In a memorandum to the OCA Holy Synod and Metropolitan Council dated March 13, 2008, OCA Treasurer, Priest Michael Tassos, presented preliminary financial statements for the year 2007.
In his introductory remarks, Fr. Michael wrote that, “excluding the one time gain (from the sale of the Martin Drive house in Syosset, NY), we still ended the year with a surplus of $228,152.00. The budget for 2007, incidentally, anticipated a loss of $68,050.”
Fr. Michael also reported that restricted funds are now being segregated from unrestricted funds and that all funds are available “to cover what I see as our obligations for all of our restricted appeals and we have money to pay our regular operating expenses.”
The full text of Fr. Michael’s introductory comments follows.
“I wish to provide you with another update regarding the accounting and finances of the OCA. I would also like to address a few general items and give you some highlights from the 2007 reports.
Financial Statements - General
“The attached financial statements are still a work in progress. I believe that they are reasonably accurate however they are not ‘final’ for several reasons:
(1) These reports have not yet been audited and I’m sure that the auditors will make some adjustments;
(2) I requested but have not yet received selected copies of the workpapers from our prior auditing firm. There were several items on the balance sheet as of December 31, 2006 that did not match our internal records and I will need the workpapers from the prior audit firm to properly identify the variances;
(3) There were some receipts and a few disbursements during the first part of 2007 that lacked supporting documentation. One item in particular was a journal entry for $2,400 classified as interest income that was posted to a restricted account. I have gone ahead and included it on the schedule of temporarily restricted funds however I believe this is probably a simple misclassification. There was also a variance in accrued expenses as of December 31, 2006 by approximately $9,000. Most of these discrepancies are related to the first six months of 2007. We are going to continue to research them but in the interest of getting the report out, I felt that it was better to point these out to you and continue to move forward. Third, there are a number of accounting pronouncements that do not appear to have been applied consistently in prior years that may result in some audit adjustments. After the audit is complete I will put the official ‘final’ report on the web site.
2007 Financial Reports
“Attached with this memo is the 2007 financial report. I know that it is very lengthy however I also know how much many of you and many others have wanted a complete and thorough examination of the books and records.
“Following are the attached reports:
A Comparative Balance Sheet - 12/31/06 and 12/31/07;
A Detailed Balance sheet (This report gives the breakdown of assets, liabilities, and net assets for 2007);
Statement of Activities (This report lists the activity for all Unrestricted, Temporarily Restricted and Permanently Restricted net assets);
Statement of Activities - Unrestricted Net Assets, Actual vs. Budget for 2007;
Schedule of all Temporarily Restricted Net Assets (This is a report of all special appeals from the balances at 12/31/06 through 12/31/07);
Individual Financial Reports all departments (This reports cover every department and fund of the OCA);
Also attached are Excel spreadsheets of this information.
“I am pleased to say that we ended the year of 2007 with a surplus of $612,648. Of this, $384,496 related to the gain on the sale of the Martin Drive property. Nonetheless, excluding the one time gain, we still ended the year with a surplus of $228,152.00 The budget for 2007, incidentally, anticipated a loss of $68,050.
“As you will see with the detailed balance sheet, we are now actually segregating restricted amounts and we are within $2,600 of the total temporarily restricted net assets figure. The difference has to do with a miscellaneous posting of interest income that I believe was in error but requires further research. The essential point is that we actually have the funds in checking and money market accounts to cover what I see as our obligations for all of our restricted appeals and we have money to pay our regular operating expenses.
“As of December 31, 2007 we actually paid all of our outstanding bills. The accrued expense figure on the balance sheet of $192,499 has to do solely with bills that came in 2008 that were for 2007 expenses (which were paid in 2008).
“There have been several staff changes in the past four months. One individual was hired to fill a Controller function and a change was made with the staff accountant position. Additionally, two temporary staff were hired and will be completing their assignments at the end of this week. The temporary staff have been working directly for me to help with the All-American Council invoices and with cleanup of the books and records for 2007.
Diocesan Assessments and payments to vendors
“With the relinquishing of funds from the Diocese of the Midwest we were able to pay off our outstanding balances to the Proskauer, Rose law firm as well as all of our other vendors as of year end. Furthermore, since the other dioceses are continuing to pay on time we are completely up to date with all of our current vendors.
All-American Council Assessments/Budget
“I am very pleased to report that we have received over $160,000 in All-American Council Assessments and this figure represents approximately 67% percent of the outstanding amount. I have received several requests for the budget for the All-American Council and we fully intend to do our best to make sure that we do not have a deficit with this Council. We are still awaiting a number of prices on items from various vendors as well as some information from the hotel. As soon as this information is complete we will put out a formal budget. These funds are sitting in our Unrestricted Checking account at present; however very shortly we will establish a separate bank account specifically for the All-American Council and move the money accordingly.
“Many of the restricted funds were expended in 2007; however there are still quite a few that need to be paid out. The only reason that they were not completed in 2007 was because of the time necessary to research them and make sure that they were accurate and to determine who the funds should go to.
“Since I mentioned the Restricted Funds I would also like to make comment about the Mission Appeals. The positive responses to the recent mission appeal despite all of the struggles that we have faced to right the financial ship is truly amazing. I would once again like to assure you and everyone else that these funds are restricted and the deposits are going into the restricted checking account.
“I am continuing to work with the CPA firm of Weiser, LLP in order to get us ready for an audit. Our tentative plan at the moment is for them to begin their initial fieldwork in May. The reason for starting so late has to do with the fact that we approached them so late in the year and the fact that we actually need the time to get our books and records to the point where then can be audited.
“We have taken a giant step forward with our accounting and I hope to see this continue. There are still a number of projects that I would like to begin however you have to learn to walk before you can run. A great deal of work is still ahead of us regarding the prior years’ financial statements.”
The OCA preliminary financial statements for the year 2007 can be downloaded at the following links: