There’s only so much time in a church leader’s day, and ideally that should be spent helping the church serve its community. Unfortunately, the practicalities of finance and accounting take away a significant amount of that time — and add complexity to church leaders’ already difficult jobs.
One of the most common tasks is managing expenses for events, summer camps, mission trips and other sponsored activities. This includes approving large expenses, meeting budget targets, gathering receipts, and reimbursing staff, clergy and volunteers. Here are some ideas for streamlining expense management so you can devote more time to the strategic activities that keep the church running.
Develop an accounting policy. If you don’t put rules and requirements in writing, you won’t ever feel in control of the expense management process. Your policy can establish how much people can spend on travel, who signs checks, and which forms to use to request reimbursement.
Expense management platforms offer visibility so that users have a better grasp on the budget and their own spending. Find one that integrates with your accounting software to simplify the process.
Establish thresholds for authorized purchases. You probably don’t want employees or volunteers to ask you to approve every expense. On the other hand, you don’t want to find out too late that someone spent $500 on refreshments when you already had supplies on hand. Decide on a dollar amount above which people must get approval from church leaders before making the purchase. That way you won’t spend time dealing with approvals for small-dollar purchases.
Prepaid debit cards let you load funds online directly from a bank account and eliminate the possibility of overspending. You can add funds as needed or place daily maximums on individual cards – and, as another plus, people won’t have to worry about reimbursement forms.
Create a list of preferred merchants. You probably have a list of trusted merchants and travel agents from whom you buy supplies regularly, and who you know will steer you toward the best deals. Include a list of these vendors in your accounting policy, and consider requiring employees and volunteers to use them unless they’ve received approval to shop elsewhere.
Cloud-based expense reporting tools can limit where your employees and volunteers spend. You’re free from micromanaging every purchase and can focus on your church.
Track purchases to curb spend abuse. Transparent spending records help people self-monitor their expenses and, in the long run, reduce them. Complete and accurate expense reporting also provides greater accountability to the congregation.
Expense reporting apps allow you to track expenses in real time and maintain closer control of spending without sacrificing convenience. You can detect fraud the moment it occurs and react quickly.
Periodically re-evaluate your budget. While your primary focus may be on bringing in more members and donations, it’s important to regularly examine the budget. Compare your budget throughout the year with the actual money spent. Trimming the budget frees up more funds to support your church’s mission.
Expense management tools help organize your expense reports and let you log digital notes for context on purchases. The more information you have on current spending patterns, the better equipped you’ll be for the future.
A modern church leader’s toolkit includes technologies that control and automate financial management. These are designed to help you to manage expenses efficiently — freeing up time for more enjoyable (and dutiful) church activities.
Here’s how PEX helps religious organizations enable employees and volunteers to make purchases while maintaining accountability and control.