Former Auditor: Over Past Two Years, Gateway Church Overspent Revenues by $23-Million

On Tuesday, I reported that Dallas-Fort Worth megachurch Gateway Church is laying off staff while spending millions on undisclosed non-operating expenses. In addition, the fourth largest church in America may have spent millions more than revenues for the second year in a row. According to former Big 4 accounting firm auditor Jason Watkins, Gateway’s expenditures have exceeded revenues by nearly $23-million. The image below was supplied by Watkins.

Gateway Deficit Spending Graph
Compiled by Jason Watkins

You can read Gateway’s annual reports for 2012, 2013, 2014, 2015, 2016 by clicking the links. However, the losses are not apparent at first glance. Watkins told me that the format of the annual reports obscures the true picture. The image below compares actual revenues and expenses.
GW 2015 revenue over expenses
Total revenue for 2015 includes the actual giving to the Heart for the Kingdom campaign and general fund revenue ($147,455,568). Expenses include the Heart for the Kingdom expenses, operational expenses, capital expenditures and debt retirement ($160,653,068). According to Watkins, Gateway spent just under $13.2-million more than the church took in.
In 2016, the church spent $9.6-million more than revenues. In the image below, compare the “non-operating expenditures” line ($13,123,084) with the “revenue over expenses – operational” line ($3,505,562). The difference is a loss of $9,617,522 for 2016. With┬áthe previous year’s deficit, Gateway has spent nearly $23-million more than received, according to Watkins.
Gateway Annual Report 2016
Since there is so little detail in the report and since Gateway has declined to respond to questions, it is not possible for me to be dogmatic about the financial picture. However, I think Watkins makes a good case that Gateway’s spending has exceeded what members have supplied. His conclusions seem quite consistent with what Gateway’s spokesman Lawrence Swicegood told the Star-Telegram about cuts in both staff and expenses.
Gateway wouldn’t be the first church to cut staff and expenses but the situation is noteworthy for at least two reasons. One, the size of the cut back is substantial — as many as one-third of 900 positions. Two, the lead pastor of Gateway Robert Morris is famous for his teachings about tithing and the promises that tithing will bring prosperity and success. Since the members have no input into how money is spent, the responsibility falls squarely on the leaders at Gateway.