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Many treasurers (if not most) take on the responsibility for this very key area without fully appreciating what is involved.
This article, which supports the webinar, identifies some of the things to consider if you have been asked to take on the role of church treasurer.
Much of what follows is expanded on in our booklet entitled “Introductory Guide for New Church Treasurers”, available on the ACAT website to all members.
The role of church treasurer is unlike any other. To be fully effective it requires a person’s personal and professional skills to be used with an added dimension, a spiritual one. This is evidenced by two important aspects.
The importance of Administration in the early Church should not be underestimated. In 1 Corinthians 12: 28, St Paul writes, “And in the church God has appointed………..those with gifts of administration.” Those involved in church administration are seen as exercising a God-given gift—one which arguably has apostolic authority. The treasurer is a financial administrator; therefore, anyone taking on this important role is being called to use their skills and expertise (divine gifts) in the service of God.
Those exercising their gift of administration are doing so alongside those with other gifts, also described in 1 Corinthians 12: 28. The treasurer is unquestionably part of the church ministry team.
Responsible for the continued administration and stewardship of the resources required to support the ministry of a local church, the treasurer is an equal team member.
Five basic personal qualities will assist the would-be treasurer; there may be others.
The treasurer is arguably the church equivalent of a Director of Finance. As such will be called upon not only to offer advice on the financial implications of a particular proposed course of action but also to deliver difficult news relating to actual or likely deficits.
In these situations, it is vital that the treasurer listens with an open mind to the views of fellow trustees.
An effective communicator presents information in as clear and as concise a manner as possible, whether that be in a written or verbal form.
It is important the treasurer recognises that not all fellow trustees will have the same grasp of financial issues or the statutory obligations to which they are required to adhere.
Simplicity in the presentation of financial facts is essential. The treasurer should not be afraid to use simple charts and graphs. The oft-quoted cliché is very relevant, “a picture paints a thousand words.”
Keep written finance reports to a minimum, and when asked for an opinion in any discussion on a key issue, take a minute to ensure that the response is clear and to the point.
At the heart of efficient financial administration in any organisation is an organised systematic approach.
The treasurer is required to ensure the accuracy and reliability of the information presented periodically to the church trustees. This can only be achieved if the underlying financial records and the systems supporting them are efficiently organised, systematically and simply.
This can be a challenge particularly in smaller churches where reliance is frequently on too few people to undertake too many tasks, resulting in “corners being cut” in respect to record keeping.
Keep things in an organised manner but keep them simple.
Too many church treasurers overcomplicate the financial administration. This approach can and does frequently lead to disaster with unwanted complications for the church involved.
The treasurer will be required periodically to advise on the funding or viability of a proposed project. Whilst a prudent and cautious approach is always to be commended, nevertheless, the treasurer should always attempt to facilitate church development however that may be conceived.
Organisations do not stand still; they either develop and grow or wither and die. Churches are no different, and an effective treasurer is one who will always consider how a project or a ministry priority might be resourced rather than dismiss it out of hand.
The treasurer with a positive “can do” approach to facilitating ministry can profoundly positively affect fellow trustees and the whole church fellowship.
The treasurer also has a significantly important part to play in the wider church and must be able to “get along with people,” some of whom may, from time to time, prove difficult.
The effective treasurer should accept that whilst he/she may not win popularity polls, good working relationships should exist with all church members most of the time.
This will require patience, a willingness to listen to all the grumbles and arguments and, where necessary, to find mutually acceptable compromises.
Are any formal qualifications required?
A church treasurer does not need to possess any formal accountancy qualifications.
However, with the impact on churches, of the increasing demands of legislation, a basic knowledge of charity law and a passing knowledge of the Charities Statement of Recommended (financial) practice –SORP is advisable.
In so far as they affect churches, the reporting requirements of charities’ legislation are arguably not complex and should not prove a difficulty for someone with a basic understanding of bookkeeping.
Anyone with career experience in financial administration, or perhaps in assisting with the running of a family business or in a voluntary capacity within a charity, should not be apprehensive when considering becoming church treasurer.
