- Financial strategies for your church
By Rev. Dr. Perry J. Hopper, MBA After two years of doing ministry and worshipping with the uncertainty of the pandemic, most churches have returned to in-person worship. Church attendance at mainline churches had been experiencing a steady decline before the pandemic, and that has been exacerbated because churches were forced to worship online for far longer than expected. We are learning to live with and protect ourselves from the COVID-19 virus, and discerning insights gained during the pandemic. Churches will benefit by taking a realistic assessment of their financial health as they plan for future ministry and financial needs. Consider the following factors in your financial evaluation: • Include an analysis of your pre-pandemic giving income and expenses in 2019 or earlier. • Determine how the church fared financially during the disruptive pandemic years of 2020 and 2021. Did congregational giving decrease, increase, or did it hold steady? • If your church received a loan under the Paycheck Protection Program initiated in response to COVID-19, how did that impact your budget in in 2020 and 2021? • Is your church making payments on payroll taxes that were deferred through December 31, 2022 under the 2020 CARES Act? How will that affect the balance sheet? • If your church adopted an online giving platform(s) in the last two years, what has been the impact on congregational giving? • Has 2022 functioned as a stabilizing year financially? • Are there any financial trends or expenses that emerged over the last two years that have become permanent? • Note any shifts that have occurred amongst your church staff. Ideally you want to develop a three-year comparison and analysis to help your church finance committee determine how giving patterns and income and expense cycles might have shifted. This might be time-consuming for the financial team at your church, but the information gathered will be invaluable as you begin working on the budget for the coming year. Discontinue ministries that are no longer effective. Pastoral leaders will want to prayerfully determine with other church leaders which ministries need to be halted before you plan your budget; determine which ministries might need increased funding such as a growing media ministry or whether there are new ministries that require funding. While everyone might have a particular ministry they believe should be retained, it is critical to take a no-nonsense look to ascertain the ministries and programs that are most effective. Consider changing your budget cycle. Most churches use the annual budget approach. However, many churches are still discerning potential changes in worship and understanding the choices congregations are making after almost two years of online worship. Should the church use a hybrid model for worship? How do you define hybrid for your church context? Changing to a 6-month budget cycle might allow the church to be more responsive as adjustments are needed. Be sure to consider cash flow when formulating your budget. Many churches make the mistake of focusing solely on overall giving without considering cash flow, so they have enough cash on hand for ongoing expenses and unforeseen emergencies. Your church will want to build up a reserve for periods when giving and income is down and large annual expenses need to be paid. The church budget should be aligned with your strategic ministry priorities. You want to be sure that all spending links back to the ministry and program goals and plans that have emerged from the church vision and mission. Think carefully about your stewardship plan. Pastors need to decide how they will preach and teach about stewardship and giving. If there is a stewardship committee, work together to develop a plan that helps the congregation understand how we are called to be stewards of God’s provision. In the book Embracing Stewardship by Charles R. Lane & Grace Duddy Pomroy1, Pomroy remarks that “Stewardship is the multiplicity of ways that the people of God live out God’s mission in the world using all of the abundance that God has entrusted to them.” She appears to view stewardship as having a generous mindset that goes beyond giving money, but manifests in our understanding of who we are called to be out of gratitude for God’s grace in our lives. Make financial education a central priority for the congregation. For most people, talking about money and finance is uncomfortable. But it does not make much sense to speak about stewardship and giving if you do not provide resources for people to become more knowledgeable about how to build their personal financial wellness. Consider hosting a workshop or webinar for a financial planner to speak about ways to manage debt or create an emergency fund. When people experience positive change in their personal finances, they tend to be more responsive to the financial needs of the church. Finally, the pastor needs to be comfortable talking about money. If the pastor has difficulty discussing money and his or her own experiences or money struggles, it will be reflected in the congregation. Members can benefit from hearing about pastors honestly speak about their own money stories or journeys and the wisdom they have gleaned as they have worked toward creating financial wellness and wellbeing in their own lives. Rev. Dr. Perry J. Hopper, MBA serves as the associate executive director and director of denominational relations of MMBB. He joined MMBB’s staff in 1987 and is responsible for coordinating special programs that support MMBB’s mission. He works in various capacities to best serve existing members, to reach prospective members, and to maintain solid relationships between MMBB and its affiliates. Rev. Dr. Hopper’s education includes a B.A. in political science (with a minor in business administration) from the University of Washington and an MBA from Penn State University. He also holds a Master of Divinity degree from the Harvard University Divinity School and a Doctor of Ministry degree as a Samuel DeWitt Proctor Fellow at the United Theological Seminary of Dayton, Ohio. 1Lane, C.D., Read More >
