Financial Policies for the Diocese of Marquette.

Transcription

1 Financial Policies for the Diocese of Marquette.

2 TABLE OF CONTENTS FINANCIAL POLICIES Capital Campaigns and Assessable Receipts, Policy Governing... 1 Financial Audits of Parishes, Policy for... 2 Gift Acceptance Policy IRS Exemption for Tax Letter (CIVIL LAW) Liquor Liability (CIVIL LAW) Mass Offering Policy Michigan Sales Tax Cover Michigan Sales Tax Sample Certificate Needy Parish Fund Loan Application Needy Parish Loan, Procedures and Criteria for Parish Annual Report and Instructions Parish Internal Control Procedures Priests' Compensation, Policy for Reporting (CIVIL LAW) Priests Compensation, Reporting Mileage Single Gift Acknowledgement Form... 37

3 DIOCESE OF MARQUETTE POLICY GOVERNING CAPITAL CAMPAIGNS AND ASSESSABLE RECEIPTS Definition: A Capital Campaign is a parish-wide fund raising effort for a specific purpose, after a proven need has been determined, such as a building expansion, renovation project, or establishment of an endowment fund. Capital campaigns involve a long-term commitment with pledges paid to the parish over a multi-time period. 1. All parish Capital Campaigns must be approved by the Bishop. 2. Capital Campaign income collected from an approved campaign is excluded from Assessable Receipts of the parish. 3. Income collected from parish building fund envelopes (not related to an approved Capital Campaign) is not excluded from assessable receipts. Please refer to the Parish Accounting Manual for instruction on recording the above in the parish accounting records. January 2000 * * * * * * * * * * * * * * * * By means of this general decree, I hereby establish the above policy as particular law within the ecclesiastical region of the Diocese of Marquette and as binding upon the faithful of the same Diocese of Marquette, according to the norms of the Code of Canon Law (1983). May 22, 2000 Date Most Reverend James H. Garland Bishop of Marquette Reverend Alex K. Sample Ecclesiastical Notary 1

4 DIOCESE OF MARQUETTE POLICY FOR FINANCIAL AUDITS OF PARISHES A financial audit of parish records shall be conducted as follows: 1. All parishes/missions will be audited at least once every six (6) years. 2. Parishes can be audited more often than every six (6) years, if special circumstances exist and it is deemed advisable by the Bishop. 3. Audits will be conducted when requested by the pastor, pastoral coordinator or administrator. The diocese will be responsible for notifying the parish when the audit is due and coordinate with the parish appropriate dates for conducting such audit. Costs for the audit will be the responsibility of the diocese. Financial audits will be conducted by the Diocesan Auditors or by members of the Diocesan Department of Administration & Finance. Effective: March 9, 2001 * * * * * * * * * * * * * * * * * * * * By means of this general decree, I hereby establish the above policy as particular law within the ecclesiastical region of the Diocese of Marquette and as binding upon the faithful of the same Diocese, according to the norms of the Code of Canon Law (1983). April 2, 2001 Date Most Reverend James H. Garland Bishop of Marquette Reverend Alex K. Sample Ecclesiastical Notary 2

5 DIOCESE OF MARQUETTE GIFT ACCEPTANCE POLICY PURPOSE The purpose of this policy is to serve the best interests of the diocese and its donors by providing guidelines for accepting gifts for various types of funds. The diocese screens proposed gifts in order to comply with related Canon, state and federal laws that affect the process of accepting a gift. GIFT CRITERIA In order for the diocese to accept a gift these four criteria must be met: 1) The purpose of the gift must fall within the broad charitable purpose of the diocese; 2) The staff must be able to assure that gifts accepted by the diocese do not place other assets of the diocese at risk; 3) Gifts must be easily converted into assets that fall within the diocese s investment guidelines, and 4) The diocese must assure that it can administer the terms of the gift in accordance with the donor s wishes. STAFF/DONOR RELATIONS Diocesan staff should disclose to all prospective donors the benefits and liabilities that could reasonably be expected to influence the donor s decision to make a gift to the diocese. Donors will be advised to consult with legal counsel and financial advisors in making their decision. In particular, donors should be made aware of: The irrevocability of a gift, Prohibitions on donor restrictions, Items subject to variability (market value, investment return, and income yield). Staff should maintain a written record of discussions with donors. The role of diocesan staff shall be to inform, guide and assist a donor in fulfilling his or her philanthropic wishes, but never to pressure or unduly influence a donor s decision. The diocese follows the Model Standards of Practice for the Charitable Gift Planner adopted by the National Committee on Planned Giving and the American Council on Gift Annuities. This code of ethics for planned giving practitioners is included as Appendix A of this policy. Diocesan staff shall maintain strict control over files and information received from or about donors or prospective donors so as to maintain confidentiality of such information. 3

6 GIFT ACCEPTANCE/DECLINATION The diocese reserves the right to refuse any gift it believes is not in the best interests of promoting a healthy, faith-filled community. In addition, the diocese will not knowingly accept a charitable gift from a donor who: A. Has insufficient income and assets remaining after making a gift to provide for his/her needs such as personal support and healthcare. B. Has insufficient income and assets remaining after the gift to provide for his/her heirs for whom he/she is fiscally responsible. C. Has an apparent insufficient mental capacity to make a rational decision. D. Has insufficient input from competent financial, legal, and/or personal counsel. The form of gift will also impact the level of review required to determine whether or not a gift will be accepted. The Director of Administration and Finance will make recommendations to the Bishop regarding gift acceptance/declination. In circumstances where a clear determination cannot be made by the Director, advice will be sought from the Diocesan Finance Council and/or legal counsel. Gifts Requiring Director of Administration and Finance Review Tangible personal property that is not readily marketable Real property Closely-held and S corporation stock Partnership interests Accounts receivable (gifts of loans, notes, mortgages, etc.) Gifts of intellectual property, mineral reserves, precious metals, and other types of assets carrying their own challenges. Gifts whose structure fall outside the ordinary purposes and procedures of the diocese. Life insurance policies requiring future premium payments by the diocese. Gifts Not Requiring Director of Administration and Finance Review Cash or cash equivalents Checks Marketable securities Gifts of personal property for use in diocesan offices or programs Life insurance policies except as noted above Artifacts for Bishop Baraga Association/Archives Appendix B contains detailed descriptions and criteria for each gift category. 4

7 The diocese management and administrative officers authorized to accept letters of direction and amendments thereto and to negotiate and sign charitable giving agreements with prospective donors are: Bishop Director of Administration and Finance Development Director Gifts to the diocese may not be directly or indirectly subjected by a donor to any material restriction or condition that prevents the diocese from freely and effectively employing the transferred assets, or the income derived there from, in furtherance of its purposes. ACCEPTED GIFTS Donors shall receive an expression of sincere thanks and gratitude from the diocese and an acknowledgement of the gift in accordance with IRS regulations. No public media exposure with respect to a donor s gift will be generated without the consent of the donor. It is the policy of the diocese to convert all gifts to cash as soon as possible. (See additional Diocese of Marquette policy on the Alienation of Property and Procedures for Sale, Lease or Acquisition of Property. Some restrictions or consent requirements may apply to accepting or selling gifted property.) The diocese reserves the right to make any or all investment decisions regarding gifts in accordance with its Investment Policy. In making a gift to the diocese, donors give up all right, title, and interest to the assets contributed. In particular, donors give up the right to choose investments and investment managers, brokers, or to veto investment choices for their gifts. Generally, costs associated with the acceptance of a gift such as attorney fees, accounting fees, other professional fees as well as other costs to establish a gift such as appraisal, escrow, evaluation, and environmental assessment fees will be borne by the donor. The direct costs of administering outright and planned gifts of the diocese will be borne from the assets of the individual funds, except for those special circumstances as determined by the Director of Administration and Finance. Custodial, investment, and administrative fees will be paid from the respective funds in accordance with the diocesan guidelines. If the Diocese accepts a gift from a donor who has specified a particular purpose for the gift, then the Diocese must use the gift for that purpose only. If the 5

8 purpose for which the donor intends the gift does not match an existing fund of the Diocese of Marquette, then the understanding will be detailed in an executed gift agreement between the Diocese and the donor. If it becomes impossible for the original purpose for the gift to be honored due to changed circumstances, then the Diocese must use the gift for a purpose closely related to the original designated purpose. A sample Gift Agreement is included in this policy in Appendix D. All accepted unrestricted gifts are to be reviewed by the Bishop for a determination as to their designation. Unless otherwise directed by the Bishop, all unrestricted gifts will be designated for the Endowment Foundation of the Diocese of Marquette in the interest of building a stable and permanent source of funds to support diocesan programs, services and ministries. PUBLIC FUND RAISING Fundraising undertaken by donors in connection with the diocese requires special consideration. See Appendix C. * * * * * * * * * * * * * * * * By means of this general decree, I hereby establish the above policy as particular law within the ecclesiastical region of the Diocese of Marquette and as binding upon the faithful of the same Diocese of Marquette, according to the norms of the Code of Canon Law (1983). March 20, 2004 Date Most Reverend James H. Garland Bishop of Marquette Ecclesiastical Notary 6

9 APPENDIX A Model Standards of Practice for the Charitable Gift Planner PREAMBLE The purpose of this statement is to encourage responsible gift planning by urging the adoption of the following Standards of Practice by all individuals who work in the charitable gift planning process: gift planning officers, fund raising consultants, attorneys, accountants, financial planners, life insurance agents and other financial services professionals (collectively referred to hereafter as "Gift Planners"), and by the institutions that these persons represent. This statement recognizes that the solicitation, planning and administration of a charitable gift is a complex process involving philanthropic, personal, financial, and tax considerations, and as such often involves professionals from various disciplines whose goals should include working together to structure a gift that achieves a fair and proper balance between the interests of the donor and the purposes of the charitable institution. I. PRIMACY OF PHILANTHROPIC MOTIVATION The principal basis for making a charitable gift should be a desire on the part of the donor to support the work of charitable institutions. II. EXPLANATION OF TAX IMPLICATIONS Congress has provided tax incentives for charitable giving, and the emphasis in this statement on philanthropic motivation in no way minimizes the necessity and appropriateness of a full and accurate explanation by the Gift Planner of those incentives and their implications. III. FULL DISCLOSURE It is essential to the gift planning process that the role and relationships of all parties involved, including how and by whom each is compensated, be fully disclosed to the donor. A Gift Planner shall not act or purport to act as a representative of any charity without the express knowledge and approval of the charity, and shall not, while employed by the charity, act or purport to act as a representative of the donor, without the express consent of both the charity and the donor. IV. COMPENSATION Compensation paid to Gift Planners shall be reasonable and proportionate to the services provided. Payment of finders fees, commissions or other fees by a donee organization to an independent Gift Planner as a condition for the delivery of a gift are never appropriate. Such payments lead to abusive practices and may violate certain state and federal regulations. Likewise, commission-based compensation for Gift Planners who are employed by a charitable institution is never appropriate. 7

