There’s only so much time in a church leader’s day, and ideally that should be spent helping the church serve and build its community. Unfortunately, the practicalities of finance and accounting often take up a significant amount of 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 and community thriving.
Develop an accounting policy. If you don’t put rules and requirements in writing, you will never feel in control of the expense management process. Your policy can establish each employee’s travel budget, who is authorized to sign checks and which forms are acceptable 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 limits for authorized purchases. Surely your goal is not to have employees or volunteers ask you to approve every expense. On the other hand, you don’t want to find out too late that someone spent an exorbitant amount on refreshments when you already had supplies on hand. Decide on a dollar amount threshold which people must get approval from church leaders before making the purchase. This will limit the time spent dealing with approvals for small-dollar purchases.
Prepaid debit cards allow you to 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 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’s mission.
Track purchases to prevent spend abuse. Transparent spending records help people self-monitor their expenses. 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 growing your community and receiving 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 reporting 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 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.