However, I would suggest that the ability to understand and implement statutory financial reporting procedures and comprehend the basic requirements of charity law as applied to churches is a prerequisite of the role.
As a manager of what God has entrusted at its very basic level, the role of church treasurer is concerned with the efficient management of money.
The treasurer is expected to administer church finances in such a manner that the highest standards of integrity and excellence are at the heart of the money management systems and process.
It is very easy to commit to a role or responsibility, particularly within the church, without fully understanding what that commitment involves or, indeed, the nature of the environment you are likely to be working within.
It is a frequently made mistake that people agree to church responsibilities without even asking the most basic of questions:
Don’t be rushed into taking on the role without asking questions, even if they are not easy ones to answer.
Find out from the trustees what their expectations are.
How do they see the treasurer in relation to the trustee board as a whole? As treasurer you will have delegated responsibility for the effective administration of the church finances and to ensure compliance with the relevant statutory obligations.
This is a delegated responsibility and does not absolve the trustees from their underlying responsibilities in law.
Ascertain whether the trustee’s view of the treasurer’s role has changed at all. What are the likely priorities of the trustees in respect of the treasurer’s responsibilities?
How many trustees are there? Does the board have a reputation for being dominated by a few strong personalities? Are they even aware of their statutory obligations?
This issue goes to the heart of the environment into which you are likely to enter. Does the church have a clear plan for its growth and development?
In this respect, there are several aspects which need to be considered.
Are there any underlying financial issues, such as continuing budget deficits? This being the case balancing the books will almost certainly be a major issue, resulting in either finding ways of saving money or embarking on a fundraising/stewardship campaign.
Are gift aid claims submitted promptly? Are PAYE tax and national insurance due in respect of church employees up to date. If this is not the case, it is usually a good sign that there is something amiss.
If the previous treasurer has resigned or left summarily, then be especially careful. It could be that there are questions to which answers should be sought before taking over responsibility.
Church accounting systems, financial filing and record keeping vary considerably but an incoming treasurer should expect the record of income and expenditure (receipts and payments) to be up to date.
Whether the accounting system is a software package, spreadsheet, or manual record, it should be relatively easy to understand. If this system appears unduly complicated and the records are not up to date, then beware.
The importance of clear, concise finance reports produced for trustees’ meetings cannot be overestimated.
In this respect the extent to which current reports comply with the required statutory formats will reflect the trustees’ understanding of their responsibilities in respect of financial oversight and the importance they give it.
The size of the church in terms of annual income (receipts) will determine the extent and nature of the annual reports required to be produced, including the financial statements (accounts).
Independent churches, not part of a formal denomination, with annual income (receipts) in excess of £5,000 are required to register with the Charity Commission.
Churches part of a denomination with annual income (receipts) of more than £100,000 are also required to register with the Charity Commission.
In both cases, compliance with the Commission requirements in respect of annual returns including a formal Trustees Annual Report and Financial Statements, will be required.
Responsibility for co-ordinating the completion and submission of these documents will almost certainly fall to the church treasurer. This is in addition to any specific denominational reporting requirements and returns.
It is important, therefore, that a prospective church treasurer is familiar with the process of preparing such reports, required by formal bodies, and will not be fazed by such a responsibility.
If all annual returns and formal reports have not been filed promptly, the question to be asked is “why not?”
Some degree of financial planning is arguably essential for the growth and development of any organisation; a church is no exception.
The absence of an annual budget should ring alarm bells in the mind of a prospective treasurer. The implication is that the trustees do not see financial planning, even in its simplest form, as being a priority.
Where no such document and process exists, the prospective treasurer should reflect on how the trustees are likely to respond if they were to implement annual budgets.
Is the church governing body open to change, however relatively insignificant it may appear?
Different churches have different perspectives and emphases when it comes to managing money.
However, there are some pointers to consider.