- ICYMI: Texting has really changed the ChMS game
By RaeAnn Slaybaugh When it comes to texting, The Church of Grace and Peace has it down. Here, Business Administrator Josette Kluender talks about all the different ways this easy, effective communications tool makes her whole team’s lives easier. Church Executive: I understand that you discovered your church’s ideal ChMS provider at a pastor’s conference. Tell me more. Josette Kluender: My husband, Tom — our Connections Pastor — and Senior Pastor Pastor Jim Wehrer attended the Renegade Pastors Conference in 2019. At the time, we had been using a different ChMS for more than 11 years and only used maybe one-quarter of its functionalities. Everyone was always looking to make changes to a database, which wasn’t a simple thing to do. Both pastors told me they found this great company, there — Churchteams — and how affordable it was. Honestly, I thought, Well, how good could it be, then? How can it offer me everything that I need for such a small fee? Because I knew what we were paying, and it wasn’t inexpensive. Luckily, Boyd [Pelley, co-founder of Churchteams] and his team were just amazing. They answered every question and even put us in touch with other, similar churches to ours. We got to communicate with all of them before we moved forward. This was critical because we really needed to get our database administrator, Shari Gilbert, onboard with potentially switching our ChMS. When we did move databases, all of our pastors went into panic mode. I told them how easy it was: ‘If you use Facebook, you can use Churchteams. That’s how easy it is.’ Now they all use it, which just blows my mind. It’s just very, very easy. CE: What did the training and implementation look like? Kluender: Shari and I really dove into it. We met weekly with James [Seawell, Churchteams Director of Strategic Support] for two months, just to make sure that we were using it the right way. By the time it went live at our church, she and I were more than ready. After that, we just needed to get the team ramped up on it. We were the first church where [Pelley] did on-site training, so that was awesome — to have the actual co-creator come out and teach us. He was here for two days training the pastors, ministry leaders and administration team. CE: As you think about your church’s overall communication strategy, how important is texting? Kluender: Well, texting is working great for us. It seems to be our main source of communication; not everybody wants to get a long email, but they’re very quick to open and read a text. Texting has become one of the easiest, fastest ways for us to communicate with everybody. CE: What unique advantages does texting offer, compared to other forms of reach-out — emailing, for instance? Kluender: We’re able to text-to-give; people can either set up a recurring gift or automatically give as the pastor is praying over the offering. They can use that feature at any time. We also use ‘text-to-check-in.’ Parents can just text the word ‘Check-in’ and skip the line for children’s church. Identification tags are waiting for their kids when they arrive. That’s a very, very awesome feature. We like that. CE: What other functionalities were you looking for, specifically? Kluender: The ChMS company we were prior to Churchteams offered texting, but only through a third-party; it wasn’t integrated with the database we were using. That meant we had to work with another company for all of our texting efforts. So, one of the main things we were looking for was a single-source solution. Only a few ChMS providers offered this, including Churchteams. But a handful of other things put it at the top of the list. First, it’s inexpensive. Second, we liked Churchteams’ data and the metrics reporting. Our senior pastor likes to keep all of those statistics, so that’s very important to us. Third, we really liked the ability to communicate with everyone within a specific group without having to pull a report first. For an example, we can create a group and assign a ministry leader to it. That ministry leader can communicate with each person in the group just by going to his or her group in Churchteams. (Left to right) Josette Kluender; Bookkeeper Linda Pannasch; Administrative Assistants Kami Kaiser and Kim Van Nortwick CE: What were some other important criteria? Kluender: We use a lot of texting in our workflows. You set those up once and that’s it. If you do it properly the first time, they do everything for you from that point on, which is such a timesaver. For example, we have a workflow to reassure parents that their children are being taken care of by screened, background-checked workers. All of that is done through a text message that happens less than 10 minutes after their children are taken to class. Another good feature, for us, was registration through texting. People can just text a word, and that registers them into a certain meeting or event. Another feature we use a lot is our membership application. Congregants receive a link to an application, which we used to provide on paper, and those applications are immediately funneled so pastors can approve them right away. This is much better than the old way of waiting for a paper application to be scanned in by an admin and then waiting for each pastor to approve or reject those by email. Now, everything happens within a day of a person hitting ‘complete’ on an online application. But really, we didn’t even know we needed a lot of the functions in Churchteams until we started using them. CE: What are some of the most effective ways your church uses the texting functionalities inherent to Churchteams? Kluender: Right now, we send reminders every Sunday and Wednesday about our church services. Every Sunday, we send out a mass text announcing a one-hour prayer call. The Read More >
- FRAUD PREVENTION: Do you have the right internal controls in place to protect your church?
