The Finance Committee
The Finance Committee oversees the fiduciary elements and actions of the church, with attention to the congregation’s responsibility for complying with both legal standards and moral and ethical financial practices. The primary goal is to faithfully receive, steward, and use the financial assets in a manner that supports the church’s stated mission and ministry.
The Finance Committee will be comprised of those identified by the Constitution and By-laws to serve in this capacity. Quality candidates for these positions will be generous in their personal support of the church, committed to the congregation’s mission, and be known as trustworthy persons of integrity. A majority of the Committee will have business, management or accounting experience, be willing to assume appropriate fiscal risk regarding debt, and be willing to train others in these capacities and in the specific duties of this work. The Senior Minister (or their designated appointee) shall serve on this Committee by virtue of office (Ex-officio) without vote on matters of staff compensation and benefits.
Duties and Responsibilities
The Finance Committee is accountable to, and shall report its activities to, the Governing Board.
The Finance Committee shall provide oversight for all financial records in accordance with its fiduciary responsibilities. This includes, but is not limited to:
- The detailed, accurate, and timely reporting of all expenditures and income
- The development and maintenance of all finance-related policy and operating procedures, including:
- Internal controls to safeguard the congregation’s assets and the personal information of congregants
- Transparent reporting that assures members that assets are appropriated and expended properly in support of the congregation’s vision and mission, and in accordance with governing documents, policies, and stated donor restrictions or donor intent
- The development of an annual budget as directed or required by the Governing Board and the regular review of financial results as compared to the budget.
- An ongoing assessment of the congregation’s financial health
- Oversight of the Church Treasurer, Financial Secretary, and any internal or external bookkeeper/financial management person or firm.
- Clarify donor intent and/or the nature of the donor’s gift (such as gifts from a donor IRA or donor-advised fund) whenever these factors are unclear.
- The timely reporting of donor contributions, no less than quarterly, and an annual statement contributions by January 20 of the subsequent calendar year. Such statement should include, as appropriate, a statement that no good or services, other than intangible religious benefits, were received in exchange for the donor’s gifts. This statement is required by the IRS for contributions to be considered deductible.
- The timely acknowledgement of donor-advised fund and or IRA gifts separately from the annual receipt and statement of donor gifts that qualify for a (federal) charitable deduction.
- Keep and maintain historical financial records, including a record of individual donor gifts
- Assure that a back-up record of financial transactions, payroll, and donations are maintained off-site
- Unless designated to another committee/task/working group, assure that there is an annual emphasis on financially supporting the church
- Administer the congregation’s gifts policy
- Commission a regular financial audit and faithfully consider any “Management Letter” recommendations made as a part of the audit. While a yearly Independent Auditor’s annual audit is ideal, some congregations will not have the resources to justify this expense. Other options may include an internal audit (using professional accountants who, as members of the congregation may volunteer their time to review procedures and transactions), an external auditor’s review and evaluation of the congregation’s internal controls, or limiting a full external audit to those years where there is a change in the Treasurer or Financial Secretary or there is a need to address credible questions with regards to the integrity of the congregation’s fiduciary practices.
- Assure that appropriate confidentiality is maintained within the members of the Committee, staff, and/or other individuals who have access to donor information.
Practice and Philosophy
Members of the Finance Committee, along with all church leadership, shall take seriously the practice of generosity. Accordingly, those placed in fiduciary leadership shall be those who have their own “financial house” in order – so that they may lead from a place of integrity and personal example.
Money is a spiritual issue and it is addressed over 2,500 time in the biblical witness. For this reason, the church will regard the faithful practice of stewardship, (including financial stewardship) as being in the prevue not simply of the Finance Committee, but also of the Elders and the Pastor as those charged with the spiritual formation of the congregation. The teaching of financial health for individuals, the encouragement to lead a generous life, and the instruction of the biblical and theological concepts about money and possessions shall be seen as germane and appropriate to the life of a Christian.
Both personal information and the giving records of donors will be safeguarded and kept confidential. At no time shall the church sell, lease, or rent the personal information of its members to any other party. In keeping with standard fiduciary practice, confidential giving records may be shared with those who are responsible for the congregation’s financial controls, donor receipting, or the pastoral care of church members. Those counting the offering and/or recording contributions will see individual gifts or other confidential information (and they are charged with treating all such information as confidential). Church leadership, when seeking to understand the nature of the composition of its donor base to make evaluations for the long-term financial health of the church may require periodic access to more nuanced details about the congregation’s donors (individual specific information will be shielded whenever possible). Should the church consider a major financial initiative, such as a capital campaign, it may be necessary to share specific donor financial information with appropriately appointed key leaders or a duly employed consultant in order to do a feasibility study or to solicit “lead gifts” for the success of such an effort. All of this information will be treated as a sacred trust and be shared only when necessary and only with those who have a legitimate need to know.
The pastor shall be notified by the Financial Secretary if there is a change in the amount and/or the pattern by which financial gifts are given by any individual or household. This is understood to be a matter and opportunity for pastoral care and not for the purpose to discuss financial contributions. The pastor is trusted with this information as with all confidential matters shared in the course of the pastor’s care for church members. Best fiscal practices suggest that all financial information regarding donor records should be accessible by the pastor. This, however, may be negotiated with the pastor and the Elders. Members who wish to keep their giving information private from the pastor may do so by written request (which will be held as a matter of record) to the Chair of the Finance Committee, who will notify the Financial Secretary of this request.