The format and design of this manual should assist you in fulfilling the responsibilities for the financial oversight of a diocese or congregation. The accounting principles and practices described in this manual should be understandable to most readers. The concepts and terminology have been kept simple yet consistent with the demands of professional accounting principles. The Spanish language download is here.
Chapter I: Financial Management
Budgeting is the allocation of the church‘s resources, in accordance with a plan, for the achievement of its objectives and goals. The church budget is one of the most effective tools available for the proper stewardship of the church’s assets.
Chapter II: Internal Controls
What type of bookkeeping system should we use? How many bank accounts do we need? Who should be able to sign checks? Who should deposit the weekly receipts in the bank, and how? These are just some of the questions to be answered when setting up an accounting system for a congregation. Such questions should be periodically reviewed.
Chapter III: Bookkeeping
The accounting year for all Episcopal congregations and dioceses is January 1 through December 31, according to the Canons of the Episcopal Church, Title I, Canon 7, Section 1(i), which are included in the Introduction of this manual.
Chapter IV: Taxes and the Episcopal Church
Timely and accurate compliance with all applicable Federal and State tax laws is an essential element of sound management of church finances. Federal and State governments have placed increased pressure on all governmental units to increase revenues through an intensified application of existing tax laws to all types of organizations, including churches.
Chapter V: Clergy Discretionary Funds
The Episcopal Church has developed these guidelines for the benefit of clergy, dioceses, congregations, institutions, and others with authority over funds of the Church. The purpose of these guidelines is to provide information and guidance in the structure and use of a class of temporarily restricted or designated funds generally known as clergy discretionary funds.
Chapter VI: Audit Guidelines for Congregations
These audit guidelines were developed to assist auditors in performing the annual audit of the books of account of the congregations of the Episcopal Church. Annual audits are required by the Canons of the Episcopal Church for all parishes, missions, and other institutions. The primary purpose of an audit is to assure that financial statements are fairly stated. Any person handling the monies or investments of the church needs an audit to protect the church assets and him/her against suspicion of mishandling those assets. Similarly, rectors, vestries, vicars, bishop‘s committees, treasurers and other persons in positions of responsibility may be liable for any losses which would have been discovered by an ordinary audit but were not discovered because they failed to have an audit conducted.
Chapter VII: Insurance
Responsible stewardship demands protection of the Church’s people and property from certain risks. Title I, Canon 7 (6), states – “All buildings and their contents shall be kept adequately insured”, and Title I, Canon 7 (3), states – “Treasurers and custodians, other than banking institutions, shall be adequately bonded; except treasurers of funds that do not exceed $500 at any one time during the fiscal year.”
Chapter VIII: Parochial Reports
Since the first General Convention of the Episcopal Church, congregations have provided a report of membership, baptisms, communicants, services and finances. In 1804 the Committee on the State of the Church was established to review this information and prepare a summary report to General Convention. The authority for the Parochial Report is described in the Constitution and Canons of the Episcopal Church, Canons I.6, I.7, and I.17. The text of these canons is included as an appendix to these instructions.
Chapter IX: Records Management
This chapter offers guidelines on practical issues that treasurers and administrators of congregations will encounter with business records. The chapter includes a general retention schedule that can be modified and adopted for a congregation‘s use.
Forms This appendix lists many forms commonly used by treasurers of congregations, and provides instructions for obtaining copies of them. Samples of some generic forms appear on the pages immediately following this Appendix.