It is essential for the integrity and credibility of our ministries that we account for all funds received in an accurate, complete and timely fashion. To ensure that this happens consistently, a ministry should determine their donation processing principles and policies.
•It is our duty to acknowledge donated funds on a timely basis through appropriate and timely receipting, thank-you letters and responses to donor queries or needs.
Use of donations: honouring designations
•The guiding, non-negotiable principle in the use of donations is that they must be used as designated by the donor. Designations of donations cannot be changed without the permission of the donor.
•Donations must also be used according to the purpose of the ministry, usually as stated in the Articles of Association, Statutes, Bylaws or other documentation. If the donations cannot be used as designated, they should be refunded to the donor.
•Legally binding guidelines and standards for using donated funds will also be followed.
•Processes should be in place to ensure that the recipients of funds - staff and ministry team leaders - are informed of donations received for them or their ministry on a timely basis.
•Such information should include dates, names of donors and amounts.
Assessments (administrative percentage)
•The ministry should define in writing the assessment guidelines:
•Which funds will be assessed
•The assessment percentages
•How exceptions, if any, will be handled (who can make exceptions and under which conditions)
•Only donations may be assessed. Sales, conference income, or any other income are not assessable.
•Clear guidelines are necessary for the conditions under which donations may be refunded.
•When a donor's original designation cannot be honoured, the donor should be consulted about redirecting those gifts to another designation or refunding the donation.
•Your country may have laws that govern how gifts may be returned.
Read More > Common Donation Issues