CHURCH FINANCES

by Elmer N. Dunlap Rouse

CONTENT

INTRODUCTION (below)

PART 1 : THE NEED FOR INTERNAL CONTROL

PART 2 : REQUIREMENTS TO BE TREASURER

PART 3 : SUGGESTED REGULATIONS

PART 4 : BUDGET

PART 5 : MONTHLY REPORT

PART 6 : REVIEW

PART 7 : FUNDS TO BUILD

PART 8 : INCORPORATION

PART 9 : MINISTER

INTRODUCTION

When I arrived in Puerto Rico for the first time, on September 1, 1970, a minister
had just destroyed a church. He had expropriated the church of a deemed fund by
means of a blank check. To simulate a robbery, he had broken a window in the
church. When a police officer learned that the treasury books were missing, he
immediately said it was the minister. That sad scenario of the crying brothers will
always be etched in my conscience.

Planning and controlling church finances is a function of leaders and as delicate

as it is important. With the necessary respect, its correct handling is easy and
simple. This presentation includes a regulation that is effective as long as it is
adopted in its entirety. If this is the case, it will be impossible for a single person,
without love, to appropriate the funds of the church. At the same time, it provides
leaders with an effective instrument to measure the economic capacity of the
church and plan their work.

TOPICS TO BE PRESENTED:

Requirements to be treasurer

Criticisms of those who manage money

How to protect yourself from unfounded accusations

How to control the offering after it is collected

How to control church checks

How to review the treasurer's books

How to prepare a monthly report

How to prepare an annual budget

How to finance a new construction

Many churches handle money without due caution because they do not know the
principles presented here. They are issues of fundamental importance for sound
and blameless administration, which is the first requirement for being a leader in
the church (1 Tim. 3:2). Valuable brothers enjoy the trust of the members due to
their decorum and wisdom.
 PART 1:

THE NEED FOR INTERNAL CONTROL

YO. THE HUMAN FACTOR

The churches of Christ follow the biblical pattern of local church autonomy and
this freedom enables them to faithfully follow the Word of God without the
interference of human legislation. But this freedom from external control makes
internal control more necessary, since the cases reported to the embezzlement
authorities almost always come from autonomous churches. Unlike churches that
are controlled by a council, churches of Christ depend on the ability of their
leaders to exercise sufficient control over finances. Note the plural expression
"leaders." It is not healthy for a single leader or minister to do everything: count
the offering, deposit it, or also be treasurer. No matter how confident you are and
how honest you think you are, it is not advisable to police yourself, but rather
you should involve more people in the process.

The saying goes, "Love and interest went to the field one day and interest was
stronger than the love I had for it."

If Peter could fall, denying the Lord three times, it is possible that others would
falter under the temptation of using church funds without permission or even
appropriating such funds. The lax practices of many churches tempt the brothers.
Opportunity makes a fool. Honest brothers, but lacking supervision, in a moment
of weakness or need, may take from the church fund without authorization,
justifying that the church owes it to them or thinking that one day it will be
returned. As a consequence of the lack of prudence on the part of the leadership,
the church suffers scandals, loses families, loses confidence in its leaders and no
one wants to become treasurer. If God does not allow us to be tempted beyond
what we can resist (1 Cor. 10:13), the church should not allow it either.

II. THE RESPONSIBILITY OF LEADERS

Each church leader is responsible for every penny that comes into the church.
They can and should entrust a qualified brother with the work of the church
treasury, but this does not take away their responsibility. As good administrators
of what God and the brothers have entrusted to them, it is their responsibility to
ensure the purity of the entry and exit of each penny. The leader who presumes
that everything is fine or that others are aware is a negligent leader.
Leaders enjoy the trust of their brothers. No one should accept to be a leader in
the church, nor allow another to be a leader, if they do not enjoy the trust of the
brothers. Trust cannot be given away but rather each person has to earn it for
themselves. Those who have been faithful with low-trust jobs can be given more
trustworthy jobs until they reach their level of competence. It is an unforgivable
mistake to admit a novice or a newcomer to a position of leadership (1 Tim. 3:6,
13; 5:21-22). No matter how famous he is on the other hand, he has to earn the
trust of the brothers of the church. The church is not the property of the minister
to be given to whoever he believes is best. Any candidate for leadership, who the
leaders judge to be suitable, has to be presented before the congregation, to see if
the church agrees, to see if there is any valid complaint against said person.
When a leader makes a serious mistake that damages the church's trust in him, he
is obliged to resign and will be a member like any other until the church no
longer trusts in him.

