Does Your Synagogue Practice Financial Transparency?
Technology has made financial transparency for not-for-profit organizations, and even business entities, a whole lot easier. Many not-for profits that want a good rating from Guidestar (a not for profit organization whose mission is to compile and disseminate information on every 501c3 organization) post their 990 tax forms and financial statements on their websites. Thousands of people look at this information to see if an organization is worthy of their financial support.
As religious institutions, synagogues don’t have to file 990 tax forms with the IRS (there are some synagogues who have 501 c 3 status and are required to file). Some synagogues engage a CPA to complete an annual audit and prepare a financial statement. But not a lot of them. I have blogged about this before.
So with all of this knowledge as backdrop, I thought I would do a little “web surfing” to see what financial information is being shared with congregants in such a forum.
Transparency with congregants is one very important aspect being emphasized as part of the new financial models for synagogues. And I wanted to see how this was being put into practice. So I looked at the websites of a bunch of synagogues – different sizes in the New York area, other cities, and some of those who have changed to the “Pay What You Want” financial model.
This was not meant to be a scientific study. But of perhaps 25 websites that I looked at, only one synagogue, Central Reform Congregation in St. Louis, is sharing the synagogue’s financial information on their website.
While the financial data for Central Reform Congregation is outdated – from FY 2013 –the attempt at financial transparency is appreciated.
Some time in early May, my synagogue sends out the next year’s budget approved by the board that will be voted on at the upcoming annual meeting. I am sure many other synagogues follow this practice. I look at it, but I wonder how many others do, especially when attendance at annual meetings is not usually so great. And this is really the venue once a year where financial information is shared and discussed with the congregation’s membership.
Maybe synagogues share budget information through their newsletters or special emails. I wonder what the open rates and click rates are for this distribution.
Of course one could ask the same question for Central Reform Congregation, and other congregations whose financial information is shared on a website. Posting financial information on a website is just one piece of an overall communications plan that needs to include multiple channels – website, email, newsletter and even snail mail for those not so tech savvy.
Synagogue leaders should also consider posting minutes or even summaries of board meetings on their websites, and communicating such information with congregants on a regular basis. Perhaps dues income and the contributions from the High Holy Day Appeal have not met projections. Maybe this is the year that the HVAC system that is on its last legs has to be replaced. Sharing the financial challenges with congregants that the board is grappling with as they are happening is true transparency. Receiving an email about an emergency financial need just leads to questions about openness and whether the synagogue board is hiding something.
What do you think? How is financial information shared in your synagogue? Take a look at your synagogue’s website and share with me whether there is a conscious effort at financial transparency.