2014 Financial Statements

---

THE EPISCOPAL DIOCESE OF TEXAS

REPORT TO THE 166th COUNCIL OF THE DIOCESE OF TEXAS

UNAUDITED FINANCIAL STATEMENTS For the year ended December 31, 2014

THE EPISCOPAL DIOCESE OF TEXAS UNAUDITED BALANCE SHEET For the year ended December 31, 2014

Unaudited December 31, 2014

Audited December 31, 2013

ASSETS Cash & Marketable Securities Prepaid Expenses A/R - Assessments - Current A/R - Allowance for Doubtful A/R - Related Entities Accounts Receivable - Other Notes Receivable Fixed Assets Accumulated Depreciation

254,073 127,929 196,104 (112,249) 46,786 127,178 27,159 798,604 (465,048) 1,000,536

60,086 1) 111,161 326,117 - 2) 161,867 156,930 62,481 667,626 3) (374,352) 1,171,916

TOTAL LIABILITIES

162,141 9,188 45,251 33,052 248,016 7,725 505,373

200,896 55,011 100,312 37,795 130 39,016 1) 350,000 19,858 803,018

Current year revenue over (under) expenses Net Assets Net Assets - Special Accounts TOTAL NET ASSETS

126,266 180,988 187,910 495,164

TOTAL ASSETS

LIABILITIES Accounts Payable - Trade Accounts Payable - Other Account Pay - Related Entities Discretionary Accounts Taxes Payable Deferred Revenue - Other Line of Credit Notes Payable

NET ASSETS

TOTAL LIABILITIES & NET ASSETS

1,000,536

NOTES: 1) Cash increase due to collections on registrations and a Church Corp. grant for Daring Way Seminar to be held in February 2015. 2) Allowance to be used after all 2014 assessment payments have been received prior to Council 2015. 3) Fixed asset increase is mainly due to the purchase of two new vehicles.

(929,664) 1,035,241 263,321 368,898 1,171,916

THE EPISCOPAL DIOCESE OF TEXAS INCOME STATEMENT Unaudited For the year ended December 31, 2014

Current YTD Actual

Current YTD Budget

Variance

Annual Budget

INCOME STATEMENT SUMMARY

REVENUES $

6,769,846 $ 1,162,426 246,617 209,143

6,769,846 $ 1,100,437 144,000 132,794

$ 61,989 102,617 76,349

6,769,846 1,100,437 144,000 132,794

TOTAL REVENUES $

8,388,032 $

8,147,077 $

240,955 $

8,147,077

$

2,835,697 $ 1,442,581 1,189,721 741,242 2,047,975 4,550

2,735,692 $ 1,483,544 1,193,951 626,397 2,107,493 -

100,005 $ (40,963) (4,230) 114,845 (59,518) 4,551

2,735,692 1,483,544 1,193,951 626,397 2,107,493 -

TOTAL EXPENSES $

8,261,766 $

8,147,077 $

114,689 $

8,147,077

NET CHANGE IN ASSETS $

126,266 $

-

126,266 $

Current Year Assessments Foundation Support Program Revenues Other Income

EXPENDITURES The Office of the Bishop Ministry of Evangelism & Cong. Devel. Ministry of Service & Outreach Ministry of Formation and Spirituality Administration Expenses Special Accounts

Page 3 of 10

$

-

THE EPISCOPAL DIOCESE OF TEXAS INCOME STATEMENT Unaudited For the year ended December 31, 2014

Current YTD Actual

Current YTD Budget

Variance

Annual Budget

INCOME STATEMENT DETAIL REVENUES Current Year Assessments Diocesan Insurance Less: Uncollectible Accounts Net Assessment Revenue

6,840,000 103,432 (173,586) 6,769,846

6,840,000 103,432 (173,586) 6,769,846

193,000 70,000 85,000

108,000 70,000 85,000

174,605 86,958 84,524 329,046 132,304 6,989 1,162,426

174,605 86,958 84,524 329,046 132,304 30,000 1,100,437

(23,011) 61,989

174,605 86,958 84,524 329,046 132,304 30,000 2) 1,100,437

Program Revenues IONA Program Revenue Safeguarding Revenue Commission on Ministry Revenue Congregational Dev Revenue Formation/Youth Event Revenue Unified Commissions Revenue RJM Donations - Camp Good News Other Program Revenue Total Program Revenue

