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Financial Reports
Financial Reports

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. There are three typical reports that -- together -- give leaders and accurate and helpful picture. Many congregations also have their finance people generate a monthly “dashboard” financial report for board members, which helps to keep the board looking trends rather than details.

Many congregations find themselves with legacy accounting systems developed by volunteers without a financial background. Updating such systems to use standard accounting practices will make it easier for future volunteers and administrative staff.

Income Statements

Income statements show revenues (pledges, plate, fundraising proceeds, rentals, etc.) and expenses (salaries, benefits, utilities, supplies, etc.) for a given period of time (previous month, last quarter, year-to-date, etc.). 

  • This report can be generated by most accounting software.

  • The report is broken out by category (often based on mission), then account or line item

  • It usually has a column showing the current year’s and previous year’s budget on each line item

  • It usually also shows two or three previous year’s numbers for comparison (For example, pledge payments tend to be low in the summer and high in December.)

  • The “bottom line” subtracts the expenses from the revenues, showing either a surplus or deficit for the given time period.

Balance Sheets

Balance sheets show the assets (petty cash, checking/savings account balances, rents due, property value, endowment, reserve funds, etc.) and liabilities (payroll, insurance payments, worker’s comp, mortgages, loans, restricted accounts, etc.) of the congregation at a specific point in time. The total is the congregation’s net worth.

Cash Flow Reports

A cash flow report is similar to a checkbook register. It tracks where money has been spent, and shows how much cash is on hand. These reports are helpful in seeing the ebb and flow of cash balances, and help the board to determine how much cash should be in reserve for the lean times of the year.

For a more detailed explanation of reports and other accounting practices, read The Business of the Church: the Uncomfortable Truth That Faithful Ministry Requires Effective Management by John W. Wimberly, Jr. 

 

About the Author

  • The regional Congregational Life staff are congregations' local connection to the UUA. All of the program Congregational Life staff have expertise in most aspects of congregational life and each also has a few program areas of expertise. See the UUA Congregational Life Staff...

For more information contact conglife@uua.org.

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