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                                    HOLY ANGELS FINANCE COMMITTEE MINUTES

                                                January 21, 2010 

OPENING PRAYER
Fr. Jerry Brittain led the opening prayer. 

ATTENDANCE
Fr. Jerry Brittain, Fr. Nathan Reesman, Don Felix, David Beine, Jack Daniels, Paula Beine, Harry German, Kathryn Fisher Davies, Chuck O’Meara, and Mike Nowack.  Absent were: Pete Rettler and Randy Lawson.   Non-committee members in attendance were Rob Mas. 

MINUTES OF THE PRIOR MONTH
A motion to approve the corrected minutes was made by Don Felix and seconded by Paula Beine.  The motion was approved unanimously. 

REVIEW OF FINANCIAL RESULTS – NOVEMBER & DECEMBER
Jack referred to the E-mail (dated 12/30/09) that updated the committee members on the financial results through November, 2009.  In addition, he restated that during the month of December, the operating funds from the School had been brought over to the Parish.  At each step of the process, a representative of the accounting firm Kieckhafer Dietzler Hauser LLP worked with the process and overviewed the results, thus insuring the accuracy of the transfer in not only the numbers but also in the procedures.  It was agreed that the School’s operating cash would be maintained at the $5K range level for the time being.  Also, there was discussion on bringing over the other accounts after this transfer was satisfactorily absorbed by the Parish – this is planned to take place prior to June 30, 2010.  Jack then proceeded with the financial review for the month of December 

Cash balances for the month were reviewed on the Balance Sheet.  It was noted that in addition to the current month end balance being shown, the opening balance of the current fiscal year is now also shown.  What that provides is the capability of easily seeing the resulting “change”, the ‘net result” of all the deposits less the disbursements of each “Cash” account. 

Week Collection report showed that the projected year end activity was significantly less than budgeted.  As of January 10, the year-to-date collections were $40K less than budgeted.  No specific explanation; however, some thought it was the effects of unemployment.   

Profit & Loss report showed that the Envelopes are $24K less than budget; however, as stated above, through Jan. 10^th, they are now $40K less than budget (not good – need to pray more).  Jack pointed out that the school is a little ahead in the amount of tuition they have collected and that the Instructional Fee has now been sent over too. Utilities and Maintenance costs are all in line with the budget at this point in time.

Profit & Loss sheet “by Class”.  This report breaks down the various functions of the Parish: Church, Rectory, Apartment, Rectory, Festival, School, Religious Ed, Youth Ministry, Faith in Our Future, Stained Glass Window, and Rolfs’ Foundation.  Jack further commented that now that the books of the Parish are consolidated (School and Parish respectively), that this report will have more significance in keeping track of how each activity is doing (from a profit and loss perspective).  Jack suggested that each committee member review the very voluminous report on their own time in order to get a feel of complexities of the Parish books.  If questions arise during that review, members are encouraged to talk with either Jack or Barb Vander Wielen.

School Financial report is now a part of the Profit & Loss sheet “by Class” as discussed above.  The previously formatted “School Report” will be produced in the future.  This will be available at future meetings. 

At the November meeting, the accounting for the “Calendar of Ca$h” program was questioned.  In response, Jack stated that the account is in its own checking account and that the School continues to process the checks and “run the program”.  It was recommended that the School transfer the Parish’s portion of the account balance to the Parish soon 

Miscellaneous questions/concerns:
Kathryn asked several questions relating to the Stehling funds:  (Since the meeting, Jack talked with Mike Sternig.  Following are the responses received regarding the questions being asked.) 

- QUESTION: Where was and is the Stehling Cash shown on the balance sheet?  RESPONSE: Previously, the Stehling Cash was not shown on the School’s balance sheet.  Now that the bookkeeping has been brought over to the Parish, the Stehling Cash is now in the Parish’s primary account at Chase Bank and is shown on the Parish’s balance sheet.

-  QUESTION: When the “programs” sponsored by the Stehling funding are negotiated, are only the direct cost of the program considered or are other indirect costs considered as well?  RESPONSE: only direct costs are considered.  In the case of salaries, FICA taxes are considered.

- QUESTION:  Because of the intent of the Stehlings' to sponsor the teaching of the Chinese language, might they be interested in sponsoring the teaching German and Spanish as well?  RESPONSE:  No, the Stehlings are not interested in sponsoring these other foreign languages.  Again, according to Mike Sternig, it is the intent of the Stehlings to sponsor programs that are ingenius to the School, meaning programs that are unique and are not being offered (on a norm) by other schools. 

Sister Parish: Sagrada Familia:  It was suggested that as a result of the devastating earthquake in Haiti (bordering on the Dominican Republic where our sister parish is located), that Holy Angels advance the funds that have been budgeted to date for them.  This amount if $5K.  A consensus of members strongly supported recommending to the Parish Council their support of the issuing of this check to Sagrada Familia as soon as would be practical. 

PROPERTY AND GROUNDS UPDATE
The work on the lighting system in the school has been completed.  The paperwork has been submitted in order to gain a reimbursement for a significant amount of the cost due to the energy savings associated with the project.  This rebate should amount to around $12-$13K.  Also, the cost of the boiler tune-up has also been submitted for a rebate; however, the cost of the tune-up was only $813, thus, the rebate will be quite small (a percentage of the cost). 