55,463 6,085 350 8,925 124,297 45,325 5,500 672 246,617

60,000 5,500 2,500 2,000 60,000 10,000 4,000 144,000

(4,537) 585 (2,150) 6,925 64,297 35,325 5,500 (3,328) 102,617

60,000 5,500 2,500 2,000 60,000 3) 10,000 4) 4,000 144,000

Other Income Brochure Sales TX Episcopalian Contribution Bequests and Donations Investments Gains (Losses) 2014 Council - EDOT hosted "The Conference" Revenues Compass Rose Society Reimburse Other Conference Revenues Miscellaneous Income Total Other Income

6,480 2,436 79,519 96 57,695 27,356 25,000 5,773 4,788 209,143

8,000 1,000 55,000 35,000 25,000 8,000 794 132,794

(1,520) 1,436 79,519 96 2,695 (7,644) (2,227) 3,994 76,349

8,000 1,000 - 5) 55,000 35,000 25,000 8,000 794 132,794

8,388,032

8,147,077

Foundation Support Church Corporation Bishop Quin Foundation The Episcopal Foundation of TX Foundation Overhead Allocation Church Corporation Bishop Quin Foundation The Episcopal Foundation of TX EHF Overhead to DOT GCF Overhead to DOT St. Luke's Health System Total Foundation Support

TOTAL REVENUES

Page 4 of 10

-

85,000 -

240,955

6,840,000 103,432 (173,586) 6,769,846

108,000 1) 70,000 85,000

8,147,077

THE EPISCOPAL DIOCESE OF TEXAS INCOME STATEMENT Unaudited For the year ended December 31, 2014

Current YTD Actual

Current YTD Budget

Variance

Annual Budget

EXPENDITURES THE OFFICE OF THE BISHOP Clergy Compensation Clergy Salaries Bishop of Texas Bishop Suffragan - Tyler Bishop Suffragan - Austin Assisting Bishops Canon to the Ordinary Safe Church Minister Secretary of the Diocese Total Clergy Salaries

185,150 98,636 112,007 3,200 56,196 68,413 5,835 529,437

209,335 98,136 111,500 20,000 53,101 67,529 5,313 564,914

(24,185) 500 507 (16,800) 3,095 884 522 (35,477)

209,335 7) 98,136 111,500 20,000 8) 53,101 67,529 5,313 564,914

Housing Allowance/Maintenance Bishop of Texas Bishop Suffragan - Tyler Bishop Suffragan - Austin Canon to the Ordinary Safe Church Minister Secretary of the Diocese Total Housing Allow/Maint

60,000 36,000 35,000 75,000 56,250 8,000 270,250

35,000 36,000 35,000 76,500 59,850 25,000 267,350

25,000 (1,500) (3,600) (17,000) 2,900

35,000 7) 36,000 35,000 76,500 59,850 25,000 9) 267,350

Pension/SS Reimbursement Bishop of Texas Bishop Suffragan - Tyler Bishop Suffragan - Austin Assisting Bishops Canon to Ordinary Safe Church Minister Secretary of the Diocese Subsidy Pension - Clergy Total Pension/SS Reimbursement

70,693 47,696 52,510 51,138 46,719 2,276 4,792 275,824

69,328 45,865 48,500 48,485 47,656 8,280 268,114

1,365 1,831 4,010 2,653 (937) (6,004) 4,792 7,710

69,328 45,865 48,500 48,485 47,656 8,280 9) 268,114

1,075,511

1,100,378

(24,867)

734,584 61,754 54,067 850,405

681,081 61,297 52,103 794,481

Total Clergy Compensation Lay Staff Compensation Salaries Pensions Employer FICA Total Lay Staff Compensation

Page 5 of 10

53,503 457 1,964 55,924

1,100,378

681,081 10) 61,297 52,103 794,481

THE EPISCOPAL DIOCESE OF TEXAS INCOME STATEMENT Unaudited For the year ended December 31, 2014

Current YTD Actual

Current YTD Budget

Variance

Annual Budget

Business and Travel Expense Bishop of Texas Bishop Suffragan - Tyler Bishop Suffragan - Austin Assisting Bishops Canon to the Ordinary Safe Church Minister Secretary of the Diocese Diocesan Bishops, Retired Business/Travel - Other Clergy Communications Dept Travel Business Travel-Support Staff Interest - Vehicles Depreciation-Vehicles, Clergy Total Business and Travel Exp

