F2

Question 1

Reasons Budgets are Necessary:

Answer 1

To ensure successful financial management

Question 2

Why look back or ahead when preparing the Church budget?

Answer 2

Past: Previous giving pattern are helpful-Using past record you can develop a somple profile of past performance. Future- Take into consideration *economy, weather, building programs.

Question 3

Cash Flow:

Answer 3

Describes how and when money comes into the church and is spent

Question 4

Negative & Positive Cash Flow-

Answer 4

Where the expense line is higher than the income line “in the red”– Positive CF *when the income line is on the top “in the black”

Question 5

Why are budgets a management tool?

Answer 5

Thinking ahead, making plans for your spending

Question 6

Red Flags for Church finances:

Answer 6

1. Not able to meet payroll expenses- 2. Purchasing mostly on credit - 3. Income is less than last year

Question 7

Non- Profit

Answer 7

“Charitable, tax- exempt, publicly owned or a prohibition against ‘making money’ from operations”

Question 8

Management Structure:

Answer 8

Professional goals- reach and make disciples of all people–Financial goal- financial planning and control