Managing church finances is complicated with regular accounting software. Church financials require more than just accounting. They require calculations and recording of information that is specific to the church. And the reporting of information must be flexible enough to accommodate the needs of the groups reviewing the information, whether it is a church council, elder board, financial committee, or congregants and parishioners. Many organizations that don’t have their own CPA will consult with an accounting firm to determine the best church accounting software. So what should church financial people look for in church management accounting software?
Flexibility with Reporting
Reporting is the most valuable tool of any financial accounting software program. Financial information is rarely useful in its raw format, especially for non-accounting types. The church financial officer understands the figures of the budget, church offering intake, and church overhead figures. But they need the ability to produce these figures in a readable and understandable format for everyone else in the church office to understand.
A good program will offer many different ways to report on financial information. It will also have customizable features that enable the user to develop custom reports to meet the church’s needs. Also, it is helpful for a software program to have a way to manage and view restricted funds – this helps with funds apart from the general operating budget of a church.
Flexibility in Design of Chart of Accounts
Not every organization has the same accounting needs. By using a software program that offers flexibility in designing and creating a custom chart of accounts, churches can have the ability to create a system for tracking finances that specifically matches the incoming and outgoing accounts as needed.
Easy and Customizable to Meet Specific Needs
Often, it’s the simple things that make a software program indispensable. A good program will allow flexibility and be easy to use for most financial managers.
Specific Accounting Requirements
For any nonprofit accounting software program, the software must meet specific accounting requirements such as the Financial Accounting Standards Board 116 and 117 requirements and IRS tax-related requirements.
Tools to Automate Key Functions
One way to automate key functions within an accounting software program is to create custom billing codes. Creating billing codes can enable convenient, accurate billing for fees and services. Invoices can run in batches rather than created one by one. Also, billing codes allow for multiple fees to be automatically applied. This allows for time-saving when dealing with general billing needs.
Identify & Maximize Key Revenue Sources
Your church software’s accounts receivable should allow you to name and create as many revenue centers as needed. These can tie to the appropriate income accounts to maximize key revenue sources. This is an important feature to see where the money is coming into your organization and where to focus time and energy to help your church grow.
Find New Ways to Reduce Expenses
By using software to manage the general ledger, accounts payable, accounts receivable, purchase orders, and fixed assets, an organization can better track finances and find areas to cut costs and reduce overall expenses.
Don’t forget Payroll
Having a church software program that automates church’s payroll withholding taxes helps you say on top of federal, FICA, state, and local taxes without the effort. It also enables you to process employee timesheets with adherence to special tax requirements and allowances for your ministerial staff. A good program will also track benefits, additional compensation, allowances, reimbursements, insurance, and retirement plans.
Overall, financial accounting software for churches can make a huge difference in the efficiency of how your church office operates. Now that you know what to look for in Church Management Accounting Software, let us show you how we can help you manage your church finances with Realm or register for a demo of Realm.
Cal joined the ACS team in 2004 and is currently the Market Strategy Manager serving denominational ministry partners. He received a degree in Secondary Education at Southeastern Bible College before pursuing graduate work at the University of Alabama. He has served on various local nonprofit organizations, including The King’s Academy, a Christian school in Florence, SC. And R.E.A.C.H., an educational resource group based in Florence.