III. SOME ARE WILLING TO STEAL FROM GOD

According to a survey, 8% of the churches of Christ indicated that they had

suffered from embezzlement and theft. Some examples: (1) A treasurer paid his
own electricity and water bills and made other checks in his name in the amount
of more than $3,100.00 until he was discovered; (2) A church reported that it lost
a considerable amount when there was no system of checking the treasury; (3) A
treasurer carelessly allowed the Sunday offering to be stolen from his residence;
(4) One church reported that they suspected one who always began counting the
offering before the others assigned to count arrived; (5) A church discovered that
charity checks were not arriving at their destination and then found that the
treasurer was cashing them; (6) A church discovered the fraud because a sister
said she always offered a $100.00 bill every Sunday. They watched and caught
the person who deposited the offering in the bank, taking out the bill. This
happens a lot in churches that do not have a record of the count or that allow the
same person who counts to also deposit; (7) To make matters worse, one church
discovered that the treasurer was betting the church's money at the racetrack on
horse races.

IV. CRITICISM OF THOSE WHO MANAGE MONEY

TO. Only one person counts the offering.

b. They do not count the offering immediately.

c. The offering is not deposited immediately.

d. The same person who accounts also deposits.

AND. The treasurer signs the checks.

F. The same individual authorizes the payments.

g. There are no reports and if there are they are oral.

H. Only one person knows what's in the bank.

YO. Nobody checks the books.

J. There is no budget.

Paul, being prudent in his handling of money, demonstrated in 2 Cor 8:19-22 that
it is not enough to be honest, but one must also demonstrate to one's brothers that
it is impossible for one to be dishonest.

18 And We sent with him the brother whose praise in the gospel is heard in
all the churches; 19 and not only this, but he was also appointed by the
churches as a companion of our pilgrimage to carry this donation, which is
administered by us for the glory of the Lord himself, and to demonstrate
your good will; 20 avoiding anyone to censure us regarding this abundant
offering that we administer, 21 trying to do things honestly, not only before
the Lord but also before men. 22 We also sent with them our brother, whose
diligence we have repeatedly verified in many things, and now much more
diligent because of the great trust he has in you.

PART 2
 REQUIREMENTS TO BE TREASURER
YO. REQUIREMENTS

TO. The treasurer must be a serious person who has mastered his personal
finances and who has no personal problems or financial need.

b. He must enjoy the confidence of church leaders. The treasury and the power to
sign checks are positions of trust that are not given to everyone. (Should a split
occur in the church, these positions are even more critical. Ultimately, church
leaders can ask the court to freeze church accounts while the issue is resolved so
that church funds are not taken by the divisive party.)

c. By law, you have to be of legal age.

d. Must be a person with accounting training or, at a minimum, one with math
skills.

AND. If it is a church that collects large amounts of money, you must take out a
fidelity bond.

F. He must be appointed by the leaders and approved by the church, being of

impeccable integrity. "Approved by the church" involves three steps: (1) that he
was announced in front of the church as a candidate for the position, (2) that a
month was given so that the brothers could communicate to the leaders any
problem that disqualifies said candidate and (3) that after a month, if there are no
valid complaints, he is installed as treasurer.

g. Must be a person without conflicts of interest. It is not possible for the

treasurer to also be a purchasing agent. For this reason, it is not appropriate for
the minister to be treasurer, nor to count the offering or deposit it. If the treasurer
is authorized to sign church checks, leaders should warn him that while he is
treasurer, he is prohibited from signing a check.

H. Since the treasurer is going to work closely with the minister, he must (1) be
very Christian; (2) believe that God is directing your life and that, at this
moment, He has assigned you the work of the treasury; (3) be free from habits
that affect your example as a Christian, (4) be 100% in agreement with the
program that the church leaders have approved, but at the same time, (5) be
independent, with the ability to think itself.
YO. If the conditions of a church are that a woman is best qualified to serve as
treasurer, there is no biblical reason to exclude her.

II. OTHER SUGGESTIONS

TO. Church leaders should prepare a list of members qualified to exercise the
treasury and rotate it every year to every three years.

b. To alternate the treasury, it is necessary that the old treasurer have all accounts
up to date and that the new treasurer sign having received the effects of the
treasury. The new treasurer will have 30 days to protest any irregularity.

c. The treasurer must protect the effects of the treasury.

d. If they find fault with the treasurer's work, church leaders should advise him
the first time, give him, perhaps, a letter of reprimand the second time, and on the
third occurrence, relieve him.

