As we wait to hear the results of the Congressional votes on the economic bailout in the US, it’s not a bad idea to also look at the financial operations of our Catholic parishes.
Last year, the US bishops’ Accounting Practices Committee, developed a set of recommendations for managing the finances of parishes. In addition to common-sense principles for financial operations, the bishops also recommended a set of steps to solidify the accountability of parish financial management.
These recommendations state that every year, every parish should send a letter to the diocesan bishop containing the following information:
- The names and professional titles of the members of the parish finance council.
- The dates on which the parish finance council has met during the preceding fiscal year and since the end of the fiscal year.
- The date(s) on which the approved (i.e.-by the parish finance council) parish financial statements/budgets were made available to the parishioners during the preceding fiscal year and since the end of the fiscal year. A copy of said published financial statements/budgets should be provided to the bishop.
- A statement signed by the parish priest and the finance council members.
To people in the business world, these seem to be basic principles. Although many people think that the Catholic Church is very centralized in authority, the reality is that each bishop is fully responsible for his diocese and each pastor is fully responsible for his parish. Thus, it is difficult to build in an accountability structure for positions that have full authority to make financial decisions. Canon law does provide restrictions for large expenditures and for large loans. But otherwise, the pastor truly does have full financial authority in the parish.
The recommendations from the bishops, then, provide minimum standards to help ensure financial accountability within parishes. Canon law requires every parish to have a finance council and it is the pastor’s responsibility to institute this. The parish finance council then has specific responsibilities given by canon law. This system can fall apart, however, if the pastor does not form a finance council for whatever reason. Ideally, parishioners would point this out and would help the pastor in forming a fully functioning finance council. Catholic parishioners are not always this proactive, however. I would not be surprised to hear that many Catholics do not know if their parish has a finance council. The bishops’ recommendations add a level of checks and balances by informing each diocesan bishop if any parishes are missing this much needed structure. The bishop can then start a discussion with the pastor about improving the financial management of the parish.
