"JIMs  JRNL" Edition
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- - And the Lord direct your heart in the love of God as you continue to faithfully serve Him - -


To:   Interested Onliners                                                                                FROM: Jim Bramer, Retired Auditor-CPA 
      
                                                  
   
 RE: 
J I Ms  J R N L   for the month of June 2008                                        FILE:  0206-08/jrnl                       


(01)  The Electronic eFINFAX Accounting System (07)

        It is with a great deal of pleasure that I present to you JIMs JRNL readers this "eFINFAX Accounting System."   Brad Pendable and I have been working on this for most of 2008.   It is an  Internet Friendly  resource that is designed for the Christ Centered Small Ministry (New or Small Churches and the small Mission Organization, etc) who handles less than $500,000 per annum.   It's features include the following:

     a>   They use of the BuxBox accounting structure so that operational expenses are limited to the balance that is available in that General Fund department's BuxBox (or Envelope). Operational income is placed in BuxBoxes and it functions as an alternative operating budget method whereby if there is "No balance no can buy or spend."
     b>   It generally has a "Web Based" flavor so that Laptop users can access the system via the Internet and use it from virtually anywhere at anytime. For safety and documentation purposes the Ministry buys as much as possible via the use of Plastic  (Preferably Debit and then Credit cards and even save money by using Scrip cards)
     c>   It provides essential Weekly (notice this is not Monthly) reports like these samples.  Please note that these reports provide decision makers with the needed money status (Balances) and activity information.
     d>   Please especially note that Bank and Plastic transactions are moved electronically (at least weekly -- some are automatically moved daily while others are moved manually) from the financial institution to this eFINFAX system They then are ultimately placed into the appropriate BuxBox. The eFINFAX user does not have to post checks and plastic transactions into their books and then reconcile each item to periodic Bank or Plastic statements.
     e>   This Small Ministry can then make full use of both remote HOMERs and CPA firms in management of this eFINFAX system during the year and at the fiscal year end.   Plus this same CPA firm can provide the necessary inexpensive annual Compilation report so that this Small Ministry can be a member of ECFA.   Ultimately this independent ECFA Ministry informs the Small Ministry's members, and/or the general public, that they are handling their money as they should, etc.

Please let me (Jim@bcidot.org ) or Brad (Brad@rpfin.org ) know if you have any comments or questions.

(02) -   Scriptural Enablements that have to do with Ministry Finances - (01)

  Below are some discovered Ministry Finance concerns plus some forthright Scriptural enablements that we have 'gleaned' down through years..... we trust you can relate as you either look up the Scriptural verse or you right click to the verse content .

  •   Finding money to pay bills is exhausting ---- Isaiah 40:29
  •   Funding of that project really worries me ---  Phil.  4:6
  •   This particular financial system is frustrating -- Eph. 2:10
  •   That computer matter is beyond me - I need help!! -- Psalm 37:30
  •   You mean the IRS requires us to do that --- Romans 13:1
  •    I know, I know - that donor was not fair, but: --- Psalm 37:28
  •   Praise the Lord-we were able to meet payroll!!! ---  Psalm 96:3
  •   The General Fund income is more than expected --- Psalm  108:5
  •   That department stayed within the budget and deserved praise;   Prov.  16:24
  •   No - We really must pay that bill-even if it is grossly unfair----  II Tim 2:19
  •   How frustrating; no one will take responsibility for that obvious over-spending - Isaiah 26:3
  •   Yes, I had my reasons for forgiving that debt - Isaiah 55:9
  •   I'm proud of that Ministry Building - I Cor. 13:4-5
  •   We gave to that needy person confidentially -  Matt. 6:3
  •   Jesus speaking --- plan ahead -- Luke 14:28-34
  •   Staying within our income was (and is) hard work -  I Cor.  10:31
  •   Double signatures are required on our checks - Prov . 18:17

(03) - PHOTO and VIDEO Financial information (03)

        Way back In 1994   (WOW -- that is over 14 years ago, now !!) I began using the "PHOTO" and "VIDEO"  Bramer-ism  terms.  My rationale is that when you are a  Ministry Finance Team  decision-maker you MUST receive sufficient fiscal information.  To do this you embrace the following objectives:

OBJECTIVE #1

    Obtain "Point in Time" information.  You MUST timely know PHOTO information --- as if you were viewing a photograph, or a snapshot."   In accounting terms we usually call this a "Balance Sheet" or "Statement of Financial Position".  A PHOTO is to answer at least the following questions:

  >>  How much Cash/Bank Balance is on deposit;
  >>  How much now belongs to the INTERNAL DISCRETIONARY FUNDs or EXTERNAL DESIGNATED FUNDs.
  >>  As applicable, what Non-Cash resources do you have,
  >>  Plus what Unpaid Obligations (or Bills) do you have - whether due now or in installments?