PART 3
 SUGGESTED REGULATION
Each church should have detailed regulations, such as below, to protect its assets,
verify the accuracy and fidelity of reporting, promote the operational efficiency
of the church, and encourage compliance. In this way the church can control its
assets, protect them from improper use and assure its parishioners that indiscreet
acts cannot happen. This regulation must appear written and approved in the
minutes of the church.

YO. CONTROL PRINCIPLES

TO. The responsibility of each one is clearly established.

b. Accounting is separate from the operation of the fund.

c. Accounting and operations use certainty tests.

d. A single person cannot carry out a transaction.

AND. Employees are selected and trained.

F. There is rotation in jobs.

g. Each job has written instructions.

II. CONTROL OVER CASH

TO. Each person will know exactly their responsibility and who they are
responsible for and these instructions will be in writing.

b. After collecting the offering, it will be kept in a safe place until the designated
people can count it. It would be preferable to have a room for this with a table,
chairs, a calculator and for the counting to take place immediately after the
service.

c. The treasurer cannot count or deposit the offering.

d. In order to count the offering, two people are required (at least) and one is
allowed to count without the other being present. The presence of other people is
also not prohibited.
AND. Those who count the offering are selected by the leaders based on their
skill and integrity. These people will be trained and periodically changed.
Rotating accountants prevents fraud or making the job a burden.

PROOF OF THE COUNT OF THE OFFERING

DATE __________________________
CHECKS CASH
name/ number/ quantity number/quantity
1. __________________/ ____/ ______
___ x $50.00 = ______ . ___
2. __________________/ ____/ ______
___ x $20.00 = ______ . ___
3. __________________/ ____/ ______
___ x $10.00 = ______ . ___
4. __________________/ ____/ ______
___ x $5.00 = ______ . ___
5. __________________/ ____/ ______
___ x $1.00 = ______ . ___
6. __________________/ ____/ ______
___ x $.25 = ______ . ___
7. __________________/ ____/ ______
___ x $.10 = ______ . ___
8. __________________/ ____/ ______
___ x $.05 = ______ . ___
9. __________________/ ____/ ______
___ x $.01 = ______ . ___
10. _________________/ ____/ ______
total checks $_________ total cash $_________
SIGN HERE total checks $_________
1. _________________________
TOTAL OFFERING $_________
2. _________________________
Please deliver the original to the treasurer and the copy to the depositor

IT IS PROHIBITED FOR ONE PERSON TO COUNT THE OFFERING

F. Each accountant will count the money themselves to avoid errors. In this way,
the depositer is prevented from appropriating excess money or from becoming
alarmed at the bank due to missing money.

g. Those counting will fill out and sign a counting slip, like the one above,
itemizing each check with the name of the person who wrote it and the amount of
cash. One copy of this receipt will be delivered directly to the treasurer and the
other to the depositor.
H. Those who count will fill out the deposit sheet. Each check will then be
stamped on the back with the church's rubber stamp that will have the words "
For Deposit Only " with the name of the church and your account number.

YO. The entire offering will be deposited. No payments should be made with the
offering money. The entire offering is deposited, without exceptions. AND
PERIOD. Additionally, all proceeds from any loans made in the name of the
church will be deposited. Only through the instrumentality of a check can church
money be disbursed.

J. The depositor will be liable for the offense if it is stolen. It is not good for that
money to stay in the church building. If the church wishes, it can request from
the bank a key case to deposit the offering in the "Night Deposit" vault that the
bank has.

III. CONTROL OVER CHECKS

TO. All church disbursements are made by check. Nothing is paid with cash.

b. The treasurer is in charge of writing checks and no one else may have blank
checks in their possession.

c. Every check needs authorization before it is made. Church leaders will provide
the treasurer with a list of ordinary and necessary expenses. You can also make
checks that are necessary to comply with the leaders' minutes. The treasurer must
refuse to write checks if he or she believes they are not properly authorized,
regardless of who requests them. The treasurer should follow his common sense
by being slow to pay for questionable items and only pay when he is satisfied
that the church received the goods or services claimed. You must be prompt in
reporting abuses, excesses, unnecessary expenses and suspicions to leaders.
Extraordinary purchases require special written authorization signed by leaders.

d. Typically, the treasurer, when handing over a check, will receive a receipt or
receipts that add to the amount of the check. It is the treasurer's duty to keep the
receipts in alphabetical order and to ensure that the same thing is not paid twice.

AND. Every receipt will have the following information:

1. Seller name;

2. Address of the seller with telephone number, if any;

3. Date of the transaction;

4. Clear and detailed description of what was sold;

5. Detailed price with sum of the total;

6. Signature or initials of the seller;

7. License plate number, if it is for gasoline;

8. Delivery address, if it is for construction material.

9. Initials of a leader (this step is not generally necessary, but can be used if the
situation requires further verification; another way would be to have receipts
accompany the check so that the people signing can verify the receipts).

