Handbooks and Callings
    34. Finances and Audits
    Footnotes
    Theme

    “34. Finances and Audits,” General Handbook: Serving in The Church of Jesus Christ of Latter-day Saints (2020).

    “34. Finances and Audits,” General Handbook.

    34.

    Finances and Audits

    34.1

    Use of Church Funds

    Church funds are sacred and must be carefully accounted for and protected. These funds may be used only by authorized members for authorized Church purposes. Church leaders must protect against the embezzlement and any other misuse of Church funds. These funds may not be used for personal purposes or “borrowed.” Nor may Church funds be mixed with personal funds or deposited into the account of an individual. These and other misuses of Church funds are serious offenses that may result in Church membership restrictions or withdrawal (see 32.6.3.3 and 34.9.5).

    34.2

    Stake Financial Leadership

    34.2.1

    Stake Presidency

    This section outlines the stake president’s responsibilities for stake finances. He may delegate some of this work to his counselors and clerks.

    • He ensures that stake funds are properly handled and accounted for (see 34.6).

    • During their regular stewardship interview, the stake president and the bishop discuss important items reflected on the ward financial statements.

    • He ensures that clerks, stake leaders, and ward leaders are taught their responsibilities for finances and that they complete available training. He also ensures that they follow Church policies and procedures in fulfilling these responsibilities. He regularly counsels with leaders and clerks concerning their responsibility for sacred Church funds and ensures that passwords to access Church financial systems are never shared.

    • He teaches members to pay a full tithe and give generous offerings (see 34.4).

    • He manages the stake budget and expenditures (see 34.7). He regularly reviews budgets and expenditures with bishops, stake clerks, and stake leaders. He ensures that budget allowance guidelines are followed in the stake (see 34.7.2).

    • He ensures that the stake and wards comply with all applicable tax laws to preserve the Church’s tax-exempt status (see 34.10.1).

    • He ensures that the stake audit committee is organized and functioning properly. He also reviews audits of stake and ward financial records. He ensures that audit concerns are resolved (see 34.9).

    34.2.2

    Stake Clerk (or Assistant Stake Clerk)

    The stake president assigns the stake clerk or an assistant stake clerk to help with stake financial record keeping. These duties are outlined in this section and explained further in instructions from Church headquarters or the assigned area office.

    • With a member of the stake presidency, this clerk properly records any funds received. He or another Melchizedek Priesthood holder accompanies the member of the stake presidency who deposits the funds. Only members of the stake presidency—not clerks—may receive funds for the stake.

    • This clerk makes sure stake financial obligations are paid promptly. He prepares checks or, in locations where checks are not used, payment approval forms.

    • He helps the stake presidency prepare the annual stake budget and keep track of the stake budget allowance (see 34.7.1 and 34.7.2). He informs the stake president of the status of stake expenditures in relation to the budget allowance.

    • He reconciles the stake checking account each month as instructed in 34.6.7. As needed, he helps reconcile ward checking accounts.

    • He ensures that the stake complies with all applicable tax laws (see 34.10). He also participates in periodic audits by stake auditors and takes corrective actions if needed (see 34.9).

    For information about calling stake clerks and assistant stake clerks, see 33.3.2 and 33.3.3.

    34.3

    Ward Financial Leadership

    34.3.1

    Bishopric

    This section outlines the bishop’s responsibilities for ward finances. He may delegate some of this work to his counselors and clerks.

    • He ensures that ward funds are properly handled and accounted for (see 34.6).

    • He ensures that all clerks in the ward and all ward leaders are taught their responsibilities for finances and that they complete available training. He also ensures that they follow Church policies and procedures in fulfilling these responsibilities. He regularly counsels with leaders and clerks concerning their responsibility for sacred Church funds and ensures that passwords to access Church financial systems are never shared.

    • He teaches members to pay a full tithe and give generous offerings (see 34.4).

    • He manages the ward budget and expenditures (see 34.7). He regularly reviews budgets and expenditures with ward clerks and ward leaders. He ensures that budget allowance guidelines are followed in the ward (see 34.7.2).

    • He makes sure the ward complies with all applicable tax laws to preserve the Church’s tax-exempt status (see 34.10.1).

    • He should be available to answer questions during audits of ward financial records (see 34.9).

    34.3.2

    Ward Clerk (or Assistant Ward Clerk)

    The bishop assigns the ward clerk or an assistant ward clerk to help with ward financial record keeping. These duties are outlined in this section and explained further in instructions from Church headquarters or the assigned area office.

