Churches hold a special responsibility that is different from a business. Houses of faith are dedicated to a mission. They also rely on donations entrusted to the church to support its good works. On paper, it may appear that business accounting software works just as well for non-profits. In the case of churches, it falls short.
Business software solutions do not take into account the extraordinary importance of fundraising. They also do not include features that are central to many church activities, from running a thrift shop to sponsoring overseas missions.
For these reasons, church leaders should take care to choose an appropriate accounting program. Donor funds form part of a sacred trust. Therefore, a stand-alone tool to optimize the fundraising process is ideal.
We're here to help you find the right program. First we'll review some unique aspects of church accounting. Then we'll devote time to giving software and why it's essential. Finally, we'll review some accounting programs that may work well for your congregation. With these facts, you can choose the right financial tools for your church.
Why Use Accounting Software?
Churches may not focus on making a profit, but they have to monitor cash flow. Every activity of the church is a commitment to the community. Without detailed accounting, it is a challenge to develop five- or 10-year plans — or even an annual budget. That leads to ineffective programs, since leaders cannot roll out plans of action beyond meeting short-term goals.
In addition, a church is a legal entity. It may have to show its books to authorities from time to time. Lastly, donor funds are given in good faith. Diligent accounting methods give congregants the peace of mind that their money is used appropriately.
Dealing With the IRS
Charitable organizations like churches and other religious establishments are not required to file income tax returns. This may lead some to think they do not have to worry about the IRS at all.
However, although churches are exempt from filing even an annual information return, it is just good practice to keep information on file. That way, if the exempt status is ever questioned, church leaders have paperwork to show.
Managing Church Assets
Like all organizations, churches have to keep the lights on. They have bills to pay for their core operations and special programs. Some churches may have capital assets or long-term debt.
By paying close attention to the books, churches can keep their books in the black. Knowing how much money they have can make it easier to get financing for renovations or repairs.
How Do I Choose the Right Church Accounting Software?
In many ways, therefore, the accounting needs of a church are similar to a business. You need to know how much you owe. You need to know how much you have in cash and assets. You need to have a long-term plan to support your work and the people who do it on your behalf.
You also need to pay special attention to giving. In many ways, the overall budget and donor management work together. You can't pay the electric bill if no one donates to the church. At the same time, many churches rely simply on goodwill to get enough money coming in.
The right technology can help them to expand their capacity to accept donations. Some providers, like NewFire Giving, also provide education on how to handle fundraising. This, in addition to a full-suite software program, can help you to manage your budget and engage with your giving community.
Giving Software: NewFire Giving
What is NewFire Giving?
Our goal is to help your church track donations and increase giving opportunities. At NewFire Giving, we want to help you engage your community. NewFire Giving believes in simplifying the process through modern, digital tools. That way, church leaders can focus on their mission rather than on how to increase funding.
NewFire Giving offers a few ways for you to make your fundraising better. Our software helps you to receive payments through a variety of methods, including online, text message, smartphone app, and on-site kiosk. But what makes us different is our coaching program. Together we work to help you improve your fundraising methods. That's all while staying true to your personal ethics.
Church accounting software does not focus on fundraising. In fact, donations are just one feature of many. It's hard to overstate the importance of donor management, so this software is insufficient. Church leaders may want to use NewFire, along with a program from the list below.
Church Accounting Software: Aplos
What is Aplos?
The Aplos Accounting program is for churches and non-profit organizations. Aplos offers “True Fund Accounting.” According to the company, you can “easily track designated funds, such as your missions fund or building fund, to demonstrate to your members that you are stewarding your gifts well.”
Demonstrating strong stewardship is essential for churches. This kind of data and reporting increases donor confidence.
The software includes payroll functionality, as well as tracking of housing allowances and tax remittances through an integrated system called Gusto. Aplos has a number of data tracking programs which may have a significant learning curve.
Aplos Customer Reviews
According to G2Crowd reviews, most users like the Aplos software. However, some users say the system has several bugs. Developers continue to add new features to the software, before fixing the existing bugs. Some have reported problems with bank reconciliation and challenges with report exports.
