June 27, 2016

Church vs. Ministry Organization Bases of Accounting

Question: 

Do churches use the same form of accounting as ministry organizations?

Answer:

Yes. Both a church and a ministry that follow Generally Accepted Accounting Principles use the same form of accounting – full accrual. But smaller churches tend to use a form of accounting such as the modified cash basis of accounting. Full accrual is governed by the rules set in place by the FASB (Financial Accounting Standards Board). FASB  116 and 117 are specific statements that discuss the application of full accrual accounting to a not for profit organization.

Resources regarding this topic:

  • We have a brief PPT linked on our website with a short comparison among the general three types of accounting. Presentation: Church and Christian Ministry Church Financial Management - http://www.ministrycpa.com/?q=alldownloads
  • Other possible resources may be explored on the website sponsored by Church Law & Tax Report  http://www.churchlawandtax.com/. Try typing in the search window terms such as "accounting" and "bookkeeping."

No comments:

Post a Comment