Letter to the Editor  |  March 30, 2018  |  

On January 31, Adventist Today printed an interview between the Executive Editor Loren Seibold, and Victor Pilmoor, who served three phrases as British Union Treasurer. The editor had acquired a be aware from an Adventist lay member in a creating nation. Through a member of the family working in a convention workplace, he mentioned he’d found that unions and conferences in his area have a two-ledger system in order that pastors and workplace employees can keep away from reporting revenue and paying taxes.

Victor Pilmoor responded to the query, “have you ever heard tales like this, and will this one be true?”

“The overwhelming majority of treasury employees I have labored with do an sincere job and have a need to be compliant with accounting requirements and coverage. The discovery of obvious aberrations shouldn’t be taken as the norm. But irregular use of cash does occur, not often, and often not on a grand scale. It is often detected later than it ought to be: worry of reputational harm can inhibit clear and candid transparency, as does the need to comprise authorized penalties. Let us suppose this individual’s declare has substance.  If a member has info on irregular follow, they’ve an obligation to place church leaders on discover, then recommend a timeframe for correction earlier than the matter is taken up with auditors, and finally with the regulatory authority. We have an obligation to maintain one another accountable.”

It is accepted that the “overwhelming majority of treasury employees …do an sincere job and have a need to be compliant with accounting requirements and coverage”. However, this reply avoids the long-standing unresolved challenge of what’s the punishment for the minority of treasury employees that aren’t sincere? The requirement member having info on irregular follow, has a “obligation to place church leaders on discover, then recommend a timeframe for correction earlier than the matter is taken up with auditors” is a shocking revelation! Unfortunately lay members don’t have the authority, nor entry to monetary information to evaluate correction or compliance with the lay-member’s intervention. Has that state of affairs ever occurred in the historical past of the church?

What is lacking from Victor’s reply to the query is, not what the regulatory authorities would do, however how would church authorities view the two ledger monetary scheme and what disciplinary motion would the perpetrators obtain? Would they be disciplined? Would they be transferred to a different SDA establishment? Would they be terminated from church employment?

Loren Seibold acknowledged that at the final Autumn Council, there was a lot dialogue a couple of report from GCAS that confirmed an growing quantity of auditing irregularities—81% of audits in the most up-to-date yr. Victor Pilmoor responded to the query, “What are audits designed to find?”

“The report recommended that 81% of entities had some coverage non-compliance, which isn’t as pejorative as to indicate wrongdoing. This might be so simple as a handful of trustees not signing battle of curiosity statements, or the entity working beneath the working capital requirement. Many treasury departments are small and battle to implement the segregation of duties that finest practices would recommend.”

After extracting the variety of trustees that didn’t “signal battle of curiosity statements” and entities “operating below the working capital requirement”, what are the auditing irregularities remaining in the 81%?

Victor Pilmoor continued,

“Auditors do their finest to dig into the monetary information, however issues might be hidden from them. When auditors start their work they request a signed ‘Letter of Representation’ in which convention officers signal and declare that they’ve made all related information and info obtainable. If accounting info stays undisclosed, then officers have misled auditors.”

What are the penalties of deceptive auditors? Is that habits of officers adequate for termination from church employment?

Loren Seibold requested one other query, “What would possibly occur to a judicatory if this type of factor is found by the authorities?”

Victor Pilmoor’s reply:

“If a church or charity is discovered to have intentionally defrauded the public purse, they are going to be required to make up the distinction on behalf of the church and the worker, typically with penalties. Tax authorities are entitled to return a number of years in the event that they suspect dishonest. If the follow is discovered to be legal, then legal sanctions apply to treasury officers and trustees. Risk administration supplies no cowl for those that are knowingly corrupt, or for those that fail to observe professional skilled recommendation”.

These remarks recommend that Risk Management in addition to auditors are conscious of people which might be “knowingly corrupt”. What are the penalties for corrupt habits? If offending treasury officers and trustees stay employed by the church and are finally prosecuted by the civil authorities what church response does this occasion evoke?

In closing, Victor Pilmoor acknowledged that “the extra we maintain our individuals accountable from the native church enterprise assembly, on up by convention, union and GC conferences, the extra our belief will develop.” This means that lay church members have the accountability, and talent, to maintain church officers accountable. Unfortunately, lay church members have neither the authority nor the instruments to perform such a activity. On the opposite, it can be refreshing to have transparency and accountability generated from inside the administrative construction of the Seventh-day Adventist Church.

George Grames
Members for Church Accountability
[email protected]

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