By
THE MOST REVEREND WILLIAM E. LORI, S.T.D., BISHOP OF BRIDGEPORT
Fairfield
County Catholic, November 3, 2007
More than thirty years
ago, when I was preparing to become a priest, the concept of turning lemons into
lemonade wasn't in the vocabulary. But we did know what Saint Paul wrote in his
Letter to the Romans: ". . . all things work for good for those who love God,
who are called according to His promise" (Romans 8:28).
That
teaching on God's Providential care was put to the test about a year and half
ago when one of the parishes of our Diocese suffered a major defalcation. It faced
a further test when unresolved financial issues surfaced in another large parish.
Confronted with a major crisis and new rounds of embarrassing publicity for the
Church, I reflected far into the night on my own responsibilities and on the dramatic
corrective steps that needed to be taken. Although I had tried to build on past
progress and had taken many steps to strengthen parish finances as well as the
central administration of the Diocese, it was clear that much more needed to be
done.
We
needed a turnaround to restore people's faith in the Church and her mission.
A
year and half later, I would like to offer you a review and a progress report.
This
journey actually began in 2001, just after my arrival, with the introduction of
the first parish finance manual in the Diocese and an internal financial review
program for parishes. But when the parish financial crises struck in 2006, the
pace accelerated. The first step was the convening of a small taskforce comprised
of three pastors from the College of Consultors and three members of the Diocesan
Finance Council charged with developing a program to improve parish financial
procedures and accountability.
Working
as a team, they proposed "Six Key Elements" as a basis for strengthening
parish financial procedures. Then I entrusted the development and implementation
of these elements to the diocesan Chief Financial Officer Norm Walker, and to
the new Director of Parish Finance Services, Deacon Bill Koniers, both consummate
professionals drawn from the business world.
You've
already seen the Six Key Elements here in the Fairfield County Catholic
and online
(updates are posted regularly), but now I hope they will look even better
because they are well on their way toward implementation.
"AN INNOVATIVE FRAMEWORK
FOR PARISH FINANCES" was the title of a keynote presentation by the Diocese of
Bridgeport at the annual Diocesan Fiscal Management Conference in Philadelphia,
PA, last month. Norm Walker (standing above, left), chief financial officer, and
Deacon Bill Koniers (standing above, right), director of Parish Finance Services,
shared details of the "Six Key Elements" of the program now being implemented
to enhance financial controls, practices, transparency, and accountability at
all 87 parishes. The
presentation was very well received, and many dioceses across the U.S. are now
interested in applying our best practices. "I can't tell you how excited I was
to hear the presentation," says Gerrie Lenn Pimentel, CPA, director of Parish
Financial Reporting for the Diocese of Fresno, CA. "I know that, despite the similarities
in size, all dioceses are different, but I would love to use your diocesan example
as leverage to avoid having to recreate the wheel."
First,
we sought to refine and update the Parish Accounting and Procedures Manual
which, as noted earlier, was issued in 2001. We wanted to make the manual
easier to read and understand. We also wanted to make it reflect more clearly
the parishes whose financial operations it seeks to guide. We even changed the
title. It's now called the Parish Administration & Finance Manual: A Management
Tool to Further the Mission of the Catholic Church in Fairfield County.
A
document like this can't be composed in a vacuum. Many long hours throughout six
months of consultation and refinement by pastors, parish business managers, and
Parish Finance Council members from across the Diocese has resulted in the production
of a superior product and one that will be continually refined. And, most importantly,
training for clergy, parish business managers and accountants, and Parish Finance
Council members will be offered. The new manual, approved by the College of Consultors
and the Diocesan Finance Council, is heading to the printers, and will be distributed
next month, with training to begin in January 2008.
A
second pressing need was improving controls over income. Put simply, we needed
to make sure parishioners' contributions made a safe and speedy trip from basket
to bank. Not surprisingly, a number of pastors, already ensuring the proper stewardship
of parishioner contributions, suggested very sound and practical ways to do this.
Their ideas are incorporated into our procedures. You can find the basic principles
for parish collections control on our diocesan website.
We
are also in the process of instituting a program of direct giving in all parishes.
Electronic funds programs are already employed in quite a few of our parishes
of varying economic means. With the assistance of pastors and lay finance professionals,
we will be evaluating several companies that provide this service. We hope to
implement a direct giving program before the start of the next fiscal year.
