ADLA Budget Application For Parishes

What is a Budget? • A Financial Plan of Action for your Parish • Financial Document that Projects Future Income and Expenses • Helps to Foster Stewardship Growth • A Guide in Making Day to Day Financial Decisions (c)2018 Archdiocese of Los Angeles

Why Budget? • Helps the Parish to Understand their Financial Position • The Parish Can Control Its Expenses and Avoids Year-End Deficits • Confirms that Spending is Consistent with Parish Goals and Pastoral Priorities. (c)2018 Archdiocese of Los Angeles

Who Can Create & Approve The Budget? • Business Manager/Accountant • Responsible for maintaining & preparing financial records • Pastor Approves the Budget • Consults with the finance council & business manager/accountant • Pastor is Responsible for Establishing and Adhering to the Parish Budget (c)2018 Archdiocese of Los Angeles

When Should the Budget be Prepared? • Fiscal Year 2018-2019 Budget is due April 27, 2018 • Completed Prior to the End of the Current Fiscal Year • Fiscal Year 2017-2018 • Early Enough to be Useful for the Upcoming Fiscal Year • Fiscal Year 2018-2019 (c)2018 Archdiocese of Los Angeles

The Budget Process • Step 1 – DATA COLLECTION • Step 2 – FINDING TRENDS • Step 3 – APPLYING TRENDS • Step 4 – PROJECTING & ESTIMATING EXPENSES • Step 5 – EVALUATION & RECONCILIATION (c)2018 Archdiocese of Los Angeles

Step 1 -Data Collection • Review 3 Year History of Income & Expenses • Review Current Fiscal Year Income & Expenses • Complete a Forecast • Estimate Actual Expenses for the final months of the Current Fiscal Year • Estimate Any Capital Expenditures and Major Purchases • Payroll Information (c)2018 Archdiocese of Los Angeles

Step 2 - Finding Trends • Any Seasonal Increases (Highs) or Decreases (Lows) in Income/Expenses • Income/Expense Accounts that are Continually Increasing/Decreasing • No Significant Changes in Prior Years • Safe to predict no changes in coming year • The Effect of the National and Local Economy (c)2018 Archdiocese of Los Angeles

Step 3 - Applying Trends • Find the direction of the trend • Increase, decrease or no change? • Is the Trend Continual or Constantly Changing? • What is the Extent of the Trend? • Using the Trend to Predict • The direction of income & expenses (c)2018 Archdiocese of Los Angeles

Step 4 - Projecting & Estimating Expenses • Breakdown of Expenses by Category • 1. Payroll (usually Parish’s highest expense – 35% to 50%) • 2. Fixed Expenses (rent, loans, assessment, taxes, subsidies to schools) • 3. Operating Expenses (day to day expenses, maintenance, utilities) • 4. Discretionary Expenses (programs, ministries, events) • 5. Capital Budgeting (large expenses, construction, cars) (c)2018 Archdiocese of Los Angeles

Step 5 - Evaluation & Reconciliation • Is the Budget Realistic & Reflects the Current Operating Environment? Income – Expense = Profit/Operating Loss • What is the Parish Doing to Increase Revenue? • Is the Payroll in Line with the Pastoral Plan and Parish Goals? • Are there any Payroll Adjustments Needed in Regards to Hours and/or Personnel? • Fixed Expenses are Non-Negotiable!!! (c)2018 Archdiocese of Los Angeles

Step 5 - Evaluation & Reconciliation • Operating and Discretionary Expenses; • Which expenses are essential? • Which of these expenses and/or purchases can be delayed? • Can these expenses be solicited as donations to the Parish? • What alternatives are available for existing programs without cost? • Are there events that can be totally or partially self-supporting? • What measures/programs can be initiated to manage cost? • (i.e. water and electricity conservation?) (c)2018 Archdiocese of Los Angeles

