Finance

May-August 2024

Review of OMF (UK) Finances

In my first five months as Director for Finance and Corporate Services I have appreciated conversations with our workers and the chance to review previous annual accounts. These have helped me to get to know OMF (UK)’s finances.

Here is a review OMF’s results over the last fifteen years with a few observations:

The above graph shows the operational surpluses and deficits over the last 15 years.

The surplus or deficit is calculated as income less expenditure.

The two volatile areas of income, legacies and investment gains or losses have been removed from these annual figures to make them comparable.

There is a clear downward trend since 2017. A surplus of £700,000 in 2017 reduced to almost break even in 2019 to 2021. Since 2022, deficits have been at least £350,000 each year and have been increasing.

One of the critical factors for OMF (UK) is the number of members sent by UK churches. Since 2013, the number of workers sent through OMF (UK) has fallen from 240 to 150. A general decline in missionary numbers has been seen since the 1980s in most of the evangelical mission agencies in the UK and Western world.

The total annual result is made up of five main factors:

  1. Cost of topping up member budgets to 100%
  2. Cost of subsidising the homeside
  3. Legacy income
  4. Retirement allowances
  5. Donations to the general fund

Some observations:

  • In 2023, the cost of topping up support for under-supported members was £840,000.
  • In 2024, the subsidy for the homeside costs is budgeted to be £310,000. Homeside costs are the costs of running the UK office, mobilisation, finance and communications. These costs, less the subsidy, are shared between the members.
  • Legacies have averaged £975,000 over the last 10 years. We have budgeted £900,000 per year.
  • Retirement allowances were £699,000 in 2023 and are expected to be similar in 2024. Note that these allowances are paid to retired members born before 1954 who have served a minimum of 15 years.
  • General donations fell from £480,000 in 2022 to £380,000 in 2023.

The budgeted deficit for 2024 is £707,000. This is a concern as we cannot continue with a deficit of more than £600,000 for more than a year or two. Otherwise, it will have the effect of depleting our reserves below a safe level. Over the next five years, we need to return to break even.

The below graph shows Reserves held over the last 13 years. The Reserves figure of £3,778,000 at 31 December 2023 is healthy, but is likely to reduce significantly over the coming 3 years due to the expected annual deficits. (Note that the 2023
figures are draft. They have not yet been checked by the auditors.)

If you have any questions about this report, or OMF (UK)’s finances in general, please don’t hesitate to get in touch with me using the details below.

Please join us in prayer for our finances

  • Praise God for his provision for OMF (UK) over many years and pray for continued provision for our work with the peoples of East Asia.
  • Pray for increased support to cover for the costs of each OMF worker.
  • Please pray for wisdom for the Trustees to plan how best to reduce the annual deficit.

James Niblet
Director for Finance & Corporate Services
james.niblett@omfmail.com

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