Calendar Year 2005 or 2006 Tax Deductible Contributions to your Ministry- (3) 

     I am including this within this November 2005 JIMs JRNL as you should be receiving it the first week in December 2005 so you and your donors who wish to make a 2005 tax deductible donation can be informed well enough in advance as to how you are going to handle such matters. 
    January 1, 2006 is a Sunday so you will need to follow the proper protocol in handling tax deductible contributions for the calendar years 2005 or 2006.  At a Church, for example, all tax-deductible contributions placed in the offering plate on Sunday January 1, 2006, will be a part of their 2006 giving record --- regardless of the date on the check, etc.  Our understanding of IRS regulations is that in order for a contribution to be tax deductible for the calendar year ended Saturday, December 31, 2005, the following would apply ---

  >>    The Ministry must have received the money physically by or before Saturday,  December 31, 2005.  
  >>    Or, if mailed, it must be an action by the donor so that the transmission envelope would be post-marked no later than Saturday,  December 31, 2005.
  >>    Or, a Ministry agent must have physically received the money by or before Saturday, December 31, 2005.

    Those of us that deal with this annually know that Ministries process checks dated December 31 well into the following month of January and the Ministry needs to handle these items in a consistent righteous manner.   Please be aware of the following:

  >>    Often the Post Office does not function well during the last few days of the calendar year and mail might NOT be processed as timely as usual. Since the intent of the regulations are NOT being violated, it is OK to process as 2005 donations all checks by mail that are post marked on or before Saturday,  December 31, 2005, but physically available within your post office box (or delivered) during the first few business days in January 2006.
  >>    A constituent contacts the Ministry on or before Saturday December 31, 2005  and indicates that they want a 2005 tax deduction, and informs the Ministry that money is coming ---  it is OK to handle as a 2005 contribution -- as long as it complies with the above intent.  CAUTION!!!!!   NO WAY does the foregoing apply when it is obvious that a donor is attempting to get a calendar year 2005 tax deduction for a calendar year 2006 decision and action --- regardless of the size of the donation.

    The above should be well documented for all individual donations as evidenced by a 2005 contribution receipt and/or on the annual giving statement.  It might be helpful for a Church, for example, who receives offerings to have separate 2005 and 2006 deposits so as to better comply with these requirements.  Further, your written financial policies should include these issues. 
    There may be merit in making this policy known to constituents early in December of each year.  

Poem about Money --- (4)

    Dug from the mountain side, washed in the glen;
        Server am I, the master of men.
    Steal me, I curse you, earn me, I bless you,
        Grasp me and hoard me, a fiend shall possess you.
    Lie for me, die for me, covet me, take me;
        Angel or devil, I am what you make me.

Financial Internal Controls within QuickBooks and Journal Entry transactions -- (7)

    Please go to  0647 where I have spoken to some needed QuickBooks (QB) steps to insure that your Ministry has the necessary Financial Internal Controls .  Such a definition includes: " What one independent person does in carrying out their financial tasks becomes a check and balance on what another independent person does."   An entire financial transaction is NOT done by one person only. Please go to  0039  and see other aspects of Internal Financial Controls. One of these issues is to exercise control over the process of doing the needed Journal Entries within  QB.  Please consider the following:

>>  Working from QB,  beginning with the first of the fiscal year, you would input the Journal Entry and then print-out each Journal Entry page as it would become a numbered hard copy Journal Voucher  (JV xxxx).   The first two digits of xxxx would indicate the month, and the last two digits of xxxx would be consecutive for that month etc. 

>>  Of course, any related documentation of the transaction would be stapled to each JV xxxx printout. You might encourage Staffers to send you Email which would be hard copied and attached as support for the applicable JV xxxx. If no written authorization via a separate piece of paper, then you need to route the  JV xxxx  hard copy itself to the authorizing Staffer and obtain such written authorization on the JV xxxx hard copy.  See rubber stamp info below.

