1 / 15

Crucible

Learn the basics of financial management including balance sheets, income statements, and cash flow statements. Understand the concepts of net worth, assets, liabilities, revenues, and expenses. Discover how to control budgets, handle cash flow, and implement internal procedures and policies. Explore the benefits and challenges of electronic giving and find out how to structure financial records for better decision-making.

westlund
Download Presentation

Crucible

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Crucible Financial Management, Part 1

  2. The Balance Sheet (Page 34) • A basic statement of “Net Worth” • Net Worth = Total Assets-Total Liabilities • Bankruptcy is defined as an entity possessing a negative Net Worth

  3. The Balance Sheet • What is an “Asset”? • The issue of depreciation • For profit business as opposed to NPO’s • How to Value Assets • Book Value, Market Value or Replacement Value

  4. The Balance Sheet • What is a “Liability”? • Short and Long Term Liabilities • “Liquidity” Can I meet the payroll? • A Balance Sheet is a Snap-shot • It is useful in and of itself, but much more powerful in comparison over time.

  5. The Income Statement (Page 36) • A basic statement of “sustainability” • The “Top Side” or Revenues • The “pledge” vs. the “plate” • The “Bottom Side” or Expenses • Can be categorized in a multitude of ways to fit your needs.

  6. The Income Statement • Control of the Budget • Current month Actual vs. Budget • Variances and reporting thresholds • Year-to-Date Actual vs. Budget • Intra-year adjustments • Departmental designated funds • Emergencies • The Year-End Sweep

  7. The Cash Flow Statement (Pages 37-8) • Annual timing of receipts and expenses • Do receipts flow evenly through the year? • The timing of expenses • Sources of Cash • Weekly Giving • Designated Funds and Internal Accounts • A Bank Operating Line of Credit • A Church Foundation

  8. Internal Procedures and Policies • Separation of Powers • General business spending authority • Expense approval & necessary signatures • Departmental Spending • Budget by line item—not an aggregate • Check requests and PO’s • Credit Cards • Limits, Documentation & the Run Sheet

  9. Internal Procedures and Policies • How many checking accounts? • Internally partitioned (Designated) accounts • Access only through the Executive Minister • Battling the “Shadow Budget” • Deposits to Departments—”What do I do with this check for the youth mission trip?”

  10. Internal Procedures and Policies • The role of the Finance Committee • Intentional structuring of “tiers” of internal and external oversight • The external audit: two questions • Is the money all there • Do we have the proper procedures and controls in place

  11. Internal Procedures and Policies • Handling the Weekly Offering • Rotating teams of counters • Trained to count “colored paper” • Making the “Bank Run” • Always a team with a varied route and routine • Remote Deposit for the checks

  12. EFT (Electronic Giving) • Offers one HUGE benefit to the ministry! • ACH—Automated Clearing House ( 3.8%) • Low cost to the Church ($.20 per transaction) • Annual signup / Provision of a voided check • Automatic withdrawal on a monthly (or bi-monthly) basis

  13. EFT (Electronic Giving) • Offers one HUGE benefit to the ministry! • Credit Card Giving (14.4%) • A higher cost to the Church (3.25-3.5% of the transaction) • Annual signup / Account information • Hacked Accounts and Canceled Cards

  14. EFT (Electronic Giving) • Other Alternatives… • Giving “Kiosks” • Online Giving • PayPal, Secure Website, Dedicated Software • One significant challenge • An empty offering plate…

  15. Table Time • Are your financial records structured to give you the information you need? • Are the reports clear and consistent • Do you have a clear set of procedures in place for control and oversight of your ministry’s finances? • How can your ministry employ an annual audit? • How can methods of EFT be put to use in your setting?

More Related