Analysis of the 2016 Audited Financial Statements for Sovereign Grace Churches, Inc.

Churches in Sovereign Grace are required to give 10% of their income to the denomination.  In addition, Sovereign Grace raises funds from individual church members.  They also rely on significant income from product sales and the institutional royalties those sales generate. 

The year 2008 was a banner year.  By 2011, Sovereign Grace Ministries was in serious decline.  In 2015, it hit bottom.  In 2016, total revenues increased by $212,248 due to church contributions while individual contributions, sales and royalties were down for the eighth consecutive year due to a loss of trust and interest. 

Moreover, you will notice that one donor was responsible for 91% or 305k of the individual contributions.  Everyone else gave 23k combined.  Very few members are giving to SGCI.  Also, the total revenue of 2.5 million in 2016 is 69% less than the total revenue of 8.2 million in 2008.  

The following information comes from the Audited Financial Statements produced by the accounting firm, Aronson LLC.  The 2016 audit can be found here.  

2008
Contributions - churches             3,540,660               
Contributions - individuals           1,987,532
Sales & royalties                          1,141,701
Total revenue                               8,281,395  

2011
Contributions - churches              3,154,438               
Contributions - individuals            1,611,821
Sales & royalties                             688,542
Total revenue                               6,722,438
 
2015
Contributions - churches              1,173,606               
Contributions - individuals               385,123
Sales & royalties                             504,624
Total revenue                               2,331,498
 
2016
Contributions - churches               1,352,101               
Contributions - individuals                333,599 (305k came from one donor, cf. note 8, p. 16)
Sales & royalties                              456,733
Total revenue                                2,543,746 
 
The reader may also be interested in My Appeal to Aronson LLC to Carefully Audit Sovereign Grace Churches, Inc. for Fraud, Private Inurement, & the Illegal Use of Funds.  

Anyone giving to SGCI should be forewarned the leadership cannot be trusted to raise or use monies properly based on their history and they refuse to release any information about executive salaries and benefits.  That was not always the case. 

During my 25-year tenure on the Board of Directors, we had a policy of sharing that information with anyone who asked including a newspaper like The Washington Post.  It changed in 2011 when I asked C.J. Mahaney and Tommy Hill (Director of Finance) about C.J.'s compensation package.  See The Need for an Independent Board of Directors & Financial Accountability (August 8, 2011).  I wrote the followng at the time.  It is still true today.

"I never heard back from Tommy or the Board.  This type of scenario has played out time and again with C.J. and the Directors.  Promises are made and then broken without explanation.  Policy is concealed or conveniently changed.  Questions requiring accountable answers are ignored or never answered.  All the polity changes in the world at SGM cannot make up for a lack of integrity and genuine transparency."

Audited statements are helpful but they reveal little about the details behind the numbers which tell you the real story.  A "clean" audit does not mean a "clean" operation.  In 2013, Sovereign Grace received a clean audit.  That same year they set up an illegal "hush fund."  Read Hush Fund Set Up by Top SGM Leaders to Meet the Demands of a SGM Pastor Whose Son Was Sexually Abused.