    • Each week this clerk helps a member of the bishopric account for all tithes and other offerings (see 34.6.2). He normally accompanies the bishopric member who deposits the funds in a bank, although another Melchizedek Priesthood holder may do so. He also submits or transmits the related donation reports to Church headquarters or the assigned area office. Only members of the bishopric—not clerks—may receive funds for the ward.

    • This clerk makes sure ward financial obligations are paid promptly. He prepares checks or, in locations where checks are not used, payment approval forms.

    • He helps the bishopric prepare the annual ward budget and keep track of the ward budget allowance (see 34.7.1 and 34.7.2). He informs the bishop of the status of ward expenditures in relation to the budget allowance.

    • He reconciles the ward checking account each month as instructed in 34.6.7.

    • Each year he prepares and organizes records to help the bishop conduct tithing settlement. He produces and distributes the year-to-date tithing and offerings statements and year-end summaries to members. He also helps the bishop prepare a year-end report of tithing status in the ward.

    • He participates in financial audits by stake auditors and takes corrective actions if needed (see 34.9).

    For information about calling ward clerks and assistant ward clerks, see 33.4.2 and 33.4.3.

    34.4

    Contributions

    Church leaders should teach members the principles of tithes and other offerings and encourage members to live these principles. Nonmembers may also make contributions to the Church. However, a person who has had their membership withdrawn may not pay tithing or other offerings to the Church.

    34.4.1

    Tithing

    34.4.1.1

    Definition of Tithing

    The First Presidency has written: “The simplest statement we know of is the statement of the Lord himself, namely, that the members of the Church should pay ‘one-tenth of all their interest annually,’ which is understood to mean income. No one is justified in making any other statement than this” (First Presidency letter, Mar. 19, 1970; see also Doctrine and Covenants 119:4).

    34.4.1.2

    Who Should Pay Tithing

    All members who have income should pay tithing, with the following exceptions:

    1. Members who are entirely dependent on Church welfare assistance.

    2. Full-time missionaries. (However, missionaries should pay tithing on personal income beyond the amount they receive for their support.)

    If mission presidents have income that should be tithed, they generally pay tithing in the ward where their membership records are located (see 33.6.5). However, if they are serving outside their own country and their membership records are in the ward where they are residing, they generally contribute their tithing directly to Church headquarters.

    34.4.1.3

    When and How to Pay Tithing

    Leaders encourage members to pay tithing as they receive their income. However, members who wish to pay annually may do so.

    Members give their tithing and a completed Tithing and Other Offerings form to the bishop or one of his counselors (see 34.6.1).

    34.4.1.4

    Use of Tithing Funds

    Bishops may not use tithing funds for any purpose. All tithing funds must be remitted to Church headquarters or the assigned area office (see Doctrine and Covenants 120).

    34.4.1.5

    Tithing Settlement

    The bishop holds tithing settlement near the end of each year. In urgent cases when the bishop is absent, the stake president may authorize one of the bishop’s counselors to conduct tithing settlement. However, such a need would be rare.

    All members should attend tithing settlement to make sure their contribution records are correct and to declare to the bishop their status as tithe payers. If possible, all members of a family should attend tithing settlement.

    In addition to reviewing records of members’ tithing, fast offerings, and other donations, during tithing settlement the bishop can discuss the principle of tithing with them, encourage them to give a generous fast offering, and discuss other relevant matters. At the time of tithing settlement, a clerk or a member of the bishopric could also review the Individual Ordinance Summary with members (see 33.6).

    Instructions for tithing settlement are provided by Church headquarters or the assigned area office.

    34.4.2

    Fast Offerings

    Church leaders encourage members to live the law of the fast. Typically this includes (1) fasting each fast Sunday for two consecutive meals and (2) giving a fast offering that is at least the equivalent value of the meals not eaten. Members are encouraged to be generous and give much more than the value of two meals if they are able.

    Where a ward is geographically concentrated and where safety conditions permit, the bishop may direct Aaronic Priesthood holders, especially deacons, to contact member households each month to give members the opportunity to contribute fast offerings. Even if members do not contribute, priesthood holders should continue to give them the opportunity to do so. If distances or other circumstances make it necessary, the bishop may limit or eliminate fast-offering collections from homes.

    Priesthood holders should go in pairs when gathering fast offerings. Melchizedek Priesthood holders may accompany Aaronic Priesthood holders if necessary.

