Why you shouldn’t shun good financial accounting in your church
I once worked for a corporation that was growing tremendously. At an annual meeting, the CEO gave a speech lamenting the fact that the accounting staff had become larger than the sales staff. But the reality was that the rapid growth of the company demanded a higher level of internal financial management than ever before.
Many churches view their need for accounting and business administration in much the same way—as a necessary evil. But I contend that appropriate financial accounting, administration and accountability is not evil. In fact, it is not only essential but also beneficial because it helps maximize the efforts of your ministry.
Here’s how to create an administrative structure that will help your church or ministry operate efficiently and effectively:
Proper organizational structure. This type of structure is critical for the health of both your senior leaders and the entire organization. In Exodus 18, God spoke to Moses through Jethro and gave him wisdom about how to manage the people of Israel. Jethro pointed out to Moses that the way they were currently structured (with everybody coming directly to Moses for counsel) would not only cause Moses to burn out but would also cause the people to burn out. Jethro also instructed Moses to be “the people’s representative before God” and to select men to be “leaders over groups of one thousand, one hundred, fifty and of tens” (Ex. 18:21, NLT).
Most churches today understand this concept, and each church has to determine how this structure works for them. Though much of how it is worked out can depend on the personality of your primary leader, ultimately the ideal organizational structure will provide an atmosphere in which the senior leader and every other leader and staff member are empowered to operate at their optimum performance level.
A proper structure also allows people to be placed in and developed through the best roles for them. It encourages decisions to be made quickly, and it allows clear and intentional communication to occur. In addition, a proper organizational structure is the necessary foundation for setting financial parameters and establishing financial accountability.
Financial parameters. The key to efficiency and productivity is empowerment—the right people doing the right things, making the right decisions. However, it’s impossible for your staff to be truly empowered when all the financial control rests with one person in the accounting office. On the other hand, if every person has complete financial control, you end up with chaos. So what do you do?
The key is to give your staff financial responsibility with clearly defined boundaries and parameters. For example, Gateway’s youth ministry doesn’t have to run every financial request through the accounting office. Likewise, the accounting office doesn’t worry that the youth ministry is out on a spending spree! Why? Because clear financial parameters are in place—each level of the organization understands how much spending authority it has and knows what process it has to follow to get approval on an expense that lies outside its realm of authority.
This setup enables our ministries to function without frustration and our accounting office to function without worry.
Financial accountability. There must be financial accountability. Some key questions are: Who monitors overall expenses? What is our cash-flow projection? Did every expense have proper approval? How did we do compared to our budget?
To get accurate answers, you must have an accounting system that provides reports you can use to manage the finances. You must also have specific times when those who have financial responsibility can review the reports with their overseers.
At my church, this happens with anyone with responsibility of stewarding money. We seek to be accountable today because we know we will be accountable to God.
Your administrative and accounting systems don’t have to be roadblocks to cutting-edge and dynamic ministry. When set up properly, they can breathe life into your ministries because they allow your ministries to be efficient, effective and fruitful.
Todd Lane serves as an associate senior pastor at Gateway Church where he oversees the departments of Business Administration, Financial Stewardship, Campus Development, Membership Services and Support Services.
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