Financial Crisis

Download the text of this video in PDF format.

Give Now

The Situation

  • IM suffered a $426,000 net asset loss in fiscal year 2008. Losses can be directly linked to the onset of the global financial crisis. Specifically to the following three factors:
    1. Lower donor income, especially in the fourth quarter when the recession hit
    2. Investment losses because of the sharp decline in the 2008 stock market
    3. Devaluation of the dollar, particularly mid-year, against other world currencies
  • The Mission entered 2009 with a commitment to carefully monitor income and expense targets. Through July, finishing the year “in the black” seemed feasible; however, a dismal August income marked the beginning of a major four-month decline.
  • Even though spending has been kept in check, well below budgets, the Mission will almost certainly show a loss in excess of $500,000 in the 2009 audit. Two years of brutal currency exchange rates and four months of significant giving shortfalls place the Mission in a dire financial situation.

What is the “worst-case scenario”?

  • The “worst case scenario” is an imminent threat. If the giving pattern of August-November becomes the “new reality,” funding will simply not be enough to maintain the Mission’s current operations— much less to grow for the future.
  • Because cash reserves have been severely depleted by the losses suffered throughout this economic downturn, if giving patterns remain at current levels during the first quarter of 2010, Mission leadership will have no choice but to take further drastic actions to maintain financial integrity.
  • The IM board and staff cannot allow the Mission to suffer ongoing losses and must act to shore up the financial strength of the organization. The board has asked for a detailed crisis plan that will avert a disaster.

If the giving shortfall continues, we may have to permanently lay off some missionaries!

IM Board and Leadership Response

  • In April, the board approved a preliminary framework budget set at $8.5 million. At its December meeting, the IM board approved a drastically reduced annual budget of $7.2 million for 2010.
  • To achieve this aggressively reduced budget, it was necessary to make drastic and very painful eductions in planned spending. This included cuts in plans to celebrate the Mission’s 75th year.
  • The following stateside positions were eliminated:
    • The position of communications project coordinator will be unfilled for 2010. Elizabeth Willhite, who has resigned to pursue another career, filled this full-time role. She will not be replaced.
    • During the duration of the financial crisis, IMpulse and other video programs will be suspended. This decision terminates our contract relationship with Brian Ellison, our video producer, in March.
    • The part-time position of video assistant will also cease for 2010. Victor Albright served in this role.
    • The director of member care position held by Dr. Neil Gilliland will be eliminated as a full-time staff role beginning in January. To continue serving the needs of our missionary family, the Mission will enter into a contract with Dr. Gilliland to provide some services as a consultant.
    These cuts reflect a value communicated to the denomination in presenting the restructured funding system. A promise was made repeatedly, “the office and stateside staff will feel the cuts first, before our missionaries feel them.”
  • In addition to these cuts, every International Missions employee (missionaries included) will suffer a 5% decrease in base pay for 2010. This is on top of the “pay freeze” imposed for 2009 with no raises given.
  • For the second year, retirement contributions will be reduced from the standard 5% to 3% of base pay for all IM employees in 2010. This reflects the minimum contribution required by the Board of Retirement to maintain an active account status and retain the life insurance provision.
  • The concern IM board and Mission leaders are experiencing cannot be overstated. No one knows what will happen in these next few critical months. Careful analysis of the current situation, and predictions concerning the future of charitable giving and the health of non-profit organizations by and large, suggests a posture of optimism is unwise. One board member, citing first our dependence on the Lord, said “our part must be to plan for the worst while we work hard, hope, and pray for the best.”

What do We Need Our FWB People to Do?

  • We recognize this battle has a spiritual dimension. Pray with the IM board and staff:
    1. For wisdom and an awareness of God’s leading as we make plans and decisions
    2. For discernment and effectiveness on the part of IM workers (especially missionaries) to operate in this challenging environment

    3. For our people to be blessed of the Lord in this economic crisis
    4. For an abundance of income in the first quarter of 2010
    5. For our field workers to be able to focus on the task to which they are called
  • If you are a pastor or church leader, please take a special offering for IM and encourage your people to give an “above and beyond” gift to help in this crisis as soon as possible.
  • If you are an individual, please give a special—even sacrificial—gift to help as soon as you can.

Download a PDF of these points.