Financial Management In Faith Based Organizations

autor: Project Clue | 2021-07-24, 05:54 |

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In today's world, there isn't a day that goes by without the news media informing us of the country's corruption (Lipset & Lenz, 2012). Nigeria's corruption is so widespread that many Nigerians believe that even the most trusted institutions, such as the Church, are corrupt. In our current epoch, the Church cannot afford to be reactive, but must instead be proactive in its financial management. In other words, there should be no indication that the Church's finances are being mismanaged. This is because the Church is ostensibly supposed to play a major role in our society's current quest for transparency and accountability. Furthermore, congregations want assurance from the leadership that funds given sacrificially to the Church as offerings are used wisely. However, while some stakeholders in the Church's finance section are proactive in managing their churches' funds above reproach, others are doing the exact opposite by pilfering their churches' funds.
“Financial management is an integrated decision-making process concerned with acquiring function and management, and managing assets to accomplish some overall goal within a business entity,” according to Baker and Powell (2013, p. 4). Decision-making is critical in financial management, which is why it should not be done by a single person, such as a pastor or church leader; each and every member of the administration should be involved in decision-making, and their opinions should be respected and implemented if they are agreed upon. A financial decision should be made with the institution's best interests in mind, not with personal gain in mind. We ask the following questions when making financial decisions: 1. What financial and asset resources do we have? 2. Do we have sufficient funds to invest in the long or short term? 3. How do we maintain our investment and raise additional funds to keep the institution afloat? Financial management will not be successful unless these questions are answered correctly. When we recognize what we have, it will be much easier to determine which areas to wisely invest in, whether on a long or short-term basis, in order to reap a profit in due time. If you don't have a well-thought-out sustainability plan, it's better not to invest in anything. Also, in Christian institutions, the aspect of mobilization is very important; there is a need to develop skills in mobilizing more funds for the institution's sustenance by raising awareness for mission organizations and individual donors to continue to support the vision. In mobilization, maintaining interpersonal skills is critical.
A local assembly of believers and the redeemed of all ages who follow Jesus Christ as Saviour and Lord is known as a church (Kanuku, 2017). Because the church is both an organization and a spiritual entity (Andrews and Roller, 2011), church leaders must understand both aspects of this identity and master a set of tools for leading and managing both of these elements in order to be effective. The Church is viewed as a social organization with good moral values in this regard (Kombo and Gogo, 2017). Despite the Church's reputation for high morals, corruption in the state and society at large, including churches, has remained a global threat because abuse of power, bribery, and secret dealings continue to wreak havoc on societies all over the world (Transparency International, 2013). Corruption has spread its roots to the point where it is now considered a global problem in both developed and developing countries (Furphy, 2010). Churches have a lot on their plates. Accounting and its charts can become an afterthought as they strive to keep a good handle on bookkeeping, future plans, and the needs of their members. Unless there is a crisis or a notice of an upcoming audit, churches often pay little or no attention to their financial records and charts of accounts.
Funds management entails the proper planning, operation, control, and accounting of an organization's financial resources. The organization's goals are clearly stated and implemented in financial terms, and proper policies aid in goal attainment. Funds management, investment management, internal controls, and accountability are the main financial components of the church that have piqued researchers' interest (Leach, 2016; Laughlin, 2018; Harris 2011; Booth, 2013; Gruber, 2014; Agyei & Kusi, 2016; Shaibu, 2013). These components cover everything from how to manage finances before they're received to how to report usage to stakeholders. The identification of each component provides a comprehensive view of the organization's entire financial management system, allowing for a more reliable expression of the quality of financial resource management.
The quality and quantity of services provided by a church organization is determined by its financial performance (Siciliano, 2017; Sulaiman et al., 2018; Nordiawan & Hertianti, 2010). As a result, it is critical for a church organization to maintain a healthy financial position in order to fulfil its strategic mission. One of the responsibilities of church board members is to keep track of their organization's revenue and expenses. Siciliano (2017) discovered that a church organization's financial performance is difficult to understand and improve when board members, staff, and directors have limited financial management experience. As a result, it's critical to look into the procedures these churches have in place for managing their offerings. This will allow one to determine the challenges, if any, that these churches are facing as a result of their inability to manage their offerings in an ethical manner during Undergraduate Project Topics.
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