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THE CATHOLIC COMMUNITY FUND OF THE ARCHDIOCESE OF BOSTON, INC. AND THE CATHOLIC HEALTH FOUNDATION OF GREATER BOSTON, INC. COMBINING FINANCIAL STATEMENTS JUNE 30, 2019 AND 2018

THE CATHOLIC COMMUNITY FUND OF THE ARCHDIOCESE OF BOSTON, INC. AND THE CATHOLIC HEALTH FOUNDATION OF GREATER BOSTON, INC. Contents June 30, 2019 and 2018

Pages Independent Auditor's Report ......................................................................................................... 1 - 1A Combining Financial Statements:

Combining Statements of Financial Position ............................................................................... 2 - 3 Combining Statements of Activities ............................................................................................. 4 - 5 Combining Statements of Changes in Net Assets ........................................................................ 6 Combining Statements of Cash Flows .......................................................................................... 7 Notes to Combining Financial Statements ................................................................................... 8 - 24

Supplemental Schedule – Inspiring Hope Campaign .................................................................... 25

Independent Auditor’s Report To the Boards of Trustees of The Catholic Community Fund of the Archdiocese of Boston, Inc. and The Catholic Health Foundation of Greater Boston, Inc.: Report on the Combining Financial Statements We have audited the accompanying combining financial statements of The Catholic Community Fund of the Archdiocese of Boston, Inc. and The Catholic Health Foundation of Greater Boston, Inc. (Massachusetts corporations, not for profit), which comprise the combining statements of financial position as of June 30, 2019 and 2018, and the related combining statements of activities, changes in net assets and cash flows for the years then ended, and the related notes to the combining financial statements. Management’s Responsibility for the Combining Financial Statements Management is responsible for the preparation and fair presentation of these combining financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of combining financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on these combining financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the combining financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the combining financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the combining financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the combining financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the combining financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the combining financial statements referred to above present fairly, in all material respects, the combining financial position of The Catholic Community Fund of the Archdiocese of Boston, Inc. and The Catholic Health Foundation of Greater Boston, Inc. as of June 30, 2019 and 2018, and the changes in their net assets and their cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

50 Washington Street Westborough, MA 01581 508.366.9100 aafcpa.com

A

Report on Supplementary Information Our audits were conducted for the purpose of forming an opinion on the combining financial statements as a whole. The accompanying supplementary information shown on page 25 is presented for purposes of additional analysis and is not a required part of the combining financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the combining financial statements. This information is solely for additional analysis and is not a required part of the basic combining financial statements, this information has not been subjected to the auditing procedures applied in the audit of the basic combining financial statements and, accordingly, we provide no assurance and have not expressed an opinion on it. Westborough, Massachusetts October 16, 2019

THE CATHOLIC COMMUNITY FUND OF THE ARCHDIOCESE OF BOSTON, INC. ANDTHE CATHOLIC HEALTH FOUNDATION OF GREATER BOSTON, INC.

Combining Statement of Financial PositionJune 30, 2019

Catholic CatholicCommunity Health

Fund Foundation Total

Cash and cash equivalents 8,431,999$ 20,061$ 8,452,060$ Interest and dividends receivable 519,406 120,995 640,401 Contributions receivable, net 33,508,920 - 33,508,920 Accounts receivable 8,893 - 8,893 Investments 52,501,577 11,487,584 63,989,161 Funds held for others 4,642,050 - 4,642,050 Assets held under split-interest agreements 1,425,812 - 1,425,812 Beneficial interest in charitable remainder trusts 1,738,807 - 1,738,807

Total assets 102,777,464$ 11,628,640$ 114,406,104$

Liabilities and Net Assets

Liabilities:Funds held for others 4,642,050$ -$ 4,642,050$ Accrued expenses 1,274,198 - 1,274,198 Annuity obligations 865,429 41,404 906,833 Due to related organizations 4,937,317 17,236 4,954,553

Total liabilities 11,718,994 58,640 11,777,634

Net Assets:Without donor restrictions (2,398,224) (26,058) (2,424,282) With donor restrictions 93,456,694 11,596,058 105,052,752

Total net assets 91,058,470 11,570,000 102,628,470

Total liabilities and net assets 102,777,464$ 11,628,640$ 114,406,104$

Assets

The accompanying notes are an integral part of the combining financial statements. Page 2


Combining Statement of Financial PositionJune 30, 2018


Assets Fund Foundation Total

Cash and cash equivalents 10,091,490$ 24,191$ 10,115,681$ Interest and dividends receivable 535,249 124,294 659,543 Contribution receivable, net 24,471,963 - 24,471,963 Accounts receivable 15,891 - 15,891 Investments 53,097,808 11,747,192 64,845,000 Funds held for others 3,791,020 - 3,791,020 Assets held under split-interest agreements 1,072,906 - 1,072,906 Beneficial interest in charitable remainder trusts 1,241,814 - 1,241,814

Total assets 94,318,141$ 11,895,677$ 106,213,818$

Liabilities and Net Assets

Liabilities: Funds held for others 3,791,020$ -$ 3,791,020$ Accrued expenses 2,647,293 - 2,647,293 Annuity obligations 782,172 42,730 824,902 Due to related organizations 3,184,272 18,862 3,203,134

Total liabilities 10,404,757 61,592 10,466,349

Net Assets:Without donor restrictions (93,794) (23,251) (117,045) With donor restrictions 84,007,178 11,857,336 95,864,514

Total net assets 83,913,384 11,834,085 95,747,469

Total liabilities and net assets 94,318,141$ 11,895,677$ 106,213,818$



Combining Statement of ActivitiesFor the Fiscal Year Ended June 30, 2019



Changes in Net Assets without Donor Restrictions: Revenue, Gains and Other Support:

Interest and dividend income $ 88,886 $ 352 89,238$ Change in value of split-interest agreements 586 (3,159) (2,573) Net assets released through satisfaction of program restrictions 22,532,349 816,291 23,348,640

