Diocesan Finance Update Diocese of St Petersburg June

Diocesan Finance Update Diocese of St. Petersburg June 20, 2018

Bishop Gregory Parkes Opening Remarks

Nancy Ridenour, Chair Diocesan Finance Council Tonight’s Agenda: • Summary of Audited Financial Statements • Update on Forward in Faith • Best Practices for Pastors • Parish Finance Councils

Audited Financial Statements and this presentation are available online at www. dosp. org (1) Click on Ministries & Offices, then… (2) Click on Accounting & Finance, and… (3) Click on Financial Updates or (3) Click on Financial Statements (this presentation) (audited statements)

Audited Combined Financial Statements Represent the following combined entities: Pastoral Center Operations, including Spirit FM Bethany Retreat Center Diocesan Savings and Loan Diocesan Insurance Trust Cemetery Funds Emmaus Foundation d/b/a the Catholic Foundation • Endowment funds • • • (Does not include Parishes, Schools, or Forward in Faith)

Combined Statement of Financial Position ($000) 6/30/2017 Assets: Cash Investments Held in Trust Receivables Land, Buildings, and Equipment, Net Other Assets Total Assets 6/30/2016 $ 13, 544 136, 586 27, 890 31, 670 1, 262 $ 210, 952 Liabilities: Payables Bank Debt Deposits Held in Trust Reserves for Insurance Claims Total Liabilities $ 6, 701 - 91, 615 4, 386 102, 702 Net Assets: Unrestricted Temporarily Restricted Permanently Restricted Total Net Assets Total Liabilities and Net Assets 82, 916 13, 381 11, 953 108, 250 $ 210, 952 $ 23, 449 114, 901 27, 220 32, 972 1, 697 $ 200, 239 $ 6, 489 7, 056 87, 168 4, 000 104, 713 72, 542 11, 078 11, 906 95, 526 $ 200, 239

Combined Results of Operations ($000) Year Ended 6/30/2017 Annual Pastoral Appeal & School Assessments Contributions and Bequests Insurance Premium Revenue Earnings on Investments & Loans Fees, Sales, and Program Revenues Gain on Sale of Land Total Support and Revenue $ 13, 284 2, 323 25, 845 10, 585 5, 562 3, 258 60, 857 Ministry Expenses Catholic Formation & Education Social Services Clergy Development Parochial Services Insurance Programs Other Program Services Total Program Services Diocesan Administration Total Expenses Change in Net Assets Year Ended 6/30/2016 $ 13, 519 2, 080 24, 792 909 5, 370 12, 206 58, 876 8, 726 5, 389 1, 135 2, 886 1, 771 24, 435 2, 466 46, 808 97. 2% 1, 324 2. 8% 48, 132 100. 0% 9, 171 4, 676 1, 409 2, 435 1, 302 24, 665 6, 771 50, 429 97. 3% 1, 410 2. 7% 51, 837 100. 0% $ 12, 725 $ 7, 037

Diocesan Savings & Loan Results of Operations ($000) Year Ended 6/30/2017 Year Ended 6/30/2016 Investment Income $ 8, 128 $ 490 Interest Received on Loans 636 634 8, 764 1, 124 Interest Paid on Deposits 1, 657 1, 487 Interest Paid on Bank Debt Grants 57 - 139 4, 000 Operating Expenses 225 2, 046 Provision for Loan Losses 839 58 Total Program Services Costs 2, 778 7, 730 Change in Net Assets 5, 986 (6, 606) Net Assets, Beginning of Year 9, 206 15, 812 Net Assets, End of Year $ 15, 192 $ 9, 206 Total Support and Revenue

Diocesan Insurance & Benefits Trust Results of Operations ($000) Insurance Premium Revenue Investment Income Total Support and Revenue Insurance Claims Expense Insurance Premium Expense Other Operating Expenses Provision for Doubtful Accounts Total Program Services Costs Change in Net Assets, Beginning of Year Net Assets, End of Year Ended 6/30/2017 Year Ended 6/30/2016 $ 27, 391 246 27, 637 20, 482 3, 174 2, 104 - 25, 760 1, 877 $ 26, 375 243 26, 618 20, 219 3, 104 2, 167 35 25, 525 1, 093 13, 678 12, 585 $ 15, 555 $ 13, 678

Published Campaign Goals Results Through 6/30/17 Sources: Pledges and Gifts $ 50, 000 $ 32, 774 Uncollectible Pledges (5, 000) (3, 224) Net Sources of Funds 45, 000 29, 550 St. Vincent de Paul Seminary Support (5, 000) (5, 138) Clergy Support (3, 000) - School Construction (11, 000) (12, 176) Tuition Assistance (18, 000) - Parish Share (5, 000) (5, 273) Campaign Costs (3, 000) (2, 781) $ - $ 4, 182 Funds to be Designated

Forward in Faith Campaign Results of Operations ($000)

Forward in Faith Campaign Pledge Report as of 5/31/18

QUESTIONS?

Diocesan Finance Council Financial Planning Committee Rev. George Corrigan, O. F. M. Gerald Giglia, C. P. A. Rev. Msgr. Robert Morris, V. G. Frank Murphy, Secretary for Administration Nancy Ridenour, C. P. A. Thomas Moriarty, C. P. A.

