The ARP Charitable Investment Program
|Helping Churches & Agencies fulfill their fiduciary & faithful stewardship responsibilities|
The ARP Investment Program is a low cost, expertly managed investment option for ARP churches and agencies that are seeking investment solutions for their contributed funds. The purpose of the Investment Program is to create an investment option for the people who are responsible for the ARP churches’ and ARP agencies’ funds while removing the administrative burden of day to-day management of these funds from the local church or agency.
As of December 2015, over $20 million value in endowments, permanent funds, and other assets under management were invested in the program which is overseen by the Investment Committee of General Synod. The program was created in 2005 for the sole purpose of handling investments for the denomination and its related entities.
The investment advisor to the ARP Investment Program is Cornerstone Management, Inc. (CMI) based near Atlanta, GA. CMI was founded in 1991 by a team of professionals to provide an independent turn-key solution to Christian non-profit organizations seeking to outsource their asset management and deferred gift administration. Since its founding, Cornerstone has also provided high quality management services and solid returns to ARP trusts and annuities programs. CMI has over $700 million under management and delivers enhanced services through the close coordination of its investment consulting and deferred gift administration teams.
All funds invested through Cornerstone are governed by the Investment Committee of Synod which meets quarterly to determine results, costs, utility, strategies, fund selection and investment fund model allocations.
The Investment Program offers passive indexed (ETF) and active mutual fund options to individual account holders based on aggregate amounts invested. The blended value of our accounts allows all investors to participate in a specially negotiated lower annual investment advisory fee of 44 bps (0.44%) based on current asset levels in the Program. Asset manager expenses (please refer to page 14 in the Risk Questionnaires) are additional & vary based on allocation model.
The following features and services of the ARP Investment Program are very helpful to the trustees and boards of member churches and agencies as they fulfill their fiduciary and faithful stewardship responsibilities.
We acknowledge that information about your finances is critical to operating your church/agency and carrying out your duties. In addition to the investment options, the Investment Program provides account access online.
Along with reporting, the Investment Program generates distributions on a schedule that meets the church’s/agency’s budget planning needs. The amount distributed is determined by the account holders and can be a percentage of total assets, a fixed dollar amount, or the amount may vary depending on the account holder’s more immediate needs. You can also choose to reinvest all earnings and not take a distribution. This feature helps churches and agencies comply with restrictions on distributions as imposed by benefactors, boards, and/or trustees.
Contributions & New Investments
Additions to current investments and the creation of new funds can occur at any time during the month. Once new or additional funds are received by Cornerstone, they are generally invested and put to work within 72 hours. The funds are valued daily.
The investment strategy of each model is governed by an investment policy which is approved by the Investment Committee annually. This policy places important restrictions on the range of available asset classes for each model, limits the portfolio to liquid assets only, and provides guidelines for the selection and review of the investment funds selected to participate in the Investment Program. A copy of the Investment Policy is available
The annual investment advisory fee charged to each participant is currently .44% of the asset balance for that participant. Fees are billed quarterly based on the previous quarter-end balance. For this reasonable fee, each subaccount gains governance over their funds via the Investment Policy, tactical asset allocation strategy overseen by the Investment Committee, investment fund research and selection led by Cornerstone, access to funds with higher investment minimums, and reporting on the subaccount level. If comparing to another program, you will also need to consider the manager fees, trading costs, as well as the additional oversight and access
|Access to Funds|
Account holder access to funds is not restricted by Synod, the Investment Committee, or investment professionals. Contributions to and distributions from these accounts are open at all times. There are no entry or exit fees. It should be understood that market timing, especially over the short term, can be counterproductive in achieving best returns when investing in equities and fixed income instruments. There is volatility and risk in these investment areas, just as there is opportunity and/or comfort in knowing that intermediate and long-term results should be favorable when compared to alternatives. Emphasis is placed on the intermediate and long-term results in achieving favorable returns, often referring to horizons of three to five years or longer. Therefore, this program is designed for intermediate or long-lived funds where corpus is to be preserved or grown over a multiyear horizon.
|Investment Options: (As of April 2015)*|
The ARP Investment Program offers four options:
1. Model B: Conservative Allocation of 20% equities and 80% fixed income and cash;
2. Model C: Moderate Allocation of 45% equities and 55% fixed income and cash;
3. Model D: Moderate Aggressive Allocation of 65% equities and 35% fixed income and cash; and
4. Model E: Aggressive Allocation of 80% equities and 20% fixed income and cash.
Passively Managed ETF Models are open to aggregate constituent assets over $20,000, but under $250,000 ($20,000 minimum)
Actively Managed Mutual Fund Models are open to aggregate constituent assets over $250,000 (or may choose Passive Models).
*Note: Allocations may change as Synod Investment Committee deems appropriate for financial market conditions and trends.
|Timely financial information critical for smooth operations and good stewardship!|
The four options allow participants to look at the investment needs of each endowment and permanent fund of the church/agency and select the allocation that best meets each fund’s investment goals and needs.
An example might better illustrate what we mean:
A church has three Investment Programs – cemetery, scholarship, and building. The cemetery fund must preserve the value of the invested assets and generate income for the care and upkeep of the cemetery. Therefore, either the Conservative (B) or Moderate Allocation (C) may be the right choice.
The scholarship fund, on the other hand, needs to grow and generate funds from income and revenue appreciation for the annual award to a deserving student. In this case, the Moderate (C) or Moderate Aggressive (D) Allocation Fund might be better.
Finally, the building fund is a reserve set aside for a planned renovation and expansion effort in five or more years, so the Moderate Aggressive (D) allocation might be best. The best fund will depend on the situation of the participant including risk tolerance and investment time horizon.
Ministry Advised Fund Application – Church/Presbytery/Agency (Download PDF).
ARP Investment Program Brochure (Download PDF)
Passive Style Risk Questionnaire (Download PDF)
Active Style Risk Questionnaire (Download PDF)
Distribution Request Form (Download DOCX)
Current Proformas and Trailing Data – Please contact the ARP Center
For further information, contact:
ARP Investment Committee
c/o Roger Wiles ARP Center
918 S Pleasantburg Drive Ste 127, Greenville, SC 29607