Knowledge Center

The Knowledge Center provides you access to hundreds of documents including policies, procedures and a wealth of research on topics such as charitable gifts, expense reimbursements, board governance, fringe benefits, and much more.

God-honoring board governance doesn't just happen. It requires spiritual discernment to recruit the right people onto the "board bus" and then wisdom to ensure that board practices are always Christ-centered.
Every Christ-centered organization should seek to handle money in a God-pleasing way. "Whoever can be trusted with very little can also be trusted with much."
Luke 16:10
Churches and other nonprofits are the recipients of public trust and must fulfill fiduciary responsibilities. This means ensuring that all funds are used in conformity with applicable laws and regulations.
Establish a resource development program that yields transformed hearts and generous gifts. Then, hold and disburse the funds in a faithful manner, with proper reporting to givers and the government.

Keywords Category Type of Documents

This text is provided with the understanding that ECFA is not rendering legal, accounting, or other professional advice or service. Professional advice on specific issues should be sought from an accountant, lawyer, or other professional.

15 Questions Nonprofit Board Members Should Be Able to Answer

If you serve as a nonprofit board member, we recommend that you review the organization’s Form 990 and be informed enough to answer these 15 questions.

Accountable Expense Reimbursement Plan – Sample Resolution for Ministries

When applied properly, expenses reimbursed through an accountable expense reimbursement plan do not result in taxable income. Here is a sample of an accountable plan.

Accounting for and Documenting Ministry Expenses

Outlines proper accounting and documentation of ministry expenses for a nonprofit and church.

Accounting for Contingencies

Outlines the proper accounting for contingencies

Accounting for Contributions Made to Nonprofits

Outlines the proper accounting treatment for contributions made by an organization to a nonprofit

Accounting for Thrift Stores

Outlines the proper accounting for thrift stores

Accounting Resources

Lists publications that include accounting information for nonprofit organizations

Agency (or Custodian) Funds

Outlines proper accounting treatment for non-gift assets an organization receives that are not legally its property, known as agency funds

Aim for Faithfulness Rather than Results!

What are we aiming for? Or in ministry terms, how do we define success? From our research, ministry leaders typically define success along one of two lines.

Audit Committee

Outlines the importance of an audit committee charter and includes a link to a sample charter

Audit Committee Charter for Ministries

Sample Audit Committee Charter in Word format to revise and use.

Audit Committee Questions for Auditors

List of questions that a board of directors or audit committee should annually ask their auditors

Audit Your Disaster Relief Policies
Humanitarian nonprofits need to be prepared for a new level of scrutiny and transparency by developing or upgrading their existing policy regarding disaster response situations.
Audits, Reviews, and Compilations

Describes the three types of financial statement reports: audits, reviews, and compilations

Board-Designated Net Assets

Unrestricted net assets subject to self-imposed limits by action of the governing board, e.g., future programs, investment, contingencies, purchases, or construction of fixed assets, or other uses.

Borrowing Restricted Net Assets

Discusses the borrowing of restricted net assets for operational purposes

Budgeting Resources

Publications that discuss nonprofit budgeting

Building the Oil Supply

Dr. John Zietlow outlines a strong biblical basis for carefully devised financial policies and establishing adequate cash reserves. As he says:  “Financial health is a prerequisite for mission achievement. As you begin to build or rebuild your oil supply and stock or restock your storehouse, take confidence that God is your Source and He will supply all of your needs according to His riches in Christ.”

Cash Reserves Q&A for Nonprofits
Cash reserves question answered for nonprofits
Cash Reserves: How Much Is Enough?

For ministries, financial resources are limited. Determining how much cash reserves are needed can be difficult and often feels like a shot in the dark. This white paper outlines the necessary steps to determine the appropriate cash reserves and liquidity for your ministry.