Church Executive: Are churches typically easy targets for fraud? Sarah Barham: Yes, because typically one person is responsible for completing all financial responsibilities from beginning to end. This means one person opens the mail to review invoices, sets up vendors in the accounting software, writes the checks, reconciles the bank accounts, and produces financial reports. CE: Generally, about what percentage of churches are taking adequate precautions — by way of their internal controls — to prevent against fraud right now? Barham: I would say about 20%-25% are taking adequate precautions with internal controls established and following those controls. A lot of times, we’ll see that internal controls are in place but not being applied to the daily aspects of church finances. CE: Is there a difference between theft, fraud and embezzlement? What exactly are we referring to when we say “fraud” in this context? Barham: There is a difference. Theft is the act of taking something that doesn’t belong to you. Fraud and embezzlement are forms of theft. Fraud is theft by deception — in other words, convincing others you aren’t doing anything wrong or falsifying documentation to cover something up. Embezzlement is using church assets for personal gain. CE: Is one of these offenses more common in churches? Barham: Based on what I’ve researched and documented during church financial assessments, embezzlement is typically the most common. With little to no internal controls, it can be easy to manipulate records through accounting if one person is responsible for everything and has no direct oversight. CE: Among the church clients you’ve worked with, what are some common red flags that indicated they were being defrauded? Barham: Multiple credit card transactions in a single day at the local gas station, which were later determined to have been made by a staff member. Also, purchasing items for personal gain using the church credit card. For example, a colleague experienced a pastor who mentioned his contribution statement for years was consistently low for the amount of donations he knew he contributed to the church. It was discovered that the volunteer counting and depositing the money had opened a local bank account under a similar name of the church and began depositing some of the offering checks into that account instead of the church’s established bank account. CE: How can a church best uncover any weaknesses in its existing internal controls? Barham: A good start would be to have an external assessment of church processes and internal controls performed and / or a church policy that requires some kind of review. CE: What’s a church leader’s first step in getting this done? Barham: Of course, they can reach out to us at WatersEdge. Also, there typically are local CPA firms willing to perform those assessments. But the church needs to be careful to select someone who’s familiar with church processing and accounting. CE: In your experience, what internal controls have proven most effective? Barham: First, separation of responsibility. Having separate people open mail to review invoices, set up vendors in the software, write checks, and so on. Second: limited access to online bank accounts. Accounting staff and / or the church treasurer should have this access. There’s no need for all staff to have it. Third, I’d suggest having two signors on checks. One of them should be someone other than the person preparing the checks. We’ve seen this be a staff member and treasurer and / or finance committee members. Next, I’d avoid pre-signed blank check stock. Oftentimes, this is kept on hand for convenience. Don’t. Church leaders should enlist multiple counters for the offering. This goes without explanation. Finally, there should be a finance committee in place that regularly reviews reports. The church finance committee I sat on met monthly to review financials and ask questions about finances. We signed checks during that time but also signed on Sundays and / or Wednesdays when we were at the church. It would be ideal to have business-minded church members as part of this committee. — Reporting by RaeAnn Slaybaugh
- All-in on A/V
The right system is essential to engagement. Here’s how to get it (in plain-English). Church Executive: How can a church leader know that the A/V system is falling short of its engagement potential? David McCauley: Reaching 60-percent-more-active engagement is something I talk about often. Yes, this is a hard metric to measure; but I feel that most leaders can get a pretty good sense of connection when looking around an audience. As a leader / teacher, when teaching classes or speaking at events, I track engagement in a couple of ways: Eye contact: This simple but informative [observation] is a key to what people are really paying attention to. If they’re only looking at their phones, or at other things going on in the space, there’s a good chance they aren’t connected. Audience response: Some cultures are quiet; others are more responsive. Either way, response is always something that we look at, especially during worship. If people aren’t singing, they’re not connected. It’s a huge clue that some adjustments are needed in your space. I developed a process that starts with a questionnaire for church leadership based on this exact topic. I ask them to rate the importance of parts of a project, from architecture to technology. A matrix we’ve designed helps our design team effectively understand and guide leaders on the journey of engagement. The end result is connecting and communicating effectively with the congregation. If that’s through architecture, great. If it’s through technology, that’s great, too. CE: As we look at your website, driving maximum engagement is clearly at the heart of what you do. Can you expand a little on each of the statements listed there, below? Audio: “We design audio systems that ensure your message is delivered with clarity and power.” McCauley: Spoken into existence: this is how the world was created, and it’s also the best way to communicate with most people. When our team thinks about engagement, we think about the whole package — from room acoustics to electronics — and the effect these elements have on people. We find a balance; a space in which souls are