Total revenue, gains and other support 22,621,821 813,484 23,435,305

Expenses:Program grants - Inspiring Hope Campaign 19,631,384 - 19,631,384 Program grants - other 2,240,392 745,626 2,986,018 Administrative fees - Inspiring Hope Campaign 2,735,738 - 2,735,738 Administrative fees - other 314,399 70,665 385,064

Total expenses 24,921,913 816,291 25,738,204

Changes in net assets without donor restrictions from operations (2,300,092) (2,807) (2,302,899)

Non-Operating Loss: Net realized and unrealized loss on investments (4,338) - (4,338)

Changes in net assets without donor restrictions (2,304,430) (2,807) (2,307,237)

Changes in Net Assets with Donor Restrictions: Contributions - Inspiring Hope Campaign 29,382,577 - 29,382,577 Interest and dividend income 2,036,902 470,175 2,507,077 Contributions - other 1,167,352 206,267 1,373,619 Change in value of split-interest agreements (139,168) - (139,168) Net realized and unrealized loss on investments (465,798) (121,429) (587,227) Net assets released through satisfaction of program restrictions (22,532,349) (816,291) (23,348,640)

Changes in net assets with donor restrictions 9,449,516 (261,278) 9,188,238

Total changes in net assets 7,145,086$ (264,085)$ 6,881,001$



Combining Statement of ActivitiesFor the Fiscal Year Ended June 30, 2018



Changes in Net Assets without Donor Restrictions: Revenues, Gains and Other Support:

Interest and dividend income $ 82,994 $ 260 83,254$ Change in value of split-interest agreements - 13,623 13,623 Net assets released through satisfaction of program restrictions 9,874,909 736,125 10,611,034

Total revenues, gains and other support 9,957,903 750,008 10,707,911

Expenses:Program grants - Inspiring Hope Campaign 7,152,855 - 7,152,855 Program grants - other 1,981,961 662,198 2,644,159 Administrative fees - Inspiring Hope Campaign 3,750,459 - 3,750,459 Administrative fees - other 320,889 73,927 394,816 Other 2,480 - 2,480

Total expenses 13,208,644 736,125 13,944,769

Changes in net assets without donor restrictionsfrom operations (3,250,741) 13,883 (3,236,858)

Non-Operating Gain: Net realized and unrealized gain on investments 27,679 - 27,679

Changes in net assets without donor restrictions (3,223,062) 13,883 (3,209,179)

Changes in Net Assets with Donor Restrictions: Contributions - Inspiring Hope Campaign 39,526,015 - 39,526,015 Interest and dividend income 2,081,055 481,448 2,562,503 Contributions - other 250,760 173,637 424,397 Change in value of split-interest agreements (4,487) - (4,487) Net realized and unrealized gain on investments 1,867,623 434,059 2,301,682 Net assets released through satisfaction of program restrictions (9,874,909) (736,125) (10,611,034)

Changes in net assets with donor restrictions 33,846,057 353,019 34,199,076

Total changes in net assets 30,622,995$ 366,902$ 30,989,897$



Combining Statements of Changes in Net AssetsFor the Fiscal Years Ended June 30, 2019 and 2018



Net Assets Without Donor Restrictions, June 30, 2017 3,129,268$ (37,134)$ 3,092,134$

Changes in net assets (3,223,062) 13,883 (3,209,179)

Net Assets Without Donor Restrictions, June 30, 2018 (93,794) (23,251) (117,045)

Changes in net assets (2,304,430) (2,807) (2,307,237)

Net Assets Without Donor Restrictions, June 30, 2019 (2,398,224)$ (26,058)$ (2,424,282)$

Net Assets With Donor Restrictions, June 30, 2017 50,161,121$ 11,504,317$ 61,665,438$

Changes in net assets 33,846,057 353,019 34,199,076

Net Assets With Donor Restrictions, June 30, 2018 84,007,178 11,857,336 95,864,514

Changes in net assets 9,449,516 (261,278) 9,188,238

Net Assets With Donor Restrictions, June 30, 2019 93,456,694$ 11,596,058$ 105,052,752$



Combining Statements of Cash FlowsFor the Fiscal Years Ended June 30, 2019 and 2018

Catholic Catholic Catholic CatholicCommunity Health Community Health

Fund Foundation Total Fund Foundation TotalOperating Activities:

Changes in net assets 7,145,086$ (264,085)$ 6,881,001$ 30,622,995$ 366,902$ 30,989,897$ Adjustments to reconcile changes in net assets to net increase

(decrease) in cash from operating activities:Net realized and unrealized (gains) losses on investments 470,136 121,429 591,565 (1,895,302) (434,059) (2,329,361) Change in discount on contributions receivable 49,291 - 49,291 1,228,510 - 1,228,510 Change in allowance for uncollectible accounts 279,493 - 279,493 776,026 - 776,026 Endowment contributions (3,862,649) - (3,862,649) (2,764,474) - (2,764,474) Change in value of split-interest agreements and beneficial

interest in charitable remainder trust 138,582 - 138,582 4,487 - 4,487 Changes in operating assets and liabilities:

Contributions receivable (9,365,741) - (9,365,741) (26,476,499) - (26,476,499) Interest and dividends receivable 15,843 3,299 19,142 (36,524) (5,948) (42,472) Accounts receivable 6,998 - 6,998 8,542 - 8,542 Accrued expense (1,373,095) - (1,373,095) 2,647,293 - 2,647,293 Annuity obligations 189,262 3,159 192,421 124,932 (13,623) 111,309 Due to related organizations 1,753,045 (1,626) 1,751,419 3,107,942 1,976 3,109,918

Net increase (decrease) in cash from operating activities (4,553,749) (137,824) (4,691,573) 7,347,928 (84,752) 7,263,176

