CHURCH ADMINISTRATION DYNAMICS: Proper Accounting And Recording Of Church Money

“Whatever is has already been, and what will be has been before; and God will call the past to account.” — Ecclesiastes 3:15
“Give an account of your stewardship…” — Luke 16:1–2
“After a long time, the lord of those servants came and settled accounts with them.” — Matthew 25:19
“Each of us will give account of himself to God.” — Romans 14:12

Understanding Church Accounting

Accounting is the spiritual and administrative discipline of keeping records of how God’s resources are used. Administration then uses those records to make wise, Spirit-led decisions for the growth and impact of the church.

1. WHY PROPER ACCOUNTING IS ESSENTIAL:

1. Helps the church function in an orderly way.
2. Protects God’s resources from theft and misuse.
3. Reveals the church’s financial health.
4. Indicates the direction of your ministry (financially and spiritually).
5. Provides a base for planning and budgeting.
6. Helps manage debtors and creditors.
7. Builds financial discipline.
8. Preserves history and accountability for future reference.
9. Detects fraud and error early.
10. Reduces waste and impulsive spending.
11. Serves as a compass for navigating financial direction.
12. Supports loan/grant applications.
13. Builds trust and generosity in the congregation.

2. STEPS IN KEEPING FINANCIAL RECORDS:

1. Collect financial data (offerings, donations, etc.)
2. Record transactions clearly and promptly.
3. Analyze the data to find meaning and trends.
4. Report the findings to stakeholders (pastor, board, government if necessary).
5. Interpret the results to evaluate financial health.
6. Make decisions based on accurate data.
7. Correct errors and improve where needed.

3. STAGES OF ACCOUNTING IN MINISTRY:

• Bookkeeping (basic recording)
• Accountancy (financial and cost-based)
• Auditing (internal or external)
• Management accounting (planning and control)
• Financial management (visionary leadership with integrity)

4. COMMON REASONS CHURCHES DON’T KEEP PROPER RECORDS:

1. Ignorance or lack of training in accounting.
2. No technical knowledge or support.
3. Lack of biblical understanding on stewardship.
4. Absence of purpose-driven financial vision.
5. Carelessness and complacency.
6. Embezzlement and dishonesty.
7. Treating the church as personal property.
8. Weak internal controls.
9. Lack of financial planning and structure.
10. Laziness or poor leadership follow-through.
11. Confusing secular and church financial practices.

Recommended Reading
Tithes And Offerings In The Church
Twenty Guidelines For A Happy Marriage
Ten Types of Laziness and How to Escape Them

5. CONSEQUENCES OF POOR CHURCH ACCOUNTING:

1. Misappropriation of funds.
2. Stagnant or declining financial progress.
3. Conflict and accusations.
4. Division or church splits.
5. Judgment from God for unfaithful stewardship.
6. Poverty and hardship for church leaders.
7. Loss of trust by members.
8. Decrease in giving due to dissatisfaction.
9. Government scrutiny or penalties.

6. ACCOUNTING SYSTEMS YOU CAN USE:

• Mental accounting (not recommended for long-term growth)
• Incomplete records (insufficient)
• Single-entry accounting
• Double-entry accounting (standard)
• Computer-assisted systems (recommended for accuracy)

Train your church finance team in:

• Bookkeeping
• Accounting
• Church administration

Organizations like Church Growth Services and Financial Accountability Ministries can help with training and resources.

Let every steward of God’s resources rise to the call. May we be found faithful in financial matters, just as we strive to be in spiritual matters. The Lord is watching, and He will hold us accountable.

“It is required in stewards that a man be found faithful.” — 1 Corinthians 4:2