Church Accounting Software: Church Windows Software
What is Church Windows Software?
Church Windows Software is ideal for beginner accountants and bookkeepers. It is a basic approach to accounting. Ideally, this software works best for small organizations. With Church Windows you can take advantage of several useful tools.
For example, the software tracks expenses and tax payments. You can compare budgets to preceding years and track running balances. Church Windows boasts “incredibly flexible reporting.”
This software does also have the capacity to track donations. It is limited, however, in that this aspect is embedded as part of the larger accounting functions.
Church Windows Customer Reviews
Some features are too complicated for users. G2Crowd reviews list some benefits, like affordability and donation tracking. Nonetheless, it may fail to be user-friendly. The company does offer customer support, but the product does not have the ease-of-use that most church leaders might seek in an accounting program.
Church Accounting Software: FlockBase Church Software
What is FlockBase?
The FlockBase Church Accounting Software system markets itself as “user-friendly church software.” This program aims to help beginners sift through the legal jargon. It also makes for simple and easy tracking of finances. One of the stated complications of church accounting is “fund accounting,” which FlockBase tries to avoid.
The goal is to simplify your day-to-day expense monitoring. FlockBase can help users extract reports for external documents and internal use. FlockBase is for small churches at present, but may have increased functionality in the future. FlockBase is church accounting software developed for your unique financial tracking demands.
FlockBase Customer Reviews
On G2crowd.com, the software system doesn't have many reviews. The only reviewer says the product is user-friendly but its appearance and interface is lacking. For church leaders in search of a simple accounting solution that works alongside a sophisticated donation solution like NewFire Giving, FlockBase may work well.
Church Accounting Software: FellowshipOne
What is FellowshipOne?
The FellowshipOne church accounting software system focuses on integration for proper financial tracking. The website reads, “Partnering with a financial software solution specifically designed for churches allows your church leadership to better align ministry goals with data and financial insight.”
The goal of this church accounting software is to help your church grow. It does this by ensuring you are on solid financial footing, without the unknowns that arise when accounting is incomplete.
FellowshipOne aims to connect all the important factors of your non-profit into one. Their true fund accounting is for non-profit organizations. You can take advantage of customer support programs, or you can speak to a software specialist.
If you want to consider FellowshipOne, you can discuss your needs with a specialist who can help you find the right plan.
FellowshipOne Customer Reviews
FellowshipOne has an average customer rating on G2Crowd.com. Most users cite the ability to track all the information in one place as the main benefit. Some users say the software is not as advanced as it should be, given the current market. Some noted when using the program that changes could take up to 24 hours to take effect.
Church Accounting Software: CDM+
What is CDM+?
This church accounting software is flexible. CDM+ is available in a cloud-based version or a desktop version. This program allows for online and mobile donations. It also works for fund accounting, contributions and donations. It's ideal for small- to medium-sized churches.
CDM+ Customer Reviews
G2Crowd reviewers say the product is a simple one, but some users question its overall value compared to the cost. Its growth potential may be limited. This means users may need new software as the congregation expands. Some users may be able to make the software work for their needs. There may not be a large-scale functionality, however.
Pair NewFire Giving With Your New Church Accounting Software
Before committing to any church accounting software system, make a list of your church's needs. Given your church's size, number of assets, and plans for local and international programs, you may want an accounting program that is streamlined or more in-depth.
At the top of that list, you'll probably include fundraising. While no one wants to take time away from the mission to focus on fundraising, this is a critical component to your church's growth. With NewFire Giving, you can keep your focus where it belongs: on the mission.
Any accounting program is best paired with NewFire Giving's comprehensive donor platform. Users benefit from the latest in giving technology, automated messaging through email and letter support, as well as one-on-one coaching. That way, church leaders can focus on the work of the church. A stronger donation program can take care of itself, keeping the church on a stable financial base.
Visit our website today to book a call at a time that is convenient for you. A specialist can guide you through the process. We can offer advice and support to help you navigate the tools most useful to your church's needs.