>>  Obtain a rubber stamp and place on each JV xxxx hard copy so as to provide such data as:

Authorization:  See attached_____  or by _______________ as of _______________
Entered within QB by________________ as of _______________
Viewed by Internal Auditor ___________________ as of ______________

>>  When completed, the JV xxxx hard copy print-out would be three-hole punched and placed within such a binder for further reference, etc.

>>  Of course, some types of Journal Entries transactions are repetitively legitimate (QB memorized, etc) with no need to authorize each time.

 Hits to our web site - (8)     

 A milestone for us -- we now have accumulated at least 20,000  hits (number of times it has been accessed, etc) on our  www.bcidot.org  web site.        

Ten Commandments of a Ministry Finance Team - (9)

  The following can be viewed as your   Ministry Finance Team's   TEN COMMANDMENTS.  Of course, you will want to remedy poor grades. Proverbs 27:23 says:  "Know well the condition of your flocks, and pay attention to your herds." Obtain the opinion of each of your MFTeamates,  as you grade yourself, on the basis of A-F grades,  the extent to which the Ministry -------.

The Internet ( Web ) as a Ministry Resource -- (10)

Some reasons why a Ministry would want to have an "On the Web, or Internet" presence.

Features: 
        -- A web site/page is accessible at all times -- 24/7
        -- Has world wide aspects in all languages
        -- Can make your unique Ministry known to Onliners via search engines

Reasons
        -- To communicate (written. graphic. verbal) or get part of the Gospel message out to Onliners
        -- To assist Onliners meet their needs; provide self-helps
        -- To answer questions and provide a means of interaction
        -- to collaborate with more than one person as needed.

Communication methods includes:
        -- Written means -- or use of Email  
        -- Onliners read Onsite material or articles
        -- Onliners can make financial transactions, like make donations or buy things, etc
        -- Onliners can provide data to the Ministry by easily filling out Ministry forms .
        -- Ministry provide tutorials -- make use of PDF resources

CAUTION: The Internet provides access to a tremendous amount of data -- make sure it is the truth, etc.

2005 K. Emergency Tax Relief Act - (KETRA)  -  (5).

    Under Sec. 301(b)(1)(A), a "qualified contribution shall be allowed only to the extent that the aggregate of such contributions does not exceed the excess of the taxpayer's contribution base (as defined in subparagraph (F) of section 170(b)(1) of such Code) over the amount of all other charitable contributions allowed under such section 170(b)(1)."  Therefore, a donor may usually make gifts up to 100% of adjusted gross income (AGI), rather than the usual 30%, etc..
    When is this 100% gift deduction rule applicable?  Qualifying cash gifts must be made between August 28, 2005 and December 31, 2005.
    Which charities qualify for the 100% deduction?  Public charities generally will qualify.
    Must the 2005 End of Year Gift be for Katrina relief?  No, if the gift is by an individual, but yes if it is by a corporation. A corporation may give up to 100% of taxable income for Katrina relief. An individual may make a 2005 end of year gift to public charities for any purpose.
    Please notice what Ron Chandler has done via this large Texas Church:  http://www.churchadminpro.com/

Donated Property Information -- (12)

    The following info about Donated Property is via Christine L. Manor, CPA MBA; Accounting Consultant to Not-for-Profit Organizations; author of QuickBooks for Not-for-Profit Organizations ---- 301/762-7798 301/461-8371 mobile 301/762-1342 fax clm@clmanor.com

>>  IRS Publication 561 -- Determining the Value of Donated Property http://www.irs.gov/pub/irs-pdf/p561.pdf -- See the Stocks and Bonds section under Valuations of Various Kinds of Property
>>  Statement of Financial Accounting Standards No. 124 - Accounting for Certain Investments Held by Not-for-Profit Organizations http://www.fasb.org/pdf/fas124.pdf  (para. 7 - securities are reported at fair market value)
>>  Statement of Financial Accounting Standards No. 117 - Financial Statements of Not-for-Profit Organizations http://www.fasb.org/pdf/fas117.pdf (para. 22 - gains and losses run through income statement)
>>  AICPA Audit and Accounting Guide for Not-for-Profit Organizations (para. 5.74, changes in value of stock between date of gift and date of sale)