Managing the Budget • Managing Income • Review Book Balance?/Cash Flow? • Using the budget to be pro-active and not reactive • Managing Expenses • Are expenses increasing compared to the previous year • Investigate, determine why • Creating Reports (Monthly/Quarterly) • Monthly/Quarterly Review • Accounting Software • Adjust Spending (c)2018 Archdiocese of Los Angeles

The ADLA Budget Application • Helps You Create Your Parish’s Budget for FY2018-2019 • Application Shows Your Parish’s Last 3 Years’ Annual Report Information • The Budget Your Parish Submitted for FY2017-2018 is Listed • Amounts Can Only be Adjusted in the Column Labeled “Budget 2018-2019” • The Column Labeled “Budget FY2018-2019 has Pre-populated Amounts • They can be changed to suit your parish’s financial need • The amounts reflect an increase from the previous column “Budget FY2016-2017”

The ADLA Budget Application • WARNING-!!!! • Print out a copy of the summary (page 5)before you begin!!! • Once you submit you report, you will not be able to make changes • 3 Ways to save your information • Drop Down Menu • Forward (right) and/or back (left) arrows • Log out link at the top of the page • A Reset Button is Located to the Right of the Columns • This will return your information to the original pre-populated amounts • You may save your work and return later to complete the report, • If you have not submitted the final report (c)2018 Archdiocese of Los Angeles

Application Login Instructions • The Budget Form Will Load • Review the Pre-Populated Amounts • If changes are necessary, enter the new amounts in these two columns (c)2018 Archdiocese of Los Angeles

Components of the ADLA Budget Application • Page 1 – Ordinary Income • Page 2 – Restricted Income • Page 3 – Ordinary Expenses • Page 4 – Other Expenses • Page 5 – Summary Page • Page 6 – Submission Page (c)2018 Archdiocese of Los Angeles

Page 5 – Summary Page • Will Display all the Pages of the ADLA Budget in Long Form • Amounts will Update as Information is Changed in the Previous Pages • No Adjustments can be Made to the Summary Page (c)2018 Archdiocese of Los Angeles

Page 6 – Submission Page • Can Only be Accessed after Clicking on the Summary Page Right Arrow • Once Submitted the Budget Application Cannot be Edited!!! • You Must Contact Financial Services for Changes to Your Report (c)2018 Archdiocese of Los Angeles

Submission Page • Once You Have Completed Reviewing All of the Pages, Submit Your Report • Enter Preparer Name, Phone #, and Any Comments as Necessary • Hit Submit Button, ONCE SUBMITTED THE REPORT WILL BE LOCKED!!! (c)2018 Archdiocese of Los Angeles

How the Information is Calculated • Every Account has a Percentage Assigned to it by The Archdiocese • The Percentages can Range from 0% to 6.25% • The Archdiocese Assessment is Calculated Using the Ordinary Income Total from the Previous Fiscal Year • You Will Create Your Own Forecast!!!! (c)2018 Archdiocese of Los Angeles

Steps for Completing the ADLA Budget Application • Gather All Current Fiscal Year Financial Information • Print Out a Hard Copy of the Summary (page 5) • Review Pre-Populated Amounts • Make Adjustments • Review Completed Report • Submit (c)2018 Archdiocese of Los Angeles

Making Adjustments • You May Enter an Adjustment in FY2018-2018 Budget Columns Only • You Cannot Make Adjustments to the Summary Page (page 5) • If You Need to Star Over, Select the icon located to the right of the final column and the pre-populated amounts will return. (c)2018 Archdiocese of Los Angeles

How Adjustments Affect the Application • Eliminates the Formula from the Forecast Projected Column • Changes Total on the Current Page & the Summary Page • Entries in Forecast Projected Column Changes the Budget Column • Manual Changes to Budget Column will not Affect Forecast Projected Column (c)2018 Archdiocese of Los Angeles

SUMMARY • Budget – What, Why, Who, When • Access Budget Application Online • Budget Due by April 27, 2018 • Cannot Make Changes Once Submitted • Contact Financial Services for Updates & Make Changes (c)2018 Archdiocese of Los Angeles

ADLA Budget Application For Parishes