Have you ever considered the relationship between your church financial management and your church team? In this article, we want to take a bit of pause and think specifically about your church’s ministry staff, and the impact of the church finance function on their roles and goals.
Driven to distraction
It would be interesting to have a figure of how many hours a week each of the ministry teams in your church are spending unnecessarily on some sort of financial matter, rather than other ministry priorities.
Such a figure would be difficult to nail down of course, with our thoughts and time regularly jumping from one thing to another, but perhaps the following areas may ring true.
How much attention are ministry staff being required (intentionally or unintentionally) to give to the nuts and bolts of financial processing?
Or perhaps you’ve experienced a time when your processes have let you down and you find you or one of your team is scrambling to resolve a financial concern that’s become unnecessarily urgent?
While the ministry team are normally supportive and gracious and happy to help of course, what may be the long-term effect on ministry when resources are regularly being diverted in this way?
An obvious consequence of this financial distraction can be less time spent in direct ministry. Not that church financial work isn’t itself a ministry, but here we are meaning that a team member’s time is being taken up in a way that was not envisaged as a part of their role. And for the team member themselves, it may seem easier to allow that time diversion rather than to spend even more energy seeking to bring about a change, and so the problem remains.
Along with time, there’s also a diversion of headspace to consider. Particularly if there are ongoing (but avoidable) financial processing issues month after month, it can be a case of significant distraction becoming normalised, making a lesser input to ministry the standard. And when financial issues from the workplace flow further into frustrations on the personal front, they can get buried deeper and have widening effects.
So, the time you are taking now to review the financial functions in your church can be seen as a well-invested use of your attention. The flow-on effects to your ministry team could be significant.
How much time is in your church is being lost in the uncertainty of ministry budgets?
Most churches are fairly good at the big-picture annual budget process, but where it can fall down is translating this into helpful month-by-month information for ministry leaders.
For example, what process and how much time do ministry leaders have to spend to understand: what budget is available to them; how they go about accessing the funds; how much of the funds are left and can still be spent; and when additional approvals are needed.
Uncertainties like this may not be voiced, but they can be affecting the ministry team.
If one or more of the team are not aware of their relevant budgets and how they are tracking, there is an increased potential for under-resourcing or over-resourcing specific ministry areas. In practice, this means that important ministry spending could be delayed or missed because the right people weren’t aware of the available budgeted funds. On the other hand (for the same reason), on-the-fly decisions may be made, which result in an unintended overspend in another ministry area. The resulting confusion, apart from the financial challenges, can involve the team in significant distractions.
Can you picture how helpful it would be to look at your financial reports and immediately see with clarity how each of the figures relates to the real-life operations of your church? Getting reporting to this level is an important early step to significantly reducing financial distraction.
Here’s how it works.
Your “accounting” or “chart of accounts” is structured in a certain way, generally defaulting to some set of standard categories and groups. However, the groups or departments or ministry areas of your church may be set up quite differently and bear little resemblance to what is coming out of your accounting software. This disparity can lead to a convoluted and manual process of trying to work out how the numbers in the accounts actually relate to ministry areas. And by the time this process is done, if ever, the opportunity to have the finances contributing to ministry operations has been reduced or missed.
But by structuring financial reporting in a way that is meaningful to the team and that intuitively relates to their ministry thinking, a good amount of this disparity can be removed. The result can be more easily understood finances that relate more to real life church operations. The team can spend less time trying to collate, understand and interpret the figures, and more time being helped by the figures.
Layered on to a financial structure that meaningfully serves the team, a good budgeting process adds a turbo charge. Not only can ministry leaders see figures that are meaningful to them, but it can become much clearer how excess (or lack of) funds are immediately affecting their ministry areas.
This allows for less time and headspace in trying to understand the situation, and more time and headspace into real-time responses, changes and plans.
The impact of church finances on the team isn’t necessarily restricted to work-related concerns. Like all of us, our church teams have personal budgets and financial planning and may be regularly juggling income and expenses at the family level. And as with any employment, when information about pay is not clear and timely, it can have an immediate personal impact.
This can be the case particularly when staff are struggling to understand the complexity of how their employment package works, and components that may affect their reporting to other bodies like Centrelink and the ATO.
So, it can be really beneficial to ensure that:
- details of employee remuneration are documented and communicated clearly at commencement
- employee remuneration is updated, processed and delivered in a good timeframe each pay cycle
- employees have access to additional information they may need from time to time for banks or real-estate agents or the like
Additionally, having the key area of payroll and minister’s expenses and benefits streamlined, accurate and well-understood can be a great help. This could mean identifying the appropriate support to ensure the payroll and benefits are structured correctly, reflect the employment agreement, are compliant with external bodies, and are communicated and understood effectively by all involved.
Would you like to explore further topics related to church bookkeeping, church payroll and church financial management? eBook available now:
Your Handy Overview of Church Financial Management
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This guide aims to provide a useful and helpful big-picture view – to assist you in further developing the financial function of your church in your context. Designed for church pastors, church ministry leaders, church officeholders, church admin teams, church treasurers and church members.
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