Investing Activities: Net change in investments held under split-interest agreements and

beneficial interest in charitable remainder trusts (988,481) - (988,481) 72,436 - 72,436 Payments to annuitants (106,005) (4,485) (110,490) (100,025) (5,136) (105,161) Proceeds from sale of investments 910,834 817,917 1,728,751 760,155 733,205 1,493,360 Purchase of investments (784,739) (679,738) (1,464,477) (1,173,204) (647,142) (1,820,346)

Net increase (decrease) in cash from investing activities (968,391) 133,694 (834,697) (440,638) 80,927 (359,711)

Financing Activities:Endowment contributions 3,862,649 - 3,862,649 2,764,474 - 2,764,474

Net Change in Cash and Cash Equivalents (1,659,491) (4,130) (1,663,621) 9,671,764 (3,825) 9,667,939

Cash and Cash Equivalents:Beginning of year 10,091,490 24,191 10,115,681 419,726 28,016 447,742

End of year 8,431,999$ 20,061$ 8,452,060$ 10,091,490$ 24,191$ 10,115,681$

2019 2018


THE CATHOLIC COMMUNITY FUND OF THE ARCHDIOCESE OF BOSTON, INC. AND THE CATHOLIC HEALTH FOUNDATION OF GREATER BOSTON, INC. Notes to Combining Financial Statements June 30, 2019 and 2018

Page 8

1. NATURE OF ORGANIZATION

Catholic Community Fund The Catholic Community Fund of the Archdiocese of Boston, Inc. (the “Fund” or “Catholic Community Fund”) was organized as the Third Century Fund under Massachusetts law on November 15, 1989, and renamed The Catholic Foundation of the Archdiocese of Boston, Inc. (the “Catholic Foundation”) in preparation for the Promise for Tomorrow Campaign in 2000. It was renamed The Catholic Community Fund of the Archdiocese of Boston, Inc. in July 2011. The purpose of the Catholic Foundation was to receive, manage, and distribute gifts and certain bequests principally on behalf of various Catholic organizations within the Archdiocese of Boston (the “Archdiocese”). During fiscal year 2010, the Roman Catholic Archbishop of Boston, A Corporation Sole (the “Corporation Sole”) reorganized the fundraising and development efforts of the Archdiocese. As part of the reorganization, the Archdiocese created Boston Catholic Development Services, Inc. (BCDS), which assumed development efforts of funds for the Corporation Sole and certain development efforts for other related organizations within the Archdiocese. The purpose of the Fund is to develop institutional support, both by way of raising funds for endowment and other sources of financial support, in order to advance the ministries and programs of the Archdiocese and to receive gifts and bequests, whether with or without donor restrictions, endowment or non-endowment, and to manage and expend all such funds consistent with their purposes and the charitable intent of the donor. In so doing, the Fund is helping to fulfill and support the mission of the Archdiocese. During fiscal year 2018, the Fund assumed the responsibility to receive, manage, and distribute gifts related to the Inspiring Hope Campaign for the Archdiocese of Boston (see Note 8). In accordance with the by-laws of the Fund, the Roman Catholic Archbishop of Boston, acting in his capacity as an individual, serves as the Chairman of the Fund. The Corporation Sole serves as the sole member of the Fund. Catholic Health Foundation The Catholic Health Foundation of Greater Boston, Inc. (the “Foundation” or “Catholic Health Foundation”) was organized under Massachusetts law on January 27, 2012. Through a Cy Pres judgment authorized by the Massachusetts Supreme Judicial Court on February 4, 2013, certain endowment and other related funds of the former Caritas Christi Healthcare System were approved for transfer to the Foundation. The transfer of the endowment funds was completed on October 1, 2013. Prior to the transfer of funds, the Foundation had no financial activity. As a requirement of the Cy Pres judgment, the funds received were organized into nine categories of restriction in addition to an unrestricted category (Catholic Health). Those categories include Bereavement, Building/Equipment, Cancer, Education (Medical or Health), Employee Assistance, Hospice, Medical, Pediatric, and Social Needs. The Foundation will award grants related to each category. The purpose of the Foundation is to provide financial support to organizations that provide health care and health care services consistent with the teachings of the Roman Catholic Church within the cities and towns that comprise the Archdiocese of Boston. The Fund serves as the sole member of the Foundation.


Page 9

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Fund and the Foundation’s (collectively, the “Organization”) combining financial statements have been prepared in accordance with generally accepted accounting standards and principles (U.S. GAAP) established by the Financial Accounting Standards Board (FASB). References to U.S. GAAP in these notes are to the FASB Accounting Standards Codification (ASC). Adoption of New Accounting Standard In fiscal year 2019, the Organization adopted FASB’s Accounting Standards Update (ASU) 2016-14, Not-for-Profit Entities (Topic 958): Presentation of Financial Statements of Not-for-Profit Entities. In addition to changes in terminology used to describe categories of net assets throughout the financial statements, new disclosures were added regarding liquidity and the availability of resources, and functional allocation of expenses. The amendments in ASU 2016-14 have been adopted and applied by the Organization on a retrospective basis. However, the Organization has elected the permitted option to omit the following information for fiscal year 2018:

• Disclosures about liquidity and availability of resources • Analysis of expenses separately for both natural and functional classification

The financial statements for the fiscal year ended June 30, 2018 have been restated to reflect the net asset classifications required by ASU 2016-14. Net assets classified previously as unrestricted are now reported as net assets without donor restrictions and temporarily or permanently restricted net assets are now reported as net assets with donor restrictions. Principles of Combination The accompanying combining financial statements include the activities of the Fund and the Foundation. There were no intercompany transactions as of or for the years ended June 30, 2019 and 2018. Use of Estimates The preparation of combining financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the combining financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include the allowance for uncollectible accounts, the fair value of investments which are not traded in active markets and life expectancies for charitable gift annuities and charitable remainder trusts. Actual results could vary from those estimates.


