CUCC Policy and Procedure Handbook_2021 Update

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FINANCE Subject Doc Number Revised Effective Date Funds Management 3.00 7/10/19 6/23/19 Approvals: Policy & Procedures Committee X Yes Date/Initial Stewardship & Finance X Yes Investment Committee No 5/29/2019 Church Council Yes No 6/18/2019 X Yes No No 6/25/2019 I. PURPOSE This policy is to safeguard CUCC assets by governing the accounting processes and access to data systems which are part of the church and ECC’s finances. II. SCOPE A. Applies To: All electronic systems and paper recordkeeping for contributions (revenue), disbursements (expense), statements from financial institutions, and Chart of Accounts which together comprise CUCC’s financial accounting system. B. Administrator: Financial Administrator with support from all CUCC staff and volunteers to the finance office. The work of the Board of Stewardship and Finance and the Board of the ECC are also in scope for this policy as it pertains to financial recordkeeping. C. Policy and Procedure Responsibility: Board of Stewardship and Finance III. DEFINITIONS A listing of all accounts used in the general ledger of an A. Chart of Accounts organization. The chart is used by the accounting