Who needs a budget anyway?
After the recent unveiling of this year’s Comprehensive Spending Review by the Government, you’d be forgiven for asking the above question. However, most of us know that adhering to good budgeting is essential. That is, of course, if you want to avoid making drastic cuts to your service as a result of poor planning.
As a charity, if you have a vision then you should have objectives and tasks that comply with the vision that God has given you. Without planning, there is no way of quantifying the success of the task and objectives!
Duty of prudence
Additionally, trustees have a duty to ensure that the charity is and will remain solvent; this means that you need to keep yourself informed of the charity’s activities and financial position.
Charitable funds and assets must be used widely to further the purposes and interests of the church. This means trustees should not undertake activities that might place the charity’s property, funds, assets or reputation at undue risk. Special care must also be taken when investing the charity’s funds, or when borrowing finance on behalf of the charity.
Budgeting is a measuring tool and a prerequisite to any good financial planning!!!
Unfortunately, many fundraising efforts fail because the organisation pays insufficient attention to creating a plan and monitoring its progress. A sound fundraising plan is your map and itinerary for raising the money your organisation needs, and a good budget will provide a near accurate record of your predicted income and spend over time.
In a church, for example, each individual departmental budget, as my Pastor’s wife would ever so eloquently put it, ‘is a facet of a composite budget’. Your individual budget feeds into a master budget, which is the overall church budget. A church budget generally relies heavily on the generous offerings of its members. However, during the course of time, we may find ourselves in a position where our actual expenditure exceeds our budgeted income. This is not necessarily wrong if you can justify your expenditure, and through faith you believed that God was committed to meeting this particular need beyond your expectations. However, on the flipside of this, generally speaking your organisation must also remember that they are stewards, and at the end of the day they are accountable to God for how they spend the organisation’s money. Working to a budget doesn’t necessarily signify a lack of faith but can in fact demonstrate great wisdom! The Bible urges us to count the cost before we build a tower, to ensure we have enough to complete it (Luke 14:25-33).
Key things to remember:
A reforecast during the course of the year is also helpful, as unforeseen changes in circumstances could mean that you need to review items that you had originally budgeted for.
Don’t be caught out…
Many of us will be budgeting in our own personal lives, ensuring that the impending Christmas spend doesn’t leave us with a huge overdraft come January! This Christmas, don’t be caught out; make sure your organisation has a budget that every member of your organisation can work to!
For further information on effective budgeting for your Christian cause, see http://www.crownuk.org/
Lara Rufus BA, MSc, Fundraising Consultant and Chair of the Black Fundraisers’ Network; email – lararufus@bfn.org.uk or lararufus@yahoo.co.uk
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