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The Business Side of Ministry

August 8, 2011

A Review by Kevin T. Bauder

Michael T. Nolan. The Business Side of Ministry. Schaumburg, Ill.: Regular Baptist Press, 2011.

When I was about sixteen years old, my father entered his first pastorate. He had spent around twenty years in the airline industry, much of that time as a manager. One of his first discoveries in pastoral ministry was that most churches are poorly led when it comes to doing business. They know little of basic office procedures, planning, budgeting, and controlling. They are poorly equipped to deal with legal matters that affect their corporate existence. They are poorly led in these areas because their pastors are poorly prepared to lead them.

My own experience has tended to confirm my father’s observations. When I took my first pastorate, I discovered that the church was operating with no written budget. A previous pastor had led the church to adopt a budget once, but the congregation saw it as a license to spend. Consequently, the church now insisted on reviewing and approving all expenditures at the monthly business meeting.

Some years later, I became involved in planting a church. The new congregation weighed the benefits of incorporation and tax exemption. The decision was made to incorporate and to secure 501(c)(3) exemption from the IRS. The church sought legal counsel and all seemed to be well. The attorney, however, overlooked the fact that our state had just instituted what amounted to a corporate income tax. IRS exemption did not automatically exempt us from the state’s collectors. Getting that situation straightened out took months of work.

Pastors and other ministers dislike the word “professional,” but churches are well advised to conduct their business affairs in a professional manner. This is especially true in an increasingly regulatory and litigious social environment. Whether they are planning and budgeting, receiving and recording funds, hiring and firing, drafting policies and procedures, insuring, incorporating, or pursuing any of a dozen other business activities, churches have never had more ways to get into public–and possibly legal–trouble.

Michael Nolan is a businessman. He has significant experience in management, sales, marketing, and human resources with General Motors and GMAC. He serves on the boards of a number of Christian organizations. His burden is to bring his understanding of business to bear upon the operation of the local church.

Nolan takes a chapter to justify his discussion, then moves into a discussion on personal financial record keeping and budgeting (a skill that many Christians need to master). This discussion provides him with a basis for another chapter on income statements and balance sheets as they apply to churches. The same chapter also deals with safeguards in the church’s handling of money: separation of duties, accounting, reporting, internal controls, document retention, and auditing.

Other chapters are devoted to strategic planning, salary packages and insurance, retirement (a concern that many pastors and churches fail to address), church documents, tax issues, and legal matters. The total effect is to provide a comprehensive survey of most or all of the business issues that an ordinary church will be expected to face. While the discussion is brief (the book is only 119 pages), Nolan regularly points readers to more advanced resources. The volume is well written, free of unexplained jargon, and highly readable.

There are a handful of books that every pastor ought to read. Most of these are valuable because of their ideas. Nolan’s work belongs on the list for a different reason. It is valuable because it summarizes a world of very practical advice that, if heeded, will be immensely useful in keeping pastors and churches out trouble. This book should be required reading for everyone who wishes to function as a church leader.

2 Comments leave one →
  1. Gary Blessman permalink
    August 12, 2011 9:42 am

    AMEN and AMEN!


  1. Bauder on The Business Side of Ministry | Regular Baptist Press

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