1.0 Overview of the manual
The Manual has been developed to promote good financial management procedures at Our Lady of Fatima Parish Fiji. It will ensure that the interests of the Parish, Archdiocese and the Church are continually met.
The Manual is concerned specifically with the responsibilities relating to financial administration. It provides information on a broad range of issues important to the parish and presents guidelines for the Parish Priests, Councils and Parishioners to follow.
All procedures are mandatory and must be followed.
The manual is a living document subject to change after assessment by the Finance Council and approval of the Parish Priest.
The manual shall be formally reviewed once every two years by the Finance Council. However amendment can be made annually if the Council deems with the approval of the Parish Priest.
2.0 The Parish Priest
Canon Law defines the role of the Parish Priest as the authoritative representative of the parish. Canon 532 says,
“The pastor represents the parish in all juridic affairs in accord with the norm of law; he is to see to it that the goods of the parish are administered in accord with the norms of canons 1281-1288.”
The Parish Priest is ultimately responsible for all financial matters within the parish
3.0 The Parish Finance Council
Canon Law Parish prescribes the Finance Council as the mandated body having an advisory and consultative role with the pastor. Canon 537 states,
“Each parish is to have a finance council which is regulated by universal law as well as by norms issued by the diocesan bishop; in this council the Christian faithful, selected according to the same norms, aid the pastor in the administration of parish goods with due regard for the prescription of canon 532.”
The Finance Council works in adherence to the Code of Canon Law, Parish constitution, Parish Finance procedures and by local norms and processes issued by the Archbishop of Suva.
Role of the Parish Finance Council
The roles of the council as enshrined under the Parish constitution are:
a. Be an independent body that consultatively makes decisions that work towards an organized financial pastoral plan for the parish;
b. Provide consultation and assistance to the Pastor in the financial administration of the parish and the safeguarding of its temporal goods;
c. Uphold in a transparent and accountable manner an effective and efficient administration in accordance with parish accounting procedures for the provision of all parish properties;
d. Ensure on-going formation and skills training for the Council members in better understanding their role;
e. Draw up a Parish Budget in alignment with the Parish Pastoral Council’s pastoral plan. The budget must be submitted for endorsement in the second sitting of the PPC;
f. Present an audited financial report annually;
g. Evaluate, monitor and make necessary recommendations on the performance of the Committees, Council Manager and Area Treasurers by way of the Research and Planning Unit.
The finance council shall consist of:
· Parish Priest
· Assistant Parish Priest
· Chairperson
· Vice Chairperson
· Secretary
· Operational Committee Chairperson
· Capital Development Committee Chairperson
· Fundraising Committee Chairperson
· Area Treasurers
· School Manager
The roles and responsibilities of Council members are prescribed under Article III of the Parish Finance Council constitution.
PROCEDURES
4.0 SYSTEMS, CONTROL AND PLANNING
4.1 INTERNAL CONTROL
The Parish Finance Council must ensure proper internal control procedures are established by means of:
· appropriate segregation of functional responsibilities as far as practicable. Where it is not possible, closer scrutiny of the accounting system must occur;
· implementing a system for authorising and recording transactions, which includes clear management/audit trails and adequate control over assets, liabilities, revenue and expenses;
· following sound practices in the performance of duties and functions; and
· ensuring the appointment of personnel with capabilities commensurate with responsibilities.
5.0 ANNUAL PLANNING AND BUDGETING
The council shall develop an annual budget formulated in accordance with the Vision and Mission of the Parish as specified in the Parish Constitution. The budget is also drawn in alignment with the Parish Pastoral Council’s pastoral plan.
The council must ensure that:
· parishioners are invited to participate in the financial planning and management process; and
· decisions are made on a participative and democratic basis.
Due to its importance the Parish Finance Council will take a rigorous stance to budgeting to ensure that church assets are used effectively.
