Ashley Ellis, Executive Officer of the Association of Church Accountants and Treasurers (ACAT), shared with us his thoughts on the advantages of accounting software and how it could prove useful for your church’s treasurer.
It’s one of the questions we frequently get asked at ACAT:
Just what are the merits of accounting software for church treasurers?
Before I answer that, allow me to place the purpose of accounting software for church treasurers in context.
Basically, a church’s accounting system – like that of any other charity – is a database of individual transactions that supports a series of calculations that produce a set of figures.
These subsequently go into the internal and external reports produced by that church.
And this is the case whether accounting software is used, or whether the information is kept on paper or a standard spreadsheet package.
So, what are the benefits of accounting software?
To my mind, these benefits can be split into three separate areas:
- It facilitates data entry;
- It performs the relevant calculations in real time to produce figures – like totals – based on the latest data entered; and
- It can generate accounting information in a form that can be used for internal or external reporting.
Let’s briefly look at these in turn…
Data entry: Accounting software standardises the data entry and prompts the user to include all essential information. Consequently, it’s more difficult to omit essential data accidentally.
Real time: Accounting software will usually operate according to the principles of a standard double entry bookkeeping system. This is a traditional and well-proven approach that enables users to generate the balances at any time on a range of accounts, make appropriate accounting adjustments and differentiate between cashflows and income/expenditure.
Internal and external reporting: Accounting software is usually configured to provide information in a form that is suitable for most common accounting applications – including the preparation of annual accounts. That saves the user the work of collating this information manually via a series of formulae from one or more tables in a spreadsheet.
In addition, some accounting packages for churches include features for generating Gift Aid claims directly from the accounting records of donations which removes the need to compile claim forms separately.
Some packages also offer the ability to integrate or interface with other packages that process payroll, expenses handling, online donations, payment terminals as well as VAT or member/donor details.
Considerations when choosing your software
A few of the questions we advise members of ACAT to ask accounting software providers are:
What does it cost? Check for anything non-obvious like add-ons or costs for going over certain turnover limits or number of transactions.
Is your software designed with churches in mind? It helps if the software was designed by someone familiar with the typical ‘standard’ income and expense accounts used by most churches.
What other features can be integrated with this software? You will probably be claiming Gift Aid and using data in your accounting software to generate claims – try to get a clear picture of how that process will work. If you use church management software, will it integrate with this?
How easy is this software to use? Will anyone who takes over the role of church treasurer after you find the software straightforward to use?
What customer support is available? Software that you can’t get effective support for is likely to become a liability.
Does the software operate in the cloud or on a desktop? Cloud-based accounting software enables you and other users to access your accounts from any connected device and share your accounting records conveniently with your independent examiner or auditor.
ACAT aims to advance the Christian faith across all denominations by providing church treasurers with the most appropriate advice, training and information precisely when it’s required.
Please do consider joining ACAT – if you’re not already a member – to ensure that you have access to our resources and team of experts who specialise in guiding church treasurers in their essential role.
To discover more about ACAT – or to join – visit https://www.acat.uk.com/
