This post was last updated on December 12th, 2019 at 09:04 am.
Events like Hurricane Harvey and the flooding in Texas remind us of how fragile and unpredictable life can be. We see, or even personally know, people and families who are suffering intensely as their lives are turned upside down. Receiving donations for flood relief and recording them properly is necessary to ensure donors have the accurate documentation later.
What can churches do to help?
Churches, though they may be far from the actual disaster, can help to facilitate the relief efforts by raising disaster relief funds. Church collections and fund raising campaigns are great ways for churches to come together at times like these to help people in desperate need. And sometimes churches have the opportunity to get more directly involved by getting together teams of volunteers or collecting goods.
It’s extremely important that a church practices good record keeping. The church needs to be transparent about what’s happening with the money and other donations. Furthermore, the church needs to honor donors’ wishes and give them accurate statements of what they’ve given. In addition, the church needs to be able to clearly report the use of the funds.
Flexible donation and accounting software allow recording donations for flood relief
These types of fund raising drives can involve a lot of planning and thought, often with little time. Icon Systems church management software includes a flexible donations module and church accounting system that can streamline the effort with a lot of great, easy options.
Here are some options and possibilities that a church management software like IconCMO can give you.
Create a Specific Donation Fund
Create a specific donation fund with a clear name that will show on donors’ quarterly/annual giving statements. Name them something like ‘Hurricane Harvey Relief Fund’ or ‘Houston Flood Relief’. All donations made to that fund will show up with dates and amounts under that fund name. Thus the donor can easily see how much they gave in addition to their normal giving.
Link the Donation Fund to the Accounting Fund
Our fund accounting module seamlessly links to your donations. You can create a specific accounting fund, maybe ‘Hurricane Relief’, and link your donation fund directly to it. That way, the donations for hurricane relief remain in that dedicated fund, and you can run any financials for that specific fund to track its balances and activity. At any time, you can find the revenues, expenses, net revenues, balances, transactions, and more for that fund.
Record Non-Cash Donations, Like Clothing or Canned Goods.
The proper way to handle these donations is not to record them as a dollar amount like other donations, but to record a description of the donated item. IconCMO handles these donations properly, so that the donor’s statement will describe what the donated item. Then the donor uses their receipt of what they paid and the church statement, they can claim the gift on their taxes.
Handling Pass Through Donations
Is the church depositing cash into a bank account so you can pass the donations on as a lump sum to one or more relief organizations? Then record these donations as a liability. You can set up your accounting link so the donations are recorded as a debit to your bank account a credit to a liability. Learn more about using pass-through accounts in IconCMO.
Buying Supplies for the Flood Relief Effort
Is the church raising the money and goods to buy supplies and send volunteers to help the relief effort? You can set up your accounting link to record the donations as revenue and keep track of your expenditures for the same dedicated purpose on the accounting side. In this case, it’s especially important to set up a specific hurricane relief accounting fund (as mentioned in #2).
Multi Site Organizations Collecting Donations
Are you running your relief effort as a denomination, synod, or multi-site church? Our IconCMO+ and Synod systems allow you to track the fund raising efforts accurately across multiple churches and locations. Roll-up reporting gives donors and board members the same transparency and accountability at this level as you have at the individual church level.
To learn more about how our seamless accounting link works and the doors it can open for your ministry, see our blog series on linking your church donations to accounting.