5.1 Sub Committee
The budget will be prepared by the PFC budget sub-committee. The Budget sub-committee at a minimum will consist of the Chairman, Vice Chairman and Operations Committee Chairperson. Additional members to the committee will be appointed at the discretion of the PFC Executive Committee and/or advice by the Parish Priest. Membership to the committee is open to all parishioners
5.2 BUDGETING PROCESS
5.2.1 Submission for consideration in the budget must be made to the Budget committee by the annual deadline date set in October of each year.
5.2.2 Submission will be considered based on the following factors:
· Aligning to Commission Aims: The budget submission must be aligned to the commission/group aims and geared towards its accomplishment. Ultimately the church goals and missions are to be accomplished. If the aims, missions and goals are not clear, it will lead to irrelevant and ineffective budgets.
· Why: Reason(s) why the item/event is needed is provided. The explanation is very important as there are equally important activities or items vying for the same funds. This is the basis for funds to be allocated. A good reason(s) is needed to support the use of church funds for each requested item.
· When: Submission must be specific as far as possible. Not knowing when funds will be needed may be a sign of poor planning. Knowing when funds are needed is important because the PFC tracks funds throughout the year to know if a budget line is on track, under spending or over spending.
· How Much: A breakdown of the item(s) being requested is needed. Calculations must be shown as far as practicable. All submissions must be made with verifiable basis e.g. a budgeted workshop must include the no of persons, all costs involved etc. One cannot put $300 for a workshop and no supporting information on how the $300 is arrived at.
5.2.3 The first budget draft will be issued for review by the PPC, PFC and Parish Priest in November.
5.2.4 Taking into account all suggestions, the final budget will be passed in the Parish Finance Council AGM.
5.2.5 The final endorsement of the PPC budget will be made no later than the second meeting of the PPC.
5.3 Budget Reassessment
5.3.1 Budgets were created based on assumptions and relevant information. It is accepted that these information and assumptions change over time.
5.3.2 On a periodic basis, reassessments must be made to budgets by Commissions to ensure efficiency in financial planning. Unused budgets or inactivity must not lock down funds when it can be used in some other important activities awaiting funds.
5.3.3 Apart from periodic assessments, the Parish Pastoral Council is required to do a formal budget reassessment on the first 6 months of a financial year and submit the final 6 months budget to the Parish Finance Council by June 30 of every year.
5.3.4 While the total funding budget may not be changed due to finalized fundraising targets, a Commission may reallocate fund from an existing budget to a proposed activity budget or from one Commission to another.
5.3.5 Totally new unbudgeted new activities that will increase the budget will have to by made by special approval by the Parish Priest with advice from the Finance Council. This will be approved only under special circumstances. Sufficient information must be provided in this case to help make the decision. With limited funds, out of budget expenses will need careful financial assessment
5.3.6 For budgets reallocation to be formalized a ‘Budget Reallocation Form’ must be submitted for this purpose. (Refer appendices for the form)
5.3.7 For the form to be accepted the Commission Chairperson or the PPC Chairperson or his vice should sign off on the form as the requestor.
5.3.8 Reallocation is only valid once both the Parish Priest and PFC Chairperson or Operations Chairperson sign as approved.
5.3.9 The form is important as it provides the necessary approvals and all those responsible with financial panning are fully aware of reallocation to budgets and its effects.
6.0 AUDIT
The council’s financial records shall be audited annually.
The Parish Priest and the Finance Council must ensure an auditor is given full and free access at all reasonable times to:
· all accounts and such other information, documents and records which the auditor considers necessary for audit purposes;
· details of moneys of the Parish; and
· details of and access to Parish property or property under Parish control.
All matters raised on auditors’ reports must receive prompt attention and action, where necessary.
The Parish Priest may request a special audit for the purpose of fraud investigation.
7.0 PARISH BANK ACCOUNTS
The Parish will have two bank accounts – Operation accounts and Fundraising Account.
Only the Archbishop of Suva with the advice of the Archdiocese Finance Council has the authority to:
· open or close bank accounts; and
· change, add or delete signatories to the bank accounts.