Cell Phone Usage

Sample cell phone policy including a summary of the tax rules relating to cell phone expense

Changing Accounting Methods for Form 990 Reporting

Discusses proper accounting methods for Form 990 reporting and procedures to follow when changing accounting methods

Check-writing Procedures

Specific internal control procedures to follow when writing checks to best protect the assets of an organization and includes a list of publications that contain more information about disbursement controls

Clearly Communicating Ministry Financial Data

Boards and others need meaningful interpretation of ministry financial data

Club Membership Dues

Discusses the taxability of club dues paid on behalf of an employee by a nonprofit organization

Contributed Services and Use of Facilities

Outlines the accounting treatment, income tax treatment, and Form 990 presentation rules for contributed services and use of facilities

Contribution Policy

A charity may have an underlying sense that some contributions should be carefully reviewed before accepted.

Costs of Soliciting Contributed Services and Time

How to classify costs of soliciting contributed services and time

Could Your Ministry Use an Accountability Tune-Up?
While solid financial accountability systems take extra effort, they are important tools.
Credit Card Sample Policies and Procedures

Sample credit card policies and procedures document for a ministry

Credit Card Use by Ministry Staff

Discusses the use of ministry credit cards for ministry purposes

Current Assets and Current Liabilities

Defines and lists examples of current liabilities and current assets according to authoritative accounting literature

Directors and Officers Liability Insurance

Discusses importance of director’s and officer’s liability insurance and important policy characteristics

Disaster Planning Assumptions

It is amazing the level of risks that leaders in churches and parachurch organizations will take with people and resources in their congregations, their facilities, and in their broader “spheres of relationship.” Moreover, by leaders not identifying and addressing risks, they open themselves to situations that can compromise their own reputation and credibility.

Document Retention and Destruction Sample Policy

Discusses proper maintenance of corporate documents and records and outlines retention time periods for several categories of documents

Educational Assistance Programs

Outlines the types and tax implications of educational assistance programs

Embezzlement of Funds

Outlines steps a ministry should take if it detects embezzlement of funds

Employee Spousal Travel Policy

Care should be exercised when reimbursing the travel expenses of an employee's spouse

Employer Mandate: Does It Apply To My Ministry?

How do you know if your church or ministry is subject to the Employer Mandate under the Affordable Care Act? If so, what are the consequences? View this helpful resource prepared by GuideStone Financial Services for more information.

Expense Report Form

Expense report form (Excel document)

Expense Reports Can Kill!

Explores the importance of proper expense record keeping and includes expense-reporting guidelines

Financial Management Resources
Resources for financial management for churches and nonprofits
Financial Management Sample Policy and Procedure Handbook

Sample Financial Management Policy and Procedure Handbook

Financial Statements Matter
A discussion of financial statements and why they are important to prepare properly
Financially Interrelated Nonprofit Organizations

Outlines the accounting and reporting guidelines for nonprofits that are financially interrelated (SOP-94-3)

Five Ways to Make an Audit Easier
There are several reasons why a not-for-profit organization might undergo a financial audit.
Flexible Spending Account Chart

Form to track flexible spending account amounts withheld from payroll and medical expenses paid under the plan

Fraud – Warning Signs and Facts
Discusses fraud-related red flags to watch for
Fraud and Whistleblower Protection for Nonprofits

Discusses the whistle-blower protection provision contained in the Sarbanes-Oxley Act and its applicability to nonprofits as well as general misconduct, dishonesty, and fraud prevention

Fringe Benefit Planning
Maximizing the take-home pay for your ministry staff
Gifts to Ministry Staff

Nonprofit ministries often make gifts to employees to show appreciation for the dedicated service. These payments may take several forms and have important implications to the ministry, the staff members, and donors.

Give Your Financial Statements a Check-up

Take a walk through your financial statements and see if any of the most common financial statement mistakes apply to your organization.

Going Concern Contingencies

Defines going concern contingencies as the inability of an organization to meet its obligations as they come due, and outlines the conditions that lead to a going concern audit opinion

Golf Outings

Overview of golf fundraisers and the proper accounting treatment for possible elements of such an event

Guidelines for International Grant-Making

Outlines the proper procedures and due diligence when making grants to international organizations

How many months of cash should our ministry have in reserve?
How many months of cash should our ministry have in reserve?  Are there different categories of reserves we should consider? 
How Much for Fundraising?

