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Finance Newsletter
<typohead type=3>New Accounting System</typohead>
I noted in my last newsletter that further testing was required before we would accept the system as being operational. That testing revealed the need for some further changes. We did not receive a guarantee that the changes would be available by 30 September so deferred implementation a further month to 1 November.
Work on an important part of the customisation is yet to be completed by the software supplier though they have provided us with a timetable to complete the necessary work. Meeting the 1 November target is subject to this work being completed and tested.
To help achieve the target we will not initially combine accounts receivable accounts and loan and deposit accounts on the one statement. The customisation needed to achieve this outcome will be done after the system is introduced.
<typohead type=3>Amalgamated Investment Fund</typohead>
The interest rate paid on deposits with the Amalgamated Investment Fund remains at 6.0%. This rate is 1% above the Reserve Bank’s Official Cash Rate.
<typohead type=3>Ministers Mortgages</typohead>
The interest rate on minister’s mortgages remains at 6.6% for the month of October.
<typohead type=3>Funds Transfers</typohead>
We have had a good response to parishes using FSD(at)pcanz.co.nz to request the transfer of funds. Thanks for making the effort to change your records and also for keeping the address just for notifying fund transfers. For those who missed the message last month we would appreciate parishes using the above address if you are using email to request the transfer of funds held in the AIF. Accounting enquiries should not be directed to this address.
<typohead type=3>Seniority Allowance Levy</typohead>
For the last two years we have written to parishes advising them of the roll numbers we will be using to invoice the seniority allowance levy. This was done to identify any differences prior to determining the roll to be used to calculate the levy. However the letter was not achieving its desired effect with most differences on roll number being notified once invoices were sent to parishes. We will therefore not be sending the letter this year.
We will continue to take a firm line on parishes wishing to change their roll requiring agreement of the presbytery before the roll is changed.
<typohead type=3>Liability Insurance</typohead>
Liability insurance for the church and associated bodies has been invoiced in the month of September. A substantial percentage increase in cost has occurred although premium cost remains low in comparison with material damages cover. The emergence of a number of child abuse claims involving religious organisations with children in their care has made insurance companies sensitive to the risks involved in this part of our operations. As we have provided care for orphans and children in the past and continue to operate a number of programmes for children we are deemed to be a risk by insurers. Premiums have risen accordingly.
Details of the cover being provided are shown in your insurance manual. If you have a question on cover the manual should be your first point of reference. When responding to insurance queries we give a low priority to questions that are covered in the manual.
<typohead type=3>Tutahi Tatou</typohead>
Thank you to all those who attended and participated in the discussion on single assessment. The Administration and Finance Policy Group has considered reports from its members attending these meetings. The feedback has resulted in some fine-tuning of the definition of income in recognition of concerns expressed during the meetings. A formal response to matters raised at Tutahi Tatou is being prepared by the Council of Assembly.
<typohead type=3>Payment of Parish Invoices</typohead>
Periodically we receive requests from parishes to pay invoices from their AIF deposit accounts. We have now reviewed this practice (as part of our review of the procedures that will apply for the new accounting system) and determined that such practice creates a significant opportunity for a fraud to be committed against the parish. With limited exceptions we have therefore decided to cease the practice.
The opportunity for fraud arises because we are unable to check that the correspondence we receive from the parish is either genuine or authorised in compliance with the rules set by the parish. We do not hold specimen signatures for parish officials authorised to approve payments and even if we did we would not know if the list were up to date. A parish official can therefore create a fictitious invoice, forge some authorising signatures and then have this money paid out. Because the money comes from a deposit account (rather than the parish cheque account) it may be some time before the money is missed particularly if the treasurer is committing the fraud.
The limited exceptions to this rule are payments to the General Assembly, because the funds do not go to an external party and payments made as part of a previously agreed arrangement between the parish and the Assembly Office. An example of such an arrangement could be progress payments on a new building.
In the future where we receive a request for payment of an invoice we will deposit the funds to the authorised bank account of the parish. The controls a parish has in place to ensure only genuine payments are made from its bank account would then apply.
We only receive a limited number of such requests so we trust that this change in our rules does not cause too much inconvenience. We have no knowledge of a fraud being committed in the manner outlined above. We are taking this action to eliminate the possibility of a future occurrence.
Geoffrey Bell
Manager Financial Services