Bookkeeping Service for Non-profits, Charities & Churches

The Australian Taxation Office defines Not-for-Profit (NFP) organisations that provide services to the community and do not operate to make a profit for their members or shareholders.

A church must understand how much funds are available, project revenues, analyse historical data and ascertain the average member donation.

The budget is determined based on information, including revenue projections using historical data, church goals, church strategy, and resources.

A budget is an itemised allotment of funds. The finance committee monitors its monthly budget by reviewing incoming and outgoing cash flow.

Financial reporting assists the church see how it performs and adheres to the budget. It will assist the decision-makers in ascertaining how financial the church is by reviewing monthly or quarterly reports apprised of spending and budget variances.

This allotment is to expect the unexpected. To offset these funds, allocate a percentage of your budget dollars to emergency funding as an emergency fund bucket.

As part of your role in the church financial committee, create a definition for an emergency and set aside these funds unless a genuine financial emergency arises.

As this fund allocation will grow year after year, financial resources will be available when those unanticipated emergencies arise, safeguarding an unexpected budget variance.

Financial reporting assists the church see how it performs and adheres to the budget. It will assist the decision-makers in ascertaining how financial the church is by reviewing monthly or quarterly reports apprised of spending and budget variances.

Churches rely on member donations. Steward’s primary responsibility is to look after the church finances and report to the church board and finance committee.

The board and the finance committee are responsible for ensuring that proper financial controls of church assets are in place.

Cash handling policies should be written and an auditing process of anyone who handles church money, ensuring safe places to store cash and constant supervision of members, volunteers, or employees who come into contact with money. Embezzlement, unfortunately, is quite common.

As Not-for-profit organisations do not pay out their profit to members, they can grow their capital and invest back into the organisation.

NFP should designate a percentage of income for a profit margin. For instance, if an NFP brings in $500,000 and budgets for a 10% profit margin, it will be saving $50,000 a year that can be reinvested back into church facilities.

A Strategy needs to be written for paying down debt and set this up as part of its budget. Paying down debt can come through capital campaigns that are designated for debit reduction, or it can be from aggressive debt payments.

Charities have reporting obligations to the ACNC, including ongoing reporting and record-keeping to comply with ACNC Governance Standards and applicable External Conduct Standards.

This reporting must be carried out annually by submitting an Annual Information Statement and Annual Financial Report (subject to charity size).

Your charity size is based on the total annual revenue for the period you are reporting on.

• Small charities have annual revenue under $250,000
  
• Medium charities have yearly revenue of $250,000 or more but under $1 million
  
• Large charities have annual revenue of $1 million or more.

• 31 December for charities reporting to a regular financial year (1 July to 30 June)
  
• 30 June for charities using a calendar year reporting period (1 January to 31 December).
  

Failure to submit an Annual Information Statement may result in penalties; however, if your charity is classified as a Basic Religious Charity, you may seek to be exempt from certain reporting obligations.

Bookkeepers For You are specialist bookkeepers, working with you to tailor bookkeeping and business development solutions for your enterprise.