Why Bother Bookkeeping in Church? How Important Is Church Bookkeeping?

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Why Bother Bookkeeping in Church? How Important Is Church Bookkeeping?

No one wants to sit down and balance their budget every week or two. It’s never fun tracking expenses on a daily basis, either (no matter how easy budgeting apps claim to make it).

Tracking your financial activity isn’t easy in your personal life. So why would it be any easier in a church setting?

And yet, as is the case with individuals, things like budgeting and bookkeeping are critical aspects of keeping your church running smoothly. With that in mind, let’s take a look at church bookkeeping, in particular, and consider why it matters and what your options are when it comes to tracking your ministry’s finances.

How Do Churches Spend Their Money?

Every church has its own unique set of expenses. Some of these are fairly consistent. For instance, any church is going to want to pay its utility costs, mortgage, and payroll.

As ministries expand their activities over time, you can get some unique and unexpected costs that pop up from time to time. A new kids ministry in a small church, for instance, could require a few hundred dollars a year to spend on curriculum, craft supplies, and snacks — lots of snacks. 

For a larger church, that cost could balloon into the tens of thousands. Relevant Children’s Ministry puts the Kid Min cost for a church with 125 children at over $14,000 per year. When you’re talking bigger numbers like that, there’s a good chance that your transaction history starts to populate with a wider variety of charges, from guest speakers and musicians to balloons and bounce houses.

Christmas budgets are another “Wild West” element of church expenses. On the one hand, if your pastor’s up for playing the role of Ebenezer Scrooge from Thanksgiving to New Year’s, you might keep your costs down. On the other hand, if you aren’t careful, you can end up pouring money into frills you didn’t even know existed, like dancing snowmen and flying drummers.

With such a wide range of potential expenses and the likelihood of their changing as your church’s needs shift, it’s important to keep track of everything as you go along. That’s where bookkeeping comes into the picture.

What Is Church Bookkeeping?

Bookkeeping is a key element of any church accounting setup. The term “bookkeeping” refers to the act of tracking and recording all of your ministry’s financial transactions over time.

If you’re wondering how the terms bookkeeping and accounting are different, it’s easiest to think of one as a part of the other. Accounting refers to the comprehensive consolidation and processing of a church’s financial data to make informed decisions. It is an overarching term that considers strategies and tactics over specific behaviors and includes things like payroll and tax compliance.

In contrast, bookkeeping is the day-to-day activity of collecting and organizing your financial transactions. Good bookkeepers pave the way for the rest of your accounting activity to take place accurately and easily.

The Biblical Call to Keep Your Books in Order

The Bible doesn’t directly use the term bookkeeping. But you can bet your bottom dollar that it references faith-based money management — more than once. For instance: 

  • Proverbs 13:22 says, “A good man leaves an inheritance to his children’s children.” 
  • A few chapters later, Proverbs 22:7 tells us that “the borrower is the slave of the lender.” 
  • 1 Timothy 3 talks about the importance of church leaders not to love money or be greedy for dishonest profits.

There are many other examples if you look for them. The Biblical money advice is there — and it’s abundantly clear. Money isn’t an inherently good or bad thing for a Christian (although the love of it is certainly not a good thing). Instead, it’s our relationship with money and the way that we handle it that matters.

The Value of Bookkeeping in the Church

Bookkeeping is a mundane activity on the surface, but it functions as a critical element in keeping your ministry financially healthy and fully operational. Well-documented financial activity sets the stage for wise decision-making. This allows you to operate a purposeful and effective ministry with the potential to leave a legacy. 

To be clear, the term “legacy” isn’t referring to receiving recognition or fame. Instead, it’s about serving the next generation and giving glory to God. When you shepherd your church’s finances with wisdom and order, you make it easier to pour into your congregation. From senior ministries to youth groups and kids events, healthy, transparent church finances make it possible to make the biggest impact with your church.

Need Help With Your Church’s Bookkeeping?

Just because churches should track their transactions doesn’t mean it is an easy activity. On the contrary, it can be a challenge. You need someone (or a team of people) in charge of approving expenses and tracking costs. 

These should be trustworthy team members without conflicting interests. They also need to have the skill sets to manage your church’s books well.

If your church isn’t big enough to hire a professional, full-time employee to handle finances, you may need to outsource the activity. That’s where Chancy & Associates can help.

Our full suite of church accounting services and software can fit the specific needs of small, medium, and large churches. No matter what stage your ministry is in, we take the finances off your plate so that you can focus on your ministry.

As the accounting firm for the Church, we can’t stress enough how important it is for you to prayerfully invest in your ministry’s bookkeeping. It is the first practical step in future-proofing your church for whatever financial ups and downs lie ahead.

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