Introduction
As organizations largely staffed by volunteers who may not have a business or accounting background, congregations will want to establish systems, policies, and procedures to reinforce financial health and vitality.
It’s also vital to prevent the opportunity for mistakes or malfeasance by any volunteer or leader--no matter how loved and trusted they may be. It is unfair to put people in situations where their reputation is their only protection against accident or allegations of dishonesty. Instituting checks and balances protects both staff and volunteers by preventing the opportunity for misappropriation of funds.
The UUA's Becoming a Safer Congregation Guide Financial Safety for Congregations and a Financial Controls Checklist .
Of course, no system will completely protect a congregation from possible financial loss.
In This Section
Congregational Financial Health
From LeaderLab
Money – acquiring it, managing it, protecting it, and using it in service of your mission: all of these are vital to the work of your congregation. Having a healthy culture around money – talking about it, understanding its meaning and influence in our lives, seeing it as a tool rather than an...
Talking About Money as People of Faith
Jan Christian, Kay Crider
From LeaderLab
The power of money in our own lives often goes unexamined. This plays out in our congregations in all sorts of ways. What would it mean to your congregation to be able to talk about money in ways that are life-giving and healing?
Segregation of Financial Duties
UUA Office of Church Staff Finances, Ministries and Faith Development
From LeaderLab
All financial best practices depend on reducing the risk of embezzlement or theft by increasing transparency and detection by creating systems and roles that segregate key duties.
Financial Reports
From LeaderLab
Financial reports help the finance committee and the board assess the financial health of the congregation so they can make adjustments or decisions as needed.
Creating a Purpose-Based Budget
From LeaderLab
We often claim that budgets are moral documents, and that congregational budgets should reflect our values. But line item budgets that include "office supplies, utilities, salary" and other such descriptions don't show how these line items serve the mission of the congregation. How might...
Help Keep Your Board Out of the Weeds with "Dashboard" Financial Reports
From LeaderLab
Boards have the fiduciary responsibility to make sure the overall finances of the congregation are in order and the budget is on track. But the line-item spreadsheets given to board often have too much detail and don't give related information that helps the board make sense of the information.
Church Financial Management Software Safeguards
UUA Office of Church Staff Finances, Ministries and Faith Development
From LeaderLab
In setting up church financial management software, it’s important to provide safeguards to prevent tampering with the electronic records
Securing the Sunday Offering
UUA Office of Church Staff Finances, Ministries and Faith Development
From LeaderLab
The Sunday offering is fairly vulnerable to theft or embezzlement unless good checks and balances are in place.
Electronic Giving
From LeaderLab
If dropping a check or cash into the basket is the only way your congregation invites financial gifts, many in your pews can’t participate in the offering even if they feel called to do so.
Handling Petty Cash
UUA Office of Church Staff Finances, Ministries and Faith Development
From LeaderLab
Any petty cash kept in the building should be in a locked file cabinet or safe and should be disbursed only upon submission of a written request.
Best Fiscal Year
From LeaderLab
What are the pros and cons of using a calendar year vs. a July 1 - June 30 fiscal year?
Parsonages
Sean Griffin, Jan Gartner
From LeaderLab
For congregations that own a parsonage, consider the possibilities as well as implications for structuring a ministerial agreement.
Paying Bills (Disbursements)
UUA Office of Church Staff Finances, Ministries and Faith Development
From LeaderLab
When making sure that your bills are being paid efficiently, accurately and on time, your congregation also needs safeguards to make sure no one has the opportunity to use your system to embezzle funds.
Property Insurance
Safe Congregations Team, UUA Office of Church Staff Finances, Ministries and Faith Development
From LeaderLab
Property insurance challenges are becoming more common, from rate increases to policy terminations. While we can't make these problems go away, we can offer some suggestions.
Expense Reimbursements
UUA Office of Church Staff Finances, Ministries and Faith Development
From LeaderLab
Employees and volunteers should be reimbursed for approved church related expenses upon submission of receipts and accurate expense reports that conform to the annual budget and IRS requirements. Such expenses may include: Travel – transportation, lodging, meals, incidentals and other associated...
Staff Credit Cards
UUA Office of Church Staff Finances, Ministries and Faith Development
From LeaderLab
Many congregations supply a credit card to more easily segregate work-related expenses. Staff members would only use the card for professional or church expenses.
Avoiding Scams
From LeaderLab
Because relationship, compassion and trust are all qualities that congregations are trying to cultivate, church members and staff can fall prey to bad actors and con artists.
Rental Income
UUA Office of Church Staff Finances, Ministries and Faith Development
From LeaderLab
There are nuanced tax rules regarding income derived from renting your building and/or parking lot, depending on its relation to your core purpose.
Restricted Accounts
From LeaderLab
A portion of the money in the church’s checking accounts may represent money that is held for specific restricted purposes, including various religious education accounts, social action accounts, the minister’s discretionary fund, etc. They may also represent “pass through” funds such as...
Operating Budget
From LeaderLab
Your operating budget helps your congregation live its mission in the world. How you allocate your resources reflects your values and goals....
Cash Reserves
From LeaderLab
A congregations’ income ebbs and flows, so it is a good idea to have some cash reserves that can help keep the bills paid in the summer when attendance and pledge payments fall off.
Payroll
UUA Office of Church Staff Finances, Ministries and Faith Development
From LeaderLab
Once the salary and benefits are set by the appropriate church leadership based on recommended practices, it’s important to make sure the payroll is handled accurately and confidentially. Because of the complicated nature of payroll, and especially when it comes to ministers’ salary, housing and...
Completing W-2 Forms
From LeaderLab
Can you provide guidance and resources for completing W-2 forms for both ministers and other congregational staff? Deadline by January 31 after the tax year (February 1 in 2021), W-2 forms must be given to employees and sent to the Social Security Administration.
Audits
From LeaderLab
Rarely can congregations pay for a full-blown audit of the church books by a CPA. Audits are expensive, often ranging from $5,000 to $15,000 depending on the annual budget of the organization....
Embezzlement
From LeaderLab
Embezzlement from congregations is not unusual, and it almost always occurs when one individual has been granted such a high degree of trust with no safeguards.
Endowment Funds
From LeaderLab
Endowments need special handling to ensure transparency, accountability and impact.
Minister’s Discretionary Fund
From LeaderLab
A Minister’s Discretionary Fund is an account that the minister or pastoral care team can use to provide confidential assistance to those facing emergency financial need.
Money Matters Resources
From LeaderLab
Consulting Congregational Finance LLC for free and paid subscriptions to access excellent resources, including the webinar she led last winter for the New England Region UUA: Financial Management for Your Congregation led by Rev. Karen McArthur...
Professional Expense Allowances
UUA Office of Church Staff Finances, Ministries and Faith Development
From LeaderLab
US tax law provides that staff may consider certain items as usual business expenses that are reimbursed beyond the compensation paid to individuals as a necessary expense that is not reported for income tax purposes.
Tax Exempt Status
UUA Office of Church Staff Finances, Ministries and Faith Development
From LeaderLab
Every Unitarian Universalist Association (UUA) congregation is a “church” under U.S. tax law, therefore tax exempt, charitable, and exempt from tax filing. There is no “group exemption” from the UUA, but the UUA will provide a letter saying a congregation is in good standing. This addresses...
The Unique Finances of Your Minister
From LeaderLab
Most church leaders don’t need to be experts on ministerial compensation, but it’s important to understand the basics of how payroll and taxes for the minister differ from other employees.
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