About Your Churchs Finances Vestry University October 5, 2013 1 - - PowerPoint PPT Presentation

▶
about your church s finances
SMART_READER_LITE
LIVE PREVIEW

About Your Churchs Finances Vestry University October 5, 2013 1 - - PowerPoint PPT Presentation

May 24, 2023 24 likes •281 views

Im On the Vestry . . . What You Need to Know About Your Churchs Finances Vestry University October 5, 2013 1 Agenda Your Role and Responsibilities Internal Controls Monthly Financial Statements Your Congregation and the

slide-1
SLIDE 1

1

I’m On the Vestry . . . What You Need to Know About Your Church’s Finances

Vestry University October 5, 2013

slide-2
SLIDE 2

Agenda

  • Your Role and Responsibilities
  • Internal Controls
  • Monthly Financial Statements
  • Your Congregation and the Parochial Report
  • “Red Flags”
  • Payroll & Insurance
  • Q&A
  • Resources

2

slide-3
SLIDE 3

Your Role and Responsibilities

3

slide-4
SLIDE 4

Your Role and Responsibilities

4

–Fiduciary and Steward of All Church Assets –Oversight of All Bank Accounts and Funds –Internal Controls –Ensure Sound Business Practices –Compliance with the Law –Compliance with Canonical Requirements

– Audits – Parochial Reports – Pledge to Diocese

slide-5
SLIDE 5

Internal Controls

5

slide-6
SLIDE 6

Internal Controls

6

– Cash Receipts – Cash Disbursements – Pledges and Reconciliations – Financial Statements

  • Annual Budget
  • Monthly Review of Financial Information
  • Inquiries of Treasurer

– Annual Audit – Parochial Report

slide-7
SLIDE 7

Monthly Financial Statements

7

slide-8
SLIDE 8

Basic Financial Statements Income Statement

8

– Income Statement

  • Income and expenses

– Current month and year-to-date

  • How much have we received, how much have we paid
  • ut?
  • Are we running at a surplus or a deficit?
  • It’s not necessarily about cash
slide-9
SLIDE 9

Basic Financial Statements Balance Sheet

9

– Balance Sheet

  • Two Components
  • Assets (including cash and investments)
  • Liabilities (amounts owed, including loans)
  • What is our financial position right now?
  • How much has it changed?

– Alternatives to the Balance Sheet

  • Schedule of Assets

– Especially Cash & Investments

  • Schedule of Liabilities

– Current Liabilities – Aging of Accounts Payable

slide-10
SLIDE 10

Examples of Financial Statements

10

– Monthly Budget vs. Actual Results

  • Exhibit, pages 1-2

– Year-to-Date Budget vs. Actual Results

  • Exhibit, pages 3-4

– Balance Sheet

  • Exhibit, page 5
slide-11
SLIDE 11

Your Congregation and the Parochial Report

11

slide-12
SLIDE 12

Annual Parochial Report

12

  • Your Parish

‒ Three-Year Summary of Financial Information

slide-13
SLIDE 13

“Red Flags”

13

slide-14
SLIDE 14

“Red Flags” Income and Expenses

14

  • Recurring operating deficits
  • Pledge income

– Number of pledges – Average pledge – Declining pledge amount – Percentage of pledge to NOI

  • Ratio of “regular support” to NOI
  • Reliance on rental and other income
  • Use of endowment/investments for operations
slide-15
SLIDE 15

“Red Flags” Balance Sheet

15

  • Amount of unrestricted cash and investments
  • Listing of aged amounts payable
  • Pension and 403(b) payments up-to-date
slide-16
SLIDE 16

“Red Flags” Other Information

16

  • Declining ASA (Average Sunday Attendance)
  • Percentage pledge to diocese
  • Comparison of key items to similar-sized congregations
  • Comparison of key items to diocese
slide-17
SLIDE 17

“Red Flags” Basic Controls

17

  • Audits up-to-date?
  • Action taken on audit recommendations?
  • How process payroll?
  • All tax withholdings timely remitted?
  • All tax filings with IRS and NJ current?
  • Bank reconciliations done and approved?
  • Two signatures required for all transactions?
  • Parochial report filed timely?
slide-18
SLIDE 18

Payroll & Insurance

18

slide-19
SLIDE 19

Payroll

19

  • Importance of Payroll
  • What Can Go Wrong?
  • Vestry Responsibility
  • Outside Payroll Service
  • ADP through Episcopal Payroll Services

– https://www.cpg.org/administrators/payroll/episcopal-payroll-services/ – Patricia Tucker – 800 223-6602 Ext 6286

slide-20
SLIDE 20

Insurance

20

  • Importance of Proper Coverage
  • Common Deficiencies
  • Flood coverage
  • Employment practices liability
  • Adequate levels of coverage
  • Lack of diocesan umbrella coverage
  • Church Insurance Company
  • Bill Lodico, Vice President wlodico@cpg.org (718) 746-1227
slide-21
SLIDE 21

Q&A

21

slide-22
SLIDE 22

Resources

22

slide-23
SLIDE 23

Resources

 Episcopal Church Foundation http://www.episcopalfoundation.org/

  • The Vestry Resource Guide (book)
  • Vital Papers (GREAT online resource)

Manual of Business Methods in Church Affairs

  • http://www.episcopalchurch.org/sites/default/files/downloads/full_manual_updated_09-30-2013.pdf

TENS (The Episcopal Network for Stewardship)

  • www.tens.org

23

slide-24
SLIDE 24

Resources

Church Pension Group

  • 2013 Federal Reporting Requirements for Episcopal

Churches*

  • 2013 Tax Guide for Episcopal Ministers—For 2012 Tax

Returns* *Updated annually; download from CPG at https://www.cpg.org/forms-and-publications/publications?label=publications&ref=flyouts

24

slide-25
SLIDE 25

Resources

Paul R. Shackford

pshackford@dioceseofnewark.org 973 430-9983

Ross Mangina

rosscman@optonline.net

25