Expense accounts are designed to keep a running total of how much money has been spent during the course of the year. As the church year progresses, your reports will show how much has been spent for each of the expense line items.
The expense accounts should be setup in a manner that best fits your church. In most cases, the church board, pastor and/or treasurer will determine how many and the names of the accounts needed. How much detail is needed or wanted on your reports should determine the structure of the expense accounts.
The accounts can be as specific or as general as you want. You could have separate expense accounts for Pastor's Salary, Housing, and Social Security Reimbursement, or you could have one account called Pastor's Salary. Remember, the more accounts you have the longer your reports will be.
Expense categories and groups are designed so that you can organize your expense accounts into logical groups. The categories and groups are not accounts themselves, but are simply groupings of similar accounts. The categories and groups make is easy to skim through the reports to find an account or find the account you need when posting a new check.
You can have as many categories and groups as you want. In many cases, 2 main expense categories are sufficient: Local and Allocations. As always, setup the categories that will work best for your church.
Within a category, you could have as many as 150 expense accounts, depending on your church. Expense Groups can be used break up this long list of accounts into smaller lists. Examples of groups might be Pastoral Support, Utilities, or Buildings and Grounds.
Please give us a call if you would like assistance with setting up your expense accounts. We also highly recommend you read the information below about the difference between expense accounts and internal accounts.
