Summary: What safeguards should be in place to prevent financial impropriety on the part of church leaders? How can the church resolve such conflicts? Read this article by Michael Barrick with Eugene Korff for excellent guidelines to help in this important matter.
Perhaps, more than any other sin, financial fraud by church leaders has done more to discredit the Church—and hence the Gospel—than any other sin. Believers’ faith is shaken and non-Christians see such scandals as evidence that the messages delivered from behind the pulpit, even that of Christ crucified and risen for each person’s sins, are at best, suspect, and at worst, another scam to pad someone’s pockets.
As a result, the church’s first order of business is to ensure that safeguards are in place to prevent financial impropriety on the part of church leaders at all levels and also of any member who has access to or is responsible for church finances.
In the course of our work at Wall Watchers, we have received countless allegations of financial misconduct by church leaders. While, thankfully, not all allegations are found to be true, there are untold numbers of churches where suspicions of financial misconduct are well-founded.
This is a concern because it is incumbent upon church leaders to model the characteristics of Jesus if the Gospel is to be considered authentic by a culture increasingly skeptical of the claims of Christians. His followers should model a lifestyle that is consistent with Jesus’ example, especially in matters that are as fundamental and visible as money and sacrificial living.
Clearly, accountability is required. [See list of Safeguards]. As we see in the life of David (2S 11), we must not wait for a crisis to occur to establish accountability. A church should have structures and relationships that assure mutual accountability. Countless examples from Scripture and from our own lives remind us of our infinite ability to deceive ourselves and one another; accountability is a safeguard against such temptation.
Jesus taught his followers the method for confrontation, repentance, and discipline within the church (Mt 18:15-17a). Arguably, exposing wrongdoing can, at least in the short-term, cause harm to the reputation of not only that church or congregation, but the overall Church. However, such disclosure is part of the repentance process and will help restore the administrator/pastor/church leader to his previous standing and demonstrate a willingness to immediately acknowledge and admit misdeeds.
Church members, too, have an obligation to report suspected wrongdoing (Ep 5:11). While this might be unpleasant, and certainly should be done prayerfully, judiciously, and confidentially, Scripture does place a burden on the church member to be discerning (Pv 1:5); a good steward (1Co 4:2); and, a generous and cheerful giver (2Co 9:7).
To be generous and cheerful givers, church members must have confidence that the church’s disclosures regarding financial practices, spending habits, governance and compensation, and other key practices are complete, thorough, timely, and transparent.
?He whose walk is blameless and who does what is righteous, who speaks the truth from his heart and has no slander on his tongue, who does his neighbor no wrong and casts no slur on his fellowman, who despises a vile man but honors those who fear the Lord, who keeps his oath even when it hurts, who lends his money without usury and does not accept a bribe against the innocent; he who does these things will never be shaken? (Ps 15:2-5).
? Adopt a robust financial reporting framework that complies with all relevant Generally Accepted Accounting Principles.
? Embrace a ?best business practice? paradigm, including composing boards and audit committees that are independent of officers and managers.
? Prepare and study financial reports, showing actual expenses and budgetary provision to date, monthly.
? Keep controlling boards and committees informed by providing them with monthly financial statements.
? Provide controlling boards and committees with an annual report of all employees’ remuneration and expenses.
? Retain a firm of independent accountants to audit the organization’s annual financial statements.
? Document the organization’s internal control components and perform periodic monitoring to ensure all processes are operating as intended.
? Develop procedures manuals and codes of ethical behavior and appropriate business practices and communicate these manuals and codes to employees and volunteers regularly.
? Create a work environment where employees have a clear under-standing of what is right and wrong, and feel free to discuss and ask questions about ethical issues and to report instances of real or perceived unethical behavior.
? Avoid personal use of denominational assets, and never commingle personal funds with denominational funds.
? Shun financial, investment, and tax scams and terminate and prosecute employees who commit fraud.