This may be the shortest post in the budget development discussion but it is the most important. The purpose of step four is to allow church staff to PLAN WELL for the upcoming church year. And, this will be impossible if the church does not COMMUNICATE well. The allocation decisions must be clearly communicated to […]
Step three involves the allocation of the available funds to various church activities as determined by the mission of the church. It must be stressed; there is no one way to do this because each church has its own specific calling and there is a wide array of ministry focus points among churches. But, in […]
The purpose of Step Two is to allow church ministers and lay leaders to know “how much they will have to work with.” This is extremely important on two levels: If ministers are given too low a figure, they may become discouraged even before the fiscal year begins. They may begin to think and mull […]
The purpose of Step One is to make sure you are staying on “mission”. This is accomplished by reviewing the church’s mission, vision and strategy. Each church needs to know three things: – Who it is. (Values) – Where it is going. (Mission) – How it is going to get there. (Strategy) Without knowing these […]
There is no one way to do a church budget. There are a variety of approaches and for the most part, no one way is better than the other. Remember mission and vision? These two factors will also impact how a church goes about its financial planning. I do have to point out however, that […]
I ended the last post by asking, “Are these definitions sufficient?” Obviously the answer is no because that would be the end of this blog series! Keep in mind that the three definitions posted were all written by accountants… As a result, the main flaw with these definitions is that they appear to be about […]
Before launching into a study of anything, I like to make sure I have at least a basic understanding of what the topic is all about. So, before launching into church budget development I looked up a few definitions of what a budget is: An accounting device used to plan and control resources of operational […]
Churches have embraced the digital world and are becoming very proficient in the use of computers. A vast array of applications has been made available to the church including sophisticated financial accounting and reporting, childcare security, online purchasing, online tithing, phone trees and coffee bars with free wireless internet. Without a doubt, churches have become […]
A close cousin to ignoring the bank reconciliation is maintaining an excessive number of bank accounts. Rather than using their church accounting software to take care of measuring and tracking restricted giving, some churches open separate bank accounts for each new special gift that may arise. This results in a number of problems: Burdens the […]
Another practice of many churches plays right into one of a fraudster’s strengths, the ability to withhold information. Perhaps in an attempt to avoid interminably long finance committee meetings brought on by micro-managing members, or more likely, fearful that the messenger is going be killed, some church administrators tend to hold back on the financial […]