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Statement of ActivitiesFor the Year Ended December 31, 2019Changes in net assets without donor restrictionsRevenue and other supportContributions, less direct donor benefits of 1,934,575 89,446,173Contributions from meetings and conferences1,653,106Contributions and revenues from foreign affiliated ministries2,083,544In-kind contributions1,210,288Sale of Christian materials3,880,377Women’s conference and other registrations2,153,375Honorariums from speaking engagements60,000Interest income228,080Other income953,379Release of restrictionsTotal revenue and other support without donor restrictions48,378101,716,700Operating expensesProgram servicesMeetings and conferences8,867,896Creative media44,140,925Missions and outreach26,369,323Christian materials distribution5,208,201Total program services expenses84,586,345Support activitiesManagement and general11,042,278Fundraising3,793,074Total support activities expenses14,835,352Total operating expenses99,421,697Change in net assets without donor restrictions2,295,003Contributions with donor restrictions 50,000Release of restrictionsChange in net assets with donor restrictions(48,378)1,622Change in net assets 2,296,625Net assetsBeginning of year44,450,936End of year 46,747,561The accompanying notes are an integral part of these financial statements.December 31, 2019NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED2. Revenue Recognition - Continuedrestrictions if the restrictions expirecontributions are recognized.in the fiscal year in which theNo amounts have been reflected in the statements for donated servicessince no objective basis is generally available to measure the value of suchservices; however, a substantial number of volunteers have donatedsignificant amounts of time to the Church’s program services. During 2019,approximately 22,400 hours were donated from volunteers for meetings andconferences.The Church commonly exchanges educational resources with donors basedon a designated contribution. For the year ended December 31, 2019, the costof these direct donor benefits was approximately 1.9 million. These costs arereported as an offset to contributions in the statement of activities.Registration and sales revenue are recognized at the time services or goodsare provided and the revenues are earned based on satisfaction of theChurch's related performance obligation.Contributions, which include unconditional promises to give (pledges), arerecognized as revenues in the period received. Conditional promises to giveare not recognized until they become unconditional, that is when theconditions have been fulfilled. Contributions of assets other than cash arerecorded at estimated fair value.The Church receives contributions in which a portion of the amount given bydonors represents a share of the direct costs of benefits received by donors.Unless otherwise verified, the fair value of gifts received with an offer isusually measured at the retail price.3. Use of EstimatesThe preparation of financial statements in conformity with accountingprinciples generally accepted in the United States of America requiresmanagement to make estimates and assumptions that affect the reportedjoycemeyer.org/smile 37

Statement of Cash FlowsFor the Year Ended December 31, 2019Cash flows from operating activitiesChange in net assets 2,296,625Adjustments to reconcile change in net assets to net cash provided by (used in) operating activities:Depreciation and amortization expense1,291,406Unrealized and realized gain in investments(375,859)Loss on disposal of property and equipment78,363Changes in operating assets and liabilities:Increase in accounts receivable(175,002)Decrease in pledges receivable48,378Decrease in due from affiliates91,250Increase in inventories(107,133)Increase in prepaid expenses and other assets(196,126)Decrease in accounts payable(1,113,099)Increase in accrued liabilities142,267Decrease in deferred revenues(47,227)Net cash provided by operating activities1,933,843Cash flows from investing activitiesPurchases of certificates of deposit(1,500,000)Proceeds from maturities of certificates of deposit1,492,012Proceeds from sale of investments2,118,992Purchases of investments and other investments(2,700,000)Proceeds from sale of property and equipment54,685Purchases of property and equipment(1,146,412)Net cash used in investing activities (1,680,723)Cash flows from financing activitiesPrincipal payments on capital lease(11,226)Net cash used in financing activitiesNet increase in cash(11,226)241,894Cash and cash equivalents - beginning of yearCash and cash equivalents - end of year11,963,939 12,205,833The accompanying notes are an integral part of these financial statements.NOTES TO FINANCIAL STATEMENTSDecember 31, 2019Note B - Summary Of Significant Accounting Policies - CONTINUED7. Fixed Assets and Depreciation3. Use of Estimates - ContinuedExpenditures and donated fixed assets in excess of 5,000 are