The Diocese of Rockville Centre is pleased
to publish its financial statements for the fiscal years
ended in 2006. Following the completion of the 2005
audits, the Diocesan Audit Committee and Finance Council
approved the appointment of new auditors for many Diocesan
entities. KPMG LLP was selected as auditor of the
administrative offices, cemeteries, and investment,
insurance and media units. Holtz Rubinstein Reminick LLP
was appointed as auditor of Catholic Charities and
Tomorrow’s Hope Foundation. Callaghan Nawrocki LLP,
already auditors of the Diocesan high schools, became
auditors of the Seminary.
Coincident with the installation of new
auditors, several of the financial reporting formats were
changed. Most changes were substantive – for some
Diocesan entities, the Diocese and its auditors determined
that alternative report formats would better fit the
nature of the funds under audit. Alternate reporting
formats generally meant that expanded audit procedures
were applied. In other cases, the audit report format
was left intact, but the Diocesan finance staff and the
auditors applied a more rigorous and consistent approach
to the application of accounting principles.
As a result of the significant reporting
and audit changes, most 2006 audit reports cover only that
fiscal year. Comparative financial statements will resume
with the 2007 reports. Below is a brief synopsis of the
financial report of each diocesan entity, including fiscal
year performance and notation of any major changes in
financial reporting format. A fuller understanding of the
changes can be obtained by review of the individual
financial reports.
Administrative Offices
The financial statements of the
Administrative Offices include Chancery Operations, Plant,
Diocesan Loan Account, and the Catholic Ministries
Appeal. In 2006, a single-column format has been adopted
for the Statement of Financial Position, and a condensed
net asset-based presentation style is used for the
Statement of Activities. In 2006, total net assets for
the Administrative Offices declined from $80.8 million to
$58.0 million, a decrease of $22.7 million. $5.4 million
of the decline is attributed to a grant made to the newly
created Mission Assistance Corporation; $4.6 million of
the decrease was due to losses in operations (unrestricted
net assets); and $13.4 million was due to a change in
accounting principle, specifically, recognition of FASB
issued Interpretation No. 47 (FIN 47), Accounting for
Conditional Asset Retirement Obligations. Under FIN
47, the Administrative Offices recognized its legal
obligations toward asbestos abatement as a conditional
asset retirement obligation. Temporarily restricted net
assets rose by $0.7 million, and permanently restricted
net assets were unchanged.
Unitas Investment Fund, Inc.
Unitas is an investment company operated
by the Diocese to facilitate the obligation of Diocesan
entities to invest their funds in a manner consistent with
Church teachings. The net assets of Unitas belong to its
participating entities, such as Diocesan companies,
parishes, and schools. The Unitas statements for 2006
have been prepared in accordance with the AICPA’s Audit
and Accounting Guide for Investment Companies. The
fiscal 2006 total return for all Unitas assets was 5.68%.
At the close of 2006, Unitas had net assets of $331.1
million available for participants.
Mission Assistance Corporation
2006 was the first year of operation for
the Mission Assistance Corporation (MAC). MAC was formed
to assume much of the loan portfolio from the Diocesan
Loan Account (DLA), and to provide financial assistance in
the form of loans and grants to parishes in need. During
2006, MAC received a $5.4 million grant from the DLA (part
of the Administrative Offices), and it earned an
additional $1.0 million in investment income and “Mission”
fees charged to Unitas investors. At year-end, MAC held
parish loans of $1.4 million, and had total unrestricted
net assets of $6.3 million.
Catholic Cemeteries
Catholic Cemeteries include the assets
and operations of Holy Rood Cemetery, Holy Sepulchre
Cemetery, Queen of All Saints Cemetery and St. Francis de
Sales Cemetery. During the 2006 year, the Cemeteries made
a $2.2 million unrestricted contribution to the
Administrative Offices. The Cemeteries ended the year
with a net increase of $4.3 million in unrestricted and
total net assets.
The 2006 financial statements reflect a
restatement of the opening net asset balances.
Unrestricted net assets at August 31, 2005 have been
restated to include $55.2 million of permanent maintenance
funds previously reported as permanently restricted net
assets, as such amounts were received in exchange
transactions and do not meet the definition of a
permanently restricted contribution. In addition, New
York State only regulates such funds when held by other
than religious corporations, requiring that such funds be
treated as trust funds, prudently invested with the intent
of preserving capital and producing a reasonable income.
Although Catholic Cemeteries is exempt from the State
regulations, it recognizes a written promise to invest the
principal of the permanent maintenance fund and to use the
income to fund the general maintenance and improvements of
the cemetery. At the end of 2006, these funds
amounted to $57.1 million of $125.7 million in
unrestricted net assets. The Cemeteries has $11,000 in
temporarily restricted net assets and no permanently
restricted net assets.
