Fiscal 2017 was a busy year for Metropolitan Community Church of Toronto (“MCC Toronto”): Brent’s final year, Jeff’s arrival, ongoing programming in worship and community involvement. All these activities are clearly reflected in the financial results for the year.
The audit of the financial statements was completed and approved by the Board on May 30th, 2018. In the notes below I will highlight some important considerations in our results.
You will notice a significant difference between the results reported in the audited financial statements and the budget to actual results reported at the end of the year. The audited financial statements are prepared on an accrual basis, whereas the budget monitoring done during the year is closer to a cash reporting basis. For our purposes, this means that the audited financial statements report all liabilities and expenses that MCC Toronto is committed to paying, regardless of when the payment comes due. For budget to actual reporting, payments are reported as the money is paid – to match the cash based budget.
The Statement of Financial Position shows the financial status of MCC Toronto as at December 31, 2017. As you can see, we hold net assets (assets available less liabilities committed) of $3.1 million. Of this total, $1.1 million is held in the Mission and Restricted funds, so only available for use to fund specific expenses for which the money was donated. A further $2.2 million represents the value of capital assets (e.g. the building). Therefore, assets available for use to fund ongoing operations is limited, with a net deficiency in the operating fund of $161,000 (see Note 6 to the financial statements).
The Statement of Operations reports the revenues and expenses incurred for the period January 1, 2017 to December 31, 2017. MCC Toronto had total revenue of $1.88 million, with expenses of $1.87 million, for a net surplus of $7,500. This near breakeven result on revenue of nearly $2 million highlights the need for continued fund raising and donations to support the operations of the church.
The net surplus of $7,500 is a combination of surpluses in both the Mission and Restricted Funds and a deficit in the Operating Fund. In general, the surplus in the Restricted Fund relates to collection of money from the Elevation Campaign, the capital fundraising campaign to be widely launched in the near future. This surplus is offset by a significant deficit in the Operating Fund – of which $237,000 relates to retirement benefit payments to be made in the future. A further $175,000 of this deficit was funded by amounts from the Mission and Restricted funds (see Statement of Changes in Net Assets). Normalizing for these two items results in a deficit of approximately $46,000, including $94,000 of amortization of capital assets.
MCC Toronto is a very active church, with activities related to worship and congregants as well as services to the community. Staff, the Finance Committee and the Board of Directors, monitor the financial operations of the church on a regular basis. While the deficit reported in 2017 is significant, the causes of it are identifiable, manageable and relates to specific decisions made in the year. These results highlight our need for continued involvement and contributions to fund ongoing operations.