OBJECTIVE #2

    Obtain "Period of Time" information : You MUST timely know VIDEO information --- like viewing finance activity like a video or a movie";  the usual accounting terms are "Profit and Loss (P&L)" or "Income Statement."  A VIDEO is to answer at least the following questions:

  >>  What has financially happened since the first of the fiscal year to the current "Point in Time",
  >>  What did each of your Ministry Funds start with as of the first of the fiscal year (if applicable) and then what type of Revenues, Expenditures and Internal fund transfers cause the balance in each Fund to increase or decrease?

                                                                    OBJECTIVE #3

    Incorporated in all of this is the need to also know where you are in relationship to where you planned to be financially. Or you need to timely answer "Actual to Budget" questions that have to do with VIDEO activity within the INTERNAL DISCRETIONARY FUND (the General Purpose or Operations Fund).   Or how does the actual activity, since the first of the fiscal year, compare to what was planned/projected (yea, via an authorized budget) for that period of time;  often by appropriate Ministry department.   Another Spending Control resource is the BuxBox method as described in the FinFax system mentioned above.  Like the FinFax system the usual budget process is usually not that important for Special Purpose Fund - SPF  monies, since you can only spend that available SPF balance.

OBJECTIVE #4

    What is the perspective of such PHOTO and VIDEO financial data?

>>   How does this information compare to other related meaningful Ministry Finance data.
>>   As a decision maker, you need to view the overall condensed 'Big Picture or Big Pix' (hopefully on one sheet of paper, etc.) and follow various financial trends. Click here  for a view of such matters in a church setting.
>>   We often refer to such info as a "Big Pix" report or a "Key Item Trend Statement - KITS" report.
>>   Another name for this type of condensed overall reporting is "Executive Summary".

    Please  Click Here   and view some PHOTO and VIDEO sample reports as produced via the QuickBooks (QBs) software.

(04) - A Ministry's Annual General Fund BUDGET    - (06)

            Remember, this budget is supposed to be a "personification of the known Ministry's plans/needs as converted to dollars."   Plans do not remain the same for the entire Annual Budget time, or 12 months.  Ministry department managers sometimes "pad" their Annual Budget and get approval for more than they really need. They should be asked the question: "Did you pad the budget for things you really do not need?" Again, the best approach is to carefully plan what you want to accomplish during that period, and then convert your plans to dollars.   
            Yes..... pre-authorized spending amounts, or a Budget is a MUST !.  But you also must be a Ministry that can rightfully respond to needs --- especially if you have available resources.  Of course, the Ministry must have the necessary accounting system, and structure, in order to timely provide information to decision-makers as they live within these advance dollar authorizations.
            Other alternatives to a strict Annual Budget includes the following approaches: " Four by Three" Plan or Budget for 4 months forward only at a time; Or you take the 4 months to date spending (or 8 months) and plan/budget forward from there. Another is a "Six + Three + Three" plan or you plan/budget for the 1st six months; and quarterly thereafter.  Spending Controls are a MUST!
             All operating costs flow via this updated "General Fund Annual Budget" when the income permits. Do NOT look to Board discretionary funds for the usual operational purposes. Draw on Reserves or SetASides resources only for
'out of the ordinary' projects and/or needs.
            Approved annual "General Fund" Budget items expire at the end of each fiscal year and any unused portions are NOT carried forward to the next year.  Ministry department managers often ask toward the end of the year if there is unspent Budget money -- or they have the mind-set/philosophy of: "
I better spend any unused portion since it is approved - even though it is not that badly needed"; or " Whewwww, I don't want to lose it so I better find some way to spend it".   NOT good resource stewardship.
            The Ministry must have a strategic plan if the General Fund is not getting enough money to pay for the authorized Annual Budget. Click Here for more details whereby money is assigned to Spending Priority Groups when it comes in. If a Spending Priority Group has money, then expenses are authorized and paid out.

