Representatives at Barnes Dennig recently met with some of the top financial personnel at local churches to discuss the challenges and obstacles they face when managing the financial operations of their Church. Several factors discussed were management of giving trends, which can fluctuate drastically throughout the year, and proper budgeting for salaries and other costs. These challenges can be inherent the church operations since they are so dependent cash flow to maintain operations, but need to be well-managed, if the church operations are to be sustainable.
Church Management System
To help in managing the operations, the participants in the session recommended implementing a church management system, which can allow for proper integration of membership/giving data and financial ledgers. These systems can be home-grown, which require a significant amount up-keep and maintenance, or several “off-the-shelf” software programs are available to help with this integration. However, finding the right system for your needs can be a daunting task. Some things to consider when determining which system/set-up is right for your church are as follows:
- Size of your church – in terms of total collections/revenue, attendance or number of locations
- Complexity of your church operations – do you have a day care, student union, book store, etc.?
- Availability of staff or volunteers to assist in database management
- History of your church and the demographics of its members
All of these items need to be considered when determining which system is the right fit for your operations. Additionally, some systems allow for a community-based integration with your website and donor database, which can help facilitate small groups, mission trips or child care.
As for managing cash flow and maintaining an accurate budget, these tips were provided:
- Salaries and related benefits should be around 50% of your total budgeted costs – this can fluctuate depending on the complexity of your church
- Monitoring and modifying your budget throughout the year is crucial to a successful financial operation
- Encouraging on-line giving will help to stabilize giving and provide for more accurate forecasting of cash inflows
Church management systems are built to provide management with accurate information to better manage the seasonality of giving trends and choosing the right system depends on several factors. If you are interested in learning more about a church management system and the associated benefits you could see from implementing one, reach out to a Barnes Dennig representative here.