1. Mennonite Church Canada Fiscal Year Ending (FYE) 2008
Friday, November 30, 2018
Mennonite Church Canada
Budget Plan:
Fiscal Year Ending (FYE) 2008
Introduction:
You will find the budget for FYE ’07 on pages 59, 61 and 62 of your report book. We have again shown you two different reporting formats of the budget. The version on page 62 shows gross revenue and gross expenses for FYE ’07 with two comparative columns, Budget for FYE ’07 and proposed budget for FYE ’08.
The version on page 61 has the recognized deferred contributions and self generated revenue credited to the corresponding expenditure line, thus reporting net program expenditures. The column left of the grey vertical bar shows the gross budget for ’08 for easy comparison of the two formats.
The budget on page 59 is the more summarized version of the other two.
When commenting on the Revenue Budget, we will be referring gross to numbers (page 62), when commenting on expenses we will be referring to net expenditures (page 61).
Preparing the annual budget is a major project; one that requires much detailed attention from Finance, Executive Staff, Councils, Financial Policy and Audit Committee and the General Board. The end result is a very helpful planning tool; when the budget is complete, the program plans for the year are pretty much made. What remains then is the execution.
The 2007 budget includes a Consumer Price Index adjustment for salaries of 2.4%.
Looking Ahead:

2. Gross Revenue Comparison
FYE Jan-08 GROSS Annual Budget
FYE Jan 07 GROSS Actual
FYE Jan 07 GROSS Budget
Individual & Corporate Donations
807,300
785,225
830,290
Church Donations
2,803,500
2,849,499
2,843,000
General Bequest
45,000
Sub-total Donation Income
3,610,800
3,679,724
3,673,290
Recognized Deferred Contributions
60,284
49,488
47,271
Other Income
632,115
849,364
838,219
Sub-total Program Income
4,303,199
4,578,576
4,558,780
Partner Program Income
695,575
770,615
373,778
Related Organization Income
297,000
414,459
85,000
TOTAL INCOME
5,295,774
5,763,650
5,017,558
Friday, November 30, 2018
Revenue Comparison:
First let us express again our gratitude to you, and the congregations you represent, for your generosity to the ministry and work we are able to do together. Church giving has matched the projections we presented in Edmonton 2006.
Each year, the budget line which generates the most extensive discussion is the Donation Revenue line. You will notice that our budget for ’08 is lower than the budget for ’07. This is due to the downward trend in donation revenue. As I mentioned, Church donations were right on target, but Individual & Corporate donations were short of projections. We are often blessed with significant support from a relatively low number of contributors. We cannot, however, expect the same level of generosity from each individual each year as their economic performance fluctuates.
You will notice that we have budgeted higher support in this segment, compared to FYE 07 actuals.
As a result of direct feedback, Church donation projections have been shifted downwards.
Fortunately though, last year’s generosity caused us to look at the future with much more optimism. Our improving balance sheet has allowed us to continue what was started in FYE 07 and adjustments will be made in FYE09.
Our cautious approach last year allowed us to end the year in a strong position. We would like to move ahead and expand more aggressively, yet prudent fiscal management requires us to remain cautious.
So let me say it again. Thank you for your generous support. We promise to continue to respond with program adjustments at home and abroad, based on the generosity of your support. There is much more that needs to be done and together we will create a world of healing and hope.
We will now move into a more detailed review of the budget.
Since partner program and related organization are evolving into a permanent and important piece of our program, greater effort has gone into budgeting for these projects.
Other budgeted income of $632,115 is anticipated as follows:
Looking Ahead:

3. Friday, November 30, 2018 Looking Ahead: 2007-08 Other budgeted income
$222,404 from a variety of fees, sales, administration fees, subscriptions, etc.
$334,089 from partner subsidies mostly from MMN.
$75,622 from interest income.
Looking Ahead:

4. TOTAL Expenses 4,577,044 4,293,134 4,071,552 MC Canada 1,852,168
Friday, November 30, 2018
Net Expenses Comparison
MC Canada
FYE Jan-08 NET Annual Budget
FYE Jan 07 NET Actual
FYE Jan 07 NET Budget
Witness Council
1,852,168
1,693,197
1,875,625
Formation Council
376,279
346,359
383,779
Support Services Council
713,043
725,546
716,658
General Board
395,374
396,026
421,585
CMU
335,580
325,603
Partner Program
607,600
391,944
253,325
Related Organization
297,000
414,459
85,000
TOTAL Expenses
4,577,044
4,293,134
4,071,552
Net expenditure budgets were basically developed on a status quo basis
As FYE 07 drew to a close, minor adjustments were made to reflect actuals and the refined revenue expectation for FYE 08.
Looking Ahead:

5. TOTAL Witness Council Expense 1,852,168 1,693,197 1,875,625
Friday, November 30, 2018
Net Expenses Comparison Christian Witness
FYE Jan-08 NET Annual Budget
FYE Jan 07 NET Actual
FYE Jan 07 NET Budget
Executive Office
114,057
82,110
90,636
Congregational Partnerships
182,066
141,896
188,253
National Ministries Admin
8,339
9,311
8,677
Multi-Cultural Ministry
38,356
38,442
39,558
Native Ministries
104,441
89,692
89,748
International Ministries
1,404,909
1,331,746
1,458,753
TOTAL Witness Council Expense
1,852,168
1,693,197
1,875,625
Net expenses budgeted for Christian Witness Council are $1,852,000 compared to a budget of $1,876,000 last year, and actual expenditures last year of $1,693,000.
The delayed hiring of a Staff member in Congregational Partnerships and the early completion of mission assignments in International Ministries along with the strong Canadian dollar all contributed to the under-expenditures.
Looking Ahead:

6. TOTAL Witness Council Expense 1,852,168 1,693,197 1,875,625
Friday, November 30, 2018
Net Expenses Comparison Christian Witness
FYE Jan-08 NET Annual Budget
FYE Jan 07 NET Actual
FYE Jan 07 NET Budget
Executive Office
114,057
82,110
90,636
Congregational Partnerships
182,066
141,896
188,253
National Ministries Admin
8,339
9,311
8,677
Multi-Cultural Ministry
38,356
38,442
39,558
Native Ministries
104,441
89,692
89,748
International Ministries
1,404,909
1,331,746
1,458,753
TOTAL Witness Council Expense
1,852,168
1,693,197
1,875,625
- A significant portion of the Witness Budget is spent in International Ministries.
Looking Ahead:

7. Friday, November 30, 2018
International Ministries Breakdown by Region
FYE Jan-08 NET Annual Budget
FYE Jan 07 NET Actual
FYE Jan 07 NET Budget
Africa
433,733
397,673
404,215
Asia & Middle East
608,241
599,901
667,426
Europe
241,684
219,233
241,443
Latin America
121,251
114,939
145,669
TOTAL
1,404,909
1,331,746
1,458,753
The Regional Breakdown is as shown on this slide.
The current years budget includes:
$433,733 for Africa
$608,241 for Asia & Middle East
$241,684 for Europe, and
$121,251 for Latin America
Looking Ahead:

8. 376,279 346,359 383,779 TOTAL Formation Expenses 148,321 136,849
Friday, November 30, 2018
Net Expenses Comparison – Christian Formation
FYE Jan-08 NET Annual Budget
FYE Jan 07 NET Actual
FYE Jan 07 NET Budget
Executive Office
148,321
136,849
154,249
Resource Center
68,474
56,253
69,400
Min. & Cong. Leadership
82,718
73,480
84,100
Youth Ministry
27,393
27,629
27,500
Youth Assembly
4,756
Education & Nurture Ministries
49,373
47,392
48,530
TOTAL Formation Expenses
376,279
346,359
383,779
Net expenses budgeted for Christian Formation are $376,000 for the current year compared to a budget of $384,000 last year, and actual expenditures last year of $346,000.
Der Bote, Mennonite Heritage Centre Archives and Gallery have been moved out of Christian Formation Council into Partner Programs.
The MHC Archives will continue to receive support from general donations, through a grant from the Formation Executive Office expense line.
Looking Ahead:

9. Friday, November 30, 2018
Net Expenses Comparison – Support Services
FYE Jan-08 NET Annual Budget
FYE Jan 07 NET Actual
FYE Jan 07 NET Budget
Administration
265,780
282,020
282,880
Annual Assembly
(5,000)
10,677
Communications
157,307
146,384
151,585
Development
120,795
114,276
116,193
Canadian Mennonite
174,161
172,189
171,000
TOTAL Support Services Expenses
713,043
725,546
716,658
Net expenses budgeted for Support Services are $713,000 compared to a budget of $717,000 last year, and actual expenditures last year of $725,000.
Administration costs have been reduced slightly due to the one time major repairs being completed last year. This decrease has been offset by an increase in Communications and Development projects.
This net expenditure slide also highlights on the 2nd line, the Annual Assembly cost for Edmonton. Due to lower than expected registration numbers, the Edmonton Annual Assembly resulted in a deficit which was covered by contributions.
Looking Ahead:

10. TOTAL General Board Expense 730,954 721,629 757,165
Friday, November 30, 2018
Net Expenses Comparison – General Board
FYE Jan-08 NET Annual Budget
FYE Jan 07 NET Actual
FYE Jan 07 NET Budget
General Board Administration
164,354
199,932
200,600
Finance
193,020
158,094
182,985
CMU Grants
335,580
325,603
Mennonite World Conference Grants
38,000
TOTAL General Board Expense
730,954
721,629
757,165
Net expenses budgeted for the General Board are $731,000 for the current year compared to a budget of $757,000 last year, and actual expenditures last year of $721,000.
GB Administration costs last year were high due to an overlap of General Secretary salaries, along with the General Secretary’s cross country church visits. The budget is now back to where it was before.
The Finance department budget is showing an increase due to rising audit fees and salary adjustments. Last years net actual was reduced compared to budget due to an $17,000 cost recovery that had not been budgeted, along with the early repayment of both CMU and MPN loans.
Looking Ahead:

11. 607,600 391,944 253,325 Total Partner Programs Expenses
Friday, November 30, 2018
Net Expenses Comparison – Partner Programs
FYE Jan-08 NET Annual Budget
FYE Jan 07 NET Actual
FYE Jan 07 NET Budget
Misc Projects
50,000
31,751
58,500
Christian Peacemaker Teams
200,000
173,705
Company of 1000
13,500
13,571
NAVMF
25,000
Philippine Partnership
80,000
52,539
26,500
MVSA
2,000
735
Kherson Partnership
5,000
5,251
Learning Tours
20,000
(29,610)
Canadian Women in Mission
30,000
Der Bote
87,300
84,272
81,825
MHC Archives
51,000
41,273
46,500
MHC Gallery
43,900
18,457
40,000
Total Partner Programs Expenses
607,600
391,944
253,325
Partner Programs are revenue neutral.
We have spent more time than in the past preparing this budget including projections for all current projects.
It is a very dynamic part of the budget, that fluctuates from year to year without affecting our bottom line.
Looking Ahead:

12. 297,000 414,459 Total Related Organization Expenses 35,000 39,774
Friday, November 30, 2018
Net Expenses Comparison – Related Organization
FYE Jan-08 NET Annual Budget
FYE Jan 07 Actual
FYE Jan 07 NET Budget
Mennonite Mission Network
35,000
39,774
MC USA
21,000
40,172
AMBS
85,000
80,999
Canadian Mennonite University
2,109
Mennonite Publishing Network
25,000
32,640
Meseretes Kritos College
100,000
197,765
Eastern Mennonite Missions
Mennonite World Conference
31,000
Total Related Organization Expenses
297,000
414,459
We have also revisited how we treat related organizations within our budget.
Knowing that the support we provide to these organization is part of who we are and what we do, and knowing that often these organizations are one of the partners in a project, we have decided to include budget numbers for each organization that we anticipate to support.
However, just like the Partner Programs, expenses are limited to the amount of support received.
Looking Ahead:

13. Balance of Budget
FYE Jan-08 NET Annual Budget
FYE Jan 07 NET Actual
FYE Jan 07 NET Budget
Operating Surplus (Deficit) before extraordinary items
(122,944)
193,169
(106,964)
Other Items
(9,096)
Operating Surplus (Deficit)
184,073
(106,964
Transfer to Reserves
(61,880)
(270,574)
(54,312)
Transfer from Reserves
206,685
144,890
211,524
Transfer to Capital Reserves
(21,861)
(67,485)
(50,248)
Transfer from Reserves for extraordinary items
9,096
Net Transfers (to)/from Reserves
122,944
(184,073)
106,964
Ending Surplus/(Deficit)
Friday, November 30, 2018
The remainder of the budget document lists the transfers to and from reserves planned by councils and the General Board.
Please note that the transfers from reserves of $206,685 includes an amount of $69,000 from General Reserves required to net a balanced budgeted bottom line.
Like I mentioned earlier, with the fiscal year end 2007 donations in house, we were forced to lower our revenue projections. The expenditures were basically left on a status quo level, with minor reduction in expenditures where possible. Our strengthening financial position, namely accumulated reserves allow us to draw on funds in the current budget, leaving more time to decide where and when permanent adjustments need to be made.
Executive Staff has invested significant time and energy planning for future program adjustments that best align with the priorities of MC Canada. This process should be completed in time for next years budget.
Looking Ahead:

14. 3-Year Budget Revenue Projections Expenditures planned accordingly
Friday, November 30, 2018
3-Year Budget
Revenue Projections
Expenditures planned accordingly
Our three year Budgeted projection will again be based on revenue projections.
MC Canada’s financial policies do not permit deficit budgeting, so as revenue projections materialize, and as the future draws nearer, we will prepare annual expenditure plans that are realistic, manageable and controllable and which reflect the priorities directed by delegates and the General Board.
Looking Ahead:

15. Statement of Operations
Friday, November 30, 2018
Statement of Operations
Last year we reported that we had experienced an unexpected increase in revenue. We were, however, not yet quite comfortable in assuming a permanent shift. Our projections were cautious and for good reason.
This year, we planned our FYE08 projections downward to what we believe is the bottom of the curve. From here forward we are projecting a small increase in revenue for FYE09 and FYE10.
Our collective ministries would welcome a surprise by exceeding our projections.
Looking Ahead:

16. 3-Year Budget Confident Responsive Optimistic
Friday, November 30, 2018
3-Year Budget
Confident
Responsive
Optimistic
These last few years have been a confidence builder. We are confident in the work that we are doing.
We are confident that our policies, procedures and controls are working well and appropriate to manage this wonderful organization.
We are also confident that our projections, though somewhat conservative, are achievable and realistic.
We remain cautious in the numbers we present wanting to err on the side of prudence but our faith in our constituency is strong.
We are seeing results in the current year that lead us to believe that our church is growing in its support and desire to build ministries we do together.
Our plans going forward are including this optimism.
The desire for the church to be well resourced to carry on the work the church is called to do is growing. We are thankful.
Looking Ahead:

17. Friday, November 30, 2018 Looking Ahead: 2007-08
- Just taking a quick look at our financial situation so far this year:
- Total Donation Revenues are tracking approximately __$________ ahead of plan __$_______ ahead of last year.
- Expenses are on plan.
Looking Ahead:

18. Thank you. Friday, November 30, 2018 Looking Ahead: 2007-08
Thank-you very much to the congregations and individuals that helped make possible our collective ministry in the last year.
Looking Ahead:

19. FPAC: Finance Staff: Randy Wiebe Lorna Friesen
Friday, November 30, 2018
FPAC:
Finance Staff:
Randy Wiebe
Lorna Friesen
Clare Schlegel Treasurer
Members: Ingrid Peters-Fransen, Helen Kasdorf
Laura Zacharias
I am now prepared to entertain your questions.
Dianne Schmidt
Nyoman Klassen
Looking Ahead: