01 -  Replacing a Christian Ministry's Retiring Bookkeeper 

    It was recently my privilege to participate in the replacement of a retiring Bookkeeper at a Christian Ministry who uses the accounting software known as QuickBooks (QBs) . Basically this how it was done.

01>   I joined two other Ministry Officials in interviewing the candidates. My involvement, of course, was to discover/evaluate the candidate's experience and skills in actually doing the bookkeeping and the two others, of course, handled other employee aspects of the job -- such as general staff expectations, hours, pay rate/benefits, etc.

02>   So I defined the following three areas of the job and joined with each one of the candidates as they graded themselves in the following areas on the basis of 1 to 5 -- with 5 being the best.

A>   Ministry (Fund) Accounting;    Their experience in serving Ministries; were they ever a voluntary Treasurer at a  Ministry or Church, etc?   Had they ever done the bookkeeping with respect to the  handling of "Spoken For" monies, etc?   See Fund Accounting below.
B>   Quickbooks (QBs);    Their use of this accounting software (QBs) in their previous jobs, etc. See Use of QBs etc. below.
C>   Computer Systems;    IBM/PC or Mac; How savvy were they in the use of said computer system, like:  Management of their desktop, Use of Email, Spreadsheets/Excel and, of course, Computer Accounting Software, etc.

03>   Once the person was hired, I spent initial time with both the old and new Bookkeeper as we pursued the following fundamentals:

A> WHAT   (The detailed specific duties, or tasks, involved in doing this job)  See Expected Tasks, etc. below.
     Job description detail; Duties/tasks/expectations; Scope of accounting/financial reports; Peculiarities of accounting for receipts (especially donations), disbursements and payroll (like Clergy, etc.).  Meeting session responsibilities of the Bookkeeper, etc.
B> WHEN   (are these tasks to be performed, etc.)
     Timing aspects or all of these "WHAT" duties/tasks, etc.
C> HOW   (are these "WHAT" duties, or tasks, performed)
      Exactly how to do the job via use of the applicable tools/resources. Who is to train/mentor the new bookkeeper; especially related to the accounting infrastructure (Chart of Accts, etc.) via the use of QBs and any other Software. See DonaMail below re Donations record keeping.

04>   Then,  it was my privilege to also monitor the "Change-Over" process as we periodically determined completion percentages of mostly the above "WHAT"  items.

       Please click on the links that follow as their content speaks to various aspects of the above process:  .   Expected Tasks and/or Job Description    Fund Accounting    Use of QBs for Fund Accounting   DonaMail

 02 - Ministry Finance Reporting Issues   

                       Please keep the following fundamental objectives in mind when you structure your own Ministry Finance and accounting/reporting system

                                                                           1ST OBJECTIVE

    Decision makers must timely be able to answer "Point in Time" finance questions.  Or how much money is on hand and how is it obligated - which include:  Liabilities due to vendors and others;  Money was obtained for specific Board approved special purposes and now is yet unspent;  plus how much money is available for Board discretionary purposes at a point in history.  Accountants usually call this report a Balance Sheet/or Statement of Financial Position.  We like the term "PHOTO" since it is like a financial historical photograph, etc.  Click Here and Here for more information.

                                                                            2ND OBJECTIVE

    Decisions makers must timely be able to answer   "Period of Time"  finance questions.  Or how much money did we start with and what was the amount and type of money coming in and going out during a period of history.  Accountants usually call this report a Profit and Loss/or Income Statement.  We like the term "VIDEO" since it is like a financial historical rendition of what has occurred during that year, or for a defined "Period of Time"  , etc.  Click Here and Here for more information. 

                                                                           3RD OBJECTIVE

     Finally --  decision makers must know how  the Ministry has spent money per its annual pre-approved spending plan;  the operative word here is  BUDGET.   Or what does the Ministry's "Actual to Budget"   reports reflect for the current year?  Have decision makers stayed within their limits, etc.   Click Here and Here for more information.   You might also include in this objective the need to monitor financial trends - especially income. 

                                        We trust this  FinFax  system  adequately complies with the foregoing objectives.

03 -   Whole Dollar Bookkeeping

      Some time ago I learned that someone kept their personal books, or financial records, in "Whole Dollars" only for a number of years.  Or they rounded up to the next dollar if the transaction was 50 cents or more and kept the same dollar if it was 49 cents or less.  Someone was not happy with this, so they re-processed all of the transactions using the pennies for this period of time and the net difference was less than 20 cents.
       I am not convinced that it is necessary to enter the pennies as you record each of your Personal Finance transactions -- whether you do them manually or via some type of accounting software.  If you need, from time to time, to move a dollar up or down in order to get to the proper end result, then simply increase/decrease the last transaction.   This "Whole Dollars" idea might also apply to bookkeeping at a Small Ministry.

04 - Church Credit Card Protocol (09):

      I ran across a situation where a Church has a Church Credit Card in each Official's name, but a particular official was NOT providing mandated Credit Card information to the Church Business Office. The result was that the Church Credit Card for this person was taken way from them and this person used their own Credit Card for approved Church purchases. However, the mandated requirements were still NOT followed so the Church's expenses on their personal Credit Card were not reimbursed.  I believe that following the "Five Step"  process below would alleviate most of these situations:

   01> This official does in fact have a separate Church Credit Card in this person's name
   02> This official makes all approved purchases only via this Church Credit Card means. This person would NOT pay for such Church expenses personally (via any of these means:  own cash, check or Credit Card, etc.) and seek reimbursement from the Church.
   03> This official (perhaps the Church's Bookkeeper or the official's Administrative Assistant) MUST weekly go online to this person's Church Credit Card account and print it out showing the transaction detail and the unpaid credit card total.
   04> This official then takes this weekly print out and determines if said charges are OK, etc and, at the same time, attach any existing Credit Card slips.  These small slips can easily be lost so they are a preferred, but they are NOT a required,  part of the process.  Since it has been within the past week, this person can normally go to their calendar and determine if the Credit Card charge appearing on the weekly statement is proper. Reminder: such charges are not a business tax deductible issue by this tax exempt Church -- or having the Credit Card slip is not a required tax matter.
   05> This weekly print out, as approved by the official, MUST then go to the Church Business Office who pays the total via a weekly Online (or a check) payment and posts the detail by Vendor to the applicable Church Departments.  Via this process, not only is the Church placed on the  Accrual Basis  by reporting all of the NOW expenses, but it is also not necessary for the Church Bookkeeper to enter the Credit Card purchase detail in advance into a liability account, and then go through the time consuming effort of reconciling each transaction to the periodic Church Credit Card statement itself, etc. 

       I also discovered that if the Church's Bookkeeper did not know what Department (or account therein) was involved in the transaction then it was placed into a type of Suspense Account until the buyer informed them of where it belonged, etc.  The Church also required that Credit Card charge slips be attached to one of their forms. The "Five Step" process described above would also eliminate these requirements.

 05 – Internal Revenue Service (IRS)  Matters pertaining to Tax Exempt Ministries    

     Title                                                                     Link:

Via the IRS:

Access to the IRS Website                                     Forms and Publications
Sales and Other Disposition of Assets                     544.pdf-Sale-Disposition of Assets Pamphlet
Determining the Value of Donated Property               561.pdf-DetermineValueof donated Prop-
Charitable Donations                                               526 - http--www.irs.gov-pub-irs-pdf-p526.pdf
Instructions for Form 8283                                       8283.pdf - form instructions
Non Cash Charitable Constrictions                           8283.pdf - form itself
Employer's Qrtly federal payroll tax return                 941- Form 941
IRS Publications having to do with:                           990 - Form 990-990EZ e-file
Exempt Org Annual Tax Return                                990 - http--www.irs.gov-pub-irs-pdf-f990.pdf
Exempt Org Annual Tax Return - short form              990EZ - http--www.irs.gov-pub-irs-pdf-
Help in filing for Tax Exemption                                1023 - http--www.form1023help.com
Charitable Contributions                                          1771 - http--www.irs.gov-pub-irs-pdf-p1771.pdf
Tax Guide for Churches & Charitable Orgs                1828 - http--www.irs.gov-pub-irs-pdf-p1828.pdf
Employers tax Guide                                              Circular E Employers Tax Guide
IRS Publication re Employment Taxes etc                Employment Taxes
Tax Exemption Info                                                 Frequently Asked Questions-filing for 501 c-3
IRS link re Charities and Non-Profits                         Tax Information for Charities & Other Non-Profits
Mileage IRS Rates                                                  www.irs.gov/newsroom/article/0,,id=147423,00.html