10 V. COMPETENCE AND PROFESSIONALISM The Gift Planner should strive to achieve and maintain a high degree of competence in his or her chosen area, and shall advise donors only in areas in which he or she is professionally qualified. It is a hallmark of professionalism for Gift Planners that they realize when they have reached the limits of their knowledge and expertise, and as a result, should include other professionals in the process. Such relationships should be characterized by courtesy, tact and mutual respect. VI. CONSULTATION WITH INDEPENDENT ADVISORS A Gift Planner acting on behalf of a charity shall in all cases strongly encourage the donor to discuss the proposed gift with competent independent legal and tax advisers of the donor's choice. VII. CONSULTATION WITH CHARITIES Although Gift Planners frequently and properly counsel donors concerning specific charitable gifts without the prior knowledge or approval of the donee organization, the Gift Planners, in order to insure that the gift will accomplish the donor's objectives, should encourage the donor, early in the gift planning process, to discuss the proposed gift with the charity to whom the gift is to be made. In cases where the donor desires anonymity, the Gift Planners shall endeavor, on behalf of the undisclosed donor, to obtain the charity's input in the gift planning process. VIII. DESCRIPTION AND REPRESENTATION OF GIFT The Gift Planner shall make every effort to assure that the donor receives a full description and an accurate representation of all aspects of any proposed charitable gift plan. The consequences for the charity, the donor and, where applicable, the donor's family, should be apparent, and the assumptions underlying any financial illustrations should be realistic. IX. FULL COMPLIANCE A Gift Planner shall fully comply with and shall encourage other parties in the gift planning process to fully comply with both the letter and spirit of all applicable federal and state laws and regulations. X. PUBLIC TRUST Gift Planners shall, in all dealings with donors, institutions and other professionals, act with fairness, honesty, integrity and openness. Except for compensation received for services, the terms of which have been disclosed to the donor, they shall have no vested interest that could result in personal gain. Adopted and subscribed to by the National Committee on Planned Giving and the American Council on Gift Annuities, May 7, Revised April

11 APPENDIX B Forms of Gifts to the Diocese of Marquette Gifts to the diocese take on a variety of forms. Many are outright gifts by living donors, either on a one-time or periodic basis. Others are testamentary gifts that take effect upon a donor s death or other forms of deferred gifts. If the value of a gift other cash or marketable securities exceeds $5,000, a donor is required to have a qualified appraisal performed and submitted to the IRS on Form If such gifts are sold within two years of receipt at a price other than the appraised value, Form 8282 must be filed by the diocese. The diocese reserves the right to accept or reject any gift as it sees fit. It is the policy of the diocese to convert all gifts to cash as soon as possible. Cash The diocese accepts cash, checks, or money orders made payable to the Diocese of Marquette. Marketable Securities The diocese will add the net proceeds of a marketable securities contribution to a fund of the diocese. The diocese will govern the disposition of securities, and will make all decisions regarding the sale or retention of securities. Stock in Privately Owned Companies and Partnerships Donors wishing to make gifts of stock in a closely-held corporation or S corporation or a gift of a partnership interest, must have it valued by a qualified independent accounting or appraisal company prior to making a contribution. If it is immediately marketable, it will be sold. Otherwise, it will be held by the diocese until it may be redeemed or sold for cash. Generally, the diocese does not accept gifts of general partnership interests due to the potential for unlimited liability. The acceptability of a gift of closely-held stock, S corporation stock, or a partnership interest will depend on the ultimate financial liability of the diocese, the amount of management attention required, whether the gift provides minority or majority control, or whether the donor requires that such interest not be sold. Consideration will be given to whether the S corporation stock or partnership interest generates unrelated business taxable income, if there is corresponding revenue to pay such taxes, and nature of the business, recordkeeping and accounting requirements, and how quickly the gift can be converted to cash. 9

