Guest Post – Forecasting Annual Church Revenues: Using Trends and Cycles to Help Predict Future Revenues – part 1

Mr. Jeff Beaumont is a CPA working for a firm that focuses on serving the nonprofit community. His opinions are his own and do not reflect the opinions or positions of his firm in any way. Because he speaks for himself, I won’t identify him or his firm in any more detail. He doesn’t speak for me either.

He has about seven years experience as an auditor working on the issues discussed on this blog. This is the first in a series.

By Jeff Beaumont, CPA

Introduction and encouragement to pastors

I found myself with a group of others only a couple of months before that church’s year-end was over to discuss the seemingly never-ending debate on how to set a budget. The good part, everyone agreed that expenses should be less than or match revenues. But then we needed to figure out revenue.

How do you determine that? I found myself holding in tension believing in faith that He will deliver what we need and, sometimes seen as “at odds”, being responsible and wise to take care of what we have been given. I was working in spreadsheets. I didn’t—still don’t!—know how to factor those concepts into budgeting. After all, God doesn’t fit in a spreadsheet.

I love the church (local and the entire body). I love the ministry that goes on within a church, and so I want to make sure that I do my best in determining the budget so that I don’t set it so low so as to disallow ministries to do their job or grow, yet not to set it so high and allow ministries to grow only to make massive mid-year cuts because my expectations were too high!

I view the forecasting role as vital for church ministries and programs to flourish and know what funds they can count on without worrying if their budgets will get cut due to overzealous expectations.

In terms of attendance, it wasn’t a static church; there were inflows and outflows of people, with inflows being the greater. This meant a dynamic and increasing budget.

Encouragement to pastors

Quick side point: I know not all churches are growing and that sometimes causes anxiety and/or a sense of worthlessness for some pastors or ministry leaders. For you, please remember that faithfulness to God is making disciples in this world, not growing a massive church and becoming a pastor-celebrity.

Man will measure another man’s worth by what he can see with his physical eyes. We listen to podcasts, read books, and talk about the pastors that have “successful,” fast-growing, and large churches and think that they are “doing it right.” God does not work that way—He looks at the heart. Please remember that.

There are also other churches and other pastors with declining churches or churches in completely different situations. For you, I pray that you be faithful where God has placed you.

Next post discusses one possible forecasting model.