Church Bookkeeping Software Essentials

What features should our church’s bookkeeping software include?

Churches need software that can track contributions and expenses in an organized way. At minimum it should handle fund-based accounting (tracking multiple funds or programs) and donation tracking so tithes and offerings are recorded accurately. Key features include:

• Donation & Fund Tracking: Record who gave what and assign it to campaigns or funds (building fund, missions, etc.).
• Expense Management: Easy entry of bills, receipts, and payments so you know exactly where money goes.
• Budgeting Tools: The ability to set annual or event budgets and compare actuals vs. plan.
• Custom Reports: Generate financial statements and giving reports. Software should produce income/expense reports and give you insights like budget vs. actual or donation summaries.
• Payroll Support: If your church has any paid staff (pastors, admins, custodians), integrated payroll features simplify handling salaries and taxes.
• Bank and Giving Integration: Sync bank accounts and online giving platforms so donations import automatically, saving data entry.
• Security & Roles: Protect sensitive data with role-based access and encryption.

Each church’s needs vary, but expense tracking, donation tracking, and report generation are non-negotiable basics breezechms.com. (For more on choosing software, see our Good Messages post “The Best 5 Church Accounting Software in the USA”.)

What financial reports are important for a church?

Churches should produce standard financial statements for transparency. These include:

• Statement of Activities (income statement): shows all revenue (tithes, offerings, etc.) and expenses.
• Statement of Financial Position (balance sheet): a snapshot of assets, liabilities, and net assets.
• Statement of Cash Flows: details how cash comes in and goes out each month.
• Statement of Functional Expenses: breaks expenses into categories (program vs. administrative vs. fundraising).

Having these statements (often called financial reports) helps your leadership and donors see the church’s fiscal health and stewardship. Most church software can generate these automatically. You may also want donor giving reports or budget vs. actual reports as needed for your church’s accountability.

Figure: A church treasurer or volunteer using financial software (or ledgers) to track contributions and expenses.

Do churches need payroll?

It depends on whether you have paid staff. If your church employs anyone – pastors, secretaries, custodians, etc. – you must handle payroll (salary, taxes, withholding). Many church accounting packages include payroll modules: for example, Shelby Financials has a dedicated church payroll tool for clergy and staff. Aplos also offers integrated payroll services for churches. By contrast, some systems (e.g. ChurchTrac) do not include payroll, meaning you’d use separate payroll software or an accountant.

If your church has no paid employees (all volunteer-run), then payroll isn’t needed. But for any staff, make sure your software or accounting system can process payroll and issue W-2s, or else plan to outsource that function.

Do we still need an accountant, or can we manage with software alone?

Bookkeeping software is a powerful tool, but expert oversight is still wise. As Jitasa explains, “working with an accountant can take the burden of financial management off your team”. Even small churches often use a volunteer or part-time accountant to check records, ensure compliance, and provide advice. Options include:

• Hiring an accountant (full-time or part-time) for larger churches.
• In-kind professional help: asking a local CPA to donate some hours. This is common for small churches starting out.
• Outsourcing: using a bookkeeping/accounting service that specializes in nonprofits.

In short, don’t entirely “ignore” the human element. An accountant (staff or outsourced) can review the software’s reports, prepare tax filings (e.g. W-2s for staff), and ensure funds are handled properly. Software reduces work and errors, but an experienced bookkeeper/accountant adds oversight and confidence for your leadership.

For more tips on church finances and software, see our Good Messages blog’s Church Accounting Q&A posts and reviews of church accounting systems.