Understanding Church Accounting
What is church accounting?
Church accounting is the process of recording and detailing all of the financial transactions that occur within a church. Church accounting includes tracking incoming donations, recording and issuing payments, preparing staff payroll, and tracking designated fund accounts. Accounting can be completed by church staff, volunteers, or outside accounting services.
What is are the different types of church income?
Churches receive donations in many different forms, ranging from weekly donations to one-time large donations. The most common type of church income is through weekly giving by members of the church. These donations are typically referred to as a tithe or offering. Some churches ask their donors to forecast their giving before the year in a form of a pledge. Church pledges can be for the general operating fund or for specific campaigns, such as building improvements. Many larger churches also have investment accounts or endowments, which can produce interest or dividends. It is also common for churches to receive in-kind contributions of physical goods or services donated to a church.
How does church accounting work?
The weekly tasks of a church accountant are very similar to the accounting or bookkeeping of a for-profit business. Depending on the size of the church, the finance tasks can be handled by one part-time position or a staff as large as 100 accounting professionals. Church accountants will record income and expenses, reconcile bank accounts, and produce monthly financial reports for review.
Talanton Church Services can help staff your church. We offer fractional staffing that will bring your books current, fill in for a staff member or volunteer, or provide full turn-key solutions for your church bookkeeping. Contact us today to learn more about how we partner with churches to create margin for ministry.