113,432 61,789 70,239 2,628 27,521 9,820 1,245 21,333 390 27,663 11,215 1,131 46,226 394,632

68,000 45,000 40,000 12,000 45,500 14,333 7,000 15,000 30,000 12,500 3,000 45,000 337,333

45,432 16,789 30,239 (9,372) (17,979) (4,513) (5,755) 6,333 390 (2,337) (1,285) (1,869) 1,226 57,299

68,000 45,000 40,000 12,000 45,500 14,333 7,000 15,000 30,000 12,500 3,000 45,000 337,333

Other Expenses 2014 Council 2015 Council - Planning Expenses General Convention Delegates Texas Episcopalian (Diolog) Episcopal Assistance Historian & Archives Communications Department Chaplains to the Retired Office of the Secretary Interfaith & Ecumenical Work Commission on Ministry Safe Church Total Other Expenses

214,648 12,140 726 89,522 3,463 15,969 5,100 260 685 43,725 128,911 515,149

209,000 16,000 107,500 5,000 20,000 25,000 7,000 20,000 7,000 42,000 45,000 503,500

5,648 (3,860) 726 (17,978) (5,000) (16,537) (9,031) (1,900) (19,740) (6,315) 1,725 83,911 11,649

209,000 16,000 107,500 5,000 20,000 25,000 7,000 20,000 9) 7,000 42,000 45,000 13) 503,500

2,835,697

2,735,692

TOTAL OFFICE OF THE BISHOP

100,005

2,735,692

177,149 15,943 13,552 206,644

1, 11) 1) 1) 8) 12)

MINISTRY OF EVANGELISM & CONGREGATIONAL DEVELOPMENT Lay Staff Compensation Salaries Pension Employer FICA Total Staff Compensation

180,078 19,148 13,744 212,970

177,149 15,943 13,552 206,644

2,929 3,205 192 6,326

Conferences & Clergy Gathering Sharing Faith Dinner Business/Travel Evangelism Iona Center Contingency (support for) Congregations

255,128 2,540 18,507 164,945 85,953

198,000 5,000 16,000 177,900 75,000

57,128 (2,460) 2,507 (12,955) 10,953

College Missions Waco, Baylor University Houston, Rice University College Station, A&M University Austin, Univ of Texas Campus Missions Total College Missions TOTAL EVANGELISM & CONG. DEVEL.

55,000 90,583 204,145 184,304 168,506 702,538 1,442,581

55,000 90,000 180,000 180,000 300,000 805,000 1,483,544

583 24,145 4,304 (131,494) (102,462) (40,963)

Page 6 of 10

198,000 1, 14) 5,000 16,000 177,900 75,000 6)

55,000 90,000 180,000 180,000 300,000 805,000 1,483,544

18)

THE EPISCOPAL DIOCESE OF TEXAS INCOME STATEMENT Unaudited For the year ended December 31, 2014

Current YTD Actual

Current YTD Budget

Variance

Annual Budget

MINISTRY OF SERVICE & OUTREACH Support of Episcopal Church Support of Anglican Communion Support of Univ. of the South Millennium Development Goals World Mission Companion Dioceses Disaster Outreach Expense Prison & Restorative Justice Mission

755,338 253,711 8,000 78,000 19,370 32,660 142 42,500

755,338 250,000 8,000 57,030 33,000 40,000 583 50,000

3,711 20,970 (13,630) (7,340) (441) (7,500)

755,338 250,000 8,000 57,030 33,000 40,000 583 50,000

TOTAL SERVICE & OUTREACH

1,189,721

1,193,951

(4,230)

1,193,951

MINISTRY OF FORMATION & SPIRITUALITY Compensation Canon for Formation (Newton) Stipend Housing Pension & SS Reimbursement Lay Staff Compensation Salaries Pension Employer FICA Total Staff Compensation Formation Other Business/travel-Canon for Formation Christian Formation Business/Travel-Other Total Formation Other Formation Ministries Unified Commissions Expense Intercultural Ministry Youth Ministry Total Formation Ministries TOTAL FORMATION & SPIRITUALITY