F. It is the treasurer's duty to protect blank and canceled checks.

g. The treasurer cannot sign a check.

H. Each check requires two signatures.

YO. If possible, those who sign checks should mail them instead of returning
them to the treasurer or bearer.

J. Checks will be written as follows:

1. With permanent ink or with a clipper

2. In this way no one can alter it

3. The amount will be written attached to the far left to prevent another person
from adding numbers.

4. After writing the amount, a straight line will be placed to avoid additions.

5. Every check and its stub will be numbered.

6. All receipts will be completely filled out with great care, specifying date,
amount, description of purpose, whose name, account number and outstanding
balance.
7. Damaged checks are not discarded, but mutilated and kept. Mutilating a check
involves tearing off the signature area of the check, writing " VOID " on top of
the check, and attaching the check to the back of the stub.

8. It is illegal to postdated checks.

K. Signing blank checks is prohibited.

L. The church account number for water, electricity and telephone will appear on
the check.

M. It is prohibited to write checks payable to " CASH ".

N. The treasurer will inform the bank immediately when a check is stolen, lost,
when an error is discovered or when a check must be stopped. This information
will be by phone and then in writing.

EITHER. Upon receiving the report from the bank, the treasurer will reconcile
the accounts and fill out a report for the leaders, with a copy on the bulletin board
in the church. It will also display a copy of the account statement. You must also
study each check for the following signs of abuse: (1) alterations, (2) lack of
signatures, (3) late payment or (4) endorsement.

It is important to follow these rules without exceptions and leaders will be the
first to comply with them. Failing or deleting a point damages the entire system.

IV. MONTHLY REPORT

Each month the treasurer will submit a detailed written report of all funds that
came in and out of all church accounts. The following will appear on this report:
before and after balance for the month, a breakdown of all offerings for the
month, special offerings, any other credit, such as accrued interest, a list of all
checks that were written with your check number, to whom, its purpose and its
amount, any other debit such as bank collections, the account number of the
different church accounts, the signature of the treasurer with the date of signature
and the initials of a church leader authorized to approve the report. The report can
also list all outstanding debts to be paid. The treasurer will keep the original of
the report, a copy will be given to each church leader and another copy will be
posted on the church bulletin board. See MONTHLY REPORT .

V. REVISION
In January of each year, church leaders will assign a brother, committee of
brothers, or a separate accountant to review all treasury items such as monthly
reports, check registers, offering slips, deposit slips, notebooks. of savings
accounts and account statements. Said person or committee will submit to the
leaders a report that certifies the accuracy of all records and the cleanliness of the
finance system. See REVIEW .

SAW. BUDGET

In November of each year, leaders will assign a committee to prepare the annual
budget with estimates for the months of April and August. In these months the
committee will make a report to the leaders comparing the church's expenses
with the budget projections. See BUDGET .

VII. SHARED WORKS FUNDS

TO. Currently in Puerto Rico there are works shared between several churches,
such as:

1. Bulletin of the Churches of Christ in Puerto Rico

2. Pro Publications Fund

3. Hurricane Hugo Victims Fund

4. Haiti Fund

5. Arecibo Pro Building Fund

6. Seminars

7. Churches of Christ Retreat Center, Inc.

b. These funds are to be treated the same as the local church offering.

1. All funds must be deposited in the bank and refunds must only be made
through checks with two signatures.

2. If a work is permanent, they must open a special account for this purpose. If it
is temporary, they can deposit the funds into any church account.

3. They should advise churches or brothers not to send money in envelopes with
the word "FUND" in the address of the letter. Corrupt employees at the post
office put them in their pockets and they do not reach their destination. It should
be addressed to the church or another name that does not indicate that it contains
money or checks.

4. Those receiving the envelopes should treat each envelope as an offering from
the church. The envelopes can only be opened in the presence of two or more,
who do not include the treasurer, and they will fill out a duplicate offering slip
with the following information: name and address of the donor, amount, check or
money order number, the date on that it was received and the signatures of the
two who opened the envelope. The envelope will be attached to the treasurer's
receipt.

5. Because some checks do not reach their destination, because (a) they were
never sent; (b) were lost in the mail or stolen; (c) were deposited in the wrong
account, reports need to be made. Contributors have the right to know how
their money was used and can reclaim it if it was not used for the purpose
for which it was donated . These reports can be monthly, quarterly or annual but
must announce when participants can expect them. If a church or work refuses to
give reports, one should ask the directors, "What are they hiding?" and let them
know that you will never give a cent again until they send you a complete and
detailed report.

