Common Manager Concernsĭepartment managers are often caught in the middle and express some common concerns with budgets: The budget is established and sent back up the ladder for review and is negotiated back and forth until a final budget is approved.

Top management sets strategy and goals, then managers and supervisors estimate budget requirements needed to accomplish the strategy. Once these departmental budgets are prepared, they are submitted to the next level of management for review and approval. This step adds a layer of accountability in that the manager can blame no one but themselves if they fail to meet the budget requirements that they recommended. This approach works much better than a manager that given a budget handed down to them from above. Managers that participate in setting their budget will have a working understanding of the reasoning behind it. The advantage to this budgeting approach is the working manager is more apt to follow their own budget. This delegation of responsibility will result in the manager being more accurate and accountable for budget estimates. The individual department managers are responsible for creating their own budget need estimates based on goals and allocated resources.Īllow individual department managers to prepare their own budget estimates. The budget review committee or church board establishes the global budget with revenue projections and allocates dollars to individual departments. These budget managers are held accountable for variances between the budget and actual results. Manager performance is based on how well their department budget is controlled. Operating expenses are organized and controlled by the different levels of management.įor instance, the youth pastor will have responsibility for expenses related to the management and development of the youth program. The quarters are then divided into months and the budget review of gains, losses, and variances is done monthly.īudget allocation is based on historical performance and church priorities. Operating budgets typically extend out for one year and are divided into four quarters. The budgeting process makes estimates of revenues, plan expenditures, and restricts spending that is not part of the plan.

Planning is futile without control over spending, and without planning, there are no targeted objectives to achieve.īudgets set targets for revenues and spending and establish a plan for how the church will achieve its short and long-term strategy.

Planning requires high-level decisions about priorities that line up with a strategy.Ĭontrolling ensures that management implements what was planned and achieves ministry objectives. Budgeting Basicsīudgets are used for both planning and control. Unfortunately, there are a surprising number of organizations that don’t operate with a budget because of the perceived value of taking the time to prepare and monitor it.

God blesses churches with tithing members to provide the resources to do the work of the ministry. As church leaders, we need to recognize that being good stewards of those resources is a significant responsibility – that should not be taken lightly.Ĭhurches use operating budgets to plan and control spending so that resources on used on ministry priorities.Ĭonsequently, creating a budgeting process can help to ensure that dollars are allocated to those things that help fulfill the church’s mission and vision.

Church budget planning