Page 10

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Combining Financial Statement Presentation The Organization classifies net assets and changes in those net assets based on the existence or absence of donor-imposed restrictions, either explicit or implicit. Accordingly, net assets of the Organization and changes therein are classified and reported as follows:

Net assets without donor restrictions - Assets and contributions that are not restricted by the donor or for which restrictions have expired. Net assets with donor restrictions - Net assets subject to donor-imposed restrictions that permit the Organization to use or expend the donated assets as specified and which are satisfied by either the passage of time or by actions of the Organization. Endowment corpus net assets are subject to donor-imposed stipulations that they be maintained in perpetuity by the Organization. Generally, the donors of these assets permit the Organization to use, all or in part, the income earned on the underlying assets for general or specific purposes. Unexpended appreciation on endowment corpus net assets is classified as net assets with donor restrictions. Interest and dividends on endowment corpus net assets are classified as net assets with donor restrictions until they are distributed to the beneficiary organization, which is generally within the same year earned.

Net assets with donor restrictions consist of the following at June 30:

2019 2018

Catholic Community Fund: Subject to expenditure for specified purposes:

Inspiring Hope Campaign purpose restricted $ 33,371,736 $ 29,146,657 Purpose restricted - other 7,082,014 6,149,488 Charitable remainder trusts 96,509 93,246 40,550,259 35,389,391

Subject to the Fund’s endowment spending policy and appropriation:

Appreciation and unspent earnings on endowments

11,363,494

11,932,849

Endowment corpus 41,542,941 36,684,938

Total net assets with donor restrictions

$ 93,456,694 $ 84,007,178

Catholic Health Foundation: Subject to expenditure for specified purposes $ 1,938,126 $ 2,043,742

Subject to the Foundation’s endowment spending policy and appropriation:

Appreciation and unspent earnings on endowments Endowment corpus

1,006,300

8,651,632

1,161,962

8,651,632

Total net assets with donor restrictions

$ 11,596,058 $ 11,857,336


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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Cash and Cash Equivalents The Organization considers investments with original maturities of three months or less at purchase to be cash and cash equivalents. The Organization maintains the majority of its cash balances with the Revolving Loan Fund of the Corporation Sole (the Revolving Loan Fund). The Revolving Loan Fund provides a guaranteed interest rate to its members, which is intended to be higher than the rate that can be obtained at a commercial bank. These deposits are not insured against losses. They are available for withdrawal on a daily basis.

Investments

The Organization’s investments are carried at fair value (see Note 6). Changes in fair value are reflected in the accompanying combining statements of activities as net realized and unrealized gain (loss) on investments and change in value of split-interest agreements. Interest and dividend income are recorded when earned or declared.

Investments represent the Organization’s unit holdings in the Common Investment Fund, Roman Catholic Archbishop of Boston (the “Common Investment Fund”), and a separate related organization established to provide a common investment pool in which the Organization and other related organizations may participate. The Common Investment Fund invests nearly all of its funds in the RCAB Collective Investment Partnership (the “Investment Partnership”); the underlying investments of which are primarily equity and fixed-income securities (U.S. Government and agency securities, asset-backed securities and corporate bonds) owned either directly or indirectly through mutual funds and private investment entities. The fair value of the Investment Partnership’s investments in actively traded domestic securities is determined by State Street Corporation. Securities listed on a securities exchange for which market quotations are readily available are valued at the last sales price or official closing price on each business day, or, if there is no such reported sale or official closing price, at the most recent quoted bid price. Securities which are primarily traded on foreign exchanges are generally valued at the preceding day's closing values of such securities on their respective exchanges and those values are then translated into U.S. dollars at the current exchange rate. Investments in traded foreign securities are valued by State Street Corporation at the mean between bid and asked prices. For those securities whose prices are not available through independent pricing services, bid price quotations are obtained by State Street Corporation from principal market makers in those securities or at fair value as determined in good faith by management. Investment holdings of private investment entities that are not actively traded are valued by the managers of these entities at the NAV per share. In accordance with such guidance, as a practical expedient, the Investment Partnership has the ability to measure the fair value of an investment in an investee based on the investee’s NAV per share or its equivalent. At June 30, 2019 and 2018, securities whose prices were not available through independent pricing services were limited to less than 16%, of the total assets of the investment fund.

Assets held under split-interest agreements consist of funds received under charitable gift annuities with the Organization having sole investment authority and are invested in cash and balanced mutual funds (equity and fixed-income) at June 30, 2019 and 2018.


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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Contributions and Contributions Receivable

Unconditional promises to give are reported as contributions receivable at net realizable value on the date the promise is verifiably committed. Unconditional promises to give that are expected to be collected within one year are recorded at net realizable value and those that are expected to be collected in future years are recorded at the present value of their estimated future cash flows. The discounts on those amounts are computed using the Fund's average borrowing rate. Amortization of discounts is classified as contributions revenue. Conditional promises to give are not included as support until the conditions are substantially met.

Contributions received by the Organization are recorded as revenue and are primarily for related Catholic organizations within the geographic territory of the Archdiocese of Boston. The Organization and these ultimate beneficiaries meet certain criteria under U.S. GAAP, permitting the Organization to recognize all contributions received as revenue. The Organization reports gifts of cash and other assets as restricted support if they are restricted as to purpose or time. When a donor restriction expires, that is when a stipulated time restriction ends or purpose restriction is accomplished, net assets with donor restriction are reclassified to net assets without donor restrictions and reported in the combining statements of activities as net assets released from restrictions. Charitable Gift Annuities The Organization records contribution revenue derived from charitable gifts based on the fair value of the assets associated with the instrument and the present value of the amount expected to be paid to beneficiaries under the arrangement. This requires the use of life expectancy estimates and discounting of cash flows in determining the amount to be recorded. In computing present value of annuity payments, the Organization has used a 3% discount rate as of June 30, 2019 and 2018. If the Organization has control over the assets associated with the gift annuity, the assets and the liability associated with obligations under the instrument are recorded on a gross basis. If third parties control the assets associated with the gift annuity, only the present value of the net amount expected to be received is recorded as an asset.