    Members should not give other contributions, such as tithing, to those who collect fast offerings.

    Those who gather fast offerings deliver them promptly to a member of the bishopric.

    Some members may choose to contribute fast offerings by using the envelopes for tithing and other offerings and giving them directly to the bishopric.

    Members should contribute fast offerings without designating how the funds should be used. Bishops may not enter into arrangements or make commitments to give a member’s fast-offering contribution to an individual or family or to use it for a special purpose that the donor designates.

    Mission and temple presidents contribute fast offerings to the ward where their membership records are located.

    Guidelines for using fast-offering funds are provided in 22.2.4.

    34.4.3

    Missionary Funds

    Contributions to the ward missionary fund are used primarily to meet the contribution commitments of full-time missionaries from the ward, as identified in 24.6.2 and 24.6.3. Excess amounts may be used to meet such commitments of other missionaries in the stake or coordinating council. Ward missionary funds should not be sent directly to individual missionaries. Ward missionary funds should not be used for any missionary activities in the ward or stake.

    Contributions to the General Missionary Fund are used by the Church in its overall missionary efforts.

    Stake presidents and bishops should send missionary funds that exceed reasonable stake and ward needs to the General Missionary Fund at Church headquarters or the assigned area office. Bishops or individuals may contact the Global Service Center (1-855-537-4357) for further information about contributions to the General Missionary Fund.

    For additional information about missionary funds and financing missionary service, see 24.6.

    34.4.4

    Humanitarian Aid

    Church humanitarian work assists people of all faiths throughout the world who are in dire need. Those who desire to contribute to the Church’s Humanitarian Aid Fund may use the Tithing and Other Offerings form. The ward remits these contributions according to instructions from Church headquarters or the assigned area office. Donations may also be sent directly to Church headquarters at the following address:

    Finance and Records Department

    Treasury Services Division

    Attention: Humanitarian Aid

    50 East North Temple Street

    Salt Lake City, UT 84150-1521

    Online donations may be made by going to donate.ldsphilanthropies.org.

    34.4.5

    Temple Construction Fund

    Members who desire to contribute financially to the construction of temples are invited to do so as their circumstances permit. They may contribute by using the Tithing and Other Offerings form. They indicate the donation by writing “temple construction” in the “Other” category. If members want to designate the donation for a specific temple, they may note this on the form.

    Leaders should not conduct fund-raising efforts or establish assessments or goals for contributions to the temple construction fund.

    34.4.6

    Perpetual Education Fund

    The Perpetual Education Fund program assists worthy young adults who need help in qualifying for employment opportunities in their own countries by providing loans for career training and education.

    Those who desire to contribute to this fund may use the Tithing and Other Offerings form. The ward remits these contributions according to instructions from Church headquarters or the assigned area office.

    For more information about the Perpetual Education Fund, see 22.6.4.7.

    34.4.7

    Philanthropies

    Philanthropies of The Church of Jesus Christ of Latter-day Saints is a department of the Office of the Presiding Bishopric that correlates, encourages, facilitates, and accepts voluntary philanthropic contributions to the Church and its affiliated charities and activities. Assistance in making contributions may be obtained by contacting the Philanthropies office as follows:

    Philanthropies

    1450 North University Avenue

    Provo, UT 84604-6080

    Telephone: 1-801-356-5300 or 1-800-525-8074

    Email: philanthropies@ChurchofJesusChrist.org

    Online donations may be made at ldsphilanthropies.org.

    34.4.8

    In-Kind Donations, Including Tithing

    The Church normally discourages paying tithing and other donations in kind. It is preferable for members to dispose of the property themselves and then pay tithing and other donations in cash. However, in-kind donations may be accepted in certain cases and may be a common practice in some areas of the world.

    The Church accepts (1) stocks, bonds, or other securities that are marketable immediately and (2) some marketable real estate. Before accepting these contributions, local leaders should receive approval from Church headquarters or the assigned area office. If members want to contribute other items, the bishop seeks approval from the stake president. The stake president contacts Church headquarters or the area office for approval before authorizing the bishop to accept the items.

    34.4.9

    Contributions Not to Be Refunded

    Stake presidents and bishops should inform those who contribute tithes and other offerings that these contributions cannot be refunded. This policy applies also to missionary contributions that are prepaid.

