Churches should be as financially transparent as other nonprofits


Special to the Recorder

I find it peculiar and inexcusable that the salary of the president of the United States is public information; the salaries of the members of the U.S. Senate and the House of Representatives is public information; the salaries of every state governor are public information; but the salaries of many pastors and church employees are, for the most part, kept confidential. 

Most charities are subject to some level of transparency, but not churches. That leaves it up to the members to demand transparency. I argue that the pastor, deacons, stewards, trustees and ministry leaders have a fiduciary responsibility of being transparent with all aspects of the church’s money, especially the compensation packages of the church leaders.

Perhaps I am missing something, but I see the issue in question as black and white. If you have something to hide, be opaque. On the other hand, if there is nothing to conceal or to be embarrassed about, be completely transparent.

There are a few organizations trying to fix this problem of church transparency. For example, Ministry Watch asks for financial information from ministries and publicizes the results. However, Ministry Watch has only about 600 ministries on their list when there are an estimated 335,000 congregations in the United States! Moreover, the financial information provided by these churches is not as thorough as that provided on Form 990 by nonreligious nonprofits. Yep, churches are exempt from filing Form 990 and this baffles me. The way I see the issue in question is that if one were looking out for the best interest of a congregation, one would avoid anything that sniffs of conflict of interest.

If you Google GuideStar, the Foundation Center, or similar organizations to see how a particular nonprofit spends its donated money, you will find a wealth of information. This applies to any nonprofit, that is, except churches. Of course, not all churches that refuse to be completely transparent with their financial expenditures are playing shenanigans. Nevertheless, do not be surprised if you meet resistance from your church leadership when inquiring about the compensation packages of the key employees. From my experience, this issue is incredibly secretive.

As Mahatma Gandhi so cleverly stated, “The moment there is suspicion about a person's motives, everything he does becomes tainted.” In other words, if we cannot trust you, nothing else really counts. In the end, these folks perhaps are more takers disguised as givers. Yes, it is sad, but arguably quite true!

Harry Pappas Jr. CFP®

Managing Director-Investments

Master of Science Degree Personal Financial PlanningCertified Estate & Trust Specialist ™

Certified Divorce Financial Analyst™Pappas Wealth Management Group of Wells Fargo Advisors

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