Agency Agreement The Corporation Sole appointed the Fund as its agent to administer endowments. The Fund has recorded these endowments as funds held for others in the accompanying combining statements of financial position. Donors of other endowments amended their gift agreements to designate the Fund as the organization to hold, manage and administer the endowments as agent for the Fund for Catholic Schools, Inc. The Fund has included those endowments as funds held for others in the accompanying combining statements of financial position.


Page 13

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Allowance for Uncollectible Accounts and Contributions Receivable

The allowance for uncollectible accounts and contributions is determined to approximate the portion of accounts and contributions receivable which will not be ultimately collected. The estimate made by management is based on a review of overdue accounts and projected total future collections based on historical experience. The allowance represents an estimate, and actual uncollected accounts may vary significantly from the amount currently recorded with adjustments to be recorded in the period they become known. Contributions receivable are written off based either upon donor cancellation or a time lapse without donor activity. During the years ending 2019 and 2018, the Fund recorded an allowance for uncollectible contributions receivable of approximately $1,036,000 and $757,000, respectively.

Concentration of Credit Risk The Organization’s financial instruments that are subject to concentrations of credit risk consist primarily of cash and cash equivalents and investments. Cash deposited with the Revolving Loan Fund (see page 11) is uninsured. Investments are also uninsured and are subject to ongoing market fluctuations.

Income Taxes The Fund and the Foundation are included in the United States Conference of Catholic Bishops’ Group Ruling and in the Official Catholic Directory and are therefore exempt from income tax under Section 501(c)(3) of the Internal Revenue Code (IRC). The Fund and the Foundation follow guidance recognizing the financial statement benefit of a tax position only after determining that the relevant tax authority would more-likely-than-not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the combining financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. The Fund and the Foundation’s management have reviewed the tax positions for open periods and determined that no provision for income tax is required in the Fund and the Foundation’s combining financial statements. The Foundation is required to file an annual Form 990 with the Massachusetts Attorney General’s Office. During fiscal year 2018, the Fund elected to and filed an annual Federal Form 990 with the IRS and related Massachusetts filing. The Fund’s returns are subject to examination by Federal and Massachusetts jurisdictions.

The Fund and the Foundation accounts for uncertainty in income taxes in accordance with ASC Topic, Income Taxes. This standard clarifies the accounting for uncertainty in tax positions and prescribes a recognition threshold and measurement attribute for the combining financial statements regarding a tax position taken or expected to be taken in a tax return. The Fund and the Foundation have determined that there are no uncertain tax positions which qualify for either recognition or disclosure in the combining financial statements at June 30, 2019 and 2018. Subsequent Events Subsequent events have been evaluated through October 16, 2019, which is the date the combining financial statements were available to be issued. There were no events that met the criteria for recognition or disclosure in the combining financial statements.


Page 14

3. CONTRIBUTIONS RECEIVABLE

Contributions receivable consisted of the following at June 30: 2019 2018

Amounts due within: One year $ 1,114,390 $ 5,394,283 Two years 9,338,914 5,884,057 Three years 8,858,680 5,384,057 Four years 8,636,990 5,384,057 Five years 5,919,875 4,288,821 Over five years 1,927,944 95,777 35,796,793 26,431,052 Less - unamortized discount (1,251,515) (1,202,224) Allowance for uncollectible accounts

(1,036,358) (756,865)

Net contributions receivable $ 33,508,920 $ 24,471,963

The average rate used to discount contributions receivable was 2.5% as of June 30, 2019 and 2018.

4. ENDOWMENTS

The Fund’s endowment consists of 101 individual funds established for the support of various Catholic organizations within the Archdiocese of Boston. As required by U.S. GAAP, net assets associated with endowment funds are classified and reported based on the existence or absence of donor-imposed restrictions.

The Foundation’s endowment consists of 100 individual funds established for the support of various Catholic Health organizations within the Archdiocese of Boston. The original funds were awarded through a Massachusetts Judicial Court Cy Pres judgment on February 4, 2013. As required by U.S. GAAP, net assets associated with endowment funds are classified and reported based on the existence or absence of donor-imposed restrictions. On October 1, 2013, these funds were transferred to the Foundation. Interpretation of Relevant Law The Organization follows a version of the Uniform Prudent Management of Institutional Funds Act (“UPMIFA”) as enacted by the Commonwealth of Massachusetts. Although UPMIFA offers short-term spending flexibility, the explicit consideration of the preservation of the endowed funds among factors for prudent investment and spending suggests that a donor-restricted endowment fund is still perpetual in nature. As is the case in the current financial environment, there is no guarantee that the amount of an endowed fund’s original gift corpus will remain intact at all times. Under UPMIFA, the Organization is permitted to determine and continue a prudent payout amount, even if the value of the fund is below the “historic-dollar-value”. There is an expectation that, over time, the endowment gift corpus amount will generally remain intact. This perspective is aligned with the accounting standards definition that donor restricted endowment funds are those that must be held in perpetuity even though the historic-dollar-value may be spent on a temporary basis. Any portion of the donor-restricted endowment fund above the original corpus amount is regarded as net appreciation and is classified as net assets with donor restriction until those amounts are appropriated for expenditure by the Organization in a manner consistent with the Organization’s spending policy.


Page 15

4. ENDOWMENTS (Continued)

Funds with Deficiencies From time-to-time, the fair value of assets associated with individual donor-restricted endowment funds may fall below the “historic-dollar-value”. Deficiencies of this nature are reported by a change to net assets with donor restriction. As of June 30, 2019 and 2018, the Fund and the Foundation had no endowment funds that fell below the historic-dollar value. Endowment Investment Policy The Organization has adopted an investment philosophy, which combined with the spending rate, attempts to provide a predictable stream of returns thereby making funds available to programs that are supported by its endowment, while at the same time seeking to maintain the purchasing power of the endowment assets. Endowment assets include those assets of donor-restricted funds that the Organization must hold in perpetuity or for donor-specified periods. Under the Organization’s investment policy and spending rate, both of which are approved by the respective Board of Trustees, the endowment assets are invested in a manner that is intended to produce an inflation-adjusted return in excess of the spending rate over a long period of time. Actual returns in any given year may vary.