recorded at costif purchased or estimated fair market value if donated. Depreciation of fixedassets is provided over the estimated useful lives of the respective assets on astraight-line basis, ranging from 3-40 years. Expenditures for repairs andmaintenance are charged to operating expense as incurred.amounts of assets and liabilities and disclosure of contingent assets andliabilities at the date of the financial statements, and the reported amounts ofrevenues and expenses during the reporting period. Actual results coulddiffer from those estimates.4. Cash and Cash EquivalentsThe Church considers all highly liquid investments with an original maturityof three months or less to be cash equivalents for the purposes of thestatement of cash flows. Deposits in excess of Federal Deposit InsuranceCorporation’s (FDIC) coverage were approximately 8,539,000 atDecember 31, 2019. The Church maintains sufficient cash resources tocover near-term working capital needs.5. Accounts ReceivableAccounts receivable are recognized on the accrual basis of accounting.Management believes these amounts to be fully collectible. Accountsreceivable consists principally of reimbursements and refundsfrom vendors.6. InventoriesInventory consists of books, CD’s, DVD’s and all other related items utilized in themedia operation of the Church. Inventory is valued at the lower of cost or netrealizable value, with cost determined on the first-in first-out basis.38The Church records impairment of property and equipment when it becomesprobable that the carrying value of the assets will not be fully recovered overtheir estimated useful lives. Impairments are recorded to reduce the carryingvalue of the assets to their net realizable value based on facts and circumstancesin existence at the time of the determination. No impairments were recordedduring the year ended December 31, 2019.8. Certificates of Deposit, Investments and Other InvestmentsCertificates of deposit held for investment that are not debt securities are carriedat cost. Interest rates on the certificates of deposit range from 2% to 3.3% atDecember 31, 2019. The certificates of deposit held by the Church as ofDecember 31, 2019 will mature during 2020, 2021 and 2022; although notexpected to occur, the Church has the ability to redeem the certificates prior totheir maturity.Investments consist of investments in mutual funds and a hedge fund and arerecorded at fair value as further described in Note D. Dividend, interest andother investment income, net of fees of approximately 29,000 for the yearended December 31, 2019, is reported in the period earned as increases in netassets without donor restrictions unless the use of the assets is limited by

December 31, 2019NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED8. Certificates of Deposit, Investments and Other Investments - ContinuedNOTE C - LIQUIDITY AND AVAILABILITYdonor-imposed restrictions, in which case the earnings are reported in thesame category as the donations.The Church strives to maintain liquid financial assets sufficient to cover 90days of general expenditures. Financial assets in excess of daily cashrequirements are invested in certificates of deposit, money market funds andother short-term investments.Other investments represent unsecured deposit investments, which arecarried at cost, and totaled approximately 1,525,000 with an interest rate of2.75% as of December 31, 2019. Accumulated interest remains in the depositaccount; although not expected to occur, the Church has the ability towithdraw funds at any time.9. Compensated AbsencesFull-time employees of the Church receive paid vacation and personal days off,depending on job classification, length of service and other factors. Compensatedabsences earned but not paid as of December 31, 2019 have been accrued.10. Deferred RevenuesDeferred revenues are generated from registration fees collected for 2020conferences and medical outreaches.11. Income TaxesThe Church is exempt from Federal income taxes under Section 501(c)(3) of theInternal Revenue Code and is further classified as a church; as such, the Churchdoes not file income tax returns.12. ExpensesAdvertising Costs – The Church expenses advertising costs as they are incurred.Allocation of Fundraising Costs – The Church allocates fundraising costs inaccordance with ASC 958-720-05, Accounting for Costs of Activities of Not-forProfit Organizations and State and Local Governmental Entities That IncludeFundraising. Joint costs affecting programs and fundraising have been reviewedby management and meet the criteria established by the accounting standard.During 2019, approximately 3.8 million of television and radio ministry expenses,meeting expenses, monthly mailing costs, and other expenses have beenallocated to fundraising.The expenses that are allocated include office and occupancy, which areallocated on the basis of usage or square footage as well as salaries andbenefits, which are allocated on the