Megachurch answers call to financial accountability

By Mark Zimmerman

Eastview Christian Church promotes and instills financial integrity and trust throughout the congregation by employing a combination of oversight and sound policy.

As God entrusts your ministry with additional resources, the need for well-established financial controls becomes more and more imperative. From a small church of 19 people in 1955, to one where attendance regularly exceeds 5,000 today, Eastview Christian Church has seen its annual operating budget grow from a few thousand dollars to several million dollars over the past 60 years.

With that growth, we’re keenly aware that God’s mandate to steward his resources well hasn’t changed. However, the consequences of doing it poorly are exponentially greater.

Under our church’s original structure, much of the financial controls were regularly reviewed and carried out by church elders and volunteers. As the church expanded and transitioned to a structure of policy governance, staff roles increased; consequently, the direct involvement of elders and volunteers in financial processes diminished.

To maintain accountability and adequate transparency under this new governance model, Eastview relies on submission to regular reviews by the board of elders, as well as adherence to clearly established policies and procedures pertaining to the stewardship of church resources.

Borrowing from the business world
From an operational standpoint, Eastview relies on a number of important proactive accounting policies and operating procedures to control and safeguard the church’s assets. Some are specific to churches; others are just common, prudent business practices.

Given the importance of our mission as a church, we evaluate all internal control processes through three lenses to make sure they are an effective fit: vision, integrity and risk. Processes must serve to facilitate ministry, promote integrity and reduce risk. A great control process or procedure will accomplish all three without sacrificing one goal for another. We aim for maximum ministry with minimal risk, coupled with a high level of integrity. (Let me point out that our church vision statement includes being “dangerous,” so risk really refers to loss of assets, resulting in failure of our mission.)

In areas less tied to ministry practice, this three-pronged fit — with our church’s vision, integrity and risk profile — is often easier to accomplish. For example, we still pass the offering plate at every Sunday service. We always have three individuals handle the contributions in a controlled room for accountability. All funds are stored in locked bags in a drop safe while on church premises. Safe combinations and keys are given only to certain staff members. Moreover, our accounting staff never processes cash without the presence of at least two (usually three) employees, all of whom are required to sign off. Contribution checks are processed only by accounting staff, and all records are kept confidential, with restricted access. These processes work efficiently, reduce risk of loss, maintain integrity and don’t impede our ministry.

But, by the same token, we’ve chosen to forego some processes that other churches use because our risk is comparatively low. In these cases, the costs and processes involved could negatively impact our ministry.

Segregation of responsibilities
We’re fortunate as a church to have reached a size where resources are available for greater segregation of duties without impeding ministry. We have four accounting staff — two full-time and two part-time. This enables us to maintain a distinct segregation of duties, which promotes efficiency and accountability between roles. Separate staff processes deposits, pays the bills, performs bank reconciliations and prepares financial reports.

We also use technology to help facilitate this segregation by limiting access to certain software components and by tracking who makes particular transactions. Without this segregation of responsibilities, it becomes much easier for losses to go undetected and for integrity to more easily be brought into question.

In churches where this separation isn’t feasible, it’s necessary to get creative; other personnel or volunteers must be enlisted to maintain a healthy checks-and-balances level, and to safeguard church funds.

Ministry often directly intersects with financial controls in the area of expenses and resource allocation. To facilitate ministry while at the same time controlling budget spending, Eastview uses a combination of check requests and staff credit cards with preset limits. Budget funds are released quarterly, and large capital purchases must be approved by the executive pastor. Regardless of size, every purchase must be documented with a receipt and entered in our purchase order system. Also, checks exceeding a certain threshold amount must be counter-signed by a member of the pastoral leadership team. Directors meet regularly with the executive pastor and review their ministry budgets. In some cases, the above processes can impact ministries; but, the reduced risk of abuse and higher level of accountability support the financial control.

To build on the financial leadership of our past and maintain the highest levels of integrity going forward, church leaders must constantly reevaluate the controls and safeguards in place to protect the resources with which their ministries have been entrusted.  In churches where this is done well, we’re more likely to see ministry succeed and God’s provision increase.

Mark Zimmerman is the pastor of finance at Eastview Christian Church in Normal, IL.

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3 steps to financial accountability

The elders of Eastview carry out their oversight role in a few key ways. All establish a foundation for how the church will operate, fiscally.

chart1Elders require the senior pastor to provide an annual balanced operating budget and ministry plan that’s in line with the church’s vision. Doing so establishes a clear benchmark for how church resources are expected to be used. It also reinforces the principle that we, as a church, won’t spend more than God provides.

As part of the budget process and review, the elders also establish and document the senior pastor’s compensation and benefits. This is done with the assistance and support of compensation surveys of similar-size churches to ensure the levels are appropriate and fair. We, in turn, follow this example when setting compensation across all staff positions throughout the church.

The elders requirpeoplecharte regular meetings with the senior pastor and pastor of finance to review the financial reports. In these meetings, actual operations are compared to budgets, and any areas of variance are discussed. Regular review increases transparency and provides an opportunity for intervention or guidance when necessary.

The treasurer of the board of elders maintains open communication with the pastor of finance. This allows for free dialogue concerning financial matters and practices and further promotes a culture of transparency. All financial records are open to review at any time by members of the board of elders. (This includes the senior pastor’s expense reports, which the treasurer reviews on a quarterly basis.)

Although regular reviews may not always seem necessary — and in some cases, even tedious — knowing they’re performed instills greater trust in leadership throughout the church.

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