I wonder how the donations I send to headquarters are processed and how they are accounted for on the books. I have heard that the donations go into Mr. Tkach's personal account or that all church property is titled in his name. Although these things don't sound correct, I am curious how these matters are handled.
None of the donations go into Mr. Tkach's personal account, and none of the property purchased with church funds is titled in his name.
Not only are such actions abhorrent to Mr. Tkach, but both of these actions would be illegal for the church to take, as any certified public accountant or attorney would know. Also, a statement exists in the Articles of Incorporation of the Worldwide Church of God specifically forbidding any church assets from inuring to the personal benefit of any private person in the unlikely event that the church ever legally disbanded.
Let me give you an outline of how your donations are processed and how church property is accounted for.
First, since you send in your donations through the U.S. mail system, our process begins when employees from our mail processing area go to the post office and pick up our mail. The mail is then taken, sorted and opened in a locked security room with access limited to selected authorized employees.
When your donation is removed from the envelope, your check is reconciled against any letter or notes you include in which you may mention the funds, and the amount is logged for entry onto the church's computerized accounting system.
Also, the amount you give is credited to your donation record on our computer so a receipt will be generated for your tax records.
After this opening of the mail and logging of the donation amounts, your check (cash or money order) is bundled and taken to the bank where it is deposited into corporate accounts. At no time does any donation to the church or to Ambassador University go into any individual's bank account.
Even though we request that church donation checks not be made out to Mr. Tkach, if such a check is received, it is presumed to be a donation to the church, is endorsed by the corporation and is deposited into a corporate account.
Once the funds have been logged into the accounting system, they cannot be spent without being fully accounted for by our sophisticated accounting system.
If the money is used to pay employees wages, for example, the employee must be listed as an employee of the church, have an identification number, be paid only his or her salary, and have the wage payment recorded and reported to the Internal Revenue Service, along with many other controls.
If the money is used to pay a bill, such as a printing bill for a booklet, we must first receive a valid invoice from the vendor. Before payment will be made, this invoice must be reviewed and approved by the requesting department and then reviewed and approved by the Accounting Department.
An authorized person in the Accounting Department then enters the invoice into a computer. At the appropriate time the computer will print a check and will make a permanent record of the transaction on the check register and on the general ledger.
If the money is used to buy property of any kind, then a form must be filled out designating what property is being purchased and for what department. An authorizing signature must be on the request, and any purchases over a certain amount must also be approved by the treasurer before they are made.
In addition, each month all the church's bank accounts are reconciled by a person in the Accounting Department. This person only reconciles the bank accounts. She has no part in the check writing process or in the banking process. Thus, these different processes are separate from each other as a means for providing further control.
Any property purchased with church funds then becomes corporate property, titled in the name of the corporation. If the property costs more than a certain amount, then it is listed on a capital assets list and is depreciated according to strict accounting rules.
Although an employee may use the property in his job for corporate business, such as in the case of a lawn mower or desk computer, upon termination the employee must surrender all corporate property.
In the event the property is later sold, the funds from the sale go back into the church treasury and the money is again listed on the books as corporate funds.
Corporate checks are kept under lock and key in the custody of the accounting manager. However, the accounting manager does not have access to the check-signing machine and is unauthorized to sign the checks personally since he is not a signatory.
Instead, other employees perform that function, thus providing controls and separation of duties. Even those who handle the checks in order to have them printed cannot simply write out a check for themselves.
Sometimes confusion is caused when a person sees a corporate check with Mr. Tkach's signature on it. They sometimes wrongly presume that the presence of his signature indicates the check is written on his personal account. This is not correct.
Every corporate checking account must have people authorized to sign the corporation's checks. These authorized people are called signatories. Usually, the signatories include the president and the treasurer, among others. The bank will not cash a check unless it contains the signature of an authorized party.
However, this is not an indication that the money is that of the signatory. The money is not theirs. It is the corporation's money and comes from the corporation's accounts and must be spent within the accounting system on a matter of legitimate corporate business.
Almost every single check issued by the church out of the thousands it issues each year carry a machine generated copy of an authorized signature, not the person's actual signature. Even this machine signature must be registered with the bank before it will be honored, however.
In summary, no employee, including Mr. Tkach, has access to church funds unless he or she complies with strict rules, procedures, controls and safeguards that guarantee they spend money only on church or corporate matters to pay legitimate corporate bills. Any property purchased with the funds becomes the property of the church.
From time to time, our auditors check our safeguards to ensure they are operating properly. Our members can have perfect confidence that their donations are processed ethically and legally and that our accounting books are kept on a modern, computerized system with built-in controls to ensure the integrity of the entire process.
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