If you’ve ever felt nervous, stumbled over your words, or watched board members glance down at their phones, you are not alone. Many nonprofit leaders, executive directors, and even seasoned managers wrestle with this exact pain.

Here’s the good news: once you understand what your board truly cares about—and how to share it—you can walk into that room with confidence, clarity, and even excitement. Let’s break it down using simple language, real-life examples, and step-by-step solutions.

Why Board Presentations Often Go Wrong

Let’s start with the hard truth: many board meetings turn into information overload. Leaders bring in piles of spreadsheets, long reports, or scattered updates. What happens? Board members zone out. The energy drops. And the mission of your organization gets lost in the noise.

Here are some common mistakes that cause confusion:

• Too much data, not enough story. Dumping numbers without explaining what they mean leaves your board confused.
• No clear focus. You try to cover everything, so nothing really sticks.
• Talking in “finance language.” Not every board member understands debits, credits, or complex KPIs.
• Fear of tough questions. You avoid sensitive topics like cash flow or staff shortages, but the board can sense it.
• Poor visuals. Tiny font slides and cluttered graphs make it hard to follow along.

When this happens, board members may lose trust. They start wondering if leadership really knows what’s going on. And that’s when stress skyrockets—for you and for them.

What Happens If You Don’t Fix This?

Here’s the scary part. If you don’t learn how to communicate clearly with your board, bigger problems show up:

• Funding can dry up. A confused or worried board may hesitate to approve budgets, fundraising strategies, or new programs.
• Trust breaks down. Without clear updates, the board may second-guess leadership. They might even start micromanaging.
• Opportunities get missed. When your message isn’t clear, your board can’t advocate for you with donors, partners, or the community.
• Stress spreads. Staff sense the tension. Morale dips. Momentum slows down.

Imagine this: A nonprofit had a chance to apply for a $500,000 grant. The board needed confidence in the numbers to sign off. But the financials were confusing, the presentation dragged on, and trust wobbled. The deadline passed. Opportunity lost. That kind of pain is real—and preventable.

Here's Your Game Plan: Share What the Board Really Wants to Know

Your board doesn’t need everything. They need the right things—presented with clarity, confidence, and care.

Here are the top areas your board truly cares about:

1. Financial health. Are we bringing in enough money to cover expenses? How’s cash flow? Are there risks we need to know?
2. Mission impact. How are we changing lives? What’s the story behind the numbers?
3. Progress on goals. Are we on track with the strategic plan, programs, and major initiatives?
4. Risks and challenges. Don’t hide the tough stuff. Be honest about problems—and show your plan to solve them.
5. Opportunities. Where can we grow? Are there grants, partnerships, or new programs worth exploring?

When you focus on these, your board feels engaged, respected, and equipped to make decisions.

Step 1: Prepare the Right Data

Gather the numbers and stories that matter most. Don’t drown your board in spreadsheets—curate what’s essential.

Examples:

• Instead of listing every expense, show program vs. admin costs in a simple pie chart.
• Instead of 10 pages of donor names, highlight the growth in new donors vs. repeat donors.
• Instead of raw survey data, share one powerful quote from a client about how your program changed their life.

Use visuals—charts, graphs, and pictures. People remember stories, not spreadsheets.

Step 2: Use Simple Language

Boards are often made up of smart people with different backgrounds. Some know finance. Others know marketing, law, or community service. Don’t assume they all speak “accounting.”

Swap jargon for plain talk:

• Say “money coming in” instead of “revenues.”
• Say “money going out” instead of “expenditures.”
• Say “extra money left over” instead of “net income.”

The clearer your words, the more confident your board will feel.

Step 3: Tell the Story Behind the Numbers

Numbers are important—but numbers alone don’t inspire. Connect them to your mission.

Example: Instead of just saying, “We served 325 families,” tell the story of one mom who found safe housing because of your program. Put a face to the figure. That’s what sticks in your board’s hearts.

Step 4: Deliver with Confidence

Confidence doesn’t mean you need to be perfect. It means you prepare, you practice, and you breathe.

Tips to shine:

• Stand tall and make eye contact.
• Practice with a friend or in front of a mirror.
• Smile—it makes you more approachable.
• Pause. Silence can be powerful. Don’t rush through your words.

When you relax, your board relaxes too.

Step 5: Welcome Questions and Feedback

Don’t fear questions—invite them! Questions mean your board is engaged. Here’s how to handle them with grace:

• Listen fully. Don’t interrupt. Let them finish.
• Repeat back. “So what I hear you asking is…” This shows respect and ensures you understood.
• Answer honestly. If you don’t know, say so. Promise to follow up—and then do it.

Action Steps for Your Next Board Meeting

• Pick 3–5 key metrics your board truly cares about.
• Turn at least one metric into a simple chart or graph.
• Write one client or community story that connects numbers to impact.
• Practice your presentation out loud—time yourself.
• Plan one slide or handout with “Next Steps” so the board knows how to help.

Frequently Asked Questions (FAQs)

1. What does my board really want to know?

Your board wants to know if the organization is healthy, making an impact, and moving toward its goals. They don’t need every detail—they need the big picture, told clearly.

2. How can I share information with confidence?

Prepare well, practice out loud, and focus on the most important points. Confidence grows with clarity and preparation.

3. What if I get a question I can’t answer?

It’s okay! Be honest. Say, “I don’t have that number with me, but I’ll follow up.” Then make sure you do.

4. How often should I update my board?

At least quarterly, and more often if there are major changes or urgent issues. Boards want to feel informed, not surprised.

5. How can I build trust with my board?

Be transparent. Share wins and challenges. Invite feedback. Show that you listen and take action on their concerns.

Final Thoughts

Sharing with your board doesn’t have to be scary. When you focus on what really matters—financial health, mission impact, progress, risks, and opportunities—you’ll transform those meetings. Your board will feel engaged. You’ll feel confident. And together, you’ll move your mission forward.

Remember: your board doesn’t expect perfection. They expect honesty, clarity, and leadership. You’ve got this.

That’s why bookkeeping matters. It’s not just about writing down numbers or balancing a checkbook. It’s about trust. Donors trust you to use their money the right way. The community trusts you to keep your programs running. And your board trusts you to give them clear answers when they ask about money.

Here’s the problem: many board members feel lost when they look at financial reports. They might not say it out loud, but inside they’re thinking:

• Are we really keeping track of donations the right way?
• What happens if we spend restricted money by mistake?
• Are we going to get in trouble with a grant report?
• Can we explain our spending without looking sloppy?
• How do we prove we’re being honest with the money?

When your board doesn’t have clear answers, confidence drops. And when confidence drops, fundraising slows down, trust wobbles, and your mission takes a hit.

Why Good Bookkeeping Matters

Let’s be honest: nobody starts a nonprofit because they love bookkeeping. You started because you wanted to solve a problem, feed the hungry, build stronger families, or serve your community. But here’s the truth: if the books are messy, your mission will struggle.

Good bookkeeping does four big things for you:

• It keeps you honest. Donors can see where the money goes.
• It keeps you safe. You stay in compliance with the IRS and state laws.
• It gives you power. You can make smart decisions with real numbers, not guesses.
• It keeps you moving. Clean books make it easier to get grants, loans, and file your 990 tax return without panic.

Bad bookkeeping, on the other hand, creates fear. You start dreading board meetings. You avoid applying for grants because you’re not sure the numbers are right. And you stay stuck instead of growing.

That’s why your board asks these five key questions. They’re not trying to give you a hard time. They just want to know the money is handled well so the mission stays strong.

Question 1: How Do We Keep Track of Donations?

Every nonprofit lives on donations. That’s your lifeblood. So when a board member asks, “Are we keeping track of donations the right way?” what they’re really asking is: Can we prove we’re trustworthy?

Here's The Potential Problem They See

If you don’t track donations carefully, problems creep in:

• Donors don’t get thank-you letters.
• Totals don’t match the bank account.
• You can’t tell which campaigns are working.
• The IRS could question your records.

Here's Your Game Plan

• Use the right tools. QuickBooks, DonorPerfect, or other donor systems can track every gift.
• Reconcile monthly. Make sure your donor records match your bank account.
• Send thank-you's fast. Donors want to know you received their gift. If your organization is a church, send out year end contribution statements.
• Show clear reports. Give the board simple charts of donations by month, campaign, or year.

How to Answer the Board

“Yes, every donation is tracked in our system. We reconcile with the bank every month. Donors get thank-you letters, and here’s a report showing year-to-date giving compared to last year.”

Question 2: What About Restricted Money?

This question usually sounds like: “Are we keeping restricted funds separate?” Restricted money is money a donor gives for a specific purpose—like scholarships, a food pantry, or a new program.

Here's The Potential Problem They See

If you mix restricted and unrestricted money, things get messy fast. You could:

• Spend money on the wrong thing.
• Break a donor’s trust.
• Risk legal trouble.

Here's Your Game Plan

• Separate accounts. In your chart of accounts, track restricted funds apart from general funds.
• Track every dollar. Record when restricted money comes in, how it’s spent, and what’s left.
• Report back. Update donors on how their money was used.
• Write policies. Have clear rules on how restricted gifts are handled.

How to Answer the Board

“Yes, restricted gifts are tracked separately. For example, the scholarship fund has its own account. Here’s a report showing how much came in, how much was spent, and the balance left.”

Question 3: How Do We Handle Grants and Government Funding?

Grants are exciting because they bring in big money. But they also bring rules.

Here's The Potential Problem They See

Many nonprofits get into trouble here. Maybe you don’t file a report on time. Maybe you pay for something that wasn’t allowed. Maybe you can’t find the receipts. And once you lose a grant-maker’s trust, it’s hard to win it back.

Here's Your Game Plan

• Create grant budgets. Track income and expenses for each grant separately.
• Save all receipts. Keep invoices, timesheets, and records in one place.
• Stay ready for audits. Assume every grant will be checked.
• Track deadlines. Put due dates on a calendar and review them often.

How to Answer the Board

“We set up a budget for each grant and track every expense. All receipts and records are saved. Reports are submitted on time, and we’re audit-ready if the funder asks.”

Question 4: How Do We Handle Spending and Reimbursements?

Board members also want to know: Is the money going out as carefully managed as the money coming in?

Here's The Potential Problem They See

Without clear rules, nonprofits can:

• Overspend.
• Pay the same bill twice.
• Reimburse expenses without receipts.
• Use money for things that don’t fit the mission.

Here's Your Game Plan

• Write it down. Create policies for how expenses are approved and reimbursed.
• Use tech tools. Apps like Expensify or QuickBooks make tracking easier.
• Set approval rules. Require pre-approval for large expenses.
• Train the team. Make sure everyone knows how to handle money properly.

How to Answer the Board

“All expenses need receipts and are coded correctly. Reimbursements are paid within two weeks with documentation. Big expenses need approval, and we review spending against the budget every month.”

Question 5: How Do We Stay Transparent?

Finally, boards ask: How do we show we’re being open and honest with the money?

Here's The Potential Problem They See

When reports are confusing—or when board members feel like they’re only getting half the picture—trust slips. And once trust is gone, donations dry up.

Here's Your Game Plan

• Provide reports often. Share balance sheets, income statements, and budget vs. actuals monthly or quarterly.
• Use plain language. Keep reports simple. Explain accounting terms in everyday words.
• Bring in an auditor. An independent review adds credibility.
• Encourage questions. Make board meetings a safe space for money conversations.

How to Answer the Board

“We share monthly financials with the finance committee. An independent CPA does an annual review. Reports are clear and highlight key trends so everyone can understand.”

How to Talk About Money with Your Board

• Use pictures. Graphs and charts work better than spreadsheets.
• Compare to the budget. Show where you’re on track—or off track.
• Highlight what matters. Don’t bury the board in details. Point out the key issues.
• Teach as you go. Offer quick explanations to build financial confidence.

When board members understand the numbers, they stop feeling afraid of them. They get more engaged, make better decisions, and feel proud to represent your organization.

The five questions we just walked through—donations, restricted money, grants, spending, and transparency—are the core of nonprofit financial health.

If you can answer them clearly, you:

• Build trust with your board.
• Keep donors confident.
• Open doors for more funding.
• Free your team to focus on the mission.

Messy bookkeeping creates stress, mistakes, and lost opportunities. But clear, clean, and honest bookkeeping gives your nonprofit the foundation it needs to grow strong and serve well.

So the next time a board member asks, “How are we doing with the money?” you’ll be ready. You’ll give them answers that build confidence, not confusion. And most importantly—you’ll show that your nonprofit is not only mission-driven, but also money-smart.

If you’ve been losing sleep over whether your books are right—or dreading that email from your board or CPA—please know this: you’re not alone. Whether you're behind on your bookkeeping, worried that your numbers don’t tell the full truth, or feeling pressure because a grant application or loan deadline is creeping up, I see you.

Let’s fix that. Together.

The good news? You don’t have to be a numbers whiz or a QuickBooks expert to start getting clarity. You just need to know what to look for. So let me walk you through three simple reports that can give you answers—and peace of mind—fast. These are the same ones I use to help nonprofit leaders and small business owners clean up their books and get audit-ready.

Let’s take a deep breath... and dig in.

1. Profit and Loss Report – Your Financial GPS

Think of the Profit and Loss (P&L) Report as your financial GPS—it tells you where your money’s coming from, where it’s going, and whether you’re headed in the right direction. This report shows your income and expenses over a specific period (like a month, quarter, or year), and it’s one of the first places I look when someone says, “My numbers just don’t make sense.”

When you look at your P&L, ask yourself:

• Are we bringing in more than we’re spending?
• Which expenses are eating up our budget?
• Are there income streams that are underperforming?

You’d be surprised how many organizations don’t realize they’re operating at a loss—until they run this report. And if you’re applying for a grant or trying to qualify for a loan, this is one of the first documents they’ll ask for. It’s your chance to tell your financial story with confidence.

Warning signs to watch for:

• Flat or declining revenue while expenses climb
• Unusually high spending in non-mission-critical areas
• Negative net income—month after month

If you spot something off, don’t panic. That’s actually a good thing—it means you’re catching it before it spirals. With QuickBooks Online, you can customize your P&L to highlight the trends you care about most.

2. Balance Sheet – Your Financial Health Snapshot

Next up is your Balance Sheet. This one shows you what you own (assets), what you owe (liabilities), and what’s left over (equity). In plain terms: Are you building a strong financial foundation, or are the cracks starting to show?

I call this your “financial selfie” because it captures your financial health in real time. When you’re behind on your books, this is often the report that throws up the biggest red flags.

Take a moment and ask yourself:

• Do we have more debt than cash?
• Are our assets shrinking over time?
• Are there unpaid bills piling up in the background?

These are the questions lenders and funders will ask, too—so let’s get ahead of it.

Red flags to look for:

• Negative equity (yikes—you owe more than you own)
• High debt-to-asset ratio (hello, cash flow stress)
• Liabilities increasing month after month

Run this report alongside your P&L for the full picture. When those two reports agree, you’ll feel that shift—from uncertainty to control.

3. Bank Reconciliation Report – The Reality Check

Here’s where the rubber meets the road.

The Bank Reconciliation Report is your reality check. It tells you whether your books match your actual bank transactions. If they don’t? You could be missing income, duplicating expenses, or misreporting your cash position without even realizing it.

If you’ve ever looked at your bank balance and thought, “Wait, that can’t be right,” this report is your best friend.

Here’s why you need it:

• It catches missing or duplicated transactions
• It helps you detect errors before your accountant does
• It’s required to produce accurate financials for tax returns and audits

When reconciliation is off, it’s a red flag that your books need some love. QuickBooks Online makes this easier than ever, but you’ve got to stay consistent.

What to look out for:

• Transactions that haven’t cleared in months
• Differences between your bank balance and QuickBooks balance
• Deposits or checks that never posted

Reconcile monthly—no exceptions. Doing this regularly will save you hours (and maybe even dollars) when it’s time to apply for funding or file taxes.

So… How Often Should You Run These Reports?

Here’s the magic answer: every month. And no, that’s not too much.

Running these reports monthly helps you:

• Spot errors before they become emergencies
• Plan ahead for cash flow and tax time
• Provide clean reports to grantors, lenders, and board members
• Avoid that pit-in-your-stomach feeling when someone asks for “your latest financials”

If you’ve ever said, “I don’t have time to get caught up,” let me lovingly say: you don’t have time not to. Because what takes 15 minutes now could take 5 hours (and a whole lot of stress) later.

Final Thoughts: You Deserve Financial Peace

You don’t have to keep second-guessing your numbers. You don’t have to hope your books are right. You can know they are—and it starts with checking these three reports every month.

And if you’re behind, confused, or overwhelmed? That’s okay. Let’s start where you are.

I help small business owners and nonprofit leaders just like you get their books cleaned up, caught up, and audit-ready—without the jargon, the shame, or the spreadsheet headaches. If you’re ready for a second pair of eyes (or just a little bookkeeping therapy), I’m here for you.

Let’s make your finances make sense—and help you feel proud, powerful, and prepared the next time someone asks for a report.

You’ve got this!

Peace and Blessings,
Belinda Whitfield
Helping nonprofits and small businesses keep their books clean, tax-ready, and grant-ready—without losing their minds.

Hey there! Belinda here. If you're leading a nonprofit, the halfway point of the year is the perfect time to step back and check in on your financial health. Don’t worry—this isn’t about diving into complicated spreadsheets all day. It’s about getting a simple, honest picture of what’s working, what needs adjusting, and how to finish the year strong.

This mid-year check-up isn’t just a financial exercise—it’s about stewardship, sustainability, and staying faithful to the mission your community counts on. And yes, you can do this even if you don’t consider yourself a “numbers person.” Let’s walk through it together.

Why Mid-Year Financial Check-Ups Matter

Think of this as your nonprofit’s version of a wellness check. You want to make sure everything is running smoothly so you can serve your community without unnecessary stress.

Mid-year check-ins help you:

• Spot financial trouble early—before it grows
• See if your spending lines up with your mission
• Update your strategy for the rest of the year
• Communicate clearly with your board and donors
• Keep your organization grant-ready and audit-ready

Your numbers tell a story—and understanding them helps you lead with confidence. It’s not about perfection. It’s about clarity and making wise decisions with the resources you’ve been entrusted with.

The Key Metrics to Check

Here are three key areas I always tell my nonprofit clients to check mid-year:

1. Income vs. Expenses

Run your Profit & Loss report (a.k.a. income statement). Are you bringing in more than you’re spending? If not, where is the shortfall? If you’ve had big one-time expenses, that’s okay—but make sure you’ve planned for them. If income is behind, it might be time to ramp up donor outreach or grant applications.

Look at your biggest expense categories. Are program expenses in line with what you budgeted? Are admin or fundraising costs creeping higher than expected? Adjustments now can prevent scrambling later.

2. Donor Retention Rate

Are your donors coming back? If you had 100 donors last year and only 40 have given this year, that’s a 40% retention rate. Donor loyalty is gold for nonprofits—it costs less to keep a donor than to find a new one. Follow up with a thank-you, an update, or a simple check-in email. They need to hear from you.

Don’t have fancy donor tracking software? That’s okay. Even a simple Excel list of last year’s donors can help you reconnect with those who haven’t given yet this year. Relationships matter.

3. Fundraising Efficiency

Look at how much you’re spending to raise money. If your event brought in $10,000 but cost $7,000 to put on, was it worth it? Could you raise the same amount with a simpler campaign?

Measure your fundraising cost per dollar raised. If it’s costing $0.40 to raise $1.00, can you bring that down by improving your messaging, segmenting your donor list, or using free tools like email or social media more strategically?

How to Do a Mid-Year Financial Check-Up (Step-by-Step)

Step 1: Pull Your Numbers

Download or print your Profit & Loss report, Balance Sheet, and Budget vs. Actual. If you’re using QuickBooks, it’s all right there. If you’re using Excel, take a look at what you’ve spent and what’s come in so far. Don’t overthink it—start with what you have.

Step 2: Look for Red Flags or Gaps

Are you spending more than planned in any area? Are certain fundraising goals falling short? Write down what stands out—both the good and the not-so-good.

This is also a good time to check in with program leaders. Are they staying within their budgets? Do they have needs that haven’t been funded? Financial health is a team effort.

Step 3: Make Adjustments

Once you see what’s off track, decide what changes you need to make. Maybe you cut some costs, launch a quick fundraising push, or move funds around. Maybe you ask for help. The goal is to finish the year strong and in alignment with your mission.

Use this check-up to set 1–3 financial goals for the rest of the year. Maybe it’s boosting monthly giving, trimming overhead, or applying for one new grant. Write them down and revisit them each month.

Need a Hand?

You don’t have to figure this out alone. Whether you need help reading your reports or coming up with a plan, I’m here for you. I offer strategy sessions, QuickBooks training, and other resources to help you stay audit-ready, grant-ready, and stress-free.

Frequently Asked Questions

What is a mid-year check-up for a nonprofit?

It’s a financial review at the halfway point of your fiscal year. You check your income, expenses, and donor activity to see how things are going.

Why should I do one?

So you can catch problems early, adjust your budget or strategy, and feel more confident about year-end. It also helps you report clearly to your board or funding partners.

What should I look at?

Start with your cash flow, fundraising progress, budget vs. actuals, and any unusual spikes in spending. Also, review if your programs are staying on budget and aligned with your mission.

Do I need an accountant to do this?

You can do a simple check-up yourself, but it never hurts to bring in a pro—especially if your reports are confusing or you want help making decisions.

Final Thoughts

A mid-year check-up is like a pit stop—it helps you refuel, adjust, and head into the second half of the year with clarity. Your nonprofit deserves strong financial footing, and your community deserves a leader who’s not afraid to peek at the numbers and make smart, faithful decisions. You’ve got this. And if you need a guide? I’m just a click away.

Video Transcript:

As you’re working through this 501C3 process or process of starting a nonprofit organization, one of the things you want to think about is that you’re going to have to keep track of your financial transactions.

Here are a few tips for tracking non-profit expenses for new ministries.

If you’re a new organization, this is going to be kind of easy. All you can do is probably start off with a little journal to keep up with your expenses, but eventually, understand that your organization is going to grow.

Be prepared as you grow or get further down the line. Also be prepared to put some processes in place and look at choosing an accounting program to keep up with your income and expenses. That’s going to make things a lot easier for you than trying to do things in a journal or on Excel. Initially, you’re okay with just keeping up with those transactions.

Lastly, be sure to keep your receipts. Get organized and keep all of that paperwork together and in order.

Thank you so much for your question. Please be sure to submit your questions on my website at https://churchcpa.com/contact-us/

That’s my accounting tip for today.

Be sure to subscribe to my channel and have a blessed day.

Is Benevolence Taxable Income?

I will tell you this is one question that comes up quite often, when it comes time to doing 1099 reporting. Someone will ask or mention this to me;

“Belinda, we have a lot of benevolence payments that we’re making to the needy. Sometimes we’re helping them with rent,” or you may even be helping them with utility bills and you wonder, should you be reporting that income or those payments that you’re making to those individuals on a 1099?"

The response is no. Benevolence payments, that’s charitable support that you’re providing to your members is not taxable income, so you don’t have to track that. You don’t ask to ask them for a W-9, and you don’t have to report it on a 1099.

That’s my accounting tip for the day, be sure to subscribe to my channel and have a blessed day.

Got questions about church finances? Submit your questions to me on my website at https://churchcpa.com/contact-us/

Managing Church Finances

The controls governing the collection of offering that will apply include:

• That there is separation of the duties surrounding the collection, counting, recording and depositing of the altar offerings. Different persons should be responsible for each area.
• That the principle of two is always followed. This means that at least two ushers should collect and count the offerings and the collections should at no time be left with just one person. Again it is emphasised that there should always be two people with the offering at all times.
• The count and collection teams should be rotated regularly and the same two persons should not be paired together all the time.
• At least two persons should accompany the collections to the area for it to be counted.
• Ushers and counters should be rotated regularly.
• The counters of the offering should be unrelated.
• All collections should always be counted and deposited intact. Basically, it is not allowed for anyone to use any of the money collected whether to make change or for church expenses.

Here’s how it should work.

1. The ushers are responsible for taking up the collection placed at the altar.
2. The money is accumulated, collected and also submitted to the accounting team so that it can properly be counted.
3. At least two adults who are not related should be involved in the collection process.
4. Immediately after the service, the ushers are to retrieve the offering and take it to the prearranged secure area (on church grounds) to be counted or stored away until the counting can be made.
5. If the count cannot be done immediately, the collection should be placed in a locked safe in an area that has controlled access (little or no through traffic) on the church grounds.
6. Where the count is done immediately and there is a need to submit the proceeds to a recipient, say the guest speaker, the total recorded as placed at the altar should be deposited intact and a check for the same amount given to the minister.

The church is built on the concepts of trust, truthfulness and honesty and most members do realize that internal controls serve to safeguard the church’s interest while at the same time protect them against any possible false allegations.

Video Transcript:

TAX BREAKS FOR PASTORS WITH NO HOUSING ALLOWANCE

{Q} Currently, I do not receive any compensation from the ministry [apparently, this is a pastor] are there any housing allowance related items or expenses that we incur that can be written off on our taxes?

Well, if you are not receiving a housing allowance, that’s not a good thing for you. But in any event, you can still take the normal tax deductions that homeowners can take. You can claim a tax deduction for the mortgage interest that you are paying and as well as your property taxes on your home. You can claim those deductions on Schedule A of your tax return.

If you still have any questions, visit my website at churchcpa.com. Just go to my contact us page and submit your questions. Thank you so much and have a great day.

Video Transcript

HOW TO REPORT PAYPAL TRANSACTIONS ON YOUR BOOKS

Today is Q and A Day, and I’m taking a questions from my inbox.

My writer writes:

“Hi, Belinda. Our company has a PayPal account. I need to know how I should be recording the financial transactions on my books.”

If you have a PayPal account, you want to make sure that you are … First of all, you set up that account just as though it were a cash account on your books. You’ll record any monies coming in as in your appropriate income account for your deposits. Also, if you’re paying bills or making purchases online, you will want to record those payments as expenses.

Also, if you’re transferring money between the PayPal account and your other accounts, you’ll want to record those transfers. Finally, you’ll want to make sure that you’re doing your reconciling of that PayPal account. It’s going to be important for you to go online, download the activity for your PayPal account, and reconcile those balances on a monthly basis. If you should have any questions, visit my website, go to my Contact Us page, and submit your questions. Have a blessed day.

The church should do everything in its power to safeguard its reputation by putting measures in place to prevent any appearance of impropriety.  These controls will also serve to preserve the integrity and safety of the members since they help to remove temptation and provide structure and established guidelines as to how accounting for church finances should be done.

Every church will from time to time invite another minister to speak at their service or function.  Very often a special offering are taken from those in attendance at the meeting and it is announced that these proceeds will be donated to the guest speaker.  Care must be taken in handling these contributions and the internal control measures that need to be in place will include a number of the procedures already discussed.

To begin with, the overarching internal controls procedure -separation of responsibilities- need to be in effect. This means, the collecting, counting, recording and bookkeeper functions must each be carried out by separate individuals or groups.  Also the best practice procedures regarding the appointment, training and scheduling of ushers still need to be followed.

Collecting

• The church may or may not have pre-printed envelopes for the service. Where they do, these envelopes as well as cash and/or check contributions should be collected together at one time.
• The collection should be done separate from the normal church collection, perhaps at the end of the service or just before the guest speaker addresses the church.
• Where funds as placed at the altar, the ushers collect and accumulate it for submission to the counting team.
• No less than two ushers should be with the money at all times. At no time should the offering be left in the possession of just one person.
• Note carefully. The collection for the guest speaker should not be mixed with the regular collections at any time.

Counting

The procedures for the delivering of offering to be counted must be followed.

• At the end the service, the ushers deliver the offering it to the designated secure area (on church grounds) to be counted or stored away until the counting can be made.
• If it not possible to do the count immediately, then the collection should be placed in a locked safe in an area that has limited access to individuals, on the church grounds.

Recording and Bookkeeping

The persons who do the counting will follow the procedures and guidelines set out and the recording is done.

• Where checks were submitted, copies of the checks and envelopes are made.
• The adding machine tapes are prepared for currency, coins and checks and are initialled by at least two members.
• The deposit ticket is prepared and duplicate made.
• The deposit is then locked away in the bank deposit bag.

Where the counting is done immediately at the end of the service in order to allow for a payment to the guest speaker, the amount recorded as received for the special offering is still deposited intact and check for that total is prepared and given to the guest speaker.

By following the above in a very practical way, the church is ensuring that there can be no hint of misconduct in how they handle the finances entrusted to them.