The purpose of the Finance Committee is to provide advice to the Pastor in the collection, administration and use of parish financial assets in harmony with the mission of Church of the Assumption. Duties include budget preparation, accounting, audits and compliance with Diocesan policy.
Contact: George Brandt - 510.562.5357 - email@example.com
Church of the Assumption Annual Report 2022 The Finance Council is pleased to present the annual report for 2022. The following comments explain the major financial impacts, milestones and successes during the last year. We thank our parishioners for their support. We could not continue operations without your help.
The schedule shows our financial results in comparison to 2021 at the top and comparison to Budget at the bottom. On the surface the revenue picture looks promising. The revenues includes $50,000 restitution from the embezzlement case and more that $50,000 in directed contributions for maintenance. The bottom line is that our revenues after adjusting for non-operational items were under budget by $50,000 (8.5%) and only slightly over last year by $17,000 (3.5%). Our regular contributions were not enough to cover our operating costs.
Major variances vs. 2021 are:
1) Lower plate collections, including Easter, offset by higher online contributions resulting in an overall increase of 3.25%
2) Lower unrestricted donations offset by higher sacramental services.
3) Higher facility usage
4) Much higher votive candle contributions
The major variances vs. budget are:
1) Lower plate collections including Easter and Christmas partially offset by higher online contributions
2) Lower unrestricted donations offset by higher sacramental services (baptisms, weddings and, sadly, funerals)
3) Lower fundraising, both parish and faith formation, due to slower post pandemic recovery
4) Much higher votive candle contributions
The expenses when compared to budget and last year were higher by over $60,000. Included in this overage were increases in both the Dad's Club and CYO spending. These two areas picked up due to resumption of regular activities post pandemic. Once we take out the impact from these two activities our regular parish expenses were over budget by almost $30,000 (5%) and over last year by $40,000 (7%). We are looking into significant additional cost cuts.
The variances vs. 2021 were:
1) Administrative salaries driven by reorganization resulting in higher hours worked
2) Lower Priest salaries due to reduction of priests in residence
3) Higher Liturgy costs due to addition of retreats
4) Higher Music salaries due to lower allocation to the school for benefits
5) Music cantors due to higher cantor usage post pandemic
The major variances vs. budget were:
1) Administrative salaries driven by higher hours worked than budgeted
2) Music salaries due to lower allocation to the school for benefits than budgeted
3) Music cantors due to higher cantor usage post pandemic
There are a number of ups and downs in other expenses but these variances offset one another and are not due to a major change in operations.
Several milestones occurred during 2022. One significant milestone is the closure to the embezzlement case related to the former Parish Secretary. Last November she pleaded no-contest to the charges. She was sentenced to one year - half in house arrest and half in the county jail. She is currently in Santa Rita jail. In addition, she was assessed over $700,000 in restitution of which she has paid $50,000 (note most of the restitution will go to the insurance company). We can now look to the future.
Along those lines, we implemented a number of changes in our operations to ensure that this will not be repeated. Your Finance Council remains committed to constantly review our procedures and keep our parish assets safe and secure. Remember the Finance Council members are parishioners also.
Again, we thank all our parishioners for your support. We could not do our ministries without you.
2021 Annual Financial Report
2021 was the second year that we operated under the rigors of COVID-19. As the year progressed the restrictions concerning interpersonal interaction were reduced. This change in restrictions allowed a gradual increase in group events especially church services. In addition, we experienced a change in Parochial Administrators. Our new Parochial Administrator, Fr. John, was quick in reviewing our ministries and parish celebrations. In August we held a celebration for the Feast of the Assumption of the Blessed Virgin Mary extending over two days. In December, Fr. John initiated a popular Filipino tradition known as Simbang Gabi. This 9 day celebration was a successful faith community builder.
Our Net Ordinary income in both 2020, income of $312,134.14 and 2021, income of $17,283, appear to be enviable. The numbers are misleading. In 2020 we received our insurance claim related to the embezzlement ($433,126.01). Adjusting the 2020 Net Ordinary Income for this claim, we lost money - $(120,991.87). In 2020 we had to draw down our savings by $132,375 to cover operating expenses. This withdrawal was in addition to the proceeds from our Payroll Protection (PPP) loan ($73,200).
