary, and Synod Treasurer
 c)  consider ways of simplifying accounts with accountant
 d)  Approve Association Unit sales and purchases
 
Investment   (Annual tasks)
a)  Review the Trust investment policy
b)  Review the investment asset allocation
c)  Obtain trustees agreement for the pool fund Association Unit dividend
d)  Ensure cash at bank is minimal by transferring to COIF deposit.

Investment (Quarterly)
a)   Produce investment portfolio
b)  Review investment performance using WM CIF performance report
c)  Recommend changes to portfolio to Trustees if appropriate in accordance with agreed investment policy and guidelines

Various
a)  Through contacting Synod Treasurer and Property Officer approximately monthly concerning cash flow, ensure maximum funds are placed in Association Units for best total return, whilst maintaining adequate working capital
b)  With the Trust Secretary’s assistance, ensure that the Trustees are advised about the requirements of the Charity Commission in connection with the Trust.
c)  The Trust Treasurer is a member of Finance and Property Group
d) The Trust Treasurer is a Director of URC EMS Inc.
e)  Will advise local churches on their holdings in the Trust

East Midlands Synod Trust

Church Investments

Association Units Class A

 The Synod Trust has for many years offered churches the opportunity to invest sums “Unlikely to be required within five years” in the Association Unit pooled fund, used extensively by the Synod itself, for its own funds, as well as churches. On January 1^st 2009, a unit was worth £3.53 following a significant fall from the previous year. The price recovered to £3.87 by January 2010. An 18p tax free dividend was paid in December. These units are now to be called Association Units Class A.

This £3.7m pooled fund is for medium to long term investors accepting medium risk. Normally the longer money is invested, the lower the risk. Money is diversely invested mostly in global equities, but also in UK fixed interest and commercial property funds, exclusive to charities. A substantial proportion of these funds are ethical funds.

Class A units will normally perform better in times of inflation because investments are made mostly in equities. Capital gains and income, are likely keep pace with inflation long term. 

Buying and selling units is free. Investments can be repaid within three weeks, and usually much sooner. Unit valuations are produced quarterly, and will be updated in the new Finance and Property quarterly e-mail to church treasurers.

A letter addressed to the Trust Fund manager at the Synod office with a cheque asking for the money to be placed in Association Units Class A, or B (see below) is all that is necessary.

Association Units Class B

This is a new short to medium term lower risk fund. In 2008 the COIF deposit accounts provided 5.3% interest. To day it is 0.5%.  The Trust holds deposit accounts to the value of £1.25m for Synod and church funds. Therefore there was an overall loss in income of around £50,000 in 2009 and will be in 2010 unless the deposit interest rate rises significantly. The Trustees therefore decided to create this new Class B fund. Synod fund holders have already invested £300,000 and it has not suffered at all from the very volatile recent global investment valuations.

This Class B fund is intended for churches with money “Unlikely to be required within 2-3 years”. This pooled fund is now open for churches to invest. Our second investment phase in the new fund is not planned until September 20th, and so units will not be issued until then, so cheques are not needed earlier. One unit will be issued for every pound invested. Class B units will be managed in the same way as class A, with a dividend paid at the end of December each year, and valuations made quarterly.

Instead of taking the dividend, further Class B units may be purchased automatically on request.

The Class B income fund will mostly be invested in fixed interest funds, but a small proportion in commercial property. It is hoped that annual interest will be around 5% p.a. ie 5p for every pound invested, but only 1.25% for the final quarter this year. Class B units are intended to just retain their value and income, with only a small risk factor.

The decision to purchase either class of unit is that of the church.  There is a risk and units may fall in value. On the sale of units held, the money returned may be smaller than the original investment. Class B units are lower risk.                                                                   

The initial investment minimum is £5,000, but for additions and withdrawals there is a £1,000 minimum for both A and B units now, to keep Synod administration costs down.

Further information is available from the Trust Fund manager, Malcolm Littlefair, tel; 0115 931 2225 or e-mail Malcolm [at] littlefair [dot] com. The Synod office also has information.

The number of issued Association Units on 30 June 2010 was as follows:-

                        Class A Units  -   964,367   - Value per Unit £3.74

                        Class B Units   -   300,000   - Value per Unit £1.03