Greenville Seminary concluded its "GPTS Impact 372" financial campaign on June 30, closing out the 2015-16 fiscal year with gifts totaling nearly $220,000 during the two months of the campaign! The seminary administration had set an ambitious, but reality-based goal of raising more than $372,000 during the two closing months of the fiscal year. That goal had two components:
- $172,300 to meet FY-end budget levels, and
- $200,000 to replenish our fully depleted reserve fund.
As our monthly e-newsletter financial reports indicated during fiscal 2015-16, more than $16,000 was withdrawn each month from a reserve fund made possible by a $200,000 bequest received by the seminary about the time the fiscal year began (see green portion of the bars in the financial report chart below). These reserve funds were critical to our ability to cover budgeted expenses. That reserve was depleted by the end of the fiscal year.
Why are reserves so important to the operation of non-profit institutions?
According to CPA Amy Boland, "Nonprofit reserves are more important now than ever in today’s economy. It is a common misunderstanding that nonprofit organizations should not make a profit.
"In fact, the goal should be to build a solid base for the organization by accumulating unrestricted net asset balances and investing them in the organization’s programs. Accordingly, the greater the unrestricted net asset balance, the greater the organization’s ability to enhance and expand current programs and further promote the organization’s tax-exempt purpose," she said, writing for the Greater Washington Society of CPA's Educational Foundation.
"Operating reserves are the portion of unrestricted net assets designated for use in emergencies. The reserves sustain financial operations in the unanticipated event of significant unbudgeted increases in operating expenses or reductions of operating revenues. ...
"The operating reserves may be the difference that allows the organization to continue when faced with these unexpected situations — such as the economic downturn. Reserves can carry nonprofits through tumultuous periods to times of greater stability when anticipated revenue is received or important decisions are made based on the new circumstances facing the nonprofit."
For an institution such as GPTS, which depends upon voluntary support for more than 70 per cent of its operating income, maintaining a reserve is a matter of responsible stewardship of the investments made by those who so highly value our unique conservatory contribution to the orthodox future of the church.
We, like most non-profits, typically face major cash-flow fluctuations from day to day and month to month in gifts to our ministry, to the point where (only rarely) we have been unable to meet payroll and other outstanding obligations in a timely manner. Faithful monthly or other automatic regular giving goes a long way toward alleviating fluctuations, but a healthy reserve fund is critical in this regard.
Some organizations meet operating fund deficits by temporarily tapping or "borrowing" funds given by donors for restricted or earmarked programs or projects. Generally accepted accounting practices warn against this approach. As Amy Boland puts it, "Using the funds in this way can be very serious for an organization since the funds are restricted for a different purpose. This situation will affect cash flow because ultimately these 'borrowed' funds will have to be paid back to the restricted net asset accounts, or the organization will run the risk of defaulting on donor wishes."
GPTS desires to honor the intentions of donors who give to restricted programs, and therefore we seek to avoid this approach, as well as tapping lines of credit offered by banking institutions.
As we begin our new fiscal year, with a new academic year looming at the end of this summer, we renew our appeal for help in realizing the rest of our GPTS Impact 372 campaign goal. You may make your gift online from our web site (gpts.edu/support/donate.php) or mailing your check to PO Box 690, Taylors SC 29687.
Fiscal Year 2015-16 Summary
Income from unrestricted contributions during all of FY2016 was $805,852, down from $1,038,649 in the previous fiscal year, which included a $200,000 bequest and two last-minute gifts of $100,000 each. Without these three extraordinary gifts, ordinary non-earmarked giving in FY2015 would have been $638,649. Total FY2016 income of $1,229,928 compares with FY2015 total income of $1,314,379. Expenses for FY2016 totaled $1,238,965, compared to $1,087,640 the previous fiscal year.
Fiscal Year 2016-17 Budget Preview
Our preliminary operating fund budget for the 2016-17 Fiscal Year contemplates income of $1,151,200 and expenses of $1,210,427, an imbalance of $66,977. Adding $60,000 in budgeted capital fund disbursements, brings the total budget deficit to $126,977. We are working on closing that gap through additional fund-raising.
The income side of the ledger calls for $810,000 in unrestricted general-fund donations and $882,500 total donations for all purposes, both general and earmarked. Thus anticipated contributions make up 77 per cent of budgeted revenue. By contrast, according to both the National Center for Charitable Statistics and the National Philanthropic Trust, gifts and grants typically provide about 21 per cent of non-profit organizations' revenue stream.
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The tables below indicate our general operating fund financial situation as of the end of June 2016, and the 2015-16 fiscal year. Unrestricted general fund donations from churches and individuals during June totaled $133,379, which was $65,421 above the $67,958 budgeted for such income. Expenses of $106,758 in June were $90 above the $106,668 budgeted for expenses.
GENERAL OPERATING FUND – JUNE 2016
Donation Income (Unrestricted)
GENERAL OPERATING FUND – FISCAL YEAR 2016-17
Donation Income (Unrestricted)
Capital Campaign Goal
Long-term Pledges Outstanding
Total Received and Pledged
Monthly Payment (Interest Only)
Donate to GPTS through the PayPal Giving Fund. Giving through this Fund means 100% of your gift will reach GPTS, without the usual processing fees deducted. You can also support the seminary by buying and selling through the eBay for Charity system.
And don't forget to do your online shopping at AmazonSmile. Log on to smile.amazon.com and select Greenville Presbyterian Theological Seminary as your charity. Or click on the AmazonSmile banner at the very bottom of this e-newsletter.
Fidelity Charitable and Schwab Charitable clients: Click here for Donor-Advised Fund direct deposit. Wells Fargo employees: check with your company about matching gifts to GPTS.
Most of all, be fervent in prayer that God would provide all that is needed for us to do what He has called us to do in this ministry which the church so badly needs in these uncommon times.
Remember, gifts to GPTS are tax-deductible and may include cash, securities, property or a variety of planned giving instruments. (The tax deduction is reduced by the fair market value of any premium received in return for a donation.) See here for information about planning your last will and testament with the Kingdom of God in mind.
Whether or not you can contribute financially, here is another way you can help the seminary: Spread the Word! Do you know someone that would be interested in learning more about our organization or supporting us? If so, share a link to this newsletter. (Click the tiny "M" e-mail icon at the bottom of this post.) Thank you for your continued support for Greenville Presbyterian Theological Seminary