In 2021, our Net Ordinary Income shows a profit of $17,283.77. Again, as with 2020, this profit is misleading. The PPP loan funded in 2020 was forgiven in 2021 and we recorded the cancellation as as Other Income. Adjusting 2021 Net Ordinary Income for the non-cash PPP transaction changes the reported profit to a loss of $(55,916.23). To cover our operating costs we had to draw down our savings by $115,000.
The good news is that starting in mid-2021 our financial picture turned around. Due to the events in the last half of 2021, we have had an incredible success. For the last half of 2021 our Net Ordinary Income was $44,383.61 (same period in 2020 was a loss of $(100,688.27) before the insurance claim). The turnaround was the effect of increased revenue and lower costs.
The factors have combined to result in a more than 24% increase in plate collection for Sundays and Holy Days in the last six months when compared to the same period in 2020. Adding the increase in Christmas giving and the new online EFT donation tool, overall plate collections were up over 39%. A note on the new online EFT donation tool, the participation increased significantly each month since its unveiling in October.
Our donations were strong in 2021 totaling $58,456. We needed success in donations because 2020 was $67,800.00 including a $50,000 special donation.
Fund raising grew from 2020 to over $6,000. 2020 was only $1,472 due to COVID-19 restrictions.
Programs and Ministries were very strong. Note that CYO and the Dad’s Club revenues are included in this area. These two ministries were added to the parish financials effective 2021. In terms of growth in Programs and Ministries, 2021 (adjusted for CYO and Dad’s Club) was $24,325.,49 vs. $5,827.54 in 2020. $19,315.00 of the change from 2020 is attributable to Simbang Gabi.
The Other Income has been discuss in the summary. In 2020 we received the insurance claim for the embezzlement. In 2021, we wrote-off the PPP loan.
On the surface it appears that our expenses were almost 5% higher than 2020. This apparent increase is misleading. As mentioned above two ministries that had not been included on the parish’s financial books were added as of 2021. The CYO expenses of $21,833.78 and Dad’s Club expenses of $20,884.68 show zero expenses in 2020. Adjusting the total 2021 expenses for these two ministries results in reduction in costs of 2.7% vs. 2020.
Our savings included lower costs in overhead areas such as Administration, Building and Grounds, and Rectory. These reductions were somewhat driven by COVID-19 constraints. The costs related to the priests in residence also went down due to the reduction from two to one priest effective in October, 2021. Our Music ministry costs were lower due to the sharing of costs with the school.
Areas that had increases actually were beneficial to our growth in community outreach. Liturgy costs were up particularly in environment related spending. In addition our ministries and faith formation spending was up over 20% even without adding CYO and Dad’s Club. This is where the money should be spent.
2022 will be different than 2021 or prior. As discussed above, during the last six months of 2021, our collections experienced significant growth. Sunday and Holy Days were up over 24%. Adding increased Christmas giving plus the impact of our newly implemented on-line giving system, overall plate collections were up over 39%. This trend should continue at these high rates through the first half of 2022. The overall plate collection projection for 2022 is a 13.4% increase over 2021.
In addition, Fr. John has initiated a popular Filipino Christmas tradition known as Simbang Gabi. Along with this new cultural initiative, two other events were enhanced - Feast of The Assumption and Our Lady of Guadalupe. These activities were not only important for our faith community, they were financially successful.
For the 2022 Budget, we approached the budget process from the bottom up. For at least the last three budgets, the budget preparation was done between the Chair of the Finance Council and the Parochial Administrator. The other members of the Council were given an opportunity to review and comment.
Again, 2022 is different. The staff were each tasked with submitting lists of the resources needed. Fr. John and the Chair of the Finance Council met with each staff member and reviewed their needs. In addition, they were encouraged to suggest ways to raise funds to support their ministries. The conversations were productive. The new process resulted in increased resources allocated to ministries. More importantly, the staff now has an ownership stake in the financial results of their ministries.
In the attached schedule, the share of expenditures for allocated to overhead, liturgy and ministries are tracked from 2015 through the 2022 Budget. As you can see we are projected to increase our effort in growing ministries.