Church Check Writing Policies & Procedures

The financial policies and procedures of churches have long been contentious. Churches should adhere to strict policies and procedures to reassure staff and the congregation that their donations are being properly handled, especially with check-writing. In establishing policies examine church by-laws and constitution for existing policies. Many churches require that addendums to church policies are voted on by members of a certain age.

Check writing policies, also called cash disbursement policies, should eliminate any doubt in the minds of your people. The church's checking account should maintain a minimum balance at all times. Polices could include the financial secretary writing checks on a set day of the week, to be signed by the secretary and a chosen officer.

Checks over a set amount, for example, $1,000, should require three signatures or approval by a specific person. If a person requests reimbursement the request should be submitted with a receipt and signature of the approver. If credit cards are necessary all credit cards should be paid at the end of the month to avoid any finance charges. Any expenditure related to travel and business entertainment should have clear guidelines. The church financial office should take advantage of any bank discounts offered for paying early or in entirety.

Policies are “what” a company does, procedures are “how”. Invest in a not-for-profit accounting system. Many systems are available specifically for churches and their needs. Procedures should include requiring two signers for all checks that are written to establish accountability.

One staff member could run payroll, and another can approve it. The chief financial officer should review all general ledger reports (a detailed transaction list) weekly or bi-weekly. Depending on the way you church is set up, you should present your board of deacons or elders with the detailed income and expense reports each month. Either the CFO or a deacon should reconcile the bank statement with your accounting program.

Model the policies and procedures of a church after the policies and procedures of for-profit companies, if at all possible. While salaries and benefits must be confidential, several people on the board should decide what the pastor and staff is paid. Checks should never be written for “bearer” or “cash”. Checks should never be signed prior to being prepared. If any problems or concerns arise you should seek the advice of a certified public accountant.