Strategies Employed for Achieving Objectives To satisfy its long-term rate-of-return objectives, the Organization relies on a total return strategy in which investment returns are achieved through both capital appreciation (realized and unrealized) and current yield (interest and dividends). From the time when the Fund and the Foundation were organized, the Fund and the Foundation have invested their investment portfolio in the Common Investment Fund, which in-turn invests in the Investment Partnership. The Investment Committee of Corporation Sole’s Finance Council is responsible for selecting the investment managers of the Investment Partnership. The Investment Committee’s investment rationale is to include an array of different strategies and investment managers for the Investment Partnership’s portfolio to reduce overall volatility, while providing investment returns above industry benchmarks. See Note 2 and 6 for more details on the Fund and the Foundation’s investments and how they are valued.


Page 16

4. ENDOWMENTS (Continued) Catholic Community Fund Endowment net asset composition by restriction and change in those net assets as of and for the years ended June 30, 2019 and 2018, are as follows:

With Donor Restrictions

Appreciation on Endowments

Endowment

Corpus

Total Endowment net assets, June 30, 2017

$ 10,392,338

$ 33,823,763

$ 44,216,101

Contributions

-

2,764,474

2,764,474

Clarification of donor intent

(89,485) 89,485 -

Investment return: Investment income 1,868,842 - 1,868,842 Net appreciation

1,783,372 7,216 1,790,588

Total investment return

3,652,214 7,216 3,659,430

Appropriation of endowment assets for operations (draw)

(2,022,218)

-

(2,022,218)

Endowment net assets, June 30, 2018

11,932,849

36,684,938

48,617,787

Contributions

- 4,882,326 4,882,326

Investment return: Investment income 1,827,954 - 1,827,954 Net depreciation

_ (420,170) (24,323) (444,493)


1,407,784 (24,323) 1,383,461


(1,977,139)

-

(1,977,139)


$ 11,363,494

$ 41,542,941

$ 52,906,435


Page 17

4. ENDOWMENTS (Continued)

Catholic Health Foundation Endowment net asset composition by restriction and change in those net assets as of and for the years ended June 30, 2019 and 2018, are as follows:

With Donor Restrictions

Appreciation on Endowments

Endowment

Corpus

Total Endowment net assets, June 30, 2017

$ 865,397

$ 8,651,632

$ 9,517,029

Investment return: Investment income 398,871 - 398,871 Net appreciation

360,150 - 360,150


759,021 - 759,021


(462,456)

-

(462,456)


1,161,962

8,651,632

9,813,594

Investment return: Investment income 288,357 - 288,357 Net depreciation

(93,231) - (93,231)


195,126 - 195,126


(350,788)

-

(350,788)


$ 1,006,300

$ 8,651,632

$ 9,657,932


Page 18

5. NET ASSETS WITH DONOR RESTRICTIONS Catholic Community Fund Net assets with donor restrictions – purpose restricted (including appreciation on endowments) of the Fund were available for the following at June 30:

2019 2018

Inspiring Hope Campaign $ 33,421,736 $ 29,146,657 Corporation Sole 11,042,031 10,682,156 Catholic Community Fund 2,373,721 2,381,813 Cardinal Medeiros Trust 1,408,753 1,522,399 Catholic School Endowments 1,151,295 1,181,721 St. John’s Seminary 916,933 945,850 St. Mary’s High School, Lynn 476,879 499,024 Catholic Charitable Bureau 382,915 216,110 Laboure College 246,189 176,962 Family Counsel and Guidance Center 197,791 204,123 Clergy Retirement Funds 135,395 138,838 Pope St. John XXIII National Seminary 65,692 80,968 St. Elizabeth’s Hospital 18,005 26,796 Knights of the Holy Sepulchre 18,005 26,796 Laboure Center 15,375 15,756 Ste. Jeanne d’Arc School, Lowell 13,275 13,716 Matignon High School 8,038 8,329 Bread for the World Institute 7,203 10,719 iCatholic Media, Inc. 4,844 4,473 Saint John Paul II Catholic Academy 2,799 - Catholic Relief Services 2,544 2,625 Cardinal Spellman High School 1,903 1,962 Trinity Catholic Academy 1,732 1,769 Massachusetts Citizens for Life Charitable Trust 424 230 Habitat for Humanity 276 910 Pope John XXIII High School - 31,538

Total net assets with donor restrictions $ 51,913,753 $ 47,322,240

Net assets were released from donor restrictions by incurring expenses satisfying the restricted purpose or by occurrence of the passage of time or other events specified by the donors as follows for the years ended June 30, 2019 and 2018:

2019 2018

Satisfaction of purpose restrictions: Inspiring Hope Campaign distributions $ 20,548,299 $ 7,843,800 Grants/Other distributions

6,911

8,891

20,555,310 7,852,691 Restricted-purpose endowment spending

distributions and appropriations:

Endowment distributions 1,977,139 2,022,218

Total net assets released from donor restrictions $ 22,532,349 $ 9,874,909


Page 19

5. NET ASSETS WITH DONOR RESTRICTIONS (Continued) Catholic Community Fund (Continued) Donor restricted endowment corpus of the Fund are designated for the following at June 30:

2019 2018 Corporation Sole $ 25,559,424 $ 25,476,393 Inspiring Hope Campaign 6,712,735 2,103,535 St. Agnes High School, Arlington 1,611,575 1,611,575 St. John’s Seminary 1,455,583 1,337,481 Catholic School Endowments 1,067,605 1,067,605 St. Mary’s High School, Lynn 1,000,000 1,000,000 Cardinal Medeiros Trust 988,835 988,835 Pope St. John XXIII National Seminary 924,166 924,166 Catholic Charitable Bureau 815,717 815,717 The Philanthropic Initiative 482,692 482,692 Catholic Community Fund 470,430 438,260 Family Counsel and Guidance Center 224,500 224,500 Saint John Paul II Catholic Academy 135,500 125,000 Pope John XXIII High School 35,645 35,645 Clergy Retirement Funds 21,771 16,771 Laboure Center 10,000 10,000 Matignon High School 10,000 10,000 Massachusetts Citizens for Life Charitable Trust 7,492 7,492 iCatholic Media, Inc. 7,271 7,271 Cardinal Spellman High School 2,000 2,000