TIME, TALENT, TREASURY – AND - FAITH IN OUR FUTURE
Faith in Our Future:  Fr. Brittain noted that $213K had been received the Diocese in response to the fund appeal and that we are only now entering the second of a three year pledge program.  Once the pledges have been fulfilled, it would be expected that the collections of the Parish will begin to rise again.  Jack is waiting for the Diocese to send out it’s year end report showing the individuals, their pledges and the collections received to date.  It will then be determined if a follow-up with parishioners is warranted given the fact that the Diocese does send out reminders. 

AUDIT SUB-COMMITTEE ACTIVITIES
Jack presented cost estimates of three different style audits (received from Kieckhafer, Dietzler, Hauser LLP) that may be obtained.  (Because of the Parish’s use of QuickBooks and because of its combining the accounting of the School and the Parish, the cost estimates that were received are actually less than the quotes previously received.).  The consensus of the committee members seemed quite interested in a complete audit being done within the next 12 months. (The Archdiocese completed an audit in Jan, 2009.)  Also, the Archdiocese is in the process of providing “direction” on the type and frequency of audits based on the size of the Parish.  It was determined that the finance committee will have further discussion on this matter in the future. 

SCHOOL TRUST FUND
There was a meeting of the Advisory Board and School Trust Fund Trustees’ on January 19^th.  At the meeting, performance issues of the investment activities of the M&I Bank Trust were reviewed.

Jack asked if there was a way of determining the amount that the Parish could plan to receive this fiscal year, both on behalf of parents seeking financial support as well as a general transfer to offset what would otherwise be a higher tuition amount in future years?  It was expressed that this very issue is being discussed and the Trustees would make that decision soon. 

 SCHOOL TASK FORCE
The Archdiocesan representative that headed up this effort has resigned.  A new superintendant of schools is being sought. 

ADJOURNMENT
A motion to adjourn was made by Mike Nowack and seconded by Don Felix.  The motion was approved unanimously. 

PRESENTATION TO PARISH COUNCIL – ANNUAL BUDGET: THE PROCESS
Following the normal Finance Committee meeting, Jack made a presentation to the Parish Council.  The presentation was an introduction to the Budget Process for the upcoming new fiscal year 2010-2011 (which begins July 1, 2010). 

Budget Assumptions:
  -  Continuation of achieving the Archdiocesan 80-90% parity level for teacher salaries
  -  Maintaining an affordable and yet competitive tuition scale
  -  Commitment of subsidizing the school within the guidelines of not more than 60% of the Parish revenues

Budget Process:
  - review Day School Committee proposal on salary recommendations and tuition rates
  - discuss proposed Staff considerations with Pastor
  - estimate next year's revenues and expenses (given the above and inflation)
  - develop budget
  - present preliminary budget to Parish Council for their input in March
 - summarize proposed salary changes
 - List revenues and expenses (based on the budget AND forecast of the prior year’s operating results
 - Budget by Functional Area, ie. Parish, Church, Rectory, School, Religious Education, & Youth Ministry
 - Chart - Income & Expenses by Functional Area
 - Budget in format of annual Financial Report
 - make requested changes of the Parish Council and present revised budget for approval in April

The Forecast of the Current Year’s Operating Results:
Forecast of the current year’s operations suggest that the Parish will incur a loss of approximately $87K.  This is based on a shortfall of $40K in regular envelope giving and $90K shortfall of tuition and related school revenues (resulting from a significant decline in student enrollment from budgeted of 375 to actual of 344 students).  The School’s response to the decline in enrollment resulted in eliminating some costs, the net of which result in the overall forecasted loss of $87K.  The Parish has an opportunity to use a portion of the Rolfs’ Foundation Trust to absorb a significant portion of this loss. 

Presentation of “Mock Budget”
A rough overview of a “Mock Budget” would suggest that revenues will NOT be sufficient of overcome the ever evolving expenses (even with a significant increase in tuition.  Thus, the School Board will be challenged to go beyond its initial effort in containing cost while keeping tuition “competitive” and affordable.  Jack will review the staffing once again with Fr. Brittain.  New estimates of revenues and expenses will be calculated.  Following these further considerations, a budget will then be submitted to the Finance Committee and then the Parish Council 

Fr. Brittain’s Assessment:
As a result of the Archdiocesan program, “Faith in Our Future”, a significant amount of parishioner contributions have been directed to the Archdiocese that would have otherwise been shared directly with the Parish.  This program will run for another two years.  Conjecture would say that with the fulfillment of the Archdiocesan effort, the gift giving to the Parish will improve (so we pray).  

Jack’s Conclusion
Therefore, it would be “reasonable” to anticipate the need to once again draw upon the available funding of the Rolf’s Foundation as a means of achieving a balanced budget in the 2010-2011 financial year. 

NEXT MEETING
The next meeting will be February 18, 2010. 

Respectfully submitted,    

John (Jack) Daniels

For Pete Rettler, Secretary, Finance Committee