    Budget Issues unique to Churches

             Most congregations are the final spending authority, but there needs to be some realistic way to meet needs between necessary congregational meetings.   A Church's by-laws could provide the Board of Leadership with the authority to make as much as 5% of Annual Budget changes without having to go to the congregation. If the congregational approved Annual Budget is $500,000, then, provided the General Fund has the resources, $25,000 is available to the Board to meet new operating ministry needs.
            There may be merit in using something like a "Tri-Angular" Budget approach; (1) Salaries and Benefits (Payroll costs) of the present Church staff remain in place for the entire fiscal year; (2) Non Payroll Operational Costs and SetASides are authorized for the first six months and (3) then, with new insight of needs etc, such non Payroll Costs (except for new staff, etc.) are authorized again for the last six months.
             it is important for the Church Leadership to keep the congregation regularly informed of the "General Fund" status - preferably showing in the weekly Church Bulletin the weekly and year-to-date donations in relation to what was needed, etc.  

(05)  -  Ask the Kids - the Internet & Plastic are here to stay   (04)

        I'm convinced it is not realistic to have a  "Do Not Touch"  Plastic and Internet approach;  my view is that we emphasize the "Pluses" and not the "Minuses".    Like the use of television and other contemporary resources (maybe even Cell phones), God enabling discipline is the issue, not abstinence.  We need to trust the Lord for spiritual victories in these areas of our lives.  Let the Lord be in charge and not the providers.   Both Plastic and the Internet MUST not be "Toys" or "Tyrants" but they should be "Tools."   Other non God honoring issues might include:   a>  Too many of us have the mentality that one never have enough money.  b> Over spending as allowed via borrowing via the use of Plastic    c>  We have no meaningful money record keeping system perhaps exacerbated by the unwise use of too much cash or "Green Stuff."
        Dad/Mom (often by example) need to teach their teenagers early on how to use Plastic and the Internet as rightful tools.  We all need to be money managers in ways that are honoring to the Lord.   The Internet and Plastic are today's life style fundamentals and are no doubt "Here to Stay."  The term "Plastic" includes Credit Cards, Debit Cards and Gift Cards.  Here are some suggestions:

    >>  No later than when they are Juniors in High School,  Dad/Mom open up both a Bank account and a Credit Card (Plastic) account for Kids that Dad/Mom can also access and supervise Online.  Dad/Mom set forth some understood rules that must be followed or the Kids do not get their weekly allowance that are placed electronically into the Kid's Bank account.
   >> 
The Kids handle the minimum amount of cash or "green Stuff" for two reasons:   1>  It is not easy to document or keep spending records when you use cash and 2>  general security or safety of cash, etc.
   >>   The Kids learn to keep financial records and control their spending;  usually via something like a Check Stub method.  Later they may want to use some Computer software, etc.
   >>   The Kids electronically  Pay Off  their Plastic balance each week.  In this way they learn to limit the use of their Plastic to what they can afford, or they learn to borrow money appropriately.

    Please note more content within the "Monthly Editorial" below on the topic of "Kids and Money"

(06) -  INTERNET FINANCIAL SERVICES  (06)

            PEOPLE INVOLVED IN "INTERNET FINANCIAL SERVICES":

    WEEKLY:

SEE BELOW:

(1)Local person who handles clerical tasks that includes the following:

Has the needed Computer system

Continually

Maintains mailing list in a computerized  People and Donation   file

Continually

Uses this file for mailing and Constituent/Donor contact purposes

As needed

Post and balances donations information within this file

XX

Provides deposit and funds information to (2)

XX

(2)Local person (could be (1) above) does such things as the following:

Uses fast connection computer system often via their home

As needed

Has "Microsoft Outlook" so can process Email and attachments

Continually

Supervises Credit Card/Plastic buying

As needed

Supervises or does the weekly donation processing/bank depositing

XX

Has an understanding of the use of Excel docs

Continually

Has an understanding of the Computer system and Chart of Accts

Continually

Computes weekly hourly payroll and send details to (3)

XX

Writes Weekly Salary and Plastic checks

XX

Writes all other checks

As needed

Codes the weekly Deposit

XX

Receives Excel docs from (3) and does the coding

XX

Emails coded Excel docs to (3)