12 Gift Annuities The diocese offers gift annuity contracts. Income beneficiaries are limited to two and must be at least 55 years old when entering into the contract. The charitable remainder interest must be designated for the diocese. Life Insurance Policies The diocese will accept gifts of permanent life insurance policies if the diocese is named as owner or is assigned ownership in such policies. Policies continuing on a premium-paying basis will be maintained as such by the diocese so long as gifts are made to the diocese in the amount of the premiums due. Premiums can be of a reducing amount if dividends are directed toward future premiums. Should such premium gifts not be forthcoming, the diocese may, on the recommendation of the Director of Administration and Finance, elect: To have the diocese continue the premium payments. To surrender the policy in exchange for its cash surrender value. To invoke procedures under which the existing policy values can sustain the policy without further outlay of diocesan funds for premium. This can take on any of the following forms: A. Change the dividends to Net (have the dividends pay future premiums) B. Use the Automatic Premium Loan feature (borrow against the cash value to pay future premiums) C. Use a combination of the two previous options (have the dividends pay as much of the premium as possible and borrow against the cash value for the remainder amount) D. Change the policy to Paid-Up in which case, no more premiums will be due The diocese discourages the contributions of life insurance policies subject to policy loans and reserves the right to accept or reject such policies as well as those carrying assignments to other entities. The diocese will consider its own interest and the best interest of the donor in the light of tax ramifications in determining on a case-by-case basis the acceptability of encumbered life insurance policies. Particular care will be given to problems of self-dealing, jeopardy investments, and unrelated business income in this regard. Gifts Naming Multiple Beneficiaries From time-to-time, donors may wish to designate multiple beneficiaries of the proceeds from their life insurance policies, IRA s, other qualified retirement plans, pooled income funds, gift annuities, or other forms of gifts to the Foundation. Multiple beneficiaries should be named on the contract itself. However, if the diocese is selected as sole beneficiary and requested to distribute funds to other organizations, the following guidelines shall apply: A. The Director of Administration and Finance will take into consideration the amount of the total gift; the amount designated for the diocese, both discretionary and restricted; the added value to the diocese; and 10

13 in the case of life insurance policies, whether or not the premiums are paid up. B. In the case where the diocese becomes the sole owner of a donor s life insurance policy, the diocese subsequently has the exclusive right to change the beneficiary/distribute designations. It can then name the diocese or other charitable organizations as beneficiaries. These other charitable organizations must be described in Section 501(c)(3) and Section 170(b)(1)(A) of the Internal Revenue Code. If a policy beneficiary/distribution designation is to be changed to a charitable organization other than the diocese, the diocese shall consider the charitable intent of the donor. It is understood, however, that a donor s recommendations in this regard are advisory and that the diocese, as owner of the policy, retains exclusive authority to direct the death benefits, maturity, and surrender proceeds of the policy. Real Property If a donor wishes to contribute real property or an interest in real property to the diocese either directly or through a life estate arrangement, the Director of Administration and Finance shall consider all facts and circumstances in determining whether to recommend accepting the gift. Donors are always advised to confer with their own counsel to review the terms of the gift. Following the Appendices is the checklist that will be utilized for all transactions involving real estate gifts. See additional administrative policy on Procedures for Sale, Lease or Acquisition of Property in the diocesan policy manual. Tangible Personal Property The donor will be advised whether the gift will be retained and used by the diocese or disposed of immediately. Accounts Receivable The diocese will consider gifts of loans, notes, and mortgages, subject to review by the Director of Administration and Finance. Artifacts The attached Deed of Gift will be completed and supplied to the donor. 11

14 APPENDIX C Public Fundraising for Endowed Funds of the Foundation The diocese is staffed to develop endowment and other funds through the acquisition of major and planned gifts and to cultivate new and existing relationships with donors. The diocese is not equipped to operate public fundraising events for its funds. In general, the diocese will administer a public fundraising event in association with a fund only under extenuating circumstances. Public fundraising events refer to those special events that are intended to raise dollars for funds. For example, a golf outing, fundraising dinner, raffle, or other special event would be considered a public fundraising event. The term is not intended to encompass the annual giving to funds through the diocesan Upper Peninsula Catholic Services Appeal, annual Bishop Baraga golf tournament, and other solicitations for purely charitable purposes. Diocesan Approval of Events In the event the diocese approves a fundraising event, the guidelines listed below apply. These guidelines encompass the legal and other requirements the diocese is subject to and must be followed. Before undertaking public fundraising events, the fundraising event coordinator will describe to the diocese each program, event, or other effort to raise money for the fund. The fundraising event coordinator will then obtain diocesan approval to proceed according to the diocesan guidelines. All uses of the diocese s name in advertising and promotion must be approved in advance by the Director of Administration and Finance. Responsibilities of the Diocese The diocese is held accountable for all public fundraising events related to offices and entities of the diocese. It can not delegate this responsibility to any other parties. In considering whether to approve the event, staff should take into account the following responsibilities: Budget and payment of expenses Who will prepare a budget? Who will be responsible for authorization for and payment of expenses? Who will oversee the budget and ensure that the budget is followed? Will the diocese assess a special administrative fee for this service? Compliance with policy and procedure 12

15 Is there a need for a special raffle or gambling license? Are the appropriate sales taxes being collected on items sold and who will field the sales tax return? Is there a clear understanding that the expenses of fundraising events are not exempt from sales tax? (may not be applicable) Liability covering the diocese Is there a need for additional general liability or other insurance for the event? Should a letter of credit or a written personal guarantee be provided? Acknowledgements If the contributors received goods or services in return for their payment, who will determine the appropriate charitable portion of the payment so that the correct tax acknowledgement will be prepared? Management of money and property received from the event Will all checks be made payable to the diocese? Where should checks and other forms of payment be sent? If someone else is collecting cash, what safeguards need to be in place? Application on income and princial to charitable uses Can the proceeds be administered in the manner in which it is advertised? 13

