EXDIA

Dealing with complicated expense reimbursements in your church One of the tricky areas that you may have come across in your church finances is how to manage many incidental and ad-hoc expenses that are incurred. These types of expenses could involve a wide variety of people including staff, admin teams and ministry teams. Further, the expenses could relate to a wide variety of purposes including ministry, office, and pastor’s expenses. Managing all this can be daunting, especially when there are lots of people and lots of transactions involved. There are a bunch of ways this type of situation can be handled, and it will be a case of working out what is effective and smooth for your church team – there is not necessarily a “one-size-fits-all” solution. Read more in our full article here: https://lnkd.in/gtnrd_5j

Some words to consider …

Is your team distracted by this? It would be interesting to have a figure of how many hours a week each of your team members are spending unnecessarily on some sort of financial matter, rather than other priorities. Such a figure would be difficult to nail down of course, with our thoughts and time regularly jumping from one thing to another, but perhaps the following areas may ring true. How much attention are sales or operational staff being unintentionally required to give to the nuts and bolts of financial processing? Or perhaps you’ve experienced a time when your processes have let you down and you find you or one of your team is scrambling to resolve a financial concern that’s become unnecessarily urgent? While your team are supportive and kind and happy to help of course, what may be the long-term effect on your business when resources are regularly being diverted in this way? Read further in our full article here: https://lnkd.in/gA_aczKT

Three key points in your expense data entry As with the data entry of income items into your accounting system, the coding of expense items is important for having good management and compliance information later on. Some of the key information that will benefit from attention in the coding process includes: • Supplier information – setting up good supplier records (and avoiding duplicate records) helps to collate supplier information in one place, and also helps with the consistency of information. Also establishing the payment method and details for each supplier can save time when preparing payments down the track. • Expense allocation – each supplier payment will be coded to one or more accounts in your general ledger. Taking care to code it where you want it at the start means that this allocation will flow through correctly to your reports with the item sitting in the correct expense category • GST – it’s also important to account correctly for GST at the point of data entry. Ascertaining the correct GST status of each supplier and each bill will increase the accuracy of your system and help avoid the need for adjustments and corrections. Note that some payments may have a combination of GST and Non-GST items, so take care to catch these as well. Like to explore further? See full article and other resources here: https://lnkd.in/gtnrd_5j

Some words to think about …

How are you reading your business’s financial health? One of the biggest financial misunderstandings (and hence miscommunications) that can occur in businesses is in the area of what we’ll call “cash position” (or “cash viability”). To explain this, we need to understand that as a business makes money, some of these funds need to be reserved for upcoming expenses or liabilities. These expenses and liabilities may be coming up at different times, and in some cases may only be an annual occurrence. When these upcoming expenses and liabilities are not well understood or recorded/reported, an unfortunate situation can occur – the business bank account may look well resourced, but the overall financial position of the business could be dire and desperate. To put it simply, obvious financial figures like the bank balance and the level of sales may not be very good indicators of your business’s actual financial position. In fact, they could give a false impression of a healthy situation, when in fact the business may owe more funds to others than it has in cash balance (and is in a decidedly unhealthy financial state). Read further in our full article here: https://lnkd.in/gBGrE4Yy

Thank you for your kind words, Jenni!

Unusual scenarios in your church accounts When getting involved with church accounts, it may surprise you just how many unusual scenarios and requirements you come across with various income items. For each item it will be important to determine: • How the income is to be classified in the church accounts • How the income is to be treated for GST • Whether there is further treatment needed in the church accounts to siphon off the income to be held in reserve • What type of receipting is required to donor and how this will be done • Any other regulatory reporting in relation to the income • Other records that need to be kept For examples of unusual items that you may come across see our full article here: https://lnkd.in/gbdH5Q43

Something to consider …

Connecting vision, finances and team For those of us who spend a lot of time with our head in the accounts, it can be easy to forget that our teams (and even our leaders) can have very little idea of what is happening in business finances. Not that every team member needs (or wants!) to know all the nitty gritty, but lack of appropriate and regular information could mean a subtle but growing disconnect of our teams from how finances can be serving the vision of the business. Where we have great team wanting to grow the business, we want to facilitate their enthusiasm, rather than create or keep obstacles. Where there is a breakdown of effective communication it can lead to increased difficulty for team to see how the finances are relating to the bigger picture. Something to explore further? Read our full article here: https://lnkd.in/gBGrE4Yy