Treasurer’s Report to the 28th Constituency Session

Arizona Conference

Stewardship for Jesus!

 

Welcome to the section of this Constituency report that everyone looks for— “The Financial Review!” In this section we will review for you the Conference’s finances for the past four years. You will also find the audited financial report for the quadrennium included in your binder. Just look for the green pages at the end of the “Reports” section.

I would like to begin by recognizing our treasury staff and the hard work they have done on our behalf. First there is Julie Riebow, our associate treasurer. Sandra Leski serves as accountant and Corene Knopp, as department secretary. I appreciate the work these ladies do for our Conference.

From 2003-2006, we received tithes in the following amounts: 7.9 million in 2003, 9.3 million in 2004, 10.4 million in 2005 and 11.3 million in 2006, totaling $38,921,868 million. Over the past three years we have received windfall tithe gifts of $300,000 to $400,000. One of the amazing things is that each year our tithe base has increased by more than the amount of the windfall gifts given the previous year. We praise the Lord for our members who have so faithfully remembered the Lord’s treasury.

Looking at the same tithe numbers but viewing them as percentages: in 2003 we saw a tithe gain of 4.21% over the previous year, in 2004 a gain of 17.25%, in 2005 a gain of 11.02% and in 2006 a gain of 8.58%. For the past four years the Arizona Conference has seen a 47% increase in its tithe base. We believe this increase leads the North American Division. As we continue our work of winning more souls for the kingdom of God, both here in Arizona and around the world, I believe the Lord will continue to bless our Conference with tithe gains in the future.

 Let’s take a look at our tithe numbers in yet another format. To determine tithe per capita, the average tithe given per member, we divide the total tithe for the year by the ending membership for that year. In 2003 we showed a tithe per capita of $585 per member,
in 2004 $649 per member, 2005 brought $691 per member and in 2006, $809 per member. As you look at these numbers note that this is on a per member basis, not a per family basis. For the North American Division the average tithe per capita was $856. From this we can see that our per capita giving is below the average for the North American Division.

We ended 2006 with an account receivable of $1,903,660. The largest portion of this is the accrual of $1,424,427 for December tithe. We also had receivables for other denominational entities of $64,000. Local schools owed the Conference approximately $369,000 for support of teachers, and local churches owed $46,000 in remittances and insurance premiums. With the exception of one school, we have seen a decrease in our accounts receivables over the last few years and we appreciate the timely payment of insurance premiums.

 Our liabilities at the end of 2006 were $2,043,232. These dollars are made up of the following items: remittance of tithes and offerings to the Union and GC, medical expenses, accrued vacations, retirement allowances, trust funds and other general accounts payable.  We are pleased to report that all of the liabilities have been paid since December 31, 2006 and that we are current with all of our accounts payable.

Our current ratio for the end of 2006 was 2.26. The current ratio is a measurement of an entity’s ability to pay its bills in a timely fashion. This means that for every dollar we owe, we have $2.26 to cover that debt. Our goal over the next four years is to increase our current ratio to 1:3 so that we will have $3.00 to cover each dollar of liability that the Arizona Conference owes.

We have also seen an increase in our working capital for the past four years. The requirement established by the General Conference is that each entity have three months worth of reserves set aside to cover tithe shortfalls and other unexpected emergencies. In 2002 we had a working capital of 46.91% of that requirement, and by 2006 this percentage had increased to 59.02% of the required working capital. By increasing our working capital, we also increase our current ratio to a more comfortable level.

 Over the past four years our net assets have grown from $1,200,000 in 2002 to just over $2,100,000 in 2006. During this time our unrestricted assets increased by about $625,000— from $775,000 to 1.4 million—while at the same time our restricted assets increased by $193,000—from $386,000 to $579,000. Overall, our net assets increase is related to the increase in tithe and the maturing of trusts.

Tithe dollars are distributed along the following percentages: the General Conference currently receives 16% of each tithe dollar, the Pacific Union receives 9%, the retirement office receives 10.10% of each tithe dollar and the small conference special assistance fund receives 0.69% of each tithe dollar. This leaves a balance of 64% of each tithe dollar for support of the ministry work here in the Arizona Conference. These percentages do not include any reversions that may return to us.

Of the 64% of tithe dollars retained here, 62% is used for support of church-related ministries/activities: our pastors, evangelism programs, Camp Yavapines, women’s ministry, prayer ministry and camp meetings; 19% is used to support Christian education at the local, academy and university level; 9% is used for the Trust, Literature Evangelism and Publishing departments; and 10% is used for administrative expenses.

Over the past four years, we as a Conference have spent over $40.5 million in support of the work done in our Conference. The difference between the 40.5 million that we have spent and the 38.9 million we received in tithe is $1.6 million. This 1.6 million has been additional income received from Conference Advance, maturities, appropriations, the local school share of teacher expense and fees for summer camp.

As we look to the future we see great challenges ahead. We have churches that need to be built; some have outgrown their facilities and need more space. Many areas of our Conference are involved in ongoing evangelistic meetings and other outreach programs.
There are young people that need to attend our schools and summer camp programs.  We have members who need encouragement. The list is endless but the Lord is with us, and with His help we will succeed!

When one sees all the blessings God has showered on this Conference over the past four years, I cannot help but remember the quotation from Life Sketches, page 196, “We have nothing to fear for the future, except as we shall forget the way the Lord has led us, and His teaching in our past history.”

Are we willing to take that step in faith? Remember that success comes from the blessing of the Lord through you, the member, as you become involved spiritually, physically and financially. We are on the brink of Jesus’ soon return. Are we going to move forward in faith according to the Gospel Commission, or will we retreat in fear of a great challenge? As we move into this new quadrennium, let us do so with zeal, making sure that the next constituency session is in Heaven.

 

     D. Kent Sharpe, Treasurer