FINANCE

An effective finance committee proposes a budget; then raises, manages, and distributes the financial resources of the congregation to support and strengthen the mission and ministry of the congregation.

RESPONSIBILITIES OF THE CHAIRPERSON
  • The finance chair works with the leadership team chair, the church staff, and other ministry leaders to fulfill the mission of the church. The finance chair works with the trustees to handle designated gifts and bequests in accordance with The Book of Discipline.
  • This person will guide the work of the finance team through the year, including planning agendas and presiding at meetings.
  • This leader will gather all budget requests to be reviewed by the committee, ensure that the congregation and pastor(s) are informed about the church’s financial situation, and recommend to the church council any changes that need to be made in the budget after it has been approved.
  • This leader is accountable to the charge conference through the church council.

RESPONSIBILITIES OF THE COMMITTEE
  • The finance committee annually compiles a budget for supporting the mission and vision of the local church and submits the budget to the church leadership team for review and adoption. During the year, the finance team recommends any changes to the approved annual budget to the church leadership team.
  • This team is responsible for developing and carrying out plans to raise enough income to support the budget that has been approved.
  • Both the finance team and individual members need to engage in spiritual practices that attend to God’s will and direction. Team members need to hold one another accountable to decisions and actions that fulfill the mission and vision of the church.
  • The finance team (or committee) recommends to the church leadership team proper depositories for church funds and carries out the church leadership team’s directions about administration and disbursement of funds and about procedures for the church treasurer and the financial secretary.
  • There are three tasks not specifically assigned to the treasurer, financial secretary, or the chairperson of the committee on finance by the Discipline. Keeping these responsibilities separate is essential in maintaining segregation of duties. These tasks are: (1) approving payments for expenditures; (2) signing checks; (3) reconciling bank accounts. While the treasurer, financial secretary, or finance chairperson may be authorized to do any one of these tasks, no person should be authorized to do more than one. No persons related to one another should perform any two or more of these three tasks.
  • This team arranges for an annual audit of financial records and makes a report of this audit to the charge conference.
  • In congregations in which there is no stewardship team or committee, the finance committee has responsibility for teaching disciples a biblical understanding of abundance and generosity and stewardship of all resources.
  • The finance leaders of the church are accountable to the charge conference through the church council.
  • New language was added to the 2016 Book of Discipline that expands/clarifies the responsibilities of the pastor in regard to giving. Paragraph 340.2.c.(2)(c) now reads: “To provide leadership for the funding ministry of the congregation. To ensure membership care including compliance with charitable giving documentation requirements and to provide appropriate pastoral care, the pastor, in cooperation with the financial secretary, shall have access to and responsibility for professional stewardship of congregational giving records.”

PEOPLE AND AGENCIES THAT CAN HELP
WEB AND PRINT RESOURCES

​Book of Discipline 2016 ¶ 258.4. Committee on Finance

¶ 258.4. There shall be a committee on finance, elected annually by the charge conference upon recommendation by the committee on nominations and leadership development or from the floor, composed of the chairperson; the pastor(s); a lay member of the annual conference; the chairperson of the church council; the chairperson or representative of the committee on pastor-parish relations; a representative of the trustees to be selected by the trustees; the chairperson of the ministry group on stewardship; the lay leader; the financial secretary; the treasurer; the church business administrator; and other members to be added as the charge conference may determine. It is recommended that the chairperson of the committee on finance shall be a member of the church council. The financial secretary, treasurer, and church business administrator, if paid employees, shall be members without vote.

The positions of treasurer and financial secretary should not be combined and held by one person, and the persons holding these two positions should not be immediate family members.

No immediate family members of any appointed clergy may serve as treasurer, finance chair, financial secretary, counter, or serve in any paid or unpaid position under the responsibilities of the committee on finance, as described herein.  These restrictions would apply only to the church or charge where the clergy serves.

The committee on finance shall give stewardship of financial resources as their priority throughout the year. It may delegate the responsibility to either a sub-group or task force that would plan, strategize, and implement ways to generate more resources for mission and ministries of the local churches and beyond. It is strongly recommended that the committee on finance, in collaboration with the church council, find creative ways to turn their congregations into tithing congregations with an attitude of generosity. All financial askings to be included in the annual budget of the local church shall be submitted to the committee on finance. The committee on finance shall compile annually a complete budget for the local church and submit it to the church council for review and adoption. The committee on finance shall be charged with responsibility for developing and implementing plans that will raise sufficient income to meet the budget adopted by the church council. It shall administer the funds received according to instructions from the church council.

The committee shall carry out the church council's directions in guiding the treasurer(s) and financial secretary.

a) The committee shall designate at least two persons not of the immediate family residing in the same household to count the offering. They shall work under the supervision of the financial secretary. A record of all funds received shall be given to the financial secretary and treasurer. Funds received shall be deposited promptly in accordance with the procedures established by the committee on finance. The financial secretary shall keep records of the contributions and payments.

b) The church treasurer(s) shall disburse all money contributed to causes represented in the local church budget, and such other funds and contributions as the church council may determine. The treasurer(s) shall remit each month to the conference treasurer all World Service and conference benevolence funds then on hand. Contributions to benevolence shall not be used for any cause other than that to which they have been given. The church treasurer shall make regular and detailed reports on funds received and expended to the committee on finance and the church council.10 The treasurer(s) shall be adequately bonded.

c) The committee on finance shall establish written financial policies to document the internal controls of the local church. The written financial policies should be reviewed for adequacy and effectiveness annually by the committee on finance and submitted as a report to the charge conference annually.

d) The committee shall make provision for an annual audit of the financial statements of the local church and all its organizations and accounts. The committee shall make a full and complete report to the annual charge conference. A local church audit is defined as an independent evaluation of the financial reports and records and the internal controls of the local church by a qualified person or persons.
The audit shall be conducted for the purpose of reasonably verifying the reliability of financial reporting, determining whether assets are being safeguarded, and determining compliance with local law, local church policies and procedures, and the Book of Discipline. 

The audit may include: 1) a review of the cash and investment reconciliations; 2) interviews with the treasurer, financial secretary, pastor(s), finance committee chair, business manager, those who count offerings, church secretary, etc., with inquiries regarding compliance with existing written financial policies and procedures; 3) a review of journal entries and authorized check signers for each checking and investment account; and 4) other procedures requested by the committee on finance. 

The audit shall be performed by an audit committee composed of persons unrelated to the persons listed in (2) above or by an independent certified public accountant (CPA), accounting firm, or equivalent.

e) The committee shall recommend to the church council proper depositories for the church's funds. Funds received shall be deposited promptly in the name of the local church.

f) Contributions designated for specific causes and objects shall be promptly forwarded according to the intent of the donor and shall not be used for any other purpose.11

g) After the budget of the local church has been approved, additional appropriations or changes in the budget must be approved by the church council.

h) The committee shall prepare annually a report to the church council of all designated funds that are separate from the current expense budget.

​10. See Judicial Council Decisions 63, 320, 539.
11. See Judicial Council Decisions 976.

​From The Book of Discipline of The United Methodist Church - 2016. Copyright 2016 by The United Methodist Publishing House. Used by permission.
© Madison United Methodist Church 110 West Academy Street, Madison, NC 27025 (336) 548-6658 [email protected]
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