Church Budget Preparation Part Two: Undesignated/Designated Business Plan
Church receipts/contributions can be placed in one of two business plan categories: 1) Undesignated and 2) Designated. A business plan is a distinctive means of budget distribution that challenges giving towards the general church budget and controls giving toward designations or non-budget items.
The church treasurer is usually the church officer with the authority for disbursement of church funds based on the proposed and adopted business plan. This means, that special authority is needed by the church business plan to pay non-budgeted or designated items. Often, treasurers and finance committees have to make tough choices if monthly receipts are insufficient. When churches face insufficient funding needs for regular general fund expenditures there is usually several causes.
The goals and objectives for the church’s mission were unclear or unobtainable by the congregation. When this happens a church is faced with amending a budget mid-year. It is better to amend a budget than to deceitfully administer a budget with resources that were not authorized by the congregation. Care should always be taken to allow congregational decision about the general operational budget. If the budget is not being supported by the congregation specific action should be taken to rectify the problem.
Most churches that have problems fulfilling their general fund budget are also creating an additional problem by allowing tom many designated offerings. Yes, “allowing” designations! The church business plan not only helps create a workable general budget it also limits the designations that will be accepted throughout the year.
The designation limits in a business plan are usually: Building Fund, Seasonal Foreign, National, and State Mission Offerings, Summer Mission Projects. Others are possible, but the emphasis is on pre-determining which designation will be accepted that match the goals and objective of the church long-term. This writer is aware of churches with 20-30 designated offerings received during a budget year which has taken moneys away from the general operations budget and allows “pet projects” to be generated by a gift that does not meet the business plan or the goals and objectives of the church. When this happens the general funds budget gets out of control and the goals are not reached. Program and Personnel frustrations become paramount and Kingdom work is minimized.
The number one church budget problem this writer has witnessed over the last five years is a lack of control of designated offerings by church leadership/congregations. If you “fix” this problem with a business plan that is realistic, well administered and focused on church goals and objectives a church will be healthier and more Kingdom focused.
Church Budget Preparation Part One