Financial Best Practices

1. Financial Best Practices Rev. Dr. Todd Adams, Associate General Minister and Vice President

2. Purpose Today • Talk about the special relationship of Disciples Women and the church • Address some areas of concern • Establish a target for minimizing risk and preparing for greater scrutiny of religious 501c3 organizations.

3. Relationship • Leadership development • Advocates for generosity • An vital ministry of the church in all expressions • Ministries that are covered by the denominations group exemption

4. Concerns • Accounts opened under the region or congregation’s EIN but not reported through the congregation • Expense and reimbursement policies that don’t meet IRS or International Accounting standards • Creating potential tax liability • Potential for fraud

5. Basics of Best Practices • Trust • Assured reliance on the character, ability, strength, or truth of someone or something • b: one in which confidence is placed

6. Trust… • Trust in people and the systems that protect people • Transactions • Decision making • Paperwork processes • Human contact with the system • Opportunity to catch and correct errors

7. Accountability Accountability: • An obligation or willingness to accept responsibility; • The state of being accountable; Accountable: • Something one can measure and explain (process, documents etc.)

8. Key Phrase for Today Trust is not an internal control

9. Basic Principles of Giving • People give to people, not to organizations. • They give to support a mission. • They give to organizations where there are high levels of trust and accountability.

10. Key Players • Protect our leaders • Officers • Protect our staff • Protect our members – donors

11. Role of the Officers • Monitor receipts and expenses. • Written budget • Report gifts and expenses to the congregation or the region • Receipting gifts properly • Noting the difference between regional / congregational

12. Basic Internal Controls • Gifts are always in dual control • Counters collect, escort and process contributions • Standardized form and process • Two counters • Use a written form and sign it

13. Basic Rules for Handling Money • Money is counted at the event by two people • Deposit is made immediately or cash converted to a money order • Forms are filled out, signed and a copy given to the president

14. Gift Acknowledgment • Gifts need to be receipted in the name of the church or reported to the Financial Secretary of the church • Tax statement • No goods or services were received in exchange for the contributions

15. Church Treasurer’s Handbook • Excellent resource for polices, guidelines, compensation, benefits, internal controls etc. • Maintained by OGMP Treasury Services, Pension Fund, Christian Church Foundation and Disciples Church Extension Fund

16. Reviewing Financials • Protecting the people handling the money • Reviews expenses and reimbursements • Recommends additional policies and procedures • Provides donors with confidence in the policies and procedures

17. Internal Review • 1 month of deposits • 1 month of checks • 1 month of bank statements • A group of 2-3 • Best practice would be to run everything through the church as designated funds

18. Expenses

19. Expense and Reimbursement of Expenses for Employees and Volunteers • Word Problem • Accountable Expense and reimbursement policy • Review of Expenses

20. What Are Appropriate Expenses? • Travel: • IRS guidelines • Employee rate .56 • Charitable / volunteer rate .14 • Written policy to reimburse actual expenses • General Assembly expenses • Quadrennial Expenses

21. What Are Appropriate Expenses? • Meals • IRS per diem for travel • What constitute “staff” • Cash • Receipt requirements • Lost receipt documentation? • Travel Guidelines in writing?

22. Guidelines • Transparency and accountability • Written plan • Sunshine Test • Is it accountable or it is based on trust?

23. Discussion • How can we share this out with other leaders within Disciples Women? • What are the challenges you have faced that you would like to discuss?