basis of estimates of time and effort oremployee count.13. Change in Accounting PrincipleEffective January 1, 2019, the Church adopted ASU 2014-09, Revenue fromContracts with Customers, using a modified retrospective approach. The newrevenue recognition standard is intended to clarify the principles of recognizingrevenue from contracts with customers and to improve financial reporting bycreating common revenue recognition guidance for U.S. GAAP and InternationalFinancial Reporting Standards. This ASU and its subsequent relatedamendments have been codified as ASC Topic 606, and supercede therevenue recognition requirements in ASC Topic 605, Revenue Recognition, andmost industry-specific guidance.Entities are required to apply the following steps when recognizing revenueunder ASU 2014-09: (1) identify the contract(s) with a customer; (2) identify theperformance obligations in the contract; (3) determine the transaction price; (4)allocate the transaction price to the performance obligations in the contract; and(5) recognize revenue when (or as) the entity satisfies a performance obligation.This ASU also requires additional disclosures related to the nature, amount, timing,and uncertainty of revenue and cash flows from customer contracts.The adoption of this standard did not have an impact on the Church's financialstatements, as the revenue recognition policies under the new guidance areconsistent with the Church's previous policies.14. Subsequent EventsThe Church evaluated its December 31, 2019 financial statements forsubsequent events through April 14, 2020, the date the audited financialstatements were available to be issued.As a result of the spread of the COVID-19 coronavirus, economic uncertaintieshave arisen which are likely to negatively impact the Church's contributions andinvestments. The potential financial impact and duration of this occurrencecannot be reasonably estimated at this time.The following table reflects the Church’s financial assets as of December 31,2019, reduced by amounts that are not available to meet general expenditureswithin one year of the statement of financial position date. Amounts not availableinclude certificates of deposit with limitations as more fully described in Note B.8.Amounts not available for general expenditure within one year also may includenet assets with donor restrictions.Net assets with donor restrictions at December 31, 2019 were restricted for thenext period and are considered available.Cash and cash equivalents 12,205,833Certificates of deposit4,200,000Investments5,697,911Other investments1,525,794Accounts receivable427,668Pledges receivable125,175Due from affiliates25,564Total financial assets24,207,945Financial assets with liquidity horizons greater than one year(4,262,775)Financial assets available to meet cash needs for generalexpenditures within one year 19,945,170NOTE D - FAIR VALUE MEASUREMENTS AND INVESTMENTSThe Church has adopted ASC 820, Fair Value Measurements and Disclosures, forall financial assets and liabilities measured at fair value on a recurring basis. Thestatement defines fair value as the price that would be received to sell an assetor paid to transfer a liability in an orderly transaction between market participantsat the measurement date. The statement also establishes a framework formeasuring fair value and provides a fair value hierarchy that prioritizes the inputsto valuation techniques used to measure fair value.The fair value hierarchy is as follows:Level 1: Unadjusted quoted prices for identical assets or liabilities in active marketsthat the Church has the ability to access.Level 2: Quoted prices in active markets for similar assets and liabilities. Quoted prices for identical or similar assets or liabilities in inactive markets. Inputs other than quoted prices that are observable for the asset or liability. Inputs that are derived principally from or corroborated by observablemarket data by correlation or other means.Level 3: Inputs to the valuation methodology are unobservable and significant tothe fair value measurement.The inputs used to measure fair value may fall into different levels of the fair valuehierarchy. In such cases, an investment’s level within the fair value hierarchy isbased on the lowest level of input that is significant to the fair value measurement.The Church’s assessment of the significance of a particular input to the fair valuemeasurement in its entirety requires judgment, and considers factors specific tothe investment.The Church’s investments in mutual funds are valued at the daily closing pricesas reported by the fund, which are actively traded, open-end funds required topublish their daily net asset value (NAV) and to transact at that price.The Church’s investment in a multi-strategy “fund of funds” hedge fund is valuedat the NAV reported by the fund. Because the Church does not have the ability toredeem its investment in the hedge fund in the near term (shares are redeemableas of the last day of any calendar quarter, after giving 95 days’ written notice,subject to other specified redemption terms), it reports this investment in Level 3of the fair value hierarchy.joycemeyer.org/smile 39