PART 4

BUDGET
YO. DEFINITION
The budget is a necessity for churches that dream of big causes. It is the final
product of a plan. Plan the realization of the congregation's desires adjusted to
their financial potential. Answer the question, "What is the best way to spend the
brothers' money? Failing to plan is planning to fail. The budget explains to
everyone the mission of the church expressed in terms of input and output.
Although the budget can be altered, once presented and accepted by the church, it
becomes a commitment. During the budgeted year, it warns the church when it is
not going to achieve its goal and encourages the church to push itself. Therefore,
it is an effective means of disciplining church expenses.

II. HOW TO MAKE A BUDGET

TO. SELECT A COMMITTEE. Church leaders can prepare the budget

themselves or they can select a committee of key people such as the minister,
treasurer, and other spiritual people. Since it is an annual budget, the committee
should begin preparing the budget around October of the previous year, and
present it to the church in the first week of January.

b. ESTIMATE THE EXPECTED CONTRIBUTION. Using previous years and

comparing the attendance, composition and interest of the congregation, the
future contribution is estimated. Leaders can ask members to fill out an intent
card to indicate the amount they propose to give. Explain to the congregation that
the card is not an obligation, but rather information that helps leaders plan.

The complaints against intent cards are that no one should know what someone
else is doing. It is true that it is not everyone's business how much a member
contributes, but it is the leaders' business. As overseers of the congregation, they
have the right and obligation because they must give an account to God (Heb.
13:17). Leaders will keep this information confidential. In churches that have
never used the intent card system, there must first be an explanation. Leaders can
even visit each member in their home to explain the cards and fill them out.

c. ESTIMATE EXPENSES. The treasurer divides expenses into categories for

the last three years. May include minister pay, benevolence, transportation,
construction, Bible school, maintenance, evangelism, youth, and other areas.

d. PRESENTATION OF THE BUDGET. A copy of the budget and an

explanatory letter can be mailed to each member. Committee members should
appear in the letter with their telephone numbers with the invitation to
communicate any opinions or questions.
 BUDGET
OF THE CHURCH OF CHRIST IN

BO. __________________________________ FOR 2001

LOCAL WORK
Minister salary $25,000.00

Literature $200.00

Bulletin $200.00

Buy equipment $500.00

Bells $150.00

Bus maintenance $500.00

Biblical school $300.00

Loan $3000.00

Gardening $150.00

Light, water, telephone $480.00

Gasoline $600.00

Office expenses $450.00

Liability insurance $550.00

Benevolence $500.00
OTHER WORKS
Orphanage "Pious Hands" $500.00

New work in Ciales $1000.00

Preacher schools $1000.00

TOTAL BUDGET $35,080.00
 WEEKLY CONTRIBUTION NECESSARY $674.62

PART 5

MONTHLY REPORT

Some leaders are very abandoned when it comes to the bottom line of the church.
They say, "Ask so-and-so." Others are very elusive and refuse to inform the
church of the state of finances. They seem to have something to hide or want to
use the church funds according to their personal desire, without anyone
questioning them, as if the church were their property. Such people reveal an
ignorance of the biblical nature of the church and of the relationship of trust that
should exist between a congregation and its leaders. Not only must they report
the financial status with their inputs and outputs, but they must also report their
decisions and plans. Isolating yourself from members is not good because it
limits your understanding of the condition, problems, and desires of the
congregation. How is it possible for a church to offer generously as the Bible
says without knowing the use to which the offering is put?

The report should (1) be concise so that everyone can understand it; (2) include
all transactions and all special funds and (3) be displayed on the bulletin board on
a regular basis - the first week of the month. If the state has many transactions, it
must classify them according to their nature.

FINANCE REPORT
CHURCH OF CHRIST IN

________________________

FOR THE MONTH OF _________________________ OF 20____

Balance at the end of last month: _________
Offerings of the month
1st. Sunday (date)_________ _________

2nd Sunday (date)_________ _________

3rd. Sunday (date)_________ _________

4th. Sunday (date)_________ _________

5th. Sunday (date)_________ _________

Miscellaneous income:
_________
Date_________ Source________________________
_________
Date_________ Source________________________
Total income for the month _________
Total income plus previous balance _________
Expenses of the month
Date #check Turned to: Reason Amount
Total expenses for the month _________
Balance, end of the month _________
Total in account #______________ _________
Total on account #______________ _________
Signature of treasurer _____________________ Date__________

PART 6

REVISION
YO. THE NEED

TO. It is important that the church books be reviewed periodically by a non-

interested person to ensure the following:

1. That all transactions were duly recorded;

2. That there were no transactions that were not recorded;

3. That there are no transactions noted that did not happen.

b. The review has three purposes:

1. First, assure leaders that the records are true.

2. Second, ensure that the funds have been managed correctly, that the internal
control system works.

3. Make obvious weaknesses in the system and make recommendations to

improve control.