16 APPENDIX D Sample Gift Agreement The following is an agreement and understanding between the Diocese of Marquette (Diocese) and (donor name) (Donor). The donor hereby delivers to the Diocese _(description of donated property). This donation is to be used to establish the (name of fund) Fund. The principal of the gift will be invested in the Diocesan Investment Pool and not be spent. Income generated from the fund can be used to (describe purpose of fund): The diocesan Director of Administration & Finance will be responsible in administering the distribution of the fund in accordance with the donor s intentions. Executed on: (date) Executed by: Diocese of Marquette Donor Most Rev. James H. Garland (donors name) 14

17 Real Estate Acquisition Checklist Description of property: Task Completed By And Date 1. Considerations Before Acceptance of Gift Request that the donor pay all costs associated with acceptance of property including title insurance policy, survey, environmental, and legal costs. Review gift acceptance policies Advise the donor to confer with their own counsel to review the terms of the gift. 2. Evidence of Clear Title Obtain title insurance commitment before acquiring title Items to deliver to title company if available: a. Recent prior title policy b. Abstract c. Condominium project Master deed Letter from association verifying status of assessments Obtain title insurance policy after taking title 3. Evidence of Boundaries Assess need for survey a. Obtain recent survey and review b. Obtain mortgage report and review c. Determine if any improvements subsequent to survey d. Determine if surrounding properties are improved Obtain a survey a. Residential properties stake survey b. Commercial properties ALTA survey 4. Evidence of Condition of Property Environmental Obtain Phase I Environmental Site Assessment Have Phase I reviewed by attorney 15

18 Obtain Phase II sampling if any recognized environmental conditions were identified in Phase I Have Phase II reviewed by an attorney Obtain Baseline Environmental Assessment if property meets definition as a facility must be performed within 45 days of transfer Have BEA reviewed by MDEQ Obtain sellers disclosure statement Obtain building inspection Check with local government for code/ordinance violations Obtain well/septic inspection 5. Rental Properties Confirm zoning compliance with local government including use, setbacks, parking, square footage, and city registration Obtain copies of leases a. Verify Lessor right to assign b. Verify no pending real estate commissions c. Verify existence and amount of security deposits Obtain copies of service contracts and management contracts Obtain estoppel certificate a. Verify no lessor defaults b. Verify no oral agreements Obtain copy of approved site plan 6. Transfer of Title Obtain deed transferring title usually prepared by donor s attorney Record deed with county clerks office Obtain assignment of lease File Property Transfer Affidavit File Real Estate Transfer Tax Valuation Affidavit Sign Form 8283 for donors tax return 16

19 7. Sale of Property Listing of property with broker suggest no more than 10% commission and 6 months in length with a three month protected period following listing term expiration File Form 8282 if property sold within 2 years of gift. 17

20 Deed for Gifts of Artifacts Given To: Diocese of Marquette Archives 347 Rock St. Marquette, MI (906) Date: Given By: Address: Contact: ARTIFACT: Restrictions: Description: Signed: Witness: Date: Accession # Cataloged: 18

21 DIOCESE OF MARQUETTE IRS EXEMPTION TAX LETTER (CIVIL LAW) The current year Internal Revenue Service Group Tax Exemption letter for entities of the Diocese of Marquette can be obtained by calling the Diocesan Office at , Ext. 101 or When calling, indicate if the Official Catholic Directory page on which your parish/institution is named is also needed. The IRS Group Exemption letter is also available on the diocesan website under Diocesan Departments and Services/Finance & Administration/Finance/2007 Group Ruling (Income Tax Exemption) January

22 DIOCESE OF MARQUETTE LIQUOR LIABILITY (CIVIL LAW) If liquor is sold on the premises at a parish/institution function, it is necessary to obtain a liquor license. Information on how to obtain a liquor license can be obtained by calling the State of Michigan, Liquor Control Commission Office in local areas. Gallagher Bassett has information available regarding liquor liability exposures and controls. Obtain this information by calling Gallagher Bassett at January

23 DIOCESE OF MARQUETTE MASS OFFERING POLICY Effective July 1, 1993 On July 1, 1993, the new annual Salary Schedule for priests was implemented. Incorporated within the annual compensation was $3,000 in lieu of Mass offerings. All Mass offerings, therefore, are to be put into the general fund of the parish which pays the priest's salary. There need not be a separate bank account for Mass offering. If you choose not to have a separate bank account, Mass offerings received would be deposited directly in the general bank account of the parish. There still would be a need for a special book. Canon 958-1: The pastor and rector of a church or other pious place where Mass offerings are usually received are to have a special book in which they list accurately the number of Masses to be celebrated, the intention, the stipend given, and their celebration. If you choose to have a separate bank account for Mass offerings, then there should be some procedure to transfer funds from the Mass account to the parish general account, e.g., a monthly check. Priests in special work who receive their full salary from the diocese or from an institution are to pay the diocese any Mass offerings they receive. The overabundance of Masses accumulated in parishes are governed by these Canons: Canon 953: It is not lawful for anyone to accept more stipends for Masses to be applied by himself than he can satisfy within a year. Canon 957: Each and every administration of pious causes or those obliged in any way to see to the celebration of Masses, whether clergy or laity, are to give to their ordinaries, in a manner to be determined by the latter, Mass obligations which have not been satisfied within a year. Therefore, Masses that have not been satisfied after one year, be they $5.00 or $10.00 Masses, are to be sent to the Pastoral Office. Any priest, whether in a parish or special diocesan work within the Diocese of Marquette, or a retired priest of the Diocese of Marquette, in need of Mass offerings may request them from the Chancellor. 21

