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Finance Newsletter

Computers

We continue to make good progress on implementing a new computer system and have determined the system we would like to implement. The process of having our choice approved by the Council of Assembly is well advanced. This will have to occur before the middle of the month if we are to have the accounting software operational by the beginning of July.

We believe we have identified an innovative solution for our problems. We hope to build on the acceptance and increasing use of the website for communicating within the Church. Use of electronic communications and data transmission offers considerable cost savings at a time when Church finances are under considerable pressure. While offering improved electronic communications the system will still provide paper output for ministers and parishes that have limited or no access to either computers or the internet.

When we implement the new system we will be transferring account balances from the system into the new system. Existing balance problems will therefore be transferred to the new system. This is not an ideal situation but there is not time to resolve the problems before implementation. It was felt it was more important to get a new system into operation and prevent known problems from continuing. Operating efficiencies gained from the new system will give opportunities to address the outstanding issues.

When accounts are transferred to the new system the existing account numbers and structures will remain in place. The new system will give us the opportunity to address the many issues related to invoice and statement presentation highlighted to us in recent years. We understand your concerns but have simply been unable to address them due to the limitations in the current system.

Amalgamated Investment Fund

The interest rate paid on deposits with the Amalgamated Investment Fund has been reduced to 6.5% with effect from 1 May. The reduction follows the fall in the overnight cash rate to 5.5%. The lower overnight cash rate is reducing the interest earned on investments making the reduction necessary. However the earning rate remains very attractive in comparison with other investments of similar term and security.

Ministers Mortgages

The interest rate payable on Ministers' mortgages has decreased to 7.09% with effect from 1 May. This change follows a fall in mortgage interest rates charged by the trading banks.

Statistics

Statistics forms are being distributed this month. The forms are being sent to the Session Clerk. If the parish has not yet received statistics returns or doesn't receive them in the next couple of days you should contact Katrina Graham in this office. Her phone number is (04) 381-8283
katrinag(at)presbyterian.co.nz.

Please read the instructions included with the forms. Some small changes have been made to the form. These are in the area of baptism details and ages brackets for religious education.

National Services Levy

The Council for Assembly has approved the budget for the 2003/04 financial year. Details of the budget have been included in an explanatory note that is to be separately circulated to parishes.

Insurance Renewal

Forms for the insurance renewal are being circulated this month. The forms seek the information we need to negotiate a renewal of our insurance cover. A prompt response will provide more time for the Church to negotiate the best available renewal conditions. Our bargaining position is weakened if limited time prevents adequate negotiations.

The insurance market remains difficult with a premium rise in the order of 20% to 30% expected. Last year it was the losses from the World Trade Centre. This year the problem is the losses insurance companies have made on their invested reserves, that is the pool of funds they hold to meet substantial claims.

There will also be a change to the manner in which earthquake premiums are calculated. Previously New Zealand was divided into three earthquake zones based upon the risk of the occurrence of a quake. There are now 16 zones. A number of parishes may experience an increase in the earthquake levy because they will move into a higher risk category. This increase will be in addition to the expected overall increase in earthquake premiums. Parishes need take no action on this matter as we have assigned a new earthquake category to each parish based upon information supplied to us by our insurance brokers.

Last year we were able to offer a substantial premium discount for on time payment of premiums. The discount was funded by earnings from our insurance fund. While the insurance fund continues to earn interest I cannot say at this time if a discount will be offered. Once our options become clearer a decision will be made on how to use the earnings so as to achieve the greatest financial benefit.

Geoffrey Bell
Manager Financial Services