Saturday, November 12, 2011

Church Treasurer Basics!!

Basic Treasurer/Church Bookkeeping Information

Protection of His finances is a key ingredient to the health of the Body of Christ. In Luke 16 just before Jesus says, “You cannot serve both God and Money” (vs. 13), Jesus states in vs. 11, “if you have not been trustworthy in handling worldly wealth, who will trust you with true riches”. The word ‘trustworthy’ comes from the word ‘pistos’ which means a person who shows themselves faithful in the transaction of business, worthy of trust, able to be relied on. It is clear that our calling to administer the finances of His church comes with great responsibility. The finances must be handled appropriately and with utmost integrity.

Below are a few basic guidelines to help you in your journey. These are not exhaustive; they are to get you started. As He directs your path you will learn other pieces to help you in your administration of the church’s finances. A few websites you might find helpful are….

Bookkeeping Basics for His Church

  • Separation of Duties

One of the key components to internal controls of His finances is basically this…one set of persons touches the physical money and another person(s) disburses and accounts for the money.

Rotating teams of counters/depositors record and log the offering after worship. There should be a minimum of two unrelated persons counting and logging the income. The offering is then taken to the bank. Offering should NOT be taken to any individual’s home. The deposit/giving report is then given to the Treasurer for entry into the bookkeeping system. The Treasurer (who disburses the funds) should NOT be part of the counting team.

If the Treasurer is tracking donations the donor information should be provided with the deposit information.

At no time should a pastor’s name be on any church account. Pastors may receive as much information as they desire, but must be insulated from access to the funds at all times. This is a protection for the pastor. He/she is called to preach and teach, not count and disburse.

  • Disbursing of Church Funds

Documentation – evidence that any expense is a legitimate ministry expense is very important. The Treasurer is the gatekeeper for accountability in how the church funds are spent. This responsibility is never to be used as a mechanism of control, but as a form of cooperation as we serve one another in love through sound financial principles and procedures. Basically, there needs to be a paper trail of expenses. Most items purchased will generate a receipt or invoice. These should be organized in monthly folders noting the check or electronic funds transfer (eft) receipt on the invoice. It is a good practice to have an invoice approval system in place.

  • Monthly Accounting

Each month the church account(s) should be reconciled with the bank statement.

Each month a report providing account balances for all church accounts, all liabilities incurred, and all expenses should be given to the leadership of the church. A complete monthly accounting of all the funds of the church is necessary to insure sound accountability.

  • Yearly Review

Each year the church bookkeeping should be reviewed either by an internal or external committee. Those on the committee should be qualified to review the accounting of His finances and also provide a written report to the Administrative Council for review.