51,095 48,000 37,062

43,898 54,000 36,630

7,197 (6,000) 432

43,898 7) 54,000 7) 36,630

178,885 14,620 13,983 343,645

164,054 14,765 12,550 325,897

14,831 (145) 1,433 17,748

164,054 3) 14,765 12,550 325,897

25,578 72,763 187 98,528

28,000 62,500 90,500

(2,422) 10,263 187 8,028

28,000 62,500 3) 90,500

85,065 40,916 173,088 299,069

60,000 30,000 120,000 210,000

25,065 10,916 53,088 89,069

60,000 4) 30,000 3) 120,000 3) 210,000

741,242

626,397

114,845

Page 7 of 10

626,397

THE EPISCOPAL DIOCESE OF TEXAS INCOME STATEMENT Unaudited For the year ended December 31, 2014

Current YTD Actual

Current YTD Budget

Variance

Annual Budget

ADMINISTRATIVE EXPENSE Lay Staff Compensation Salaries Reserve for Salary Adjustment Pensions Employer FICA Total Staff Compensation

368,485 34,982 25,589 429,056

363,557 35,000 35,870 27,430 461,857

4,928 (35,000) (888) (1,841) (32,801)

363,557 35,000 35,870 27,430 461,857 15)

Diocesan Center Operating Exp Information Technology O/H Reimbursement - EDOT FSC Secretarial Assist-Contract Administrative Contingencies Utilities Janitorial, Maintenance, Repair Rent - Austin & Tyler Offices Storage Interest and Bank Fees Miscellaneous Operating Exp Total Diocesan Ctr Operations

269,464 270,227 1,699 89,363 103,242 74,393 14,654 17,670 (386) 840,326

290,000 270,227 10,000 10,000 90,000 105,000 77,000 20,000 20,000 4,000 896,227

(20,536) (10,000) (8,301) (637) (1,758) (2,607) (5,346) (2,330) (4,386) (55,901)

290,000 270,227 10,000 10,000 90,000 105,000 77,000 20,000 20,000 4,000 896,227

General Office Expense Office Equip Lease/Maint Office Supplies/Printing Communications-Telephone Postage/Delivery Expense Miscellaneous Office Expense Payroll Processing Expense Depr - Furniture & Equipment Total General Office Expense

56,497 42,802 55,825 22,648 10,602 7,131 17,589 213,094

65,000 40,000 60,000 35,000 9,000 12,000 32,000 253,000

(8,503) 2,802 (4,175) (12,352) 1,602 (4,869) (14,411) (39,906)

65,000 40,000 60,000 35,000 9,000 12,000 32,000 253,000

Insurance Diocesan Property & Casualty Diocesan Workers Comp Auto Ins - Diocesan Vehicles Other Insurance Costs(reserve) Group Health Insurance Total Insurance

55,880 21,932 22,199 48,701 144,205 292,917

55,000 25,000 20,000 75,000 25,910 200,910

880 (3,068) 2,199 (26,299) 118,295 92,007

55,000 25,000 20,000 75,000 25,910 200,910 19)

Other Admin Expenses Provincial Synod Assessment Provincial Synod Delegates Exp Legal Expense Journal Expense Diocesan Audit Executive Board Standing Committee Business/Travel-Finance Staff Diocesan Staff Meetings Canonical Printing Expense Calling & Moving Total Other Admin

13,275 61,545 5,130 26,523 8,582 2,169 47,692 8,158 99,508 272,582

13,500 15,000 100,000 4,000 30,000 10,000 3,000 44,999 10,000 5,000 60,000 295,499

(225) (15,000) (38,455) 1,130 (3,477) (1,418) (831) 2,693 (1,842) (5,000) 39,508 (22,917)

13,500 15,000 16) 100,000 4,000 30,000 10,000 3,000 44,999 10,000 5,000 60,000 17) 295,499

2,047,975

2,107,493

(59,518)

TOTAL ADMINSTRATIVE EXP

Page 8 of 10

2,107,493

THE EPISCOPAL DIOCESE OF TEXAS INCOME STATEMENT Unaudited For the year ended December 31, 2014

Current YTD Actual

Current YTD Budget

Variance

Annual Budget

INCOME STATEMENT TOTALS RECAP TOTAL REVENUES

8,388,032

8,147,077

240,955

8,147,077

TOTAL EXPENSES

8,257,216

8,147,077

110,138

8,147,077

4,551

-

4,551

-

126,266

-

126,266

-

Special Accounts - NET NET INCOME (LOSS)

