Thursday, February 6, 2014

Five things to do when you suspect impropriety in your church's finances

I occasionally receive comments and emails from readers, always laypeople, who are concerned about improper or inappropriate financial matters in their local church. These are mostly well-meaning folks who have read some of my several dozen articles on the housing allowance, clergy compensation, or church finances and recognize some things are not right in their own church.

So, what should laypeople do when they are concerned about their church's handling of financial matters?

1. Don't be embarrassed about asking questions of church leaders, church finance committee members, deacons or whomever is in charge of this aspect of church administration.

There is a difference in church size here. If you are in a megachurch or large church, my sense is that your concern is unlikely to be welcomed. But most SBC churches have a single clergy staff (the pastor) and may have a full or part time administrative assistant and members are likely to have some forum or practice where they can ask financial questions.

If you have a question about the periodic financial report or budget ask the appropriate person at the appropriate time. It's your church as much as it is the deacon's, pastor, finance committee or staff and you should not hesitate to ask honest questions. Just don't buttonhole the pastor in the hallway before worship or come to be known as the tiresome gadfly at church business meetings who always has a bunch of questions.

2. If you think you know of a problem tell the appropriate person or committee before you raise the issue publicly.

Sometimes churches, church treasurers, and pastors are not as informed as they need to be on matters of compensation, IRS rules, and the like. I would like to be optimistic and think that it would not be seen as a threat if they were made aware of something that needs correcting.

I once found out that my church was innocently engaged in an accounting practice that was misleading. The reports said one thing but the reality, including how much money was actually in certain accounts, was different. I fixed it with the church treasurer and explained it to the church and that was that. No one was insulted or made to feel that they were deliberately trying to deceive the church.

If you are informed enough to know that your church is, for example, handling the pastor's compensation, tax status, or housing allowance incorrectly then you absolutely should raise this question. Just don't do it in a threatening manner. Most church treasurers (most CPAs I'd bet) are not up to speed on clergy tax matters which are different than regular folks.

3. Be known as a generous giver.

If you give a pittance to your church then keep your mouth shut unless you know someone is stealing or something serious like that. Your membership in the congregation may fully entitle you to speak at business meetings and ask any finance people or the pastor questions, but someone who doesn't support the church financially or who gives a token gift just doesn't have much credibility. As pastor, I never knew what anyone gave unless they told me but if I had someone who always complained about church finances, I might be tempted to find out. Chances are in an average congregation, folks have a sense about who gives and doesn't give anyway.

4. If you are knowledgeable, make a suggestion about how to fix things.

A church that doesn't give timely records of contributions in the proper manner, for example, could cost its members additional headaches and grief from the IRS, not to mention additional taxes. A non-threatening and simple solution would be to offer the proper forms or to direct the appropriate person to a source for this.

Frequently and regularly there are news reports of churches being robbed by staff, usually the administrative financial person. Implementing some internal controls over church finances is not all that difficult but if the pastor doesn't know enough to do this or doesn't care, a respected layperson should step up and find a way to suggest simple changes that should be made. 

Here's a fact: most pastors don't know a lot about finance, reports, and all that. They would rather stick to the 'spiritual' things and let others handle the administrative stuff. The problem is that laypeople are less likely to know certain things about clergy and church financial matters than the pastor. If he doesn't know and just coasts along, some knowledgeable layperson might help out. If you are this person, expect to be asked to take a volunteer job.

5. Leave the church. 

A church where financial mismanagement is known, has been brought before the church leadership, and nothing is done is probably not a church worth belonging to. Most laypeople in most SBC churches know that they can outlast the pastor if he is a problem, so I'd make leaving a last resort. Staying in a church with known, uncorrected financial impropriety (and not just a gripe about how much staff are paid or how money is budgeted) is serious business.

I'd make allowances for ignorance and mistakes but a church whose pastor and church treasurer know that finances are being mismanaged and does nothing about it is a train wreck waiting to happen. Better to get off before it happens if you've tried to help and have been rejected, or condemned for asking about such things.

My stance as pastor was to practice the old Baptist axiom, "Trust the Lord and tell the people." That solved many a financial problem in the church. I would also tell the congregation that if they had a money question, ask and they would get an answer. Frankly, it is harmful to the body for churches to fail to be open and  transparent about their finances.

There is no guarantee of success here if you are the concerned layperson. You may end up being the abused martyr. Pray about it and do what the Lord tells you. That always works for the best in the long run.


Anonymous said...

Plodder: “Leave the church.”

Perhaps. No one size fits all, even if it may fit some. From a minister’s perspective, which typically means less family history with the congregation, such is probably a wise career move, but from one with deep roots in the church, stay and keep the issue before whoever will listen, and before the stones if none do! Yet, one does not need deep roots or any roots to stand against something in need of change. Leadership can be replaced, whether lay or professional. May take time, much time; may take longer than one has life, but such could be carried on by others, and even if not, it was carried on by someone at some point. Leaving and allowing the abuse, the perpetrators win. If they are going to win, for whatever time they can do so, make it very difficult for their behaviors to go unnoticed and un-criticized. If you are, indeed, right, and a situation does rise to the level of legal and ethical considerations, others will take notice. And if they don’t, so be it. Stay; be the one referred to by some as “that pain in the @$$!” Being labeled as such does not mean that one is a disagreeable person, even if one is making some people very uncomfortable. In scripture, many times the plea was for something else when the demands were heavy. The response was usually of a different sort.

William Thornton said...

I agree with you and will do some editing. Leaving should be one of the final options. There are churches where riding an issue put and waiting for a staff change is a remote possibility.