As such any resolution to the above must be communicated to the Archbishop within two weeks after the Finance Council meeting.
Parish funds are considered to be Archdiocese moneys and must be administered in accordance with Parish Priest Instructions and ultimately the Archdiocese guidelines.
7.1 Operations accounts
Funds to be credited to the Operations account are:
· Sunday collections
· Other special collections
· Proceeds from sale of parish assets
· proceeds from hire or of parish facilities;
· proceeds from investment;
· other moneys properly receivable for the purposes of the council, e.g. special donations (other than those established under a the fundraising account); and
· Other income not related to the fundraising account
7.2.1 Fundraising account
Funds to be credited to the Fundraising accounts are:
· Parish fundraised funds
· Donations relating to annual budget
7.3 Restrictions
7.3.1 The parish is not permitted to borrow money from or enter into an agreement with a financial institution, organisation, party or individual for the purpose of debt financing, such as a bank overdraft, hire purchase or finance lease unless authorized by the Archbishop of Suva.
7.3.2 The Parish must not lend money to other orgnisations, clubs or individuals, except, at the support of the Parish Priest, and authorization of the Archbishop.
7.3.3 The Parish is prohibited from the cashing of any cheque for any person out of parish moneys.
7.3.4 The Parish is prohibited from the giving of change on any cheque, except where such a cheque is drawn on a bank account of the Parish and provided the cheque is presented in payment of an account in the name of the payee of the cheque.
7.3.5 An officer is not to mix personal cash and cheques with Parish money’s or other moneys under his or her control. No personal cash and cheques may be kept in the Parish safe without the authorisation of the Parish Priest.
8.0 BANK RECONCILIATION
A bank reconciliation statement must be prepared at least quarterly for each bank account. The Operations Chairperson must ensure the balance shown in the reconciliation statement matches with the balance shown in the bank statement.
Each reconciliation statement must be checked and signed by the Chairman of the Finance Council. Final review will be made by the Parish Priest.
Any discrepancy must be clearly stated on the reconciliation statement and appropriate action taken to clear the discrepancy.
9.0 CONTROL OF RECEIPTS
9.1 AREA RECEIPTING
Area Treasurers by their appointment in an Area becomes the Parish Finance Council (PFC) appointee in cash collection in their Area and is bound by Parish finance procedures.
The names of the Area Treasurer, his assistant or any other nominee who will receipt cash will have to be submitted to the PFC through the Parish Office immediately after appointment no later than March 15 of each year.
Not following procedures in receipting is viewed as a serious breach and will be referred to the Parish Priest for his decision. It may result in expulsion from the Council.
9.2 AREA RECEIPTING AND SAFE KEEPING
Only the Treasurer, his assistant or any other Area nominee is allowed to receipt cash for the area provided their names are registered in the Parish Office.
A receipt must be issued for any cash received by the Treasurer. As such all Areas MUST keep a receipt book for this purpose.
The person receipting must be separate from the person keeping the money. This role can be shared between the Treasurer and the Assistant Treasurer.
The cash must be kept in a safe and secure place at all times.
It is strongly recommended that cash collected be submitted to the Parish Office within a week of collection.
9.3 USE OF MONIES COLLECTED
Cash once collected for the annual fundraising shall not be available for loan or any other purposes by Area members.
All monies collected using the name of the Parish or Area for fundraising must be submitted intact to the Parish Office. Areas that collect monies for other purposes such as charity, picnics etc do not necessarily have to submit this monies to the Parish Office, however they are required to submit the purpose of the special fundraising to the parish office.
9.4 PARISH RECEIPTING
Parish Receipting can be made by either the Parish Secretary, Operations Chairperson or a
PFC Executive nominee.
Receipts shall be prepared in duplicate, the white copy for the parishioner/customer and the duplicate kept as book copy.
Receipting must be made on pre numbered official receipt books bearing the name of the Parish
Monies received through mail will be verified though signature by the Parish Priest, Assistant Parish Priest or any of the Finance Council executives.