4. Protect the treasurer from accusations or a new treasurer changing the records.

c. There are two kinds of review: internal and external. The internal review is
carried out by members of the same church while the external review is carried
out by an expert and disinterested person. If it is a large church, it should be
reviewed by a certified public accountant (CPA). If it is small, it can be reviewed
by a community accountant, by the treasurer of another church, or by a group of
brothers from the same church.

II. HOW TO REVIEW BOOKS

TO. The review should begin by ensuring that the fund reported by the books is
the same as that which appears on the bank statement. Then you choose three
non-consecutive months, say January, April and September, and examine these
three months carefully for the following:

1. Ensure that all offerings appear deposited in both the church books and the
bank statement.

2. Ensure that the deposit sheets correspond in quantity with the receipts of the
offering count and that said receipts bear the signatures of authorized persons.

3. Ensure that the account debits correspond to checks with two signatures.

4. Ensure that checks are dated and made out to the person listed on the receipts
and that the amount corresponds to the amount on the receipt.

5. Ensure that the same bill was not paid twice by comparing receipt dates.

6. Ensure that all addition and subtraction are correct.

7. Ensure that receipts are made in the name of the church and that the amount on
the receipt is correct.
8. Ensure that all checks are canceled by the bank or appear together with their
stubs and properly mutilated.

9. Put all checks in numerical order and ensure that everyone is present.

10. Ensure that the date stamped by the bank approximates the date the check
was made.

11. Ensure that each check is endorsed by the same person who appears on the
check.

12. Investigate all checks made out to "CASH".

13. Find out if there were special offerings and if they were correctly deposited
and spent.

b. After carefully investigating the three months, you should review the entire
year looking for large payments and study them. A small church can review
every transaction, but for a large church, three months is enough.
 PART 7

FUNDS TO BUILD
YO. INTRODUCTION

A construction program involves four areas: (A) organizing construction by

studying the needs of the church and its potential; (B) hire and guide the architect
or engineer; (C) finance the construction and (D) construct the building or work
with the contractor. Perhaps in a small church one person or one committee can
do all four parts, but in a large church the four parts may be assigned to four
committees. A single person can work faster and more efficiently than a
committee, but a committee is necessary if there is no consensus on what to do or
if it is desirable to involve the maximum number of members in the project.

II. THE COMMITTEE

TO. You must choose the committee very carefully. If they lack experience, they
don't get their act together and what they do is useless.

b. Before choosing a contractor, it is necessary to find out if he has ever built a

building. If the answer is affirmative, one can go see what they have done and
how it turned out with the owners.
c. You can choose an architect, although they charge a lot. The church needs a
little elegance. In terms of materials and labor cost, building it pretty or ugly is
worth the same.

d. In terms of size, the new building must be three or four times larger than the
current one in order to grow. The church tends to grow until it fills the building
and then stops growing.

II. PAY NOW OR PAY LATER?

As Christ prohibits marketing on the part of the church (Jn. 2:16), only the
donations of its members remain as income. The church does not solicit
donations from non-members, but it also does not reject them if they come from
an honest source. Since very few churches have sufficient resources to pay for
construction, there are two possibilities: (1) slow construction based on donations
or (2) rapid construction based on a loan. Building with donations is the best
way, because the money does not have to be repaid with interest. But sometimes
it is better to borrow because (1) the church urgently needs to use the structure, or
(2) the inflation rate is very high and, as a result, the cost of building rises faster
than the interest. Furthermore, if leaders perceive something unstable in the
church that could affect their commitment to the bank, it is best to refuse credit
and build when the offering allows. You must understand that to take $100,000
for thirty years, the church will have to pay $300,000. That is, the church lost
$200,000.