The
third element is improved parish finance reports. Here we were all over the
lot. Some parishes reported quarterly, some annually, and some never did. The
reports were sometimes hard to understand because their format reflected more
the way the QuickBooks system works than the way our parishes operate. As had
already been done for the central administration of the Diocese, a new standardized
Chart of Accounts for parishes was carefully developed with the assistance of
pastors, parish business managers, and Parish Finance Council members. This Chart
of Accounts reflects more accurately parish income and expenditures. In addition,
the new manual calls for quarterly reporting in all parishes. These reports will
be relatively easy to understand and provide parishioners with a clear picture
of the state of their parish's financial activities and position.
The
fourth element is to assist parishioners when they have concerns about parish
finances. Most often these questions can be answered by the pastor or by members
of the Parish Finance Council. But what to do when such questions remain unresolved?
The Diocese offered practical help to parishioners in a brochure in four languages
which was distributed in all parishes last spring and posted on the diocesan website.
It provides clear and simple procedures for employees and parishioners in addressing
their concerns.
The
fifth element is an annual review and tests of parish financial controls and
accounting procedures across all 87 parishes. The aim here was to strengthen the
parish finance review program that was already in place. For parishes with larger
annual incomes (over $400,000) outside auditing firms were contracted; for those
with smaller incomes, internal procedural reviews were performed.
As
of this writing, we have completed these reviews. The findings and recommendations
prepared from these reviews are discussed in Parish Corporation meetings which
include the pastor, a representative of my office (e.g., Vicar for Administration,
Chancellor, Vice-Chancellor, CFO, Director of Parish Finance), parish clergy,
and the two lay members of the Parish Corporation. This
new "hands-on" approach represents a step up from the parish financial review
program that was begun here in 2001.
The
results of these reviews have been largely positive and happily unspectacular,
a tribute to the hardworking pastors of this Diocese and good policies already
in place. Most parishes received recommendations from the auditors on how to strengthen
parish financial procedures going forward and correcting outdated and inadequate
practices. Next year's reviews will be even more helpful as they will be guided
by the clear procedures in the new Parish Administration & Finance Manual.
And
the sixth element is helping pastors to obtain the help they need in our
parishes to administer them well and wisely. For example, we are suggesting that
parishes with lesser means share a single competent business manager. We are providing
extensive training for parish business managers and accountants as well as for
Parish Finance Council members. We are also in-servicing clergy to help them in
fulfilling their responsibilities not only to oversee finances but also to assess
the capabilities of their staff.
The
goal here is not to burden pastors with further administrative duties, but in
fact to lighten the load by giving them access to well-qualified help and the
advantages which upto- date technology can provide. Most every priest I know sees
parish finances not as end in itself but rather as a means of supporting pastoral
programs like religious education, liturgy, and so forth. So we want to run the
business of the Church in a business-like manner while never reducing the Church's
mission to a business.
And
speaking of technology, reference has already been made to QuickBooks, the parish
accounting system introduced here in the 1990s. Fortunately, none of our parishes
are manual but, truth to tell, we found some were using older versions of this
program and the process of sending in floppy discs to the Chancery for review
and analysis had grown quaint. So with the help of the Intuit Corporation, a leading
software company, and Right Networks, a significant Internet service provider
vendor, not to mention the unflagging efforts of Norm Walker, Deacon Koniers,
Mary Miller, CPA, and our team, the accounting data of each parish is now being
transferred on to a web-based platform.
This
new technology has many benefits. It means that all parishes will be using the
most up-to-date version of Quick- Books rather than a multiplicity of versions.
It means that when a pastor or parish accountant calls Parish Finance Services
to seek accounting help and or to discuss day-to-day problems, everyone will be
viewing the same data in real time. And it will greatly help parishes in producing
their reports, not only for the Diocese but also for parishioners.
Yet
another change is in the offing. Those who run small businesses know how time
consuming and difficult it can be to figure out payroll, especially taxes and
other deductions. After consultation, we are now implementing an out-sourced and
standardized QuickBooks payroll process across the 87 parishes. This service enhancement
will be totally operational by January 2008.
A
few months ago, this package was presented at a national meeting of diocesan fiscal
managers from across the U.S. I am happy to report that more than 10 dioceses
are now reviewing our program and two are in serious conversation with us. Make
no mistake: bishops throughout the country are working hard on this issue.
All
of the above represents not merely new procedures but indeed a culture change.
As those of you in the corporate world know, no one finds that change comes easy,
and no one imagines that we've achieved procedural utopia.
But
my hat is off to the pastors of this diocese and to dedicated lay co-workers for
the very turn-around I prayed for one long night in my chapel.
Was
it lemons to lemonade or God's Providence at work in our Diocese? I think it's
the latter!
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