Diocese releases audited financial reports for FY2021

By Raymond L. Delisle
Director of Communications

Diocesan operating income did not cover expenses in fiscal 2021, which ended last August. But investments benefitted from a banner year in the financial market.
The Diocese of Worcester has released audited financial reports for the fiscal year ending Aug. 31, 2021. The audited statement of financial position is being released six months later than usual due to the transition to a new audit firm, Grant Thornton LLP of Boston, after more than two decades of being conducted by O’Connor Maloney & Company, PC, of Worcester.  According to Paul G. Schasel, chief financial officer for the diocese, the process also faced challenges of working remotely with limited system resources and limited manpower support given the ongoing pandemic at the outset of the audit.
The audited statements report the financial position of the Chancery Offices of the Roman Catholic Bishop of Worcester, excluding parishes and parish schools. This format does not lend itself to presenting the revenues and expenses of individual programs and departments. For example, all programs which are funded by Partners in Charity are presented simply as one aggregate group called Partners in Charity, presented alongside other groupings including Central administration, St. John Cemetery System, Priests’ Retirement, Central Catholic Schools and the Diocesan Expansion Fund. A management report by program is being published this week on the diocesan website and in The Catholic Free Press to supplement the audited financial statements.
As reported in the Combined Statement of Activities and Changes in Net Assets, operationally the diocese ended the year in a deficit prior to allowing for realized and unrealized gains on investments. Expenses for all operations under the corporate sole totaled $22,949,389. Fund-raising expenses were only 1.5% of that total. General administration, as listed on the Combined Statement of Functional Expenses, supports all our parishes, schools and ministries with a variety of services, in addition to those offices and agencies housed at the Chancery on Elm Street.  Income from contributions, tuitions, fees, cemeteries’ sales and specific designated investments totaled $20,992, 672, resulting in an operational deficit of $1,956,717.
Investment returns were very favorable during the fiscal year ending Aug. 31, 2021, which was a banner year in the market.  The report shows realized and unrealized gains on investments totaling $10,211,641. After accounting for gains on the sale of property, and net income from the Legacy of Hope capital campaign, as well as adjustments for an annuity, the diocese showed an increase in net assets of $12,217,796.
According to Mr. Schasel, “The financial results of the Chancery offices benefitted greatly from strong investment returns during the 2021 fiscal year. These strong returns and higher investment balances positioned the Diocese’s investment portfolios well to withstand the unrealized investment losses which were experienced in the first seven months of 2022. While we anticipate that FY2022 investment returns will be negative, the returns over a two-year period ending August 31, 2022, should be positive.”
“It is important to recognize that these reports demonstrate three things to our staff, our parishioners, and in particular our donors to diocesan appeals,” said Bishop Mc Manus. “First, we are being good stewards and demonstrating how funds are collected and used as well as acknowledging through an independent audit process that the diocese is operating appropriately. Secondly, the work at the diocesan level on behalf of our more than 90 parishes and in support of their operations is complex and involves nearly $23 million in operations. Lastly, I want to stress that the bulk of what is spent is directed toward the charitable, educational and pastoral mission of the church.”
Bishop McManus concluded, “I am most grateful to our diocesan staff, our pastors and parish leadership, our many thousands of volunteers, and most especially to our donors for helping us carry on that mission to make the love of God as manifested through his Son, Jesus Christ, present in a world seeking hope.”

– Copies of the report can be seen online at worcesterdiocese.org/diocesan-financial-reports or by contacting Paul G. Schasel, director of fiscal affairs, at 508-929-4333 or pschasel@worcesterdiocese.org.