by AT News Team

The Seventh-day Adventist Church recently published a 75-page book designed to introduce denominational leaders around the world to basic concepts and best practices designed to improve the integrity of policies and operations. Entitled Transparency and Accountability, the publication was sponsored by the denomination’s in-house audit agency, the General Conference Auditing Service (GCAS). Paul Douglas, the director of GCAS, introduced the book during the 2012 annual meeting of the denomination’s governing body.
 
The group that edited the volume includes three accounting experts who are not employed by church-related organizations: Jon Satelmajer, a partner in the major accounting firm, Price Waterhouse Coopers; Jack Krogstad, a professor with an endowed chair at Creighton University; and John Stanley, a principal in Quintesse Consultants. It also included two management professionals from Adventist institutions: Bill Robertson, president of Adventist Healthcare, based in Rockville, Maryland; and Dr. Ann Gibson, a CPA and accounting professor in the business school at Andrews University.
 
The chapters in the book are attributed to a number of GC officers, although one source has told Adventist Today that drafts of the material included contributions from a number of other individuals. It includes chapters on why the trust and confidence of church members matters, introducing a code of conduct for denominational administrators, and exploring the concept of “transparent” organizational processes. It also includes chapters describing best practices in governance and financial management.
 
For example, a chart on page 90 explains the difference between “ecclesiastical structures” in the conferences and missions that make up the denomination itself, and “institutional structures” in the nonprofit organizations affiliated with the denomination. In ecclesiastical structures “each entity is part of a chain of organizations,” while in institutional structures “each entity [is] a ‘stand-alone’ organization,” the chart states. It makes six other comparisons related to the make-up of governing bodies and administration, etc.
 
Another example: In the chapter on best practices for financial management, there is an explanation of liquidity ratios, asset turnover ratios, financial leverage ratios and profitability ratios. The role and function of audit committees is explained as (1) “understand the risks related to the organization and its financial reporting; (2) oversee financial reporting processes for quality and reliability, including internal controls; (3) oversee audit activities with the internal and/or external auditor.”
 
Much of this is standard fare in professional literature on nonprofit organizations, but most clergy serving on the boards of Adventist organizations, as well as many of the laity, have no education in nonprofit management. The direct application of procedures learned in small business or even major for-profit corporations can be tricky, both because of practical differences in the nonprofit world and legal differences in tax codes, etc.
 
“It is common today for nonprofits to provide board training,” a source in a major professional organization told Adventist Today. “This book looks like the kind of materials that are used in many organizations.” Graduate programs in nonprofit management are offered in many universities and a growing number of nonprofits require at least a master’s degree in this field for their leadership, the source stated.
 
The book states that it was prompted by recommendations from the GCAS board and lists four such recommendations. The policy recommendations include (1) promoting “a culture of transparency and accountability” among denominational leaders, (2) revising working polices “to incorporate best practices,” (3) requiring “an Audit Committee for each denominational organization which is chaired by and comprised of persons not employed by the organization,” and (4) encouraging denominational organizations to provide board training.
 
The entire book has been published in electronic format and can be downloaded from the denomination’s official web site. Paper copies were distributed to division officers and union conference presidents in mid-October. No information is available as to when and if it will be translated into languages other than English.
 
The book can be found and pdf downloaded here.