OCA Treasurer reports on financial status of Church in first quarter of 2008
At the 2008 Spring Meeting of the Holy Synod, May 13 to 15, 2008, OCA Treasurer, Priest Michael Tassos, gave a report on Church finances covering the first quarter of 2008. Fr. Michael’s introductory comments to the Holy Synod are as follows.
“This report covers the period of January 1, 2008 through March 31,2008. As of March 31,2008, we continue to hold our expenses in line with contributions and assessments. Before considering the 15th All-American Council, the OCA had a surplus of $19,660 compared to a budgeted surplus of $86,445. However, please note these figures are on a cash basis and a portion of the surplus is related solely to the timing of monthly assessments from various dioceses.
“A better indicator of the financial performance is actual expenses. As of March 31, 2008 the actual expenses exceeded our budgeted expenses by $7,413. One item of note was Legal expense. Legal expenses through March 31st were $74,102 compared to an annual budget of $25,000. To have exceeded the overall expense budget by only $7,413 given this overage in Legal expense is actually fairly positive. It means that we have been holding the line on all of our other expenses.
“If there was any one word to describe the financial position of the Orthodox Church in America at this time I would say that it is fragile. Much like a patient that has come out of surgery and is transported to an intensive care unit, the OCA is coming out of a similar situation. We are slowly but surely recovering but it is slow. A good indication of this is the fact that we are in the black. Another positive sign is the fact that through May 11, 2008, we have received $112,909.63 in contributions towards the 2008 Mission Appeal. However, there are still significant obstacles: Fellowship of Orthodox Stewards contributions are down significantly; there is still the very real possibility of more legal bills coming later in the year; the work of the Special Investigative Committee was not actually built into the budget and we are over budget related to the Metropolitan Council, and there may still be a day when the I.R.S. wants to come and perform an audit which could result in significantly higher accounting expenses.
“We are trying very hard to implement additional controls and to take a fresh look at almost everything. Since the beginning of the year here are some of the things that we have done to cut our expenses:
- Reduced the accounting staff by one;
- Reduced the amount kept in petty cash and implemented additional reviews of expense requests;
- Reduced the amount spent on food and supplies at the Chancery;
- Reduced the number of cell phones in use by chancery staff.
“This coming week we should receive the formal engagement letter from Weiser, LLP so that we can begin the audit for the year 2007. I have been in contact with the partner on the engagement, Mr. John Barrone, and he anticipates starting the field work the first week in June.
“The work of the Preconciliar Commission is on schedule and through May we have received approximately $173,000 compared to a budget of $198,000. In the operating budget, we budgeted $50,000 towards the Preconciliar Commission and to date we have spent less than $10,000. Therefore, I believe we will be within budget by the time of the All-American Council in November.
“The department programs are all within budget with the exception of Missions and Evangelism, and the only reason they are over budget is related to the approval of a conference last year that was not considered in the 2008 budget. In fact, the department programs of the OCA are actually under budget by $4,128 through March.
“Included with this report are a Statement of Operations - Unrestricted Funds, Actual vs. Budget through March 31, 2008, a Balance Sheet as of March 31, 2008, and a separate report on the Central Administration. As you will see, the expenses of the Central Administration are over budget; however, 70% of the overage is related to Legal expense. Some of the overage is also related to staffing changes in the first quarter. We should see a further reduction in our Central Administration expenses as we go forward into the second quarter.
“The work at the Chancery is continuing though it is not without its challenges. Even though I have not been on site at the Chancery since mid April, I have been in daily communication with Ms. Barbara Evans, the acting Controller, and I have been communicating with both Fr. Alexander Garklavs and Fr. Andrew Jarmus on a weekly or more frequent basis via phone calls and emails. To try to improve the communications even more, we just recently had our first formally called conference call and will continue to schedule regular meetings. In my opinion, the current working situation is not ideal but it is still workable and it has worked fairly effectively for the past month.”
Fr. Michael’s first quarter 2008 financial statements can be downloaded in PDF format here.