WELCOME

Budgeting 101 for Ministry

Organizations

August 16, 2012

Who’s here?

75% Churches

5% Christian schools and

mission sending agencies

20% Other ministry organizations

How to participate:

• Open and close your panel

• Submit text questions

• Questions will be addressed at the end of today’s session

• Everyone will receive an email with a link to view a recorded version of today’s session

Our presenters:

Mark Jones

VP and Senior Banking Consultant

ECCU

Vonna Laue

Audit Partner

CapinCrouse LLP

Ingrid Robinson

Founder/CEO

Lenshaw Financial Services

Agenda:

• Aligning budget to strategy

• Budgeting approaches

• Before you get started

• Budget preparation and approval process

• We have a budget. What now?

Overview of budgeting

key principles:

• The budget must be based on a sound

and clearly defined strategic plan.

• The budgeting process must involve

extensive collaboration.

• The approved budget must be monitored

on an ongoing basis.

Developing a strategic budget:

• Review mission, vision, and values:

– What is your 5-year plan?

– What are your key objectives and outcomes?

• Determine (forecast) income.

• Determine allocation by program/area.

• Communicate allocation.

• Set up contingency (reserve) funds.

Budgeting process:

• Budgeting types:

– Zero-based

– Incremental

• Budgeting approaches:

– Top-down

– Bottom-up

Budgeting—before we start:

• Align your ministry financial structure to

your mission/vision:

– Can you tie back your budget/reporting to

what is most important to your organization?

• Review your mission/vision.

• Create a budget/reporting structure that shows

how you are accomplishing your mission/vision.

Our Vision…to build joy-filled communities of faith whose very existence inspires every individual to live R3.

What is R3?

It is the balanced, abundant Christian Life, made up of three key [r]elationships:

� [r1] A deepening relationship with God

� [r2] A life-changing relationship with other believers

� [r3] An engaging relationship with those yet to believe

Worship Community Outreach

Operations

Entire Ministry

Community

Sam

Outreach

Sally

Local

Adult Care

Karen

Adult Groups

Drew

Operations

Keith

Facilities

Jim

Foreign

Worship

Bill

Students

David

Children

Janet

Finance

Mark

Office

General Operation

Todd

Restricted Funds

Todd

Budgeting—before we start:

• Review chart of accounts setup:

– Keep it simple:

• Use general categories.

– Make it meaningful to your organization.

– Utilize department/program structure:

• Class functionality in QuickBooks

Budgeting—before we start:

• Budgeting spreadsheet:

– Align spreadsheet with your financial structure:

• Budget for each department/program area.

• Roll up departments/ministry areas to entire

organization.

• Show prior year totals for comparison.

• Sample spreadsheet

Budget preparation:

• Preparing a draft:– Involve department/ministry leaders:

• Justify their budget

• Align budget with strategic objectives

– Merge department budgets (refer to sample).

– Determine budget gap (projected revenue vs. expenses).

– Discuss and determine revisions.

– Spread the amounts by month.

– Prepare additional budgets for surplus and shortfall.

Budget approval:

• Who is involved?

– Leadership

– Finance committee

– Full board

– Congregation (if required)

• What information do you present?

We have a budget. What now?

• Monitoring

– Implement into your accounting software.

– Monthly reporting:• Department/ministry leaders

• Leadership team

• Board and/or committee

• Others (e.g., congregation)

– Accountability

Questions?

Mark Jones

VP and Senior Banking Consultant

ECCU

Vonna Laue

Audit Partner

CapinCrouse LLP

Ingrid Robinson

Founder/CEO

Lenshaw Financial Services

Resources:

• Examples of budgeting spreadsheets, chart of accounts, class listings, and organizational financial structure

• Budgeting Checklist

• White papers like How to Budget in a Changing Economy and Cash Reserves: How Much Is Enough

• Budgeting books, websites, and online resources

Upcoming webinar:

• Advanced Budgeting:

– Date: Thursday, August 23, 2012

– Time: 10:00 – 11:00 a.m. (PT)

– To register visit:

www3.gotomeeting.com/register/692040454

Upcoming events:

• 2012 Financial Seminar for Churches and

Nonprofits

– Locations/dates: Denver (10/2), Fort Worth

(10/3), Dallas (10/4)

• 2012 Financial Forum for Ministries

– Locations/dates: San Diego (11/6), Livermore

(11/7), Brea (11/8), Denver (12/4)

For more information, visit:

www.eccu.org/resources/events/

Thank you!

If you have questions or would like to speak

with an ECCU ministry development

officer, please contact us at 800.288.4846

or solutions@eccu.org.