Although the global economic turmoil caused by the 2020 COVID-19 pandemic also struck the General Conference of Seventh-day Adventists’s finances, God’s provision—and astute actions by church leadership—kept the world headquarters solvent and serving.
“Things are different, and the world in general, and the church in particular, are still in a survival mode,” GC Treasurer Juan R. Prestol-Puesán told Spring Meeting virtual attendees on April 13. “We are doing new things, and we are learning to do old things in a different way.”
Confronted with a near-total shutdown of business activity across the many nations in which the world church has members, Prestol-Puesán recalled leaders said “in the early part of 2020 that we might show a 20 million operating loss” by the end of the fiscal year, “and prayers were offered hoping for divine intervention.”
Those prayers were answered, Prestol-Puesán said, “more generously than I thought.” Instead of breaking even, the General Conference’s Net Assets without Donor Restrictions grew by [U.S.] $67,816, “more than six times what I asked the Lord to provide,” he noted.
He added, “Liquidity and operating levels previously reported below adequate levels ended 2020 at an adequate level due to the lower expense level. During the year the General Conference reduced personnel, eliminated services, and avoided unnecessary costs.”
That lower expense level was not achieved without pain: positions were cut at the world headquarters and some services were trimmed or eliminated. In 2021, the General Conference expects to be in a catch-up mode, Prestol-Puesán said, noting the following plans:
1) Make up allocations to the Interdivision Service Employees (ISEs) program and the General Conference Auditing Service to reach pre-Covid19 levels, if possible.
2) Area Travel Allowance to be increased from 50% to 100% in July of 2021.
3) Seek an improvement in the Mission Offering giving to pre-Covid19 levels.
4) Renew more normal economic and mission activities.
5) Determine the staffing level to be recommended to the GC Session in 2022.
6) Complete the sale of Review & Herald property in Hagerstown, MD.
7) Complete a new warehouse facility in Silver Spring, Maryland, and the sale of the Elkridge warehouse operation.
Prestol-Puesán also took pains to note that the 2020 fiscal year "left us plenty of warning against careless management, and cautioned us about being overconfident in 2021 and beyond." Such concerns have long been on the GC Treasurer's mind; in 2016 he spoke with Adventist Review about the need for an ethical focus in ministry, citing the work of Arizona State University emerita professor Dr. Marianne Jennings.
Prestol-Puesán also told delegates he had been led to study “eschatology and the closing events of earth’s history, particularly I studied selected portions of the book ‘Last Day Events’ and what will precede the close of probation, the conclusion of Mission, the end of giving and wrapping up of organized work.”
As a result, the treasurer believes Ellen White’s prediction that “the true Sheep will hear the true Shepherd’s voice” and support the proclamation of the gospel was fulfilled in part last year.
“As we were closing [Fiscal Year 2020], our accounting office notified me that we had received a few large and unexpected donations for the 10/40 Window and the Unusual Opportunities Fund from individuals that were not known to us. The donations were in the millions of dollars,” he said.
Prestol-Puesán said he expects “a worldwide manifestation of giving guided by the Holy Spirit when funds will be given in the largest amount we will ever see. The funding needed for the concluding effort to reach humanity before the close of probation.”
FOREIGN EXCHANGE ISSUES HURT TITHE
Undertreasurer Ray Wahlen noted 2020 ended up a far different year than was expected: “We started 2020 with an approved In-House Budget of slightly more than U.S. $50 million. With the sudden changes happening in the early months of the year, the GC took measured steps to reduce its operational budget. These actions, taken in the second quarter of the year, had the effect of reducing the operating budget to U.S. $46.5 million. These cuts were painful,” he said.
“The result was that expenses attributed to the 2020 Operating Cap amounted to US $37.9 million – U.S. $7.7 million less than the actual cap calculated at year end (and U.S. $12.1 million less than the original budget for the year),” Wahlen reported.
Trimming expenses proved to be a wise move, given that Tithe income for the General Conference decreased by 3 percent in 2020, or U.S. $2.7 million. Contributing factors were an already-planned reduction in the North American Division’s tithe percentage from 6.1 percent to 5.85 percent, and sharp devaluations in the currencies of Brazil (down 29 percent) and Mexico (down 6 percent). Those two countries are part of divisions supplying half the world church’s foreign currency income: Brazil as part of the South American Division, and Mexico in the Inter-American Division.
According to Wahlen, “When comparing 2019 to 2020, we can see that the U.S. $29.9 million decrease in income was offset by reducing expenses U.S. $17.1 million and shifting transfers by U.S. $7.1 million. This provided a bottom line that was U.S. $5.7 million less than 2019 but still slightly more than break-even for the year.”
World Mission Offerings, Wahlen said, presented a different picture: In 2020 those offerings dropped by U.S. $14.9 million, down 20 percent from 2019.
“This area of giving merits urgent, comprehensive study to determine the causes – such as the possibility of changing attitudes regarding donations to mission and the need for giving-opportunities that disappear when on-site worship services are cancelled,” Wahlen noted.