Total donor restricted endowments corpus of the Fund

$ 41,542,941

$ 36,684,938

Catholic Health Foundation Net assets with donor restrictions-purpose restricted (including appreciation on endowments) of the Foundation were available for the following at June 30:

2019 2018

Subject to expenditure for specified purpose: Catholic Health $ 1,171,120 $ 1,301,827 Medical 780,425 834,158 Education 436,537 475,498 Employee assistance 235,640 235,640 Cancer 157,306 187,398 Building/equipment 133,303 135,844 Social needs 16,441 20,200 Bereavement 9,500 10,056 Hospice 4,153 5,083

Total net assets with donor restrictions - purpose restricted

$ 2,944,425

$ 3,205,704


Page 20

5. NET ASSETS WITH DONOR RESTRICTIONS (Continued) Catholic Health Foundation (Continued) The Foundation released net assets from restrictions by awarding grants and incurring administrative fees. For purposes of this presentation, the Foundation treats net assets released from time restrictions based on the purpose for which the related funds were used. Donor restricted endowment corpus of the Foundation are designated for the following at June 30:

2019 2018

Medical $ 2,488,240 $ 2,488,240 Catholic Health 2,142,218 2,142,218 Education 1,981,425 1,981,425 Cancer 1,709,565 1,709,565 Social needs 216,912 216,912 Hospice 53,521 53,521 Bereavement 25,000 25,000 Building/equipment 24,509 24,509 Employee assistance 10,242 10,242

Total donor restricted endowment corpus of the Fund

$ 8,651,632

$ 8,651,632

6. FAIR VALUE MEASUREMENTS

The Organization measures the fair values of assets and liabilities as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. A fair value hierarchy is used to prioritize the inputs to valuation techniques used to measure fair value. The Organization classifies its assets and liabilities into Level 1 (securities value using quoted prices from active markets for identical assets), Level 2 (securities not traded on an active market for which observable market inputs are readily available), and Level 3 (securities valued based on significant unobservable inputs). Investments are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.


Page 21

6. FAIR VALUE MEASUREMENTS (Continued) Investments The Organization’s unit holdings in the Common Investment Fund do not have quoted prices in active markets or significant other observable inputs that have quoted market prices, although the Organization can redeem its investments at the Net Asset Value (NAV) per share at June 30, 2019 and 2018. In accordance with ASC Subtopic 820-10, Fair Value Measurements, certain investments that are measured at fair value using the NAV per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the accompanying combining statements of financial position (see Note 2). The Organization estimates the fair value of its unit holdings in the Common Investment Fund based on the Organization’s share of the underlying investment portfolio that consists of actively-traded equities, bonds, private investment entities, mutual funds, and money market funds. There were no unfunded commitments on these investments as of June 30, 2019 and 2018. These investments are available for redemption on a monthly basis. Beneficial Interest in Charitable Remainder Trusts The Organization is not the custodian of the assets and liabilities of the charitable remainder trusts. This recurring fair value measurement has Level 3 inputs and is based on the fair value of the underlying trust assets, measured using quoted prices in active markets, less the present value of future cash flows. There were no unfunded commitments on these investments as of June 30, 2019 and 2018. The beneficial interest in charitable remainder trusts is restricted from redemption for an extended period of time as established by the respective donors under the individual trust agreements. Annuity Obligations Annuity obligations are non-recurring fair value measurements. These instruments are initially recorded at the present value of future cash flows with a discounted rate adjusted for market conditions to determine fair value. Annuity obligations are valued using other observable inputs which are significant to their fair value including age, frequency of distributions, life expectancy, and discount rate. The Organization’s financial assets that are accounted for at fair value on a recurring basis as of June 30, 2019 and 2018, by level within the fair value hierarchy, are presented in the tables on page 22. Financial assets and liabilities measured at fair value on a non-recurring basis, such as contributions receivable and annuity obligations, are excluded from the table.


Page 22

6. FAIR VALUE MEASUREMENTS (Continued)

Catholic Community Fund

2019 Assets

Level 1 Level 2 Level 3 Total

Investments - Common Investment Fund (CIF) *

$ -

$ -

$ -

$ 52,501,577

Funds held for others – CIF * - - - 4,642,050 Investments held under split-

interest agreements – CIF *

-

-

-

1,425,812 Beneficial interest in charitable

remainder trusts

-

-

1,738,807

1,738,807

Total $ - $ - $ 1,738,807 $ 60,308,246

2018 Assets


Investments - Common Investment Fund (CIF) *

$ -

$ -

$ -

$ 53,097,808

Funds held for others – CIF * - - - 3,791,020 Investments held under split-

interest agreements – CIF *

-

-

-

1,072,906 Beneficial interest in charitable

remainder trusts

-

-

1,241,814

1,241,814

Total $ - $ - $ 1,241,814 $ 59,203,548

Catholic Health Foundation

2019 Assets


Investments - Common Investment Fund *

$ -

$ -

$ -

$ 11,487,584

2018

Assets


Investments - Common Investment Fund *

$ -

$ -

$ -

$ 11,747,192

* In accordance with ASC Subtopic 820-10, Fair Value Measurements certain investments that

are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the accompanying combining statements of financial position.