Discusses factors that may be considered when determining what is an appropriate amount of fundraising expense for a specific organization

How to Budget in a Changing Economy
If we've learned anything over the last three recessionary years, it's that as the economy changes, we need to change with it if our ministries are going to thrive.
Independent Auditor Sample Request for Proposal (RFP)

Sample request for proposal can be used by ministries to request proposals from independent auditors to perform the ministry’s audit

Internal Control and Internal Audit Guidelines for Schools
Guidelines for internal control and audit procedures
Investment Management Resources

Publications that discuss investment management for nonprofits

Investment of Permanently Restricted Net Assets in Real Estate

Discusses the propriety of investing permanently restricted net assets in real estate

Investment Policies

Investment policies for nonprofits are board-created to determine and direct how funds are to be invested.

Is Now the Time to Refinance Your Ministry's Loan?
In this every-changing economy, ministry leaders frequently face the question: "Is now a good time to refinance?"
Is Your Organization Ready for the General Data Protection Regulation?

The General Data Protection Regulation, or GDPR, went into effect on May 25, 2018 and many nonprofit organizations don’t realize they could be impacted. The GDPR is a set of laws enacted by the European Union (EU) to protect individual rights to privacy and control over personal data.

Let’s Admit It – The Emperor is Naked: Functional Expense Reporting for Nonprofit Organizations is Voodoo

Measurement and Evaluation of an Organization’s Performance Should Not Be Based on Subjective Expense Allocations

Meals and Lodging Provided to Employees

When an employer provides meals and housing for employees, it is important to determine whether the value of the meals and lodging is taxable to the employees.

Missionary Travel Expense Form

Sample claim form for families traveling with dependent children

Overhead Assessments on Restricted Gifts
What limitations does a ministry have when applying an overhead assessment on restricted gifts?
Paying Counseling Fees for Employees

Outlines the proper tax treatment of counseling fees paid by an employer on behalf of its employee(s)

Per Diem Rates

Outlines lodging, meals, and incidentals per diem rates for business travel

Permanently Restricted Gift

A gift restricted in perpetuity by the donor.

Permanently Restricted Net Assets

The part of net assets for a nonprofit organization that is restricted in perpetuity by donor-imposed stipulations.

Personal Use of Ministry-Owned Vehicle Sample Policy

Policy for personal use of company vehicles

Personal Use of Ministry-Owned Vehicles

Vehicles provided by organizations to employees for business use are often used for personal purposes.

Policies Relating to the Payment of a Housing Allowance, First Class or Charter Travel, Spousal Travel, Gross-up Payments, Discretionary Spending, Health or Social Club Dues

Sample policies for first class travel, spousal travel and housing allowances

Pregnancy Resource Center – Chart of Accounts

Pregnancy resource centers often have specialized chart of accounts needs. This chart of accounts has been designed with these needs in mind.

Preparing for Disasters?

Taking the time, energy, and finances to prepare for natural or man-caused disasters is an investment. Preparing for the unexpected is the process of integrating readiness into all elements of ministry.

Purchase and Travel Cards

Certain credit cards may be used to restrict purchases to specific vendors (purchase card) or types of expenditures (travel card).

Qualified Audit Opinions

Details ECFA’s qualified audit opinion policy

Quality Financial Reporting

Outlines a nonprofit board’s responsibility for quality financial reporting

Quasi-Endowment Sample Policy

Starting a quasi-endowment program should begin with a sound policy.

Reclassifications of Net Assets

These are the simultaneous increases in one net asset class and decreases in another.

Recording Income from Estates

Explains the proper accounting and recognition criteria for estates contributed to nonprofit organizations

Rescue Mission Client Payments

Rescue missions often make modest payments to "clients" who participate in a spiritual transformation program at the mission. This document addresses the taxability of these payments.