    When tithes and other offerings are given to the Church, they belong to the Lord, to whom they are consecrated. The essence of all such contributions is that they are freewill offerings, made without reservation of purpose, retention of control, ownership in any form, or expectation of any benefit by the donor other than the Lord’s blessings. It is therefore improper to refund contributions given to the Church. Doing so would violate the spirit of freewill offerings. In some countries, refunding contributions could also cause legal and income tax complications for both the contributor and the Church.

    34.5

    Confidentiality of Tithing and Other Offerings

    The amount of tithing and other offerings paid by a member is confidential. Only the bishop and those who are authorized to handle such contributions should know the amount. Stake presidents and bishops are not to announce the total amount of tithing received.

    If necessary, the bishop may tell the elders quorum president whether individual quorum members are full-tithe payers, contributors to the tithing funds, or exempt. The elders quorum president must keep this information confidential.

    34.6

    Handling and Accounting for Funds

    The stake president and bishop ensure that all Church funds are properly handled and accounted for according to current financial instructions. General principles are outlined in the following sections.

    34.6.1

    Receiving Tithing and Other Offerings

    The Lord has given bishops the sacred trust of receiving and accounting for the tithes and other offerings of the Saints (see Doctrine and Covenants 42:30–33119). Only the bishop and his counselors may receive tithes and other offerings. Under no circumstances should their wives, other members of their families, clerks, or other ward members receive these contributions. The only exception is when Aaronic Priesthood holders are assigned to collect fast offerings (see 34.4.2).

    Ward members give contributions to a member of the bishopric in a sealed envelope with a properly completed Tithing and Other Offerings form enclosed. Church members should not leave their donations unattended, such as by placing them in a contribution box or under the door of the bishop’s office.

    Checks should be made payable to the ward, not to the bishop or the Church. In units where members make payments electronically (such as direct deposit or automatic bill pay), payments should be deposited in the Church’s bank account as instructed by Church headquarters or the assigned area office.

    Only the stake president and his counselors should receive funds for the stake. They should maintain custody of the funds until the funds are recorded and prepared for deposit by a member of the stake presidency and a clerk.

    34.6.2

    Verifying Tithing and Other Offerings

    Contribution envelopes should be opened and verified on Sunday, except during tithing settlement, when they are opened and verified on the day they are received. Two persons—a member of the bishopric and a clerk, or two members of the bishopric—open each envelope together to verify that the funds enclosed are the same as the amount written on the Tithing and Other Offerings form. If the funds and the written amount differ, the contributor should be contacted as soon as possible to resolve the difference.

    34.6.3

    Depositing Tithing and Other Offerings

    A bishopric member and another Melchizedek Priesthood holder, usually the clerk who helped verify the donations, prepare the deposit.

    Those who deposit funds should use, where available, (1) deposit bags that are locked when funds are inserted and are opened only by the bank or (2) other tamper-resistant deposit bags. A clerk or member of the bishopric checks with Church headquarters, the assigned area office, or the local bank for availability of such deposit bags.

    Where a 24-hour bank depository is available, the bishopric member, accompanied by the other priesthood holder, deposits the funds in the bank on the same day the funds are opened and verified.

    Where a 24-hour bank depository is not available and the bank is closed on Sunday, the bishop designates a Melchizedek Priesthood holder, normally a member of the bishopric, to make the deposit at the bank the next business day. The person who makes the deposit is accountable for these funds. He should:

    1. Ensure that the funds are kept secure until they are deposited at the bank.

    2. Obtain a bank-certified deposit receipt showing the date and the amount of the deposit.

    Furthermore, a bishopric member and a clerk should complete the following procedure on the next Sunday before processing any donations for that day:

    1. Compare the bank-certified deposit receipt to the previous week’s deposit records to verify that the correct amount was deposited.

    2. Sign the bank-certified deposit receipt and file it with the previous week’s donation information.

    34.6.4

    Safeguarding Church Funds

    Members who are responsible for Church funds must never leave them in the meetinghouse overnight or leave them unattended at any time, such as during meetings and activities.

    34.6.5

    Receipting Tithing and Other Offerings

    Church headquarters or the assigned area office sends instructions to stakes and wards for issuing receipts for tithing and other offerings.

    Receipts to members who make donations in kind (noncash tithing and other offerings) are issued only by Church headquarters or the assigned area office. These receipts show no monetary value for the items contributed.

    34.6.6

    Receiving and Managing Budget Allowance Funds

    See 34.7.2.

