● Sometimes friends in the community will make their contributions with the expressed “wish, hope or desire” that they be passed along to the International Bahá’í Funds, besides the local Fund. These donations are called designated funds and should not be mixed with the local contributions. Any interest earned on money for other than local Funds while it sits in the Assembly’s bank account also belongs to those Funds and not to the local Fund. These funds must be dispersed to where they were intended to go without long delay.

● Note that these kind of contributions ARE NOT to be counted towards the local Fund goal, unless the donor specifically indicates that the donation is to assist the Assembly’s budget goal of contributing to a particular Fund. For example, the Assembly as an institution has its own special relationship to other Funds such as National and International Funds. It budgets for these Funds in its budget as part of expected expenditure. The Assembly uses its discretionary funds it receives over the course of the year to meet this budgeted expense. An individual, on the other hand, has his or her own relationship to different Bahá’í Funds including local, national, and international Funds. The individual can make contributions to these other Funds through one institution, usually the Local Fund or National Fund. Using the National Fund as a vehicle of contribution, the individual uses the Online Contribution System (OCS) to make his or her contribution to the local Fund through the National Fund, and the National Fund in turn distributes back to local Funds all contributions made by individuals to their local Funds. The National Spiritual Assembly cannot count these local funds as part of its contributions or part of its Fund goal as they are just pass through. The same concept applies to the local contributions designated for other senior Funds of the Faith.

One of the Treasurer’s functions is to make sure that all bills for the Assembly are paid. There are several points to remember each time we spend money from the Local Fund.

● First, be sure that the Assembly approves all expenses. Routine bills, however, can be given general approval on a continuing basis. There should be a clear policy on how the expenditures are approved. For example, there could be a policy that any expenses exceeding a certain limit must be approved by certain members of the Assembly or others that may require the whole Assembly’s approval.

● Second, make sure that bills are paid on time.

● Third, Keep proper records of paid bills, making sure that they tie to the disbursements report in whatever financial system or recording system may be in use.

● Fourth, if your Local Assembly is operating a local bookstore or Bahá’í center, it should consider establishment of a separate bank account so that all related expenses are drawn against this account. For a bookstore, this account should be used to deposit all the proceeds from sales of books and to purchase inventory. Please contact the National Treasurer’s office for information on procedures to set up the accounting for a bookstore.

Consider Unnecessary spending

-Shop around - Consider taking multiple bids.

-Track and log assets to avoid rebuying materials.

-Consider spending versus Fundraising.

The Assembly must consult and approve all transactions before writing a check for expense or reimbursement, regardless if the participating party has spent the money. If the Assembly decides to give the Treasurer allowances for reimbursement it must be documented in the Assembly minutes prior.

We recommend writing directly on the receipt the name of the participating party, what the reimbursement is for and which line item the Funds are coming from regarding the budget. Then deduct the amount from the budget and file in the month it was purchased or used. This will help to stay organized and assist in the audit process.

The Treasurer should advise the Assembly to set aside sufficient sums on a regular basis to provide for the repair and maintenance of properties owned by the Faith so that these can be kept in good condition and so that the normal work of the Cause is not interrupted by sudden requirements of large sums for repairs. Usually the task of maintaining the properties is assigned to a special committee or committees, which should be consulted by the Assembly and can suggest a suitable amount to be set aside annually.

An Assembly may consider purchasing a computer, or at least ensure that it has access to one. Currently, of the nearly 1,000 Local Spiritual Assemblies, over 700 have signed up to utilize the NSA’s Online Contribution System (OCS). This system has features and modules that enable Assemblies and community members to make their contributions to different Funds electronically, thus making it easier for all to develop special relationships with various Funds of the Faith. Listed here are steps an Assembly may consider to automate its accounting system:

● Make sure that the Assembly has a reliable, easy-to-use financial system. Software needs for each Assembly may vary depending on the locality’s size. A simple spreadsheet program like Excel may be all that is needed for one Assembly. In other cases, a more comprehensive package such as QuickBooks, Quicken, Sage 50, etc., may be required to serve the needs.

● The process of obtaining a financial system for a community should be thorough and, if necessary, employing advice from reputable and reliable experts in the community (regardless of whether they are Bahá’í or not). As always, reach out to the Office of the Treasurer at the Bahá’í National Center with any questions about this.

Growing communities require development of relatively complex systems of finance and accounting. Currently, such communities are learning how to collaborate with other institutional agencies of the Faith. For example, agencies such as the Area Teaching Committees (ATCs) are often supported by mature Local Spiritual Assemblies financially. Also, communities with complex institute activities, where friends are asked to assist by covering the costs of home front pioneers to an extent, are required to develop efficient methods of capturing these costs so as to be able to produce accurate reports of real cost of the institute activities. This section, therefore, covers the following topics:

● How to get an effective financial or accounting system with checks and balances for proper bookkeeping;

● Provide some guidelines on how to prepare a comprehensive budget;

● How to develop an effective method of collecting funds from sectors of a community;

● How to adopt the best investment policy for the community assets while keeping the high standards of the Faith;

● Management of fixed assets in collaboration with a Baha’i Center Assistance Corporation agent;

● Aspect to keep in for running and maintenance a community bookstore;

● The importance of obtaining property and liability insurance;

● What it means by sponsoring community activities;

● Aspects to consider in preparing financial reports to the Spiritual Assembly, the community, and other external agencies; and

● The importance of selecting a reputable external audit accounting firm for the Assembly books auditing.