Diocese Reports Operational Deficit offset by Unrealized Investment Gains

Following a complete audit of its financial accounting, the Diocese of Worcester has issued online Financial Statements and online and printed editions of the Annual Report on Financial Activities for the fiscal year ending August 31, 2017. That report also highlights many of the accomplishments of the diocesan ministries and Partners in Charity recipient agencies during that timeframe.

In his letter, Most Reverend Robert J. McManus, S.T.D., Bishop of Worcester, wrote that "diocesan operations were challenged and experienced a loss of $278,802 before unrealized gains on investments." That deficit amounted to slightly more than 1 percent of the total expenses of $26,169,629. After including unrealized gains on investments, the annual report on financial activities reports a surplus of $1,116,885 or 4.25% of total support and revenue. By comparison, there was a small surplus of less than 1 percent the previous fiscal year after accounting for unrealized gains. The Bishop did note that the figures do not include the financial reports of individual parishes, which are posted online at worcesterdiocese.org/fiscal-affairs, or of parish and private Catholic schools.

Bishop McManus also noted that Central Administration reduced the line of credit due to the Diocesan Expansion Fund (DEF) by almost $3.9 million, but raised concerns over the fact that receivables due from parishes were "essentially unchanged." The DEF is essentially a “savings and loan” for the parishes and the diocese. He explained that "this is an indicator of a bigger, more systemic problem.

Many parishes are struggling to develop balanced budgets due, in part, to capital needs and increased maintenance costs." For this reason, he announced that a feasibility study is in progress with a professional consulting firm in stewardship and development regarding a proposed capital campaign. Such a campaign would benefit "specific diocesan programs such as Priests' Retirement Care, Catholic education and the financial needs of our 96 parishes." His letter notes that more information on the feasibility study will be announced soon.

Priests’ Retirement Care experienced a deficit of $453,865 after support from restricted funds and another successful Celebrate Priesthood event in October 2016 which contributed $191,520 to their care.

Operating expenses for Central Catholic Schools totaled $12,794,312 resulting in expenses over revenues of $120,119 after support from restricted funds. Central Catholic (C.C.) schools include the financial activity of the Holy Name C.C. Jr./Sr. High School, St. Bernard C.C. High School, and St. Peter-Marian C.C. Jr./Sr. High School, as well as St. Peter C.C. Elementary School. There were 1,495 students reported in Pre-K through grade 12 in those four schools during the school year ending June 2017.

The complete text of the Bishop’s management letter accompanies the Annual Report on Financial Activities for FY2017 prepared by the diocesan Office of Fiscal Affairs and an impact report from many of the diocesan agencies. The Annual Report is being distributed as a supplement to parishes for distribution at Masses on the weekend of January 28, as an insert in The Catholic Free Press on the same weekend, and is posted online at worcesterdiocese.org/fiscal-affairs. A complete copy of the audited Financial Report prepared by O'Connor, Maloney & Company, P.C. is available online at worcesterdiocese.org.

New to this year's report is a 2017 Partners in Charity Campaign Review which reported having raised $5,125,527 in cash and pledges from 17,248 donors as of August 31, 2017. That campaign raised funds which are being expended in FY2018. The report provides a breakdown of funding for 29 agencies and ministries, along with a detailed report on the 4,309 donor households who contributed as members of eight giving societies.

Any questions about the reports can be directed to Paul Schasel, director of Fiscal Affairs at 508-929-4333 or by email to [email protected].