We have reviewed the annual financial report of the Church for the year ended December 31, 1976, and operations for the period September 1, 1975, to December 31, 1975. The fiscal accounting period of the Church was changed in 1975 from a year ending August 31 to the calendar year. The financial statements and operations reviewed by the committee include the general funds of the Church and of other controlled organizations, the accounts of which are maintained by the Financial Department of the Church. We have also examined the budgeting, accounting, and auditing procedures employed, and the manner in which funds received and expenditures are controlled. We determined that expenditures of general Church funds were authorized by the First Presidency and by budgetary procedures. The budget is authorized by the Council on Disposition of the Tithes comprised of the First Presidency, the Council of the Twelve, and the Presiding Bishopric. The Committee on Expenditures, in weekly meetings, administers the expenditure of funds under the budget.
Modern accounting technology and equipment are employed by the Financial Department and other departments in keeping abreast of rapid Church expansion and changing methods of electronic data processing. The Finance Committee and the Law Department are conjointly giving continuous attention to matters relating to taxation of churches by the federal government, by states, and by foreign governments.
The Auditing Department, which is independent of all other departments, regularly conducts a program of auditing the organizations referred to above, including the missions, on a worldwide basis. The extent and scope of its operations in safeguarding the resources of the Church are increasing commensurate with the growth and widening activities of the Church. The audit of local funds of wards and stakes is assigned to stake auditors. Incorporated businesses, owned or controlled by the Church, for which accounts are not maintained in the Financial Department, are audited by professional auditing firms or by governmental regulatory agencies.
Based on our review of the annual financial report and other accounting data, and our study of the accounting and auditing methods by which financial operations are controlled, together with continuing discussions with personnel of the Financial, Auditing, and Law Departments, we are of the opinion that the general funds of the Church, received and expended during the sixteen-month period September 1, 1975, to December 31, 1976, have been properly accounted for in accordance with procedures outlined herein.
CHURCH FINANCE COMMITTEE
Warren E. Pugh