activated in worship but worshippers’ ears are also reachable in the softest moments when you’re sending a life-changing message. Then, if you need a system with bass so loud that it knocks the devil out of the church, we can help with that, too. Video: “We design the technology you need to visually communicate your stories.” McCauley: Video is so important. If a picture is worth a thousand words, then what are 24-plus pictures per second worth? It’s a huge part of next-level engagement. Lighting: “We design an immersive atmosphere that keeps your audience engaged with your message.” McCauley: Eyes are the window to the soul; you can guide people with intensity, help change a mood with color, and intensify engagement. People were designed for light. A picture of our Creator is light. Acoustics: “We design a balanced environment that will ensure your message is delivered clearly.” McCauley: Acoustics are often overlooked but are one of the most powerful ways to connect and engage. Most people don’t understand the importance of acoustics or how it affects people and the dynamics of the room. With our dynamic acoustic systems, it can be a pretty direct and quiet space, or I can press a button and it sounds like a cathedral. It’s art and science; experience and engagement can intertwine. Done wrong, acoustics are distracting. Done well, they make all the difference in terms of connection. CE: Stewardship-focused church executives might assume that a truly engaging A/V system comes with a high price tag and requires “all the bells and whistles.” What’s the reality? McCauley: Everything has a cost; the goal is to put the budget where it does the most towards reaching church leaders’ goals, and then phase in other wants and needs later. We need to set the roadmap and expectations before we can hit any target. CE: What effects has COVID had on how engaging church A/V systems are created now? McCauley: There was a lot more attention on reaching outside the walls of the church. Now, it’s focused on how to get people engaged in person again. What creates that special moment of connection with other people, that shared experience? I believe the world will never think the same as before. COVID has impacted how we view the worship experience. I even find myself thinking ‘Hey, I can just watch it at the house while I’m cooking.’ But doing so means you miss the component of engagement and connection that comes with worshiping together, in person, and how that experience deeply impacts us. — Reporting by Emma Green
- Holy Land journeys: A disciple-making tool or Christian vacation?
Walking in the footsteps of Jesus in the land of the Bible is the ultimate hands-on disciple-making experience for Christians — not just a vacation to a destination related to church. Educational Opportunities Tours (EO) President/CEO James Ridgway recently interviewed Rev. Tom Smith about how Holy Land journeys have changed lives and inspired the faith of people who traveled with him in the Holy Land. James Ridgway: How did your first Holy Land journey influence your life and ministry? Rev. Tom Smith: It’s safe to say that it began to affect me even before I returned home. But the immediately noticeable influence was the way that it affected my preaching and teaching. I found myself painting word pictures of a passage of Scripture as I would preach or teach. I would give little tidbits of what it means to go ‘up’ from Jericho or the winds affecting the Sea of Galilee as they funneled into that area. It was like I had an entirely new resource to add to my library as I prepared for a sermon or class. Ridgway: When did you decide to start taking groups to the Holy Land? How did the people respond? Smith: I went the first time without a group. But after returning, my excitement was obvious. I talked about it constantly. As soon as I was introduced to Educational Opportunities and learned of how I could ‘earn’ a trip, I decided to go back and take as many people as possible. As soon as I mentioned that I was putting a group together, people started signing up. A journey to the Holy Land is in the hearts of a lot of people — not as a vacation but as part of their faith development — so there was natural interest in participating. Folks were excited that they could travel with me because they trusted me as their pastor. Ridgway: Afterwards, what did you see in the lives of those who experienced the Holy Land? Smith: They were changed. They engaged with Scripture differently. They talked about the way they heard the sermons differently. They began to participate more readily in Sunday School, study groups or accountability groups. Many of them became more open and expressive of being leaders in the congregation. They have a renewed/revitalized faith, it seems. Ridgway: What other benefits come from the Holy Land journeys? Smith: One of the things was how close the group became. They bonded with each other as they shared the experience. They also bonded with me, as their pastor, differently. Instead of hearing me teach or preach a couple of hours per month, they spent 12 to 14 hours a day talking and experiencing this profoundly moving journey. We formed some truly lasting bonds. They also came back with a deeper understanding of the current issues facing people in the region. They experienced not just what the news media shared, but what they themselves saw. They could ‘put a face’ to it, and it opened doors/eyes in a way that nothing else could do. Ridgway: How does a pastor plan a journey to the Holy Land? Smith: There are two ways a pastor could begin this journey. First, they could participate in an EO Familiarization tour. After experiencing the Holy Land personally, they could start planning a group journey. Personal experience helps while recruiting a group. The second way is to jump right in and organize an EO Holy Land journey for their group by going to www.eo.travelwithus.com and reviewing the different itineraries offered and finding one that best suits what they and their folks would love to see. Then, they can reach out to the EO team to partner and build the journey that will help make disciples for Jesus Christ. The EO staff will provide all the tools necessary — including ongoing support — to build a life-changing tour for the congregation.