Via www.bcidot.org 

            Filing Form 990 (990Z)                                           http://www.bcidot.org/all/0108-01.html
            Form 1099 Matters re Ministries                             http://www.bcidot.org/all/0048-01.html
            Gifts in Kind  (Non Cash)                                       http://www.bcidot.org/all/0055-02.html  
            Benevolence Matters at a Church                            http://www.bcidot.org/chu/5021-02.html     

06 - Church Recommendations following an Embezzlement

        After a Church suffered embezzlement (stealing) of their money, they developed the following ten questions that are intended to insure that they and other churches do NOT again go through such an awful experience.  It seems that we hear of such things all too often.  As Board Treasurer,  or a member of your Church's Finance Committee, please carefully correct any "No" answers to the following questions as you access the integrity of your own financial process. 

01>    Do you count and record offerings immediately after they are received? Every moment they sit unaccounted for leaves them
open to theft.
02>    Are offerings always stored in a secure or well-supervised area?
03>    Do you independently count your cash and checks twice for accuracy?   To err is human, but the more we check our work, the more we avoid careless mistakes.
04>    Do you place offerings in lockbags (money bags provided by the bank requiring a key to open) after counting?
05>    Do you place the lockbags in a safe or a night depository until the bank opens?
06>    Do you strictly limit who has access to the safe?
07>    Do you change the safe combination when someone is no longer authorized to use it?
08>    Do you make sure the same person is not involved in more than one financial procedure (collecting funds, counting
funds, recording the giving, authorizing expenditures, writing the checks, auditing the account)?   The more access a
person has to the various procedures, the greater the ability to misuse funds
09>    Are any persons authorized to write checks against church funds held accountable, or responsible, through an
appropriate accounting/auditing system?
10>    Do we issue annual receipts for giving? This is another way to determine that what comes in has, in fact, been
accounted for.

 07 - Church and Metric Measurements

        If you are like me, you do not see the "Metric Measurements"  term that often.  It is my understanding that it is a way to use factual statistics to measure your Church Congregation's overall spiritual health. Or you use such information as attendance and donation results and display it in a personalized manner that enables you to follow trends and provide appropriate data for analysis by the Church leadership. Please Click Here and read a dialog with five Onliners on this topic.

Internet Links not via Jim Bramer        

      01>  Church Administration Basics    02>   Will Your Will be Your Will?   03>   Ministry Business Services, Accounting & Finance   04>   Benevolence via Ministry Savvy Attorney   05>    ECFA's Best Practices for Churches

This Month's Editorial - "For What It is Worth" originally rendered in October 2004:

      Youngers learn from Olders as to "Righteous Personal Finance"

Current "Ministry Finance"  Truism

      Below is a Ministry Finance precepts/beliefs/principles, or  "rule of thumb". Please go to  0069  for our complete TRUISMS list: 
      Foundational Truism -- up to date record keeping is an essential element of Spending Controls.  It is impossible to control something if you do not know its current status, etc.     

Prayerful Thots :

      Dear Lord:   I appreciate that I was recently reminded about this:  "Considering forgiveness without the necessary ingredient of repentance is like viewing Christianity without the Cross of Christ"  Help Me,  Oh Lord !!!!.