Catholic
Charities and Affiliates (CC)
The Catholic Charities financial statements
include the Catholic Charities agency and its affiliates:
the Catholic Charities Support Corporation (CCSC),
Catholic Charities Health Systems, and Regina Maternity
Services Corp. In 2006, the combined entities had a loss
from operations (decrease in unrestricted net assets) of
$1.2 million. Total unrestricted net assets increased by
$0.8 million, due to gains in the investment portfolio of
CCSC. Temporarily and permanently restricted net assets
of CC and its affiliates increased by $0.1 million, so
that total net assets increased by $0.9 million, to $26.7
million at year end. In 2006, Catholic Charities
recognized receipt of $2.4 million in assistance from the
Diocesan CMA program.
Catholic Press Association
The Catholic Press Association is the
publisher of “The Long Island Catholic” weekly newspaper.
In 2006, the Press had a small increase in unrestricted
net assets of $21,000, leaving its total net assets
relatively flat at $2.5 million. The Press has no
temporarily or permanently restricted net assets.
Telecare
Telecare operates the
Diocesan television station, which broadcasts religious
educational and spiritual programs on Long Island. In
2006, Telecare had a net operating loss of $2.3 million.
The loss was offset by a Diocesan subsidy of $2.5 million,
yielding an increase in unrestricted net assets of
$200,000. Telecare’s total unrestricted net assets at
year end were $700,000; it has no temporarily or
permanently restricted net assets.
Diocesan Service, Inc.
Diocesan Service, Inc. provides
insurance brokerage services for many diocesan entities.
In 2006, it had total revenues of $28,000 and new income
of $10,000. Its total retained earnings at the end of
2006 were $152,000.
Ecclesia Assurance Company
Ecclesia is a New York State captive
insurance company that provides insurance for diocesan
entities. Ecclesia is a stock corporation wholly owned by
the Diocese. In 2006, Ecclesia had net income of $0.4
million, and it closed the year with $0.8 million in
retained earnings. The company has $4.4 million in total
assets with $2.8 million in total stockholder’s equity.
Health Insurance Program
The Health Insurance Program provides
medical, dental, life, and non-occupational disability
insurance for participating employees of Diocesan
entities, parishes and schools. During 2006, the Health
Program had an increase of $4.3 million in net assets
available for benefits and ended the year with $26.0
million in net assets available for benefits; the year end
value includes the plan’s total benefit obligation of $2.7
million.
The 2006 financial statements reflect a
restatement of the opening net asset balances. In 2005,
the Health Program followed a not-for-profit organization
format. The 2006 financial statements for the Health
Program follow the AICPA’s Audit and Accounting Guide:
Employee Benefit Plans for Health and Welfare Plans.
In applying the benefit plan accounting standards, the
former classification of $6.0 million in unrestricted net
assets and $15.5 million in liabilities were eliminated,
and replaced with an equal amount of net assets available
for benefits. The plan’s beginning of year benefit
obligations were restated to $2.2 million.
Diocesan High Schools
The Diocesan High Schools include Bishop
McGann-Mercy High School in Riverhead, Holy Trinity High
School in Hicksville, and St. John the Baptist High School
in West Islip. In fiscal 2006, the schools had a combined
$31.1 million in revenues and $34.1 million in
expenditures, leaving a net loss of $3.0 million in
operations before Diocesan subsidy. The Diocese provided
the schools with $4.2 million in support -- $2.2 million
toward operations and $2.0 million in capital
improvements. When added to the operating results, the
Diocesan subsidy yielded for the schools a combined $1.2
million increase in unrestricted net assets, most of which
is in plant. The schools also had a moderate increase in
temporarily restricted net assets, which total $2.1
million at year end.
Seminary of the Immaculate Conception
The Seminary of the Immaculate Conception
is an institution of higher learning established for the
training of men for the priesthood. In 2006, the Seminary
had a net decrease in unrestricted net assets of $0.5
million, resulting from an operating deficit of $1.9
million and a Diocesan subsidy of $1.4 million. The
Seminary also had small increases of about $70,000 in
temporarily and permanently restricted net assets. The
Seminary ended the year with $3.4 million in net assets.
Tomorrow’s Hope Foundation
Tomorrow’s Hope was created to support the
excellence and continuation of Catholic school education
on Long Island, primarily through the provision of
scholarships to students and direct grants to schools.
2006 was the first full year of operations for Tomorrow’s
Hope; scholarships raised during that time were awarded
for and paid during the 2006-07 school year. During 2006,
Tomorrow’s Hope raised $0.9 million from direct
contributions and special events, and awarded $0.9 million
in scholarships. Total revenues and total expenses each
amounted to $1.7 million, including $0.8 million in
contributed service income and expense from the Diocese.
Tomorrow’s Hope ended the 2006 year with a small deficit
in unrestricted net assets; it has no temporarily or
permanently restricted net assets.
Other Audits
Reports on two additional 2006 entities,
Protected Self Insurance Program, and Mission Office &
Propagation of the Faith, will be added to this
site upon conclusion of the audits.
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