November 17, 2015

Dear Sisters and Brothers of Our Diocese:

We are attaching the final audit report, summary report, and communications letters regarding the financial statements of the Diocese of Bethlehem for the year ending December 2012. These reports represent the fifth completed audit of the finances of the diocese of six financial audits (2008 – 2013) Bishop Sean and the Standing Committee hired the accounting firm of Campbell Rappold & Yurasits to undertake in March 2014.

These are the complete reports as presented to the Audit Committee. No information has been left out. These audit reports and letters indicate the firm has found no malfeasance or misuse of funds in the years that have been examined. However, as with the previous three reports, the auditors have pointed out a number of weaknesses and deficiencies to be addressed and which we began to address as of the 2014 fiscal year.

In fact over the past almost two years, under the leadership of Bishop Sean and since we began working with the auditors to take steps to improve our methods, many of the problems cited have been rectified: improved procedures and internal controls have been put into effect over the previous months; a state-of-the-art accounting system has been installed; new staff management is in charge; and generally accepted accounting policies, in accordance with those set forth in The Manual of Business Methods in Church Affairs of the Episcopal Church, are being utilized. It is important to note, however, that the audits of the years 2008 through 2013 reflect the practices previously in place so that deficiencies in procedures pointed out in the 2008, 2009, 2010 and 2011 audits remain in this audit.

We are distributing these materials to the people of the Diocese via the Diocesan Newsletter and Diocesan Leadership Newsletter.

Only one audit remains for the ad hoc Audit Committee to oversee. When the 2013 audit is completed, we will disseminate the information without delay. Work on that audit is already under way.

Starting with the audit for the year 2014, the responsibility for ensuring that audits are completed will fall to the Treasurer of the Diocese and the Finance Committee.

Your Sister in Christ,

Ms. Libby House, Chair of the Audit Committee
For the Members of the Audit Committee