III. BUILD WITH DONATIONS

TO. Evangelize: The church that does not evangelize does not need to build
because there is always plenty of space. But the church that wants to serve its
community and is constantly evangelizing needs more space. The larger the
congregation grows, the easier it is to share the burden of a building. It is not
unusual to see a sectarian church grow from nothing to a value of several million
dollars in a short time. We can criticize some unbiblical methods and teachings,
but we cannot criticize their love for souls or their hard work. It is difficult for a
stagnant and dying church to raise funds. It is more important to have a spiritual
and obedient church than to have an elegant but empty building. The
Macedonians gave themselves to the Lord first (2 Cor. 8:5).

b. Three Year Program: After orientation, a church may decide to increase its
offering from one and a half to three times the normal offering for a period of up
to three years. Triple the offering is also possible. That is, if a church's normal
offering is about $250.00 weekly or $13,000.00 per year, it is possible for them
to double the offering up to $500.00 weekly or $26,000.00 per year for three
years, which equals $78,000.00 in total. By tripling the offering you can raise up
to $117,000.00 in three years. Well managed, this amount can build a fairly
equipped building. Requires very active promotion for three years. Due to the
effort, a church giving like this should not manage a loan until after three years.
If a church really wants to build, if the leaders set the example, and if there is
love for the work, anything can happen.

c. Sister Church: Invariably, other churches are willing to help in the construction
of another church, especially those that already have their buildings.

d. The Special Offering: A large church in Texas promoted a single offering for
several months, emphasizing to its members how early Christians sold property
to meet the needs of the church. They raised more than a million dollars. Then
another church did the same and offered ten million in a single offering. Raising
large amounts of money requires several months and a lot of promotion. The
"Offering for the Saints" of 1 Cor. 16:1-2 and 2 Cor. 8 and 9 was a special
offering that Paul promoted for a long time. Three months is not enough time for
a special offering, but a minimum of 4 months. You have to involve the entire
congregation, even the children, and do special activities to promote it.
Furthermore, each one must propose in his heart the amount that, with God's
help, he is going to give. Depending on how you propose what you are going to
give on Sundays in your regular offering, you can make a commitment about
what you are going to give in the special offering six months from now, if God
allows. One must write it down and look at it every day.

AND. The Will: By leaving a will in order, the will of the deceased is respected
in the distribution of the assets they left. If the testator wants to continue giving
after death, he can include the church and other special works in his will.

IV. BUILD WITH LOANS

TO. Banks

1. Banks lend to churches like any other institution, but they are reserved for the
following reasons:

to. Banking institutions do not want the embarrassing job of seizing or

expropriating a church. It discredits the bank and it may be a better deal to lose
the money,

b. A church building is a structure with limited function and often difficult to sell.
c. Churches are generally not known for their business prudence, but for
ineptitude, inefficiency, and very poor credit history. A church with many
problems is not going to have constant income. Furthermore, the banks are very
elusive when they perceive a church as adventurous, like those that start
overnight with a tent.

d. Additionally, church leadership changes and new leaders may be unstable.

2. Because of these reasons, it is difficult for a church to get the loan it needs
unless it can convince the bank of (a) its sincerity, (b) its ability to repay; (c) its
solid planning, (d) its payment plan and (e) its stable leadership. Additionally, the
bank needs several members with property to sign as collateral for the loan. They
think, "If you believe in your church, there should be no problem." If the church
is not incorporated, the bank needs even more signatures.

3. The church should cultivate a positive relationship with bank managers. You
must pay electricity, water and telephone on time, as well as past loan payments.

4. When applying for the loan, you must include the history of the church, a
summary of each of its leaders, growth projection and financial history.

5. Federal and state restrictions limit the amount a bank can lend to a church
relative to the market value of a certain property and limit the amount of time it
can be repaid. You can lend 100% of the cost of a construction, but you cannot
lend more than 60% of the certified value of a property and for a period of no
more than fifteen to twenty years, ten years maximum if it is for a personal loan.
The amount depends on capacity (income), your affiliation with other churches,
and your strength as a church. Normally payments should be 25% of monthly
income, but can be up to 50%.

6. Information requested for loans: (a) a report of income and expenses for the
last three years; (b) a balance sheet, prepared by an accountant; (c) a copy of the
budget; (d) a resolution of the leaders authorizing the loan; (e) a copy of the
church regulations; (f) a copy of the deed and a description of the property; (g) a
title to property; (h) a portrait of the property; (i) a certification of the value of
the property; (j) a copy of the plans and specifications; (k) an estimate or offer
from the contractor; (l) a payment plan; (m) a copy of the liability insurance
policy; (n) a copy of the property tax (or its exemption).

b. Individuals: Some churches are lucky enough to find a brother or wealthy

individual who is willing to finance the entire construction. You may be
motivated to help the church, or you may be interested in earning more interest
than the bank pays. The church may not have rich people, but rather members
with savings who are willing to lend them to the church for a time. The church
pays them the same interest that the bank pays or two or three points less. This
can be complicated, as emergencies happen. A brother may get sick and need
your money.