There are a few references which may help establish a foundation for some guiding biblical principles;
Proverbs 11: 24-25 Give freely, be generous. Share with those in need.
Proverbs 21: 5 Have a plan for the God given resources, it will lead to benefit.
Proverbs 21: 20 Set aside something for the future, have reserves in place.
Proverbs 27: 23 Keep all your resources in good condition.
Matthew 25: 14-30 Our resources are God given we must manage them wisely.
2 Corinthians 8: 19 Administer finances in ways which honour God and his people.
The prospective treasurer should therefore reflect on the extent to which biblical principles are present in the church, and if not, then why not?
If there is one singular lesson to be learnt from the Church’s historical use of money it is that the substantial financial resources at its disposal have not always been invested in a manner consistent with the underlying biblical principles summarised above.
The over-concentration on amassing wealth and property, arguably at times for its own sake, is a criticism that the Church might be hard-pressed to refute.
Stewardship: responsibility for the administrative management of financial and property assets is an important biblical theme.
Douglas Hall, in his book “The Steward, a Biblical symbol come of age” 2004, argues that the concept has a much wider relevance for the contemporary church. In this respect, it might be helpful for any prospective treasurer to consider the extent to which the characteristics of a 21st century steward are applicable. These may be summarised as follows.
The importance of budgets and financial planning within our churches cannot be overstated.
In essence, the steward is a facilitator who, through careful, planned, transparent management of church resources, “makes things happen.”
The overriding responsibilities of the treasurer’s role have, in many respects, already been indicated; however, the following might prove a helpful summary.
In most cases the treasurer will also be a full member of the church governing body. Even where that is not the case, the responsibilities of the role are delegated from the trustees.
This does not absolve the board from its statutory duty to ensure that church finances are administered in accordance with charity law and denominational obligations, where appropriate.
It therefore follows that the treasurer should, in most circumstances expect fellow trustees/board members to appreciate the issues which he/she has to deal with and be supportive when difficult financial decisions have to be made.
Compliance with charity law requirements in so far as they relate to churches registered with the Charity Commission is obligatory.
Churches which are not required to register (excepted charities,) mostly those within denominations whose annual income/expenditure (receipts/payments) are less than £100,000, should still follow the Statements of Recommended Practice, which registered churches adhere to and still observe the statutory obligations of charity law.
Churches that are part of a denominational structure, however informal, will also be required to comply with financial reporting obligations as part of their membership. Compliance will almost certainly fall within the treasurer’s duties.
The mission and ministry of the church obligates it to aim for the highest standards of good governance. Trustees should therefore be always aware to conduct the business of the church:
i. Honestly, with integrity
ii. Transparently
iii. Prudently with skill and care
iv. In a business-like manner
The treasurer frequently has the responsibility of gently and sensitively drawing the attention of the trustees to the above principles when important issues are under consideration. Particularly where potential conflicts of interest might occur.
The most common risk related issues which a church treasurer may be faced with are likely to relate to either a shortfall in income over expenditure, actual or projected.
Funding a particular project which the trustees are keen to see implemented may also involve risk related issues.
In such circumstances, the treasurer will need to assess the financial implications (risks) associated with proceeding in the face of a deficit or, in the case of a project, inadequate funds.
An effective treasurer will be able to fully assess the situation and outline all the available options to the trustees before offering a recommended course of action.
There are occasions and situations when the church treasurer may feel the weight of the responsibilities which come with the role. However, practical advice, support and help are available from a number of sources.
Although essentially a “non-spiritual role”, the treasurer’s responsibilities have a direct spiritual impact. In carrying out these responsibilities efficiently and effectively, the ministry of the church in the local community and beyond is made possible.
Never underestimate the power of prayer in the practical work of ensuring that church finances are administered to the highest standards and the associated responsibilities undertaken to the best of one’s ability.
Being a church treasurer is not easy and, at times, is stressful. However, it is also immensely rewarding and, at times extremely enjoyable because the role is essential for the churches’ ministry to a needy world.
Robert Scott-Biggs
ACAT Trainer