Explanatory Notes

1) The Church Corp. granted $45,000 to the Diocese to assist with costs associated with the Bishops' travel to Taiwan for the House of Bishops in the fall of 2014. Also, Church Corp. granted the Diocese $40,000 to bring in specialists to do conduct mini-conferences concerning evangelism for 2014 and 2015. 2) The budget was created with the intention that the Diocese would manage the payroll for the chaplains at St. Luke's Hospital for a quarterly fee. CHI decided to take the payroll processing of the chaplains back in-house beginning on April 1, 2014. 3) Revenues are in excess of budget but are offset by increased expenses reported elsewhere. 4) Overage in budgeted revenue mainly due to FIND/Spiritual Formation registration fees. 5) Restricted donations totaling $10,000 were collected on behalf of St. Vincent's House during the 165th Council Offering, those funds were remitted to St. Vincent's in February 2014 and are recognized as part of Council expense in these financial statements. Also, a sabbatical grant of $7,500 was received from Bishop Quin to assist with the costs of Bishop Doyle's summer/fall sabbatical. In addition, the Emmett Estate bequeathed $50,000 to the Diocese for use on "impoverished persons" and $9,600 from the G. Montgomery Mitchell estate. 6) Expenses were higher due to greater needs for coaching in our congregations due to transitions. 7) The variance in these accounts are due to a change of housing allowance elections after the budget was created. The variance nets to near zero. 8) Assisting Bishops were not used as much as had been anticipated during Bishop Doyle's sabbatical. 9) Expenses for the Secretary were less than had been projected due to changes in the planned staffing for that office. 10) The lay staff of the Office of the Bishop is in excess of budget due to hiring in the Safeguarding department, and one additional staff person added to Bishop's Office upon retirement. A Compass Rose employee's expenses are also shown here and are offset by the Compass Rose funds received in revenue. 11) Bishop Doyle's business and travel expenses include some costs associated with his summer/fall sabbatical, some of which will be offset by donations. See also note 1 above. 12) Travel by Canon Ryan has been less than anticipated due to Bishop Doyle's sabbatical.

Page 9 of 10

S

THE EPISCOPAL DIOCESE OF TEXAS INCOME STATEMENT Unaudited For the year ended December 31, 2014

Current YTD Actual

Current YTD Budget

Variance

Annual Budget

Explanatory Notes continued

13) Safe church expenses include costs associated with assisting smaller churches with the SRS Records Archive Project. Such costs include staff time and travel expenses in addition to IT expenses for the new SRS database monthly maintenance. 14) The Hispanic Lay Ministry Conference expense of approximately $13,000, held at Camp Allen, was recognized on the books of the Diocese, instead of Camp Allen starting in 2014. 15) The Business Manager's position was not filled although it was provided in the budget. 16) The Provincial Synod meets in 2015 not 2014. 17) Calling & Moving includes unexpected costs associated with assisting clergy to move out of the Diocese as well as costs incurred in relation to a bishop's residence. 18) Campus Missions did not find a suitable candidate to lead new missions that had been anticipated in 2014. 19) Clergy and staff headcount was higher than had been budgeted for 2014 resulting in higher than budgeted health insurance premiums.

S

Special revenue and expense accounts are shown as net on the Diocesan financial statements because they are not part of the normal Diocesan operations and are thus not budgeted for. They represent the Bastrop fire relief program, which was a temporary program managed by the Diocesan Disaster Relief department that ended in 2014. Excess revenue from 2013 in the amount of $18,000 were applied to the expense overage in the current year and is included in the "Net Assets - Special Accounts" amount on the Balance Sheet. In addition, Special accounts include revenues and expenses related to the new Bayou City Service Corp project. Revenues include grant funds from the Bishop Quin Foundation and from the 6 "host sites" that are receiving the benefit of the 6 interns' volunteer employment. Expenses for the program consist of room and board for the six interns, as well as a monthly grocery budget and a minimal monthly stipend. Special accounts also include revenue and expenses related to the Daring Way event to be held in February 2015 at Camp Allen. Certain contractually obligated expenses and grant revenue are recognized in 2014, with the remaining revenue and expense to be recognized in 2015. Total Special Acct - BCSC Rev 85,777 85,777 Special Acct - Daring Way Rev 250,100 250,100 Special Acct - Bastrop Exp (659) (659) Special Acct - BCSC Exp (84,646) (84,646) Special Acct - Daring Way Exp (255,123) (255,123) Special Accounts - NET

472

Page 10 of 10

(5,023)

(4,551)