Diocesan Finance Council Financial Planning Committee “Guardian Angels” • at least on our best days • Pastors, parish finance council members, folks in business, and above all - people of faith • Tonight – we hope to share some good practices

Financial Leadership in the Parish

Best Practices � Common Ground We want to do good… � …but there is limited staff � …you want to be church and not a business � …We want to be good stewards We don’t want the “tail to wag the dog” � Your Pastor… Holy, compassionate, dynamic, leader, visionary, …a saint in the making Oh yeah…. financial whiz, MBA, fund raiser extraordinaire You have the pastor you have Oh n o!! !

Financial Planning Committee � Diocesan Finance Council Audit Committee Investment Committee Planning Committee � Planning Committee Review the numbers Assess projects Review the agreed-upon procedure review Watch over parishes Give advice to Council and Bishop Parkes …some good practices – things you may already do! � Farmer’s Insurance… We’ve seen a lot …and so we have something to share

Offertory Review (weekly) �Review the “tally sheet” �Review “tally sheet” vs. bank deposits Including any bank corrections Ensure there is independent signature on final tally sheet

Running Tally

Checking/Bank Statement Review � The pastor opens the mailed statement and initials the outside of the envelope � Review the scanned copies of the checks for Payee Authorized person and signature(s) Amount (consistent with the routine checks to that payee? ) � Know the “regular” vendors Utility suppliers (electric, water, phones, internet, etc. ) Equipment suppliers (e. g. , copy machine rental, etc. ) Know the seasonal suppliers of goods and services Contract 1099 vendors � Know the “regular checks” Payroll and payroll taxes Insurance payment to Diocese Electric and other utilities Offertory deposits Merchant deposits (if applicable) Bank fees and charges Other routine checks and charges � Review any ATM, POS, direct payment, or credit card charges associated with the account POS = point of sale, e. g. the parish accepts credit card payments Direct payments, e. g. , Microsoft Office 365 requires automatic withdrawal from bank

Reconciliation (monthly) �End of month plus 10 days max �…. And what invoices are in the “I’ll pay these later…” folder? �Discussion about who performs this in your parish

Payroll Review �Know the list of people authorized to be part of the payroll system Staff (exempt) Staff (hourly / full-time) Staff (hourly / parttime) �No unauthorized payments �Know the range of normal “paydays”

Monthly Diocesan Invoice Review �Savings and Loan statements – amounts and activity �Insurance – bills/schedule of payments Property Liability Health Workman’s comp and mandated contributions �School assessment �Annual Pastoral Appeal (including assessment worksheet) �“Accounts Payable”

Financial Leadership in the Parish

CPE For CPAs and Attorneys Sponsored by CBIZ and MHM Suggested donation of $100 to Catholic Charities June 28, 2018 (next Thursday) 8 Hours of CPE / CE units See Margi or Tom tonight for further info

Diocesan Norms for Parish Finance Councils Panel Discussion: Nancy Ridenour Fr. George Corrigan Phil Signore

Diocesan Norms for Parish Finance Councils Why must a parish have a finance council? Canon Law Bishop’s mandate: “… it is essential that the Christian faithful share their knowledge and competence in financial and administrative matters with their pastors for the good of the Church. ”

Diocesan Norms for Parish Finance Councils Who should be on the finance council? • Outstanding integrity • Qualified in accounting, finance and/or business. • Registered parishioners, and not employees.

Diocesan Norms for Parish Finance Councils How many members should a finance council have? Composition of Parish Finance Councils (in addition to pastor): • Fewer than 500 families: at least 3 members. • 500 to 1500 families: at least 5 members. • More than 1500 families: at least 7 members. • Inter-parochial schools: at least 2 members.

Diocesan Norms for Parish Finance Councils What is the time commitment for a member? • Meetings: o Required: quarterly. o Recommended: monthly. o Financially challenged entities must meet monthly. • Terms should be 2 -4 years but members must not serve more than 8 continuous years.

Diocesan Norms for Parish Finance Councils What does a Finance Council approve? • Nothing. • The pastor presides. • The Council is a consultative body providing wisdom and advice.

Diocesan Norms for Parish Finance Councils Does the pastor ever have to use these consultants? Yes. For acts of “extraordinary administration” pastors must petition the Bishop after consulting the Parish Finance Council. Extraordinary administration: • Capital campaigns. • Incurring debt. • Real estate transactions. • Legal actions. • Acceptance of non-cash gifts, including stock. • Any transaction > $40, 000.

Diocesan Norms for Parish Finance Councils Isn’t the Finance Council responsible for financial oversight? Yes. Pastors must consult the parish finance council before submitting to the Bishop: • The annual governance certification letter. • The internal control questionnaire. Signatures of finance council members on these documents are indicative of consultation, not approbation.

Diocesan Norms for Parish Finance Councils Is that all they ever do? They should be consulted on: • The annual budget. • Quarterly & annual financial reports to Bishop. • Financial accountings to parishioners. • Educating parishioners regarding stewardship. • Resolution of unpaid debt and budget deficits. • Personnel administration, staffing needs, & salaries. • Tax compliance. • Federal, State, and local regulatory matters. • Leases or contracts > 1 yr. • Expenditures > $25, 000. They must also maintain written minutes of all meetings.

Many financial resources are available online at www. dosp. org (1) Click on Ministries & Offices, then… (2) Click on Accounting & Finance, and… (3) Click on Parish & School Support

Many financial resources are available online at www. dosp. org

Thanks for listening…