Statement of Functional ExpensesMeetings andConferencesAdvertising 156,412Books and other outreach expensesMissions andOutreach845,164 63,57441,889---Broadcast timeContract labor CreativeMediaCost of Christian materialsDepreciation and amortization178,218184,423190,705Dues, subscriptions and ipment rentalInsurance481,9683,043,1811,055,384Outreach programs, services and projects15,126-13,888,569Payroll 34Postage44,1692,743,846403,607Printing and productionProfessional feesPromotional costsRentRepairs and maintenanceSalariesSpeaker honorariumsStaff trainingSuppliesTaxes and licensesTelephoneTravelUtilitiesSubtotal expenses by ,369,323--- 8,867,896 44,140,925 26,369,323Cost of direct donor benefitsTotal expenses by functionThe accompanying notes are an integral part of these financial statements.NOTES TO FINANCIAL STATEMENTSDecember 31, 2019NOTE D - FAIR VALUE MEASUREMENTS AND INVESTMENTS - CONTINUEDThe fair values of investments as of December 31, 2019 are determinedas follows:Mutual fundsLevel 1 1,300,669Hedge fundTotalLevel 2 –– 1,300,669 Level 3–Total 1,300,669–4,397,2424,397,242– 4,397,242 5,697,911Investment securities are exposed to various risks such as interest rate, marketrisk, and credit risk. Due to the level of risk associated with certain investmentsecurities and the level of uncertainty related to changes in the value ofinvestment securities, it is at least reasonably possible that changes in risks inthe near term may materially affect the amounts reported in the financialstatements.NOTE E - PLEDGES RECEIVABLEThe changes in the fair value of the Church's Level 3 investments held for the yearended December 31, 2019 are as follows:Level 3Beginning balance 3,979,061Unrealized gains218,181Additional InvestmentEnding balance40200,000 4,397,242Pledges receivable include the following at December 31, 2019:Amount due in:Less than one year One to five years, gross68,500Less allowance for doubtful accounts(5,725)One to five years, netTotal pledges receivable62,40062,775 125,175

For the Year Ended December 31, 2019Christian MaterialsDistribution -Managementand General Fundraising -15,469Total 499,421,697--1,934,5751,934,575 5,208,201 11,042,278 5,727,649 101,356,272The accompanying notes are an integral part of these financial statements.NOTES TO FINANCIAL STATEMENTSDecember 31, 2019NOTE F - INVENTORIESNOTE G - PROPERTY AND EQUIPMENTInventories include the following at December 31, 2019:Property and equipment includes the following at December 31, 2019:Land and land improvementsFinished goods:Books 1,085,24225,854,61020,852,73816,601,288Supplies to produce finished goods505,888Transportation equipmentKits261,546TV, computer and other equipmentNovelties231,898CD’s186,573Food and household items163,258DVD’s68,148,155Less: accumulated depreciation47,404,219 20,743,93619,072Other inventory items 4,839,519Buildings68,467 2,521,944joycemeyer.org/smile 41

NOTES TO FINANCIAL STATEMENTSDecember 31, 2019NOTE H – NET ASSETSNOTE J – COMMITMENTS AND CONTINGENCIESBoard-designated EndowmentIn November 2019, the Church's Board of Directors established a boarddesignated endowment. The initial contribution in 2019 consists ofinvestments and certificates of deposit held by the Church at the time of theresolution. The funds are invested to seek growth of principal over time;however, any income, principal, appreciation on principal or other moniesheld in the endowment fund may, with Board approval, be used for thefollowing purposes:Airtime — The Church has radio and TV airtime contracts extending to 2020.These contracts may be terminated with a fourteen to sixty day notification.The average monthly cost of these contracts is approximately 1.7 million. Emergency funds Long-term investment Maintenance and support of the physical assets of the Church To encourage, receive and administer gifts from donors Outreach ministries Seed money for new ministries and special projects Such other purposes as may be specifically designated by donors of theChurch whose gifts are included in the endowment fund Such other purposes as the officers of the Church deem appropriate andreasonable expendituresChanges in endowment investments by net asset composition for the yearended December 31, 2019 are as follows:Without donorrestictionsEndowment,beginning of yearContributionsInvestment return, netEndowment, end of year –With donorrestictions –10,008,167 –75,62 1 – 1 0,083,788 –To

vManagement Report to Supporters Joyce Meyer Ministries, Inc. issues an annual assertion letter provided by an independent public accounting firm that attests to the compensation of our President and Founder Joyce Meyer. v Joyce Meyer Ministries, Inc. requires all board members and employees to abide by a conflict of interest policy that encourages