A contribution to a church is a sacred item and should be managed carefully. The story of the Widow’s mite reminds those of us who are in charge of managing church finances that even the littlest amount is important to the Lord. This means that you should have some form of system in place in order to carefully track these donations.
Typical donations to churches include money and stocks; however, occasionally someone will donate a physical item of value like a painting or an animal. A good church contribution software package can help you keep track of all of these donations.
Why are contributions so difficult to manage?
This is a common question asked by those who are just entering the church accounting scene. From an outsider it would seem pretty simple. The church receives money, makes note of it, and deposits the money in the bank. It seems like by simply monitoring the church’s bank account, one would be able to keep track of all of the donations. Unfortunately managing church contributions is not this simple.
When a donor pledges an asset to the church, he/she will often only do so under certain circumstances. The donor might say that the money can only be used for feeding the poor or rebuilding the old church. Donations like this need to be tracked in a special purpose fund. Unfortunately banks are not willing to keep track of all of this for you. Some people may consider at this point creating two accounts at a bank: one for general funds (donations without any restrictions) and one for special purposes. Problem solved, right? Not exactly because Sue’s contribution was to be used specifically for maintenance of the Church, and John’s contribution was to be used for the summer camp, and Harold’s for the missionaries in Africa. You can see how this quickly spirals out of hand. A good church contribution system will help you keep track of these different donations.
Features included in Church Contributions Software
Not all software packages are created equal but most of them will have the following features: funds setup to help you manage the different contributions you receive, a place to track donor information, reports at the end of the year that summarize how much a donor has contributed, and an automatic letter-generator that will send out a statement to the donor for tax purposes. Depending on the size of your church, the letter-generator can be a real time saver.
Remember that church contributions are acts of faith and should be managed carefully, preferably with some form of church accounting software. Careful management is necessary due to the nature of restrictions with contributions.