207 – Parish Finance Council Requirements

Last Updated:2/5/2019

I. Purpose

1983 Code of Canon Law Can. 537: In each Parish there is to be a finance council which is governed, in addition to universal law, by norms issued by the diocesan bishop and in which the Christian faithful, selected according to these same norms, are to assist the Pastor in the administration of the goods of the Parish.

Through his office, the Pastor is the administrator of the finances and temporal goods of the Parish. The Parish Finance Council is a consultative, advisory body with a collaborative relationship with the Pastor. The Parish Finance Council fulfills an essential role in assisting the Pastor in carrying out his office in compliance with all the requirements of canon and civil law. The Parish Finance Council serves the good order and administration of the Parish by fulfilling the duties entrusted to it. It does not have final decision-making authority regarding the finances of the Parish.

II. Definitions

“Annual Parish Financial Report” means that report required to be submitted annually to the Archdiocese within 120 days after the close of the fiscal year that contains the Parish assessment calculation and the Parish budget, which must include a balance sheet, statement of activities with a clear accounting of all income, financial assets, liabilities, revenues and expenditures of the Parish.

“Annual Representation Letter” means that letter required to be submitted annually to the Archdiocese within 120 days after the close of the fiscal year that discloses communication of the Parish financial statements and budget to the parishioners and the meetings of the Parish Finance Council.

“Archbishop” means the sitting Archbishop of St. Paul and Minneapolis ( or the appointed Apostolic Administrator).

“Archdiocese” means that certain corporate entity formed, maintained and existing under Minnesota Section 315.16 with the Minnesota Business Name: “The Archdiocese of St. Paul and Minneapolis”.

“Archdiocese Territory” means the twelve (12) counties of the greater Twin Cities metropolitan area: Ramsey, Hennepin, Washington, Dakota, Anoka, Carver, Wright, Scott, Chisago, LeSueur, Rice, and Goodhue; and those persons outside the geographical territory over whom the Archdiocese has the ability to direct or control.

“Parish” means a Parish within the Archdiocese Territory that is Archdiocese-recognized as Catholic.

“Parish Finance Council” means the canonical consultative body established in a Parish in accordance with canon 537 of the 1983 Code of Canon Law and the policy of the Archdiocese, which provides consultation to the Pastor from a cross-section of Parishioners to share their thoughts and insights in service to the mission of a specific Parish.

“Parish Pastoral Council” means the canonical consultative body established in a Parish in accordance with canon 536 of the 1983 Code of Canon Law and the policy of the Archdiocese, which provides consultation to the Pastor from a cross-section of parishioners to share thoughts and insights in service to the mission of a specific Parish.

“Pastor” means a Parish Pastor or a parochial administrator, as the case may be.

“Trustees” means the two lay members of the parish appointed to serve as members and officers of the parish corporation by the Archbishop, the Vicar General and the pastor or a majority of them.

III. Policy

A. Each Parish is required to have a constituted and active Parish Finance Council to assist and support the Pastor and Trustees in their stewardship of Parish resources. Parishes that are clustered (sharing one Pastor while remaining separate legal and canonical entities) must maintain their own Parish Finance Council.

B. A member of the Parish Finance Council may serve as a representative to the Parish Pastoral Council to facilitate communication between the Councils.

C. Members of the Parish Finance Council must be current with Essential 3 safe environment requirements of the Archdiocese.

D. A Parish Finance Council must meet at least quarterly. The Parish Finance Council must operate in accordance with current Constitution and Bylaws that have been approved by the Archbishop or his designee.

E. The Parish Finance Council remains in place when there is a change in Pastor. A new Pastor must meet within 90 days of his appointment with the Parish Finance Council.

F. A template for the Constitution and Bylaws of a Parish Finance Council is attached to this policy. Adaptations that may be made by the Parish are indicated in red font.

G. The Parish Finance Council must fulfill the functions required of it by canon law and Archdiocesan policy. These include:

1. Receive and study budget requests and propose an overall Parish budget to the Pastor and Trustees. Ensure that provisions to satisfy all obligations of the Parish are included in the budget, including those to lenders and programs of the Archdiocese. The Parish Finance Council then submits its draft budget to the Parish Pastoral Council, or a committee of it, who reviews the budget to provide advice in light of Parish goals and priorities.

2. Regularly review periodic (at least quarterly) financial reports such as balance sheets, income statements, cash flow analysis, and comparisons to budget prior year(s).

3. Review budget to actual comparisons by individual program category. Identify and investigate significant variances from budgeted figures.

4. Review all expenses in order to minimize costs through preventative maintenance, energy conservation, and the implementation of risk management programs and recommendations.

5. Internal controls and procedures:

a) Ensure that the Archdiocesan-required procedures for cash receipts, cash disbursements, administration of bank accounts, petty cash, and payroll are being followed;
b) Ensure that procedures for approving new bank accounts that indicate the Parish Finance Council must approve new bank accounts before they are opened, including those for auxiliary groups, are in place and followed;
c) Review the financial reports for Parish general operations, the Parish school (if applicable) and other Parish organizations or programs with bank accounts or revenue collection responsibilities, to determine if proper accounting practices and internal control procedures are in place;
d) Identify areas where internal controls may be lacking or proper accounting practices not applied, and make recommendations to the Pastor as to how those areas can be corrected;
e) Advise the Pastor and Trustees on the selection of independent public accountants and review management letters issued by said accountants including resolution of internal control deficiencies.

6. Oversee Parish investments in accord with Archdiocesan Policy.

7. Provide advice on the management of Parish funds and banking arrangements.

8. Review and provide assistance as to the communication of the Annual Parish Financial Report to the Parish community and to the Archdiocese, as indicated in the policy titled “Parish Financial Requirements.”

9. Review and sign the Annual Representation Letter as indicated in Policy N. 405 (Annual Representation Letter).

10. Provide advice as to what the Parish should do to comply with Archdiocesan policies and USCCB recommendations with respect to conflicts of interest, protection of whistleblowers and fraud detection, reporting, and prevention.

11. Provide advice on how to use undesignated bequests or other unbudgeted revenue.

12. Provide advice when hiring or evaluating a business manager or anyone providing business services to the Parish.

13. Become knowledgeable on Archdiocesan policies so as to provide advice to the Pastor on implementation, including attending training sessions offered by the Archdiocese to Parish Finance Council members.

14. Evaluate compliance with Archdiocesan policies and assist the Pastor in meeting these obligations, bringing concerns about irregularities to the appropriate Archdiocesan staff and law enforcement when necessary.

15. Provide advice on matters requiring proxies by the Parish civil corporation, as outlined in Archdiocesan policy titled “Parish Use of Proxies for Corporate Action.”

16. Provide Trustees with access to the information required to fulfill their responsibilities.

17. Review fundraising activities to assess the effectiveness of existing programs and recommend changes if existing revenues are insufficient. Review activities such as bingo, raffles, and concession sales for acquisition of the required licenses, support documentation for tax filings, and actual tax filings.

18. Review the financial statements, including perpetual care funds, maintenance, and contracts of any Parish cemeteries and the activities of Parish auxiliary groups and verify cash balances of bank accounts.