XX

Receives Weekly reports and Proofs

XX

If Proofs are OK, then distributes to leadership

XX

Processes payroll tax returns from data supplied by (3)

As applicable

(3) Remote person like an Accountant who serves via the Internet

Their Computer system could be at a  HOMERS  home

As needed

Has the same computer software on their system

Continually

Has "Microsoft Outlook" so can process Email and Excel attachments

Continually

Establishes the Computer system and Chart of Accts

One time

This includes Clergy and hourly payroll earnings records etc

One time

Downloads weekly deposit and check info from ECCU's Web Service

XX

Places above download into the Computer system

XX

Converts such info to Excel Docs and Emails to (1)

XX

Receives coded Excel Docs from (1) and updates the Computer system

XX

This includes updating Clergy and hourly payroll earnings records etc

XX

This includes applicable Online "Looking Over your Shoulder" -- Click here for how it can be done.

XX

Process agreed Reports via Computer software and Emails to (3)

XX

Finalizes payroll data

As applicable

        Please also be aware of the resources along these lines found at this   Spending Control   web site.  Plus this paragraph when you  Click Here found within a recent JIMs JRNL edition..       

(07) -  Small Church and one Person with Multiple Finance Tasks - (09)

Question from Onliner:

     The Treasurer and Bookkeeper (same person) of our small Church also serves on the Board of Leadership and is on the Mission Committee.   Is there enough separation that this should be allowed or do you see any problems with him serving on additional Church Committees that also make some of the financial decisions?  

Answer by Jim Bramer:

    Regardless of the size of a Church, or how many ways the individual finance person is involved in the overall ministry at your small Church, my view is that you evaluate this person’s multiple tasks within context of  “Truisms” like the following which each Church should apply:

>>    A Ministry Finance Team that makes finance recommendations to, and is responsible to, the Church’s Board of Leadership. One person does not handle all of the finances.
>>    A written Finance Policy Manual  is authorized by this Board of Leadership and it is reviewed for relevance on a regular basis.
>>    The Church should have In place the applicable Internal Financial Controls – of course small entities are limited to available people, but the major issue is when you handle someone’s else’s money, even though it is a nuisance sometimes, you do NOT do it all yourself.   Examples are:

1> At least two unrelated people do the money counting and make the deposit.
2> The unrelated Check Signor is not the unrelated Check Writer (Treasurer or Bookkeeper, etc)
3> Two signatures of unrelated people are often desirable on at least the larger checks.
4> See details on this topic displayed when you go  HERE.

(08)  Monthly Editorial - "For What It is Worth"  as rendered this past calendar year  --     Kids and Money

(09)  Click below for "Potentially Helpful Online Links" for  you JIMs JRNL readers: 

Higher IRS approved Mileage rate beginning 07-01-08   
Ministry Finance and Tax Publications by Attorney Frank Summerville
IRS Publication 526 re Charitable Contributions
The current means to "View Jim Bramer's Desktop" or to "Transfer Files" back and forth 
ECFA's list of quarterly newsletters.
Board's Dirty Little Secrets

(10)   Current "Ministry Finance" Truism (2)

       What follows is something like one of my Ministry Finance precepts/beliefs/principles, or  "rules of thumb". Please go to  0069  for complete TRUISMS list.  

        "A budget is like taking a picture of a dollar landing before it starts. A budget is keeping an expense account before, instead of after, you spend it."

        (11)  Prayerful Thots -  (3)

       Dear Lord,  Bettie and I want to thank you for our Christian grandson's recent graduation and commissioning from the "U.S. Naval Academy"  per pictures when the readers  Click Here.   We ask your guidance and protection of Kraegen as he serves You as his Lord and as he, at this time,  is a U.S. Marine officer in pilot training.   Thank you, Lord, for the U.S.A. that you have blessed in so many ways all of these years and for those who serve in our military.  In the name of Jesus, Amen.


     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  and some  "Click Here" 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  Jim@bcidot.org .  Lists of our  www.bcidot.org  articles (or Web Docs), can be found at   9707  and  9708


 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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Click Here and go to a list of earlier JIM's JRNLs - Contact  Jim@bcidot.org 

This document was updated last on:  November 15, 2010