c. Bonds: It is rare but some churches have raised funds by selling bonds to their
own members and the general public. The interest rate is a little lower than what
banks and other institutions charge, but high enough to be attractive. The church
decides the interest, what property will be mortgaged, the repayment schedule,
and how to pay the interest. The church will need the services of an attorney to
contract the debt and bonds. As advantages, the interest is lower, the church does
not have to prove its credit, the bonds will be paid when the church is collecting
more offerings (assuming it has grown), a bank will be the trustee preparing all
the papers and there is no searching signatures of other people.
 PART 8

INCORPORATION
Each church must be incorporated in order to comply with the laws of the
Commonwealth of Puerto Rico. The law requires that when there are properties
that belong to a group of people, these people have to incorporate themselves to
acquire legal identity.

If the church is not incorporated, each member individually is responsible for

loans made in the name of the church. If it is incorporated, no one is responsible
unless they endorse the loan as guarantor. In the event of an accident, officials
are also not responsible, unless they are negligent.

If it is not incorporated, it is most likely that everything will be in the name of a

brother (the minister). If he dies, all church belongings are now the property of
the deceased's family. It becomes "the shepherd's mess" to sort out the title of
property after the person whose name the property appears to be in dies.
 PART 9

THE MINISTER
YO. FUND MANAGEMENT

Many times financial problems lie with the minister. Their power in the small
church is almost absolute and very few today believe that they receive enough
salary. Paul counseled Timothy of the value of contentment when he said, “…for
we have brought nothing into this world, and surely we can take out nothing.
Therefore, having food and shelter, let us be content with this" (1 Tim. 6:7-8). If
material gain is very important to a person and the lifestyle of others affects him,
perhaps he should consider another profession than preaching. It is not
convenient for him to be treasurer, or even to count the offering. It is not in your
best interest to receive money through the mail. It is better to be very strict and
have integrity than to give the opportunity to dangerous and embarrassing
situations.

II. LOANS

The minister should never borrow money from the church. The church is not a
financial institution and should never lend money to anyone. Never. If a minister
or brother has a true emergency, the church can donate the necessary money,
clarifying that it does not expect reimbursement. Lending church money is a sure
way to lose a brother. Almost always the church ends up forgiving the debt. It
must be explained that if we lend the church's money to one brother, it must be
lent to all of them and then there will be no fund left to do the Lord's work. The
minister should also not borrow money from the brothers of the church, but
should go to a bank or other commercial institution. Your ministry will suffer if
the brothers perceive you as more interested in money than soul, or worse, as a
cheat.

III. SALARY
TO. Churches that grow widely are those that employ a full-time minister. Paying
a salary is the wisest investment a church can make. Churches without a full-time
minister are like businesses that are open three hours a week. It's more of a hobby
than a business. Christ taught that workers are worthy of wages (1 Tim. 5:18) and
ministers are entitled to reasonable remuneration. Little salary, little love.

b. A minister must work a minimum of 40 hours per week and the least he or she
should receive is the current minimum wage. Churches that grow substantially
have dedicated ministers who work 60 and even 80 hours per week. Another way
to calculate the salary of a minister is to pay him the same salary as a school
teacher, considering his academic preparation. Some churches use the bank's
salary schedule to set salaries. Other churches add what other working members
of the congregation earn and pay them the average. This method has a flaw,
because unlike other professions, a minister has to use a means of transportation
to be effective. In addition to a basic salary, the church must cooperate with
gasoline and car repair. It should provide benefits like those provided by schools
and banks in terms of health insurance, social security and pension. Now, if the
minister works hard and doubles the membership, it would generally be fair to
double his salary. What if he gets lazy and the church falls? Cut your salary or
find another one!

c. If a minister receives a salary and comes to preach a campaign, the inviting

church must pay only his expenses.

d. A church with ten full-time members may employ one minister. If the church
does not have enough income, you can save your money until they have enough
to pay you for six months or a year. Then they can invite the minister in the hope
that he will raise the church before the fund runs out. A worthwhile minister must
be successful. Another way would be to find work for him in the community,
until he can build the church. There may be ministers who are willing to live off
what they are given, even willing to walk or ride a bicycle for the love of the
Lord and the work. If the church can build a house for the minister's use, it makes
the salary more attractive.

IV. MINISTERS AGE

Ministers cannot preach all their lives and therefore must save something to live
on when they can no longer preach. They must pay their Social Security, have
their house paid for and something saved in the bank. They must manage the
money that passes through their hands well. In addition, churches can open a
savings account to deposit an amount as a pension for ministers who have
worked with them.