Archive for February, 2008

All Too Common and Totally Preventable

February 27, 2008

The headline was in today’s newspaper: Church Treasurer Charged in Theft: volunteer accused of pilfering $18,000. The story went on to tell of the story of a St. Paul man who’s been accused of stealing nearly $18,000 from the weekly collections of a Christian church. Imagine the distress of the church leaders — the betrayal of trust — the difficulty the church will have now that the money is gone. And the question they all must be asking themselves is “How could this happen!?!?”

Well, of course, we can guess how it happened. One person was put in charge of counting the money in the Sunday collection plate, and of taking the money to the bank, and of depositing the money, and of writing checks from the church’s account, and of signing those checks.  How many red flags do you see in that sentence?? The newspaper report says that over several months, the treasurer wrote a number of checks payable to “cash” and cashed them himself. Since the treasurer would have been the person receiving the bank statements, there was no one to sound the alarm. Again, red flags!

A congregation needs to be able to trust the people it empowers to act on its behalf. Safeguards need to be put into place so that temptation is minimized. Safeguards not only protect the assets; they also protect the volunteers from false accusations of misdeeds.

The Sunday offering should be counted by two people who are not related to one another. One of them could prepare the deposit slip, and the other could take the money to the bank if this is not a staff responsibility. If the church has staff doing financial work, the staff can check the deposit slip against what’s actually in the envelope handed over from the volunteers. The volunteers counting the money and taking the money to the bank should be someone other than the treasurer. The treasurer can check copies of the deposit slips against the deposit receipts and against the bank statement which comes back at the end of the month. Multiple checks and balances will go a long way to ensuring security for the assets.

If your congregation has someone who knows about good accounting and money handling practices, ask that person to go over your practices and give you advice on improving them.  lists several books available to assist congregations with accounting systems and cash control. One that I particularly like is Richard J. Vargo’s book Effective Church Accounting [now out of print]. Vargo lists 50 internal controls for churches.

The bottom line is this — leaders need to ensure that congregation members can trust that the money they give to the church will be used wisely, and that includes setting up safety policies and practices for handling it. Without those assurances, why should they give?