Best Practices Using Shelby Systems’ New Cloud Financials Welcome and introduction of the Session and who I am Alfred Johnson Sales Manager

Internal Controls Office policy governing processes, procedures and/or practices 6 specific topics – will start with the money

Money Handling Offerings counted by multiple people Deposit offerings in a timely manner Get few different ways people count, enter, and deposit Sunday offerings Is there a different process of collection of other funds? *2 points follow *Illustrate examples from past trainings – bad ways to do it. CLICK

Check Writing and Approvals Check signers not involved with record keeping Use of supporting documents for check signers There are bills to pay. So, there may be a number of steps to the entire process. Bills arrive and need to be paid. Enter bill into software to be paid Provide a list and get approval to pay approved bills Print Checks Sign Checks Mail / Distribute checks Keep copy of bill/invoice with payment (copy or electronic) Invoices are a bit different. Purchase order – with approval? Who proofs the invoice against items or services received? Is there shipping charges? If so, are they checked against the actual charge? Is the math on the invoice correct? What is the expected payment day or due date? What does it matter? Who then approves payment? Enter Invoices – follow same procedure above? But end at the same spot – CLICK – Someone signs the checks CLICK – Verification of what they are signing provided? ALSO – EFT need same type of procedures

Bank Reconciliation Regularly completed and retained for future audits Not done by same person writing checks General ledger reconciled with all sub ledgers Who enjoys Reconciling a checking account? A necessary task – and sometimes may not be easy. - Mention personal experiences Try not to get behind – putting it off could make it harder to complete CLICK – when done, print report and keep with the bank statement CLICK – it is a bad idea to let the AP person and/or Check Signer to also reconcile the account Off topic, but just adding it here -- CLICK – Sub ledgers should be reconciled with each sub ledger Provide a couple of examples EXTRA NOTE – Make sure ALL accounts are being reconciled and reported

Audits Internal Annual Let’s start with Internal Audit CLICK– Any of your churches conduct Internal Audits? Church should provide an Internal Audit Checklist. Find several suggestions on Internet But, I think it should start with a examination of the reports provided to committees and the congregation Proceed along to checking on topics we have already covered Include a review of the latest outside audit and check to see if its recommendations / changes have been addressed Check Fixed Assets Check on insurance, property, liability, etc. Review Employee policies, Employee Policy Manual, required identifications, timely filing of tax related forms, etc. CLICK – Dread Annual outside audit? If you have all of your internal controls properly aligned and enforced, COA designed correctly, books in balance, completed changes requested in prior audits, then you should be good. The more you have done correctly, the less time it will take and the less it should cost.

Screenings Check with previous employers Watch for embezzlement history Do Background screening CLICK – Check with previous employers – JCPenney Story CLICK – Read somewhere that 70% are repeat embezlers Brotherhood Mutual handout

Cloud vs. Client Server Cover 8 topics on handout

Chart of Accounts Design Fund accounting Account levels / segments Mention Church Executive Article Handout Cover Fund Accounting as time allows – Principles of closing accounts GAAP – Generally Accepted Accounting Principles FASB – Financial Accounting Standards Board AICPA – American Institute of Certified Public Accountants CLICK – Closing accounts CLICK – COA design discussion

Stakeholder Reports Finance Committee Congregation Ministry Leaders Internal Auditors Short Discussion on Special Reports CLICK – Finance Committee CLICK – Congregation CLICK – Ministry Leaders CLICK – Internal Auditors

Accrual vs. Cash Differences Advantages of each CLICK – Describe differences CLICK – Advantages of each Small Church – cash basis easier to manage Cash flow problems – really need to be on Accrual AR?

Managing Payroll Should you outsource Taxes Reports CLICK – How many of you outsource your payroll? Collect reasons Balance time to process outsourced vs. in house processes Transition to Shelby Payroll CLICK – Taxes CLICK – Reports

Questions? Thanks for attending