June 20, 2019
Payment Approvers | Best Practices & Resources
We’ve seen a few issues regarding payment approvers during our 30+ years of partnering with ministries to help with their payroll and accounting needs. Today we wanted to share some best practices when signing checks or approving electronic payments for your church.
View our Resources Page for our Check Signers and Payment Approvers Standards / Protocols
4 Best Practices
These are our top four rules that apply to both Payroll and Accounts Payable check requests, or electronic payments: otherwise known as ACH payments.
- Require two signatures on every check – no exceptions, because exceptions become the rule. Not only should there be two different sets of eyes on these requests, but (a) the people should not be related, and (b) as often as possible, have at least one check signer to sign most of the checks so they can check for trends and other issues.
- The approvers should not be two staff members; this is a great time to include a volunteer Treasurer or a board member. However, this is not the time to instill the authority of the Senior Pastor.
- Ensure clear backup documentation for every payment. The documentation should be attached to the request, prior to approving.
- Minimize issuance of manual checks. One thing we want to avoid is writing blank checks or “emergency” checks. There should almost always be enough time to go through proper channels to approve payment. If the vendor says they cannot wait, that could be a red flag.
One of the biggest reasons for these best practices is to protect your ministry from fraud. Or even the perception of fraud. As a church, we are held to a higher Kingdom standard of accountability.
An important step to reducing fraud is:
To have an independent person – someone not involved in any aspect of the offering counting process – balance bank deposits to the general ledger and to the contribution system every month.
More Resources:
On the Miller Management Forms page we provide sample forms and whitepapers that your ministry can start using right away. Our talented, experienced, and degreed staff have done extensive research on specific topics relating to churches and non-profits. Simply use the search bar to quickly access the form you need.
Accounts Payable:
Some of the most relevant documents for accounts payable payment approvers include:
- Benevolence Examples
- Cash Counting Sheets
- Check Signers and Payment Approver Standards / Protocols
- Loose Check Logs
- Ministry Descriptions for Offering Counters
- Offering Team Confidentiality Agreement
Payroll:
Some of the most relevant documents for payroll payment approvers include:
- 1099 Information
- Employee or Contractor
- Ministry Descriptions for Senior Pastors
- Paying Foreign Workers
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