Financial  Audits at  Churches- (13)

    Please go to  2040  for details of captured interaction on this topic by certain Onliners.  "Dialog Topic: Audits of Church's financial records"  Let me know at JimRetCPA@bcidot.org  if you would like to know the exact Onliner sources and Forum involved in this.  As a retired CPA-Auditor I will try to be as unbiased as possible and offer the following comments about an Audit's objectives/purposes within context of their comments:

A>   Regardless of size, a Ministry handles someone's else's money. Therefore it needs to be a good steward in a transparent and up-front manner and ultimately tell the proper financial message.
B>   An outside audit not only serves the Ministry itself but also validates the honest work of the staff who handles such resources.
C>   A qualified outsider's perspective (be it via an Internal or External source) usually adds to a Ministry's fiscal veracity and credibility.
D>   Most Ministries can usually improve their finance policies plus internal procedures and controls -- or (in general) improve their stewardship of cash and non-cash fiscal resources for their own well being. Audits should contribute to that end.
E>   Presentation of financial data in a manner that is "according to hoyle - or per GAAP standards" allows reporting uniformity and makes possible realistic comparisons to like endeavors.
F>   Loan providers, or applicable governing bodies, need assurance that the Ministry's fiscal data is valid and reliable.

        Please go to the link contents below on our web site for more info on this overall topic:

CPA-Auditor Assignments - Types of  -- 0003   
Other Such Matters follow:    Online Assurance  0056   Internal Auditors  0038  Volunteers  0057  Evaluations:  0025  QB Assuror  0676   Fiscal Fitness  0129  Internal Controls  0039   Self Exam  0005  Grades  0128

          Click below for Potentially Helpful Online Links for JIMs JRNL Readers: (1)       

Is an Intranet in Your Ministry's Future (98)  -- http://www.churchbusiness.com/articles/0b1comp1.html
Virtual Board Meetings, etc. --   http://www.churchbusiness.com/articles/041profi.html    
 

Current "Ministry Finance" Truism:       

    UNIFIED ACCOUNTING SYSTEM (8) - The idea here is that all of the dollars handled by a Ministry has one common/pooled bank account.  This TRUISM is especially meaningful in a Church setting where there are a number of Auxiliaries who may want to do their own thing and have their own bank account.  When they use the Unified Accounting System such groups are more likely to be appropriately responsible to the Church Board, plus a Ministry has the prospect of earning interest income from bank balances .....  see  0006  for more details.

          Bible Verse and/or Prayerful Thot:

     This "Blogger" like monthly endeavor (99) allows me to share some personal comments/thoughts as to Ministry Finance issues plus matters concerning Righteous Personal Finance for Christian people.  Please go to  0200  for further explanation and links to earlier JIM's JRNLs.  The four digit links  xxxx  herein come from www.bcidot.org sources. 
    If you would like to receive the next monthly JIM's JRNL during the first week of the subsequent month,  please join the following Yahoo Group:   ---- http://groups.yahoo.com/group/JIMsJRNL/.    Caution --- the non  www.bcidot.org  web links that I reference herein do NOT necessarily imply my endorsement.  Further, if any of these links do not work, let us know which one at LINK@bcidot.org.  Lists of our  www.bcidot.org  articles (or Web Docs), can be found at 9712.  9716  and  9705.  

 Probable "Ministry Finance Lingo", or "Frequently Used Vocational Terms" used herein, appear below:

            BLVR =  Someone who has accepted Jesus Christ as Lord and Savior, CBA = Church Business Administrator, CBAer;  CMS = Church Management Software/System;  CPA = Certified Public Accountant;  GAAP = Generally Accepted Accounting Principles/Practices;  GPFund or GPF = General Purpose Fund; MFTeam or MFT= Ministry Finance Team;  QBOE = QuickBooks Online Edition;  QBooks or QB = Quickbooks; RPFin  = Righteous Personal Finance , SPFunds or SPFs = Special Purpose Funds

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This document was updated last on:  May 24, 2007