24 Pastors are to be reminded of their obligation to offer the Missa pro popula every Sunday and Holy Day of Obligation. Canon 534-1: After he has taken possession of his parish, the pastor is obliged to apply Mass for the people entrusted to him each Sunday and Holy Day of Obligation within the diocese; if he is legitimately prevented from this celebration, he is to apply Mass on these same days through another priest or he himself is to apply it on other days. * * * * * * * * * * * * * * * * By means of this general decree, I hereby establish the above policy as particular law within the ecclesiastical region of the Diocese of Marquette and as binding upon the faithful of the same Diocese of Marquette, according to the norms of the Code of Canon Law (1983). May 22, 2000 Date Most Reverend James H. Garland Bishop of Marquette Reverend Alex K. Sample Ecclesiastical Notary 22

25 DIOCESE OF MARQUETTE MICHIGAN SALES TAX EXEMPTION (CIVIL LAW) The State of Michigan has furnished the Diocese of Marquette with a sample tax exemption certificate which can be given to the seller when goods are purchased by your organization. This certificate, of which is below can be completed when you are asked to furnish evidence of tax exempt status. Simply indicate the name of your parish or institution on the form and sign and date the certificate. If you have any questions regarding this matter, please contact at the Diocesan Pastoral Office at: Ext. 101 or January

26 MICHIGAN DEPARTMENT OF TREASURY REVENUE DIVISION SALES AND USE TAXES R Nonprofit entities. Rule 90. (1) Sales of tangible personal property and services to properly qualified nonprofit entities for their own use and consumption, but not for resale, are exempt. (2) The claimant shall meet the following requirements for exemption: (a) Qualify as a school, hospital, home for the care and maintenance of children or aged persons, and other health, welfare, educational, charitable, or benevolent institutions and agencies. (b) Be operated by an entity of government, a regularly organized church, religious or fraternal organization, a veterans organization, or a corporation incorporated under the laws of the state. (c) The income or benefit from the operation shall not inure, in whole or in part, to any individuals or private shareholders, directly or indirectly. (d) The activities of the entity or agency shall be carried on exclusively for the benefit of the public at large and not limited to the advantage, interests, and benefits of its members or any restricted group. (3) When an exemption is claimed, the seller, at the time of transfer of the tangible property or services, shall retain, as part of the seller s records, an executed exemption certificate which reads as follows: CERTIFICATE TO BE EXECUTED WHEN TAX-EXEMPT SALE IS MADE TO AN EXEMPT INSTITUTION OR AGENCY The undersigned hereby certifies that the item or items being purchased are to be used or consumed in connection with the operation of the exempt institution or agency named in the space provided below, and that the consideration of this purchase moves from the funds of the designated institution or agency. In the event this claim is disallowed, the transferee promises to reimburse the seller for the amount of tax involved. Name of exempt institution or agency Date: Signature and title of person making certification (4) The department does not issue so-called exemption numbers. If there is some question regarding exemption status, the claimant may contact the department for a ruling. (5) Nonprofit entities engaged in a retail sales activity of any kind are required to have a sales tax license. The fact that the receipts or profits from such sales may be used for otherwise exempt purposes is not material. 24

27 Diocese of Marquette Needy Parish Fund - Loan Application Parish/Mission: Date: 1. Describe building project for which this application is being made: 2. When will this project begin and when will it be completed. Beginning date: Completion date: 3. What is the cost of the project. $ 4. What amount of existing assets are designated for this project at the commencement date. $ 5. Does the parish have other anticipated revenue sources in addition to the amount of #4 above, such as a capital campaign. If yes, indicate potential revenue and when it will be collected. 6. What amount is requested from the Needy Parish Fund. $ 7. The requested terms of repayment of the loan will be: $ per month for years. 8. Will you be borrowing from another source other than the Needy Parish Fund. If yes, please describe: Amount to be borrowed from other source is $ Indicate who/what is the source: Repayment terms anticipated: Years: Annual debt payments $ 9. Indicate how loan repayments will be made out of parish funds: * Total Annual parish revenues $ * Total Annual parish expense $ Amount available for debt repayment $ *(Attach a copy of parish annual budget) 10. Describe why a loan is necessary from the Needy Parish Fund rather than a lending institution: (Attach additional sheet, if necessary.) Pastor/Pastoral Coordinator Parish Council/Finance Committee Chairperson (Revised 1998) 25

