First Baptist Church, Halifax
Treasurer’s Financial Update
Hello everyone. I thought that you might be interested in how FBCH has fared through the first six months of this very unusual year.
The finance function of our church moves ahead uninterrupted. We continue to receive donations, pay bills, administer payroll, deal with investment issues and the management of cash, conduct our monthly accounting as well as other related activities, all the while adapting to the new realities. A special thank you to Mary Banks for her dedication to FBCH and her adaptability to the changing environment.
Donations are down this year from last year by almost 11% or $13,450. Our 2020 budget anticipated a reduction of about 5% due to trend analysis, so that does account for some of the drop. A significant part of this decline is undoubtedly the effect of Covid with all of the constraints imposed on the church and congregation.
Each month we benefit from the solid donation base provided by our longstanding pre- authorized deposit system. Recently, E-Transfers have become very popular and quite a number of our people are using this method of donating to the church. E-transfers are very easy to make, even the first time, and certainly once you have done one transfer it is even quicker and easier from then on. Also, some people are donating to FBCH through Canada Helps. Finally, we continue to receive a few cheques in the mail as well as ones that are dropped off at the church. This payment option is fine for FBCH, especially if that is what works best for you.
Our rental of church space has effectively stopped as of mid March. In the last few years space rentals have become an important revenue stream in that they represent about 8% of annual revenue. It is unlikely that this revenue activity will resume in 2020, and so we expect a net rental revenue decline of $25,000 or more for 2020 compared to 2019.
Investment income (dividends and interest) represents about 24% of our total revenue. This income has risen significantly in the last few years from the investment of several large Planned Gifts. Due to economic disruptions, however, two or three of the companies that we invest in have reduced their dividends. These reductions represent possibly as much as 9% of operating investment revenue. No further reductions are anticipated, but only time will tell.
As to the investments themselves, they were down in value by about 13% or about $600,000 from December 31 2019. In fact, the decline was even greater at the end of March when the market hit its bottom. As we have no immediate need or desire to sell any holdings, these market value swings have no near-term negative consequence and we would expect the markets to recover. The investment portfolio is under the watchful eye of our Investment Committee.
The expenditure side of our church is always quite stable. About 60% of our costs are salary related and a significant amount of other costs are predictable. In addition to the regular day-to-day expenses of the church, our year-to-date expenses include ongoing special projects. The Property Redevelopment Committee has spent some of its authorized funds as it moves forward with its planning work. In July we will incur costs for audio-visual systems that will improve our live streaming and related activities. Fortunately, this audio-visual expense will be largely offset by a contribution from the Auxiliary.
As with the changes to our revenue side, there are changes to our methods of making payments in that the vast majority of expenditures are now paid by electronic funds transfers. While we always paid many bills electronically, we have greatly expanded this practice and outgoing cheques are increasingly rare.
Many of the issues described here are, without question, challenging, However, as we move through the demands of these times, I am truly heartened by the response of our church family and their support of all things FBCH!