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Q&A: How Do We Budget During This Time of Rapid Change and Uncertainty?

First step: stop focusing on your annual budget.

Q&A: How Do We Budget During This Time of Rapid Change and Uncertainty?
Image: Klaus Vedfelt | Getty Images

Our church has always tried so hard to stick to our budget, but the current crisis makes it impossible to do so. What do we do about budgeting in this time of rapid change and uncertainty? What are some strategies for preserving cash, if that’s one of the things we should be doing?

Here’s some fairly radical advice as it relates to budgeting—radical in the sense that this is not conventional church financial management wisdom: Stop focusing on your regular annual budget. For churches experiencing rapid changes in their giving levels, the annual budget developed months ago is largely irrelevant.

I realize that as a matter of church governance and policy, you might have to have a budget. But what you planned when you developed that budget is no longer reality. Your spending levels and spending categories most likely have changed. Your revenue levels may be very different. So, ...

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Michael (Mike) E. Batts is a CPA and the managing partner of Batts Morrison Wales & Lee, P.A., an accounting firm dedicated exclusively to serving nonprofit organizations across the United States.

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Posted:
  • June 29, 2020

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