Page 23

6. FAIR VALUE MEASUREMENTS (Continued) The following table discloses a reconciliation of assets measured at fair value on a recurring basis using significant unobservable inputs during the years ended June 30:


Beneficial Interest in Charitable

Remainder Trusts

2019 2018

Beginning Balance, July 1

$ 1,241,814 $ 1,211,548

Contributions 575,296 - Net realized and unrealized (loss) gain

(78,303) 30,266

Ending Balance, June 30 $ 1,738,807 $ 1,241,814

7. RELATED-PARTY TRANSACTIONS

Amounts recorded in contributions revenue include amounts raised by the Organization on behalf of donor-specified beneficiary organizations that are related to the Archdiocese. Distributions to specified affiliates are recorded as expenses upon payment of these amounts.

Effective fiscal year 2014, Corporation Sole and BCDS charge an administrative fee that covers costs directly associated with the accounting, reporting, compliance, management, and administration of the Organization. The fee is based on a percentage of the market value of the endowments at the beginning of the fiscal year. Effective fiscal year 2018, BCDS charges an administrative fee that covers costs directly associated with the management of all aspects of the Inspiring Hope capital campaign (see Note 8) including fundraising and gift administration. Payment terms and related timeline for amounts owed to BCDS are dependent on, and intended to mirror, the collection of contributions over the term of the Inspiring Hope capital campaign. The Organization owes Corporation Sole and BCDS the following amounts as of June 30:


2019

2018

BCDS – Inspiring Hope Campaign Corporation Sole

$ 4,875,210 52,753

$ 3,103,126 54,368

BCDS – other 9,354 26,778 Total

$ 4,937,317

$ 3,184,272

Catholic Health Foundation

2019

2018

BCDS $ 11,549 $ 12,637 Corporation Sole

Total

5,687

$ 17,236

6,225

$ 18,862

THE CATHOLIC COMMUNITY FUND OF THE ARCHDIOCESE OF BOSTON, INC. AND THE CATHOLIC HEALTH FOUNDATION OF GREATER BOSTON, INC.

Notes to Combining Financial Statements June 30, 2019 and 2018

Page 24

8. INSPIRING HOPE CAMPAIGN

The Inspiring Hope Campaign is the first major capital campaign conducted in the Archdiocesesince 2003. Currently in its quiet phase, the Inspiring Hope Campaign is designed to raisesignificant funding for endowments, programs and capital needs to benefit virtually everyinstitution in the Archdiocese including parishes, schools, current and future priests, thereligious, and social services. CCF has raised $29,382,577 and $39,526,015 in conjunction withthe Inspiring Hope Campaign for the years ended June 30, 2019 and 2018, respectively. Accrueddistributions relating to the Inspiring Hope Campaign totaled $1,256,138 and $2,647,293 as ofJune 30, 2019 and 2018, respectively, and are included in accrued expense in the accompanyingcombining statement of financial position.

9. LIQUIDITY

The Fund and Foundation pay all operating expenses from financial assets without donorrestrictions. Inspiring Hope Campaign program grants are disbursed from contributions receivedthat are held in the Revolving Loan Fund. Other program grants consist primarily of distributionsfrom endowments that are subject to investment performance. Administrative fees are accruedbased upon both cash contributions and pledges received. Administrative fees are paid uponthe receipt of funds.

10. FUNCTIONAL EXPENSES

The combining financial statements reflect the expenses of providing grant making, program, and supporting activities, and are summarized in the accompanying combining statements of activities. Supporting function expenses (development and general and administrative) include costs related to the Inspiring Hope Campaign. Development expenses are included in the administrative fees charged by BCDS and include both fundraising and gift administration. Administrative fees are allocated between development and general and administrative based on estimates of employee time and effort.

Expenses by natural and functional classification for the year ended June 30, 2019, are as follows:

Program Develop-

ment

General and Admin- istrative Total

Catholic Community Fund:Program grants $ 21,871,776 $ - $ - $ 21,871,776Inspiring Hope administrative fees - 2,628,295 107,443 2,735,738

Other administrative fees - 220,079 94,320 314,399

Total expenses $ 21,871,776 $ 2,848,374 $ 201,763 $ 24,921,913

Catholic Health Foundation:Program grants $ 745,626 $ - $ - $ 745,626

Other administrative fees - 43,399 28,266 70,665

Total expenses $ 745,626 $ 43,399 $ 28,266 $ 816,291


Supplemental Schedule - Inspiring Hope CampaignFrom Inception of the Campaign through June 30, 2019

Strengthening our Presence

Educating and Inspiring our

ChildrenServing the

Poor

Supporting our Priests and Religious

Building Faith for our Future Donor Pending

General and Administrative Total

Contributions - purpose restricted 20,153,249$ 9,055,674$ 3,646,665$ 9,862,796$ 19,794,559$ 1,660,228$ -$ 64,173,171$ Contributions - corpus endowments - - 2,622,886 1,135,620 976,915 - - 4,735,421 Interest and dividend income 65,947 13,503 4,171 8,694 10,496 4,949 - 107,760 Administrative fees - Inspiring Hope Fund (901,668) (147,755) (114,161) (184,933) (182,014) (79,182) (4,876,484) (6,486,197) Program grants - Inspiring Hope Fund (16,794,075) (1,028,473) (1,073,541) (2,364,101) (5,524,194) - - (26,784,384)

Total net assets available 2,523,453$ 7,892,949$ 5,086,020$ 8,458,076$ 15,075,762$ 1,585,995$ (4,876,484)$ 35,745,771$

Contributions receivable, net 2,057,674$ 6,077,048$ 3,881,310$ 6,676,525$ 14,432,629$ 383,734$ -$ 33,508,920$ Cash and cash equivalents 472,907 1,818,150 820,136 1,815,020 1,754,582 1,203,511 - 7,884,306 Investments - - 475,000 9,000 - - - 484,000 Accounts payable and accrued expenses (7,128) (2,250) (90,426) (42,469) (1,111,448) (1,250) (1,167) (1,256,138) Due to related organizations - - - - - - (4,875,317) (4,875,317)

Total assets 2,523,453$ 7,892,948$ 5,086,020$ 8,458,076$ 15,075,763$ 1,585,995$ (4,876,484)$ 35,745,771$

Mission Allocation

Page 25

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