Restatement of Prior-Period Financial Statements

Any error in the financial statements of a prior period discovered subsequent to their issuance should be reported as a prior-period adjustment by restating the prior-period financial statements.

Restricted Gifts for Employees

Discusses how restricted gifts for employees should be handled

Restricted Net Assets

Resources whose use is restricted by an outside agency or person.


A donor stipulation that limits the time or purpose of a gift’s use.

Rotation of Auditors and Audit Partners

Discusses the issues to consider concerning rotation of auditors and audit partners

Sample Grant Agreement
Sample wording of a grant agreement
Sample Policy on Suspected Misconduct, Dishonesty, Fraud, and Whistleblower Protection
Sample policy covering the whistleblower protection provision contained in the Sarbanes-Oxley Act
Sample Quid Pro Quo Charitable Gift Acknowledgment
Sample gift acknowledgement for a quid pro quo gift
Sarbanes-Oxley Act

Outlines the applicability and relevance of this law to nonprofits

Segregation of Duties

Outlines specific duties that should be segregated when handling cash and other revenues as well as when making expenditures

Selecting an Auditor

Suggests factors a nonprofit organization may consider when selecting an auditor

Should the Government Be in the Business of Taxing Churches?
This article by Michael Martin, ECFA Vice President, was written for Regent Law Review.
Social Security Tax for Ministers - More Complex than It Appears
Social Security Tax for Ministers - More Complex than It Appears
Special Events

Overview of fundraising events and proper accounting treatment for event elements

Standard Mileage Rates

The Internal Revenue Service (IRS) establishes the optional standard mileage rates for employees to use in computing the deductible costs of operating an automobile for business, medical, or moving expense purposes.

Tax Treatment of Scholarship and Fellowship Payments

Discusses the proper tax treatment of scholarship and fellowship contributions and payments

The IRS Takes These Board Financial Responsibilities Seriously — Do You?
If you serve on the board of an organization, you’ve probably heard the term “fiduciary responsibility” and know that it applies to your role as a board member.
Tithing Charity Funds

Discusses issues relating to a ministry tithing a portion of its funds to another ministry and includes link to a tithing policy

Travel and Expense Reimbursement Policy

Travel and expense reimbursement policy for a nonprofit organization

Travel Expense Form

Sample form for families traveling with dependent children

Travel Outside the United States

Outlines the deductibility guidelines of business related travel outside the United States

Tuition Payments for Missionary Children

Discusses the deductibility of payments for missionary children’s tuition

Underwater Funds

A fund in which the principal amount (corpus) has fallen below the value of when originally gifted by the donor.

Underwater Funds Rule

Under UMIFA, an organization was pro­hibited from using fund assets if the value of the fund was below its historic dollar value.

Unrestricted Net Assets

Resources that have no external restriction on use or purpose.

Viatical Investments

Defines and discusses issues relating to viatical investments, investments by an organization in an individual life insurance policy

What are the Compensation Committee Best Practices for Setting CEO Compensation?
An ECFA member ministry has a compensation committee charged with the responsibility to recommend the CEO’s compensation and fringe benefits to the board each year. The committee is comprised of two non-staff board members and the ministry’s CFO. When the board receives the recommendation of the compensation committee, the CEO stays in the boardroom but does not participate in the vote. While the compensation committee records the details of the recommended compensation in their minutes, the board minutes do not reflect any details. How could the ministry improve their practices?
What to Expect from your Auditors

Details what a nonprofit should expect and look for in an audit firm

When is it Appropriate to Make an Overhead Charge to a Ministry Project?
When a ministry raises funds for a project—let’s say a building fund or a campus expansion fund—is it appropriate to make an overhead charge to the project? In other words, is it appropriate for a ministry to allocate a portion of the funds raised for the project to cover general and administrative costs and any costs related to raising the resources with the total raised less the overhead allocation used for the project?
Zero-Based Budgeting

Defines zero-based budgeting and outlines its major processes