Foundations of Church Administration

Foundations of Church Administration

The administration is one of the critical areas in any organization for its proper operations and day to day running of business activities. For a church, the way the administration does determines the success of the Church. It is, therefore, an essential part of any organization. Finance is a significant area that needs to be handled with great care to ensure accountability. With this in mind, these are the summary of some of these Principles and how they are applicable in assisting in the financial agency of the Church;

Provision of Management Reports

It is crucial that Church Leadership has a comprehensive and easy to understand to allow them to make decisions based on the up-to-date financial status of the Church. It is common to find that most pastors and church leaders are not qualified accountants hence the need for accountants to provide them with financial reports that they can understand. There is a tendency of accountants manipulating reports or use complicated terms that those with no accounting knowledge are unable to understand. However, this kind of trend must be avoided especially in church setup. Accountants must liaise with the church leaders, pastors, to determine the type of information they need to capture in the reports. In addition to standard accounting report, manager’s report must be developed for church leaders for proper decision making based on the financial information within the report

This principle is essential for church leaders in making decisions based on the financial information of the Church. It is the work of the church leaders to keep records of the financial ability of the Church to understand how operations of the Church and projects to monitor within the financial report and easy tracking and referencing.

Developing a Research Cash Fund

It is also known as the Contingency Fund.  There are seasons that the Church will experience a high flow of cash while other time, the flow of money in the Church is low. With this understanding in mind, even though the faith in God’s provision is essential, ignorance when it comes to finances is not advisable for believers.  T, it is advisable to establish Reserve Cash Fund to maintain the effectiveness of the Ministry and trust with the Congregation

With different channels of cash flow, it is proper for the Church to have an appropriate management of the funds. Establishment of the Reserve cash fund is essential in the effectiveness of the church activities, especially in times of low-income seasons. It is vital as good stewards to be accountable for every coin and not be wasting.

Aligning Expenses with the Ministry Vision of the Church

Every Church needs to have the vision to work with, and where there is not a defined vision, the church leaders must come up with one and announce the same publicly to the church members. Once the concept is communicating, it will serve as a guide to donors’ expectations, thus encouraging them to support the vision. Well defined vision is a motivation for donors to give purposefully to help and build the vision.

As long as the Church expenditure has aligned with the Ministry’s vision, the donors’ expectation will align with the same spending. The more an idea is advanced, the more effective it becomes in the side of finances. A defined vision that has aligned with the Church expenses is essential for proper management of the Church finances.

Developing a system to protect Designated Funds

The Church must protect and safeguard funds allocated for specific projects without using them on other unplanned activities. Financial reports must be monthly and analysis the way funds are being utilized in the Church. When the church expenditure is more than the income, it means more money used that has not been assigned for any project.  Stewards must be faithful enough to produce this kind of report to track on how funds utilization to avoid diverting of funds set aside for specific projects.

Differentiating between Charitable Gifts and Personal Gifts

There must be a distinction and understand between what is a charitable gift and what is not. Any donation attracts its tax on it, and if not well defined, the Church can end up losing a lot of money due to taxes. According to the Internal Revenue Code (IRC) of the United States, there is a good guideline when it comes to matters of tax collection and assessment. The Church Stewards must understand these regulations and guidelines while making any charitable donations. It goes a long way in saving the Church from losing unnecessary funds

Developing a Spiritual View of Money

It is the work of pastors and Church leaders to view money not just from a subjective viewpoint but also from a spiritual standpoint. The lifestyle of someone is reflected majorly on how they can handle their finances. If a person cannot manage their finances effectively, it becomes difficult even to understand and manage other areas of their lives. Pastors have a responsibility to help the Congregation to understand the theological view of money. When the Church members have a better grasp of money from the biblical viewpoint, they are challenged to use it for God’s purpose, thus affecting their giving and donations.

Avoiding the “Church Treasurer” Syndrome

When the church financial stewards do not prevent the syndrome of being a church treasurer, their effectiveness to service delivery is compromised since they have a better understanding of the financial status of the Church. They have to avoid, at all cost, the symptoms that may make them prone to this syndrome for them to function effectively. Those handling finances in the Church must be careful not to be lured into controlling schemes by other church leaders who may have their interest

Conclusion

As noted above, financial stewards of the Church and other church leaders must work together to ensure they safeguard church finances. It is the responsibility of every leader to have a better understanding of how funds are essential to the church organization. With this collaboration and knowledge, it is necessary to protect and safeguard church finances using the above seven principles

References

Petersen, B. L., Whiteselm, B., & Thomas, E. A. (2014). Foundations of church administration: Professional tools for church leadership. Nazarene Publishing House.