28 DIOCESE OF MARQUETTE POLICY / CRITERIA FOR NEEDY PARISH FUND The diocese has established a Needy Parish Fund from the proceeds of a gift. It is the intent that this fund be used by parishes and missions in need of financial assistance for construction projects. The criteria for usage of the fund is as follows: 1. The fund will be used for loans (not grants) for construction or improvement projects. 2. A parish must have 75% of the project cost on hand (excluding the loan amount) in accordance with the Diocesan Construction Policy. 3. The construction project is to be approved by the Bishop and the Diocesan Building Commission in accordance with the Diocesan Construction Policy. 4. Loans will be non-interest bearing with specific repayment terms established for each individual loan. 5. The loan amount cannot exceed 25% of the project cost, with a maximum loan amount of $100, A parish has to show difficulty in being able to repay a bank loan, which necessitates the borrowing from the Needy Parish Fund. 7. A parish has to show the ability to repay the loan to the Needy Parish Fund. 8. Applications for loans will be accepted at any time during the year. Loan applications received will be reviewed and approved by the Diocesan Finance Council. Funds will not be distributed to the parish/mission until needed. Loan application forms are available at the Diocesan Office, 117 W. Washington St., Suite 3A, P.O. Box 1000, Marquette, MI Call: (906) or , Ext Revised: January 25,

29 June 21, 2007 OFFICE OF THE BISHOP 117 W. Washington Street, Suite 3A, P.O. Box 1000 Marquette, MI Dear Father/Pastoral Coordinator: Please complete the information called for in the enclosed Parish Annual Report. Also, please send along a copy of your computerized Balance Sheet and Income Statement for the year ending June 30, New this year is an excel Parish Annual Report Checklist, which was presented at the Annual Secretary/Bookkeeper Workshop held in Marquette this past May. The information contained in the Parish Annual Report is essential for various reports prepared by the diocesan offices as follows: parish profiles background data for granting of parish loan requests education and demographic studies reference for inquiries about Mass schedules determination of parish assessments for schools and UPCSA goals If you do not personally prepare the report, please check it for accuracy and completeness before signing and forwarding to the diocese. Also, please make sure the Parish Finance Council President signs the report. Completed reports are to be sent to the Diocesan Office no later than July 31, This date is very important because data in the report is used to compute the annual UPCSA goal for your parish or mission. After I review and sign the reports, one copy will be returned to the parish for its files Also, Diocesan policy requires that each parish have an annual budget prepared and approved by the pastor and finance committee. Please forward your annual budget to the diocese along with your Annual Report. We will be using these budgets for planning and auditing purposes. Many thanks for all your efforts. I am truly grateful for all that you do. May the Lord bless you. Please continue to remember me in prayer and know that you are in mine. Sincerely yours in Christ, Most Reverend Alexander K. Sample Bishop of Marquette 27

30 PARISH ANNUAL REPORT DIOCESE OF MARQUETTE For the year ended June 30, Parish or Mission City Zip Code I, the undersigned, hereby certify that I have examined this Parish Annual Report and Financial Statements and find that it is an accurate statement of the condition of this parish or mission. Respectfully submitted the day of, Pastor/Pastoral Coordinator Finance Council President This Parish Report, when signed, is to be submitted in duplicate to the Pastoral Office by July 31 st. One copy will be returned to the parish or mission after approval by the Bishop. THIS REPORT HAS BEEN EXAMINED AND APPROVED THE DAY OF, Bishop of Marquette Number of Families Registered as of June 30 (Those registered should equal Total Number of Envelope Holders) Total number of individual members : (Adults Children ) NUMBER OF ADULT ENVELOPE HOLDERS: Each contributing adult envelope holder Each non-contributing adult envelope holder TOTAL NUMBER OF ENVELOPE HOLDERS = 1 Unit = 1 Unit 28

31 OTHER PARISH DATA I. VITAL STATISTICS FOR YEAR ENDING JUNE 30, Baptisms Funerals Total Marriages Mixed Marriages Catholic Marriages II. Did your parish conduct a diocesan approved Capital Campaign this year? Yes No If yes, please complete the following: Project Description Project Approval Date Year Campaign Started Number of Yrs. For Pledge Redemption Campaign Goal Pledges to Date Amt. Collected as of June 30, III. DEBT SCHEDULE LOANS PAYABLE (Include Needy Parish Loans): PAYMENT LAST YEAR To Whom Payable Date Made % Interest Original Amount of Loan Interest Principal Unpaid Balance IV. PHYSICAL PLANT 1. Seating capacity of church Parish Mission Name of Mission Mission Name of Mission Description of buildings (i.e. date of construction, condition, etc.) 2. Major repairs or remodeling done in the last year: 3. Construction, remodeling needed: 29

32 V. HISTORICAL DATA State briefly historical data with respect to the parish and/or mission during the year, i.e., pastoral changes, cost and description of buildings erected, improvements, purchases of property, and any other items worthy of record, giving the exact date for each item where appropriate: Linked parishes/missions: Linkage date, if applicable: VI. VII. VIII. MASS SCHEDULE Please list the weekend Mass schedule for the parish/mission: COMPUTERIZATION Is your parish/mission computerized? Yes No Name of accounting software Name of census software MINISTRIES: Please indicate the number for each category in your parish: Extraordinary Communion Ministers Lectors Ushers Music Minister Choir Cantors Catechists Indicate active groups with a check Youth Group Men s Group Women s Group Pastoral Council Finance Council Evangelism Comm. RCIA Stewardship Comm. IX. OUTREACH MINISTRIES (i.e. prisons, hospitals, nursing homes, Native American, etc.) Institutions/Groups Served Average Number of People Served (monthly) Description of Service or Ministry Provided Please list names of parish staff listed below: Name: Position Associate Pastor Pastoral Associate Deacon Secretary Bookkeeper Local Safe Environment Coordinator 30 Address:

33 DIOCESE OF MARQUETTE PARISH INTERNAL CONTROL POLICIES AND PROCEDURES The following parish internal control procedures are to be implemented at all parishes and missions: CHECK SIGNING POLICY: All parish bank accounts shall be established and maintained with the Pastor, Pastoral Coordinator or Administrator as the primary authorized signer of checks. Secondary authorized signers should be limited to the Associate Pastor or a Parish or Finance Council officer. The parish secretary/bookkeeper shall not be one of the authorized signers of checks. Rubber stamp signatures are not allowable. BANK ACCOUNTS: The number of bank accounts should be strictly limited to those absolutely required. All accounts should be opened in the name of the parish or mission, never an individual. Bank statements are to be delivered unopened to the pastor, pastoral coordinator or administrator, who will examine the checks and deposits contained therein. Bank accounts are to be reconciled by the parish secretary or bookkeeper and approved by the pastor on a monthly basis. CASH RECEIPTS: The parish secretary should make a listing of all checks and cash (cash receipts) that come through the mail. This person should be independent of the accounting functions, if possible. The listing should indicate the date received, person from whom the funds were received and the amount received. A listing is given to the pastor monthly. Cash receipt should be deposited daily, intact (all receipts) with the secretary making up the deposit ticket and taking deposit to the bank. All cash receipts are to be deposited and recorded in the general ledger. Mass Collection Counting Procedures established by the diocese are to be utilized. Cash receipts are to be maintained in a locked safe until deposited. Receipts are to be deposited no later than the first banking day after the collection takes place. Deposit summary sheets are to be retained for one year. A tape should be run of the individual envelope receipts (as noted on the outside of the envelope) by the parish secretary/bookkeeper. Individual parishioner donations should be posted to a subsidiary record. The total posted to the subsidiary records should agree with the tape of the individual envelope receipts. The tapes and envelopes should be retained for one year. 31

34 Envelope holders are to be given an annual report of contributions made. Internal Revenue Service regulations require that individual donations of $250 or more are to be given a separate receipt. A sample Single Gift Acknowledgment form is attached for your use. Total of individual envelope holder receipts should be reconciled with general ledger revenue on an annual basis by parish secretary/bookkeeper. BUDGET & REPORTING: An annual budget will be prepared and approved by the pastor and finance committee. Financial statements are to be prepared at least quarterly and submitted to the finance committee for review, comparing budget with actual. Annual financial statements of the parish are to be prepared and submitted to the parishioners. Revised: February 1, 2000 * * * * * * * * * * * * * * * * By means of this general decree, I hereby establish the above policies and procedures as particular law within the ecclesiastical region of the Diocese of Marquette and as binding upon the faithful of the same Diocese of Marquette, according to the norms of the Code of Canon Law (1983). May 22, 2000 Date Most Reverend James H. Garland Bishop of Marquette Reverend Alex K. Sample Ecclesiastical Notary 32

35 COLLECTION COUNTING SHEET/DEPOSIT SUMMARY Date of Count: Names of Money Counters: REGULAR COLLECTION: 501 Sunday and Holiday $ 502 Loose Collection $ 503 Children s Collection $ 508 Fuel Collection $ 603 Pamphlets $ 604 Votive Lights $ DIOCESAN COLLECTIONS: (List) $ OTHER INCOME: (List) $ $ $ TOTAL COLLECTION $ Summary of Collection: Envelope Checks (2) Loose Checks (2 & 3) Currency Coin Total Collection $ $ $ $ $ (1) Total posted to accounts must be equal to deposit. (2) Amounts to be posted to parishioners records (3) List loose checks on the back of this form for proper recording of donation. Money Counter Signature: Money Counter Signature: 33

36 MASS COLLECTION COUNTING PROCEDURES Establish a Count Committee of volunteers from the parish, working in teams of at least two unrelated individuals on a rotating basis. The uncounted collection should never be left in the custody of a single individual. Count collections after Mass, making certain that the amount checked on the offertory envelope agrees with the contents. If the collection is not counted immediately, it should be kept in a locked safe or night depository. Complete the Collection Counting Sheet/Deposit Summary form and have each member of the team sign the form evidencing concurrence of counts. Use a rubber stamp or write on back, to endorse all checks For Deposit Only to the parish bank account. Loose checks are to be listed on the back of the Collection Counting Sheet/Deposit Summary form for proper recording of donation. Bank deposits should be prepared in duplicate. The original deposit slip remains with the deposit to the bank depository. The duplicate slip, along with the validated deposit receipt from the bank, are to be retained for parish records until the bank statement is reconciled. Cash and checks are to be maintained in a locked safe until deposited no later than the first banking day after the collection takes place. Review envelopes to ensure that they clearly indicate amounts and parishioner so that the offering records will be accurately maintained. Copies of the Collection Counting Sheet/Deposit Summary, and duplicate deposit slips are forwarded with empty offertory envelopes directly to the pastor or bookkeeper. Collection Counting Sheet/Deposit Summary form and deposit slips should agree with the bank statement deposit. 34