    34.6.7

    Managing Stake and Ward Checking Accounts

    Each stake normally has one checking account. The stake president manages it, though his counselors and clerks may assist him. The counselor who serves as chairman of the stake audit committee generally should not sign checks or otherwise be involved in stake financial record keeping.

    All ward funds are handled in one checking account. The bishop manages the account, though his counselors and clerks may assist him.

    Each check must have two authorized signatures. Usually the stake president, his counselors, and the clerk assigned to finances are authorized to sign checks for the stake account. Usually the bishop, his counselors, and the clerk assigned to finances are authorized to sign checks for the ward account. An authorized check signer should not sign a check if he is the payee or the fast-offering beneficiary.

    Although counselors may be authorized to sign checks, they should not do so unless the stake president or bishop has approved the expenditure.

    A check should not be signed until it is filled out completely.

    Each month the stake president or bishop promptly reviews the Church unit financial statement or the bank statement and gives it to a clerk to be reconciled.

    Each month a stake clerk reconciles the stake checking account and the local deposit bank account (if one exists) and funds in the “Other” category (if any). Each month a ward clerk reconciles the ward checking account, funds in the “Other” category, and any other financial records required. The clerk signs the reconciliation. The stake president or bishop then reviews and signs the reconciliation.

    Checkbooks and blank checks should be stored in a locked file or cabinet. They must not be left unattended when they are not locked securely. If any blank checks are missing, the stake president or bishop immediately reports the numbers of these checks to Church headquarters or the assigned area office. He also requests a stop payment on the missing checks.

    Stakes and wards that have checking accounts may not have savings accounts.

    Quorums and organizations may not have checking accounts, savings accounts, or petty cash funds. Their budgeted expenses are all paid through the stake or ward checking account.

    34.6.8

    Managing Stake and Ward Funds Not Held in a Checking Account

    The following instructions apply to units outside the United States and Canada that do not manage their funds through a checking account. Instead, these units have cash working funds, savings accounts, or bank accounts accessed by a debit card.

    The assigned area office provides specific guidelines for these units to follow. Some basic principles are outlined as follows:

    • A unit should have only one cash working fund, savings account, or debit card bank account.

    • The funds should be controlled by the stake president or bishop.

    • Money from cash working funds, savings accounts, or debit cards should not be used until two authorized people have signed a payment approval form. They should not sign this form until it is filled out completely.

    • Supporting documents such as invoices, bills, or receipts should be attached to the payment approval form. If funds are advanced to a member, he or she signs the form, acknowledging the receipt of the money and noting the date and the amount. The member then (1) provides supporting documentation for the funds spent and (2) returns any unspent funds.

    • If there is a bank statement, it should be delivered directly to the stake president or bishop, not to the meetinghouse or a clerk. He opens each bank statement promptly, reviews it, and gives it to a clerk to be reconciled. The clerk signs the reconciliation. The stake president or bishop then reviews and signs the reconciliation.

    • The stake president or bishop reviews any other financial reports and ensures that they are reconciled.

    • The stake president or bishop maintains custody of cash working funds.

    • Cash working funds should be separate from personal funds. Church funds must be physically safeguarded at all times.

    • Cash working funds should be counted each month by two authorized signers. The counts and signatures should be documented on forms provided by the assigned area office. Any fund shortages should be reported immediately to the area controller.

    • All disbursements should be promptly recorded, and all bills, receipts, or other documents supporting the disbursements should be retained.

    34.6.9

    Keeping Financial Records

    Each stake and ward should keep current, accurate financial records. These records help stake presidents and bishops account for and protect sacred Church funds. Accurate records are also necessary for preparing budgets, managing the budget allowance, and providing information to members on their financial contributions.

    For information about the use and retention of records and reports, clerks should refer to instructions from Church headquarters or the assigned area office. Financial records should be retained for at least three years plus the current year. Local laws may require longer retention periods.

    34.7

    Budget and Expenditures

    34.7.1

    Stake and Ward Budgets

    Every stake and ward prepares and operates on a budget. The stake president manages the stake budget, and the bishop manages the ward budget, though each may assign a counselor to supervise it under his direction. Each may also assign a clerk to help prepare and monitor the budget.

    No stake or ward expenses may be incurred or paid without the presiding officer’s authorization.

    Stake presidencies and bishoprics begin preparing budgets well before the beginning of each calendar year as follows:

    1. Review the amounts spent during the previous year to make sure that recurring expenses are considered.

    2. Ask organizations to estimate their budget needs in detail.

    3. Compile the budget, using wise budgeting practices, being equitable, and ensuring that projected expenses do not exceed anticipated budget allowance funds.

    It is not necessary to call for a sustaining vote to accept the budget.

    The stake president reviews ward expenditures as part of his interview with each bishop.

    34.7.2

    Budget Allowance

    The budget allowance program provides general Church funds to pay for the activities and programs of stakes and wards. It eliminates the need to receive budget contributions from members. Faithful payment of tithes has made the budget allowance possible.

    34.7.2.1

    Allocation of Budget Allowance Funds

    Church headquarters or the assigned area office allocates budget funds based on attendance in the following categories:

    • Sacrament meeting

    • Young men

    • Young women

    • Primary children ages 8–11

    • Young single adults

    The stake president determines how much of the funds are allocated to the stake and to the wards. He ensures that the stake and wards are funded fairly and adequately as permitted within these guidelines.

    The stake president works with bishops in a unified, cooperative manner. If unforeseen changes occur that may justify altering original budget allocations, he makes sure that fair adjustments are made.

    The bishop oversees the allocation of budget allowance funds in the ward. He ensures that organizations in the ward are funded fairly and adequately.

    Priesthood leaders ensure that the level of budget allocations and activities for young men and young women is equitable. Budget is allocated according to the number of youth in each organization. The budget allocations and activities for boys and girls in Primary should also be sufficient and equitable. Budget is allocated according to the number of children.

    34.7.2.2

    General Principles and Guidelines

    The budget allowance was created to reduce the financial and time burdens on members. If necessary, leaders should reduce and simplify activities to stay within the allowance. Most activities should be simple and have little or no cost. Expenditures must be approved by the stake presidency or bishopric before they are incurred. Expenditures should never be approved unless they are accompanied by supporting documentation.

    Stake and ward budget funds should be used to pay for all activities, programs, manuals, and supplies. Members should not pay fees to participate. Nor should they provide materials, supplies, rental or admission fees, or long-distance transportation at their own expense. Activities in which many members provide food may be held if doing so does not place undue burdens on members.

    Possible exceptions to the funding policy in the preceding paragraph may be made for annual camps or similar activities (see 20.2.8), optional activities (see 20.5), and occasional young single adult activities (see 14.3.7).

    Members who want to contribute additional funds to the Church may not designate them for the stake or ward budget. Instead, leaders encourage them to contribute the funds to fast offerings, missionary funds, or other authorized donation categories.

    Stake presidents and bishops make sure budget allowance funds are spent wisely. Funds should be used to bless people and to further gospel purposes. Leaders also ensure that all expenditures are within the allowance. The success of the budget allowance depends on the efforts of local priesthood leaders to monitor and control Church finances and expenses.

    Unneeded budget allowance funds should not be spent. Unneeded ward funds are returned to the stake. Unneeded stake funds are returned to Church headquarters or the assigned area office. As an exception, stakes and wards may retain some unspent funds if they are needed for specific activities that are planned for the next year, such as a youth conference. However, significant portions of the stake or ward budget allowance should not be retained from one year to the next to cover travel expenses. Nor should funds from the “Other” category be used to supplement the “Budget” category.

    For the budget allowance to succeed, it is important that the Quarterly Report is accurate and on time.

    The budget allowance does not include expenses for building construction, maintenance, telephones, utilities, computers, or priesthood leader travel. These expenses are paid from general Church funds according to current guidelines.

    34.7.3

    Funding Special Activities and Equipment

    34.7.3.1

    Stake and Multistake Activities

    Local leaders are encouraged to hold stake and multistake activities that provide opportunities to develop unity and friendships, especially among youth and young single adults. Leaders ensure that they budget adequate funds to support an appropriate number of stake and multistake activities. These funds should come from the budget allowance.

    For more information about activities, see chapter 20.

    34.7.3.2

    Youth Conferences

    See 20.4.

    34.7.3.3

    Annual Camps or Similar Activities and Equipment

    See 20.2.8 and 20.2.9.

    34.7.3.4

    Optional Activities

    See 20.5.

    34.8

    Fund-Raising

    See 20.6.8.

    34.9

    Audits

    34.9.1

    Stake Audit Committee

    The stake president appoints a stake audit committee consisting of one of his counselors as chairman and two other stake members who understand financial matters. The counselor who serves as chairman generally should not sign checks or otherwise be involved in stake financial record keeping. Committee members should not be stake auditors and should not perform stake or ward financial record keeping.

    34.9.2

    Stake Auditors

    The stake president or his counselor who is chairman of the stake audit committee calls at least two stake auditors. These auditors should be trustworthy brethren who hold current temple recommends. If possible, they should be experienced in accounting or auditing. They should be approved by the stake presidency and high council, but they are not sustained and are not usually set apart.

    High councilors may also serve as stake auditors. However, the stake clerk and assistant stake clerks may not be called as auditors. Those who serve as auditors may also hold other callings.

    34.9.3

    The Auditing Process

    Stake auditors audit financial records of the stake, wards, branches, and family history centers twice each year. Auditors also audit the financial records of recreational properties once each year.

    Auditors ensure that tithing and other contributions are properly recorded; Church funds are properly used, accounted for, and protected; and financial records are complete and accurate. The unit’s presiding officer and the clerk assigned to finances should be available to answer questions during audits.

    The stake president and stake audit committee review all audits. After their review, the stake audit committee chairman and stake president sign the audits. Audits may be signed and submitted before all of the exceptions are corrected. The stake president and stake audit committee ensure that any audit exceptions are promptly corrected.

    34.9.4

    Area Auditors and Assistant Area Auditors

    The Area Presidency calls an area auditor as a member of the Area Audit Committee. The area auditor reports to the Area Audit Committee Chairman. Under the direction of the Area Audit Committee Chairman, an assistant area auditor is called for each coordinating council. Assistant area auditors report to the area auditor.

    The primary responsibilities of area auditors and assistant area auditors are to:

    • Provide training on audits and financial policies to priesthood leaders, clerks, audit committees, and stake auditors.

    • Follow up on missing audits unresolved audit exceptions.

    • Encourage financial oversight by leaders and clerks.

    • Perform special audits as assigned.

    34.9.5

    Loss, Theft, Embezzlement, or Misappropriation of Church Funds

    If Church funds have been lost or stolen, or if a leader has embezzled or misappropriated Church funds, the stake president or chairman of the stake audit committee should be notified promptly. He notifies the Church Auditing Department (or the area controller if the unit is outside the United States and Canada). The Church Auditing Department (or area controller) sends a loss report form to the stake president or chairman of the audit committee. Under the direction of the Church Auditing Department (or the area controller), the stake president or chairman of the audit committee ensures that the matter is properly investigated and the loss form is properly completed and submitted.

    If a major misuse of funds is discovered, the stake president or chairman of the audit committee also notifies the Area Presidency.

    34.9.6

    Stake Clerk or Assistant Stake Clerk Assigned to Finances

    When assigned by the stake audit committee, the stake clerk or the assistant stake clerk assigned to finances should train wards in proper financial policy and procedures related to exceptions disclosed by audits.

    34.9.7

    For More Information

    More information on audit committees, auditors, and audit procedures is available in the Help Center at ChurchofJesusChrist.org. Stake audit committees may direct questions to their assistant area auditor.

    34.10

    Taxes

    The tax information in this section applies only in the United States and Canada. If priesthood leaders in the United States and Canada need additional information, they should contact:

    Tax Administration

    50 East North Temple Street, Room 2225

    Salt Lake City, UT 84150-0022

    Telephone: 1-801-240-3003 or 1-800-453-3860, extension 2-3003

    Priesthood leaders outside the United States and Canada should contact the assigned area office to resolve questions on taxes.

    34.10.1

    Tax-Exempt Status

    The Church normally is exempt from paying sales, property, income, and other taxes because it is a religious organization. Church buildings and other property are to be used for the purposes of worship, religious instruction, and other Church-related activities. Stake and ward leaders ensure that Church facilities are not used for political, business, or investment purposes as outlined in 35.4. To do so would violate laws that permit tax exemption of Church property.

    It is important that stake and ward leaders follow these guidelines to preserve the Church’s tax-exempt status. If one stake or ward misuses the Church’s tax-exempt status, other Church units could be affected.

    34.10.2

    Sales and Use Tax

    Sales and use tax laws and how they apply to the Church vary by country and by state. Leaders should contact the Church’s Tax Administration Division or the assigned area office to see whether the Church is exempt or must pay such taxes.

    34.10.3

    Property Tax

    The Church’s Tax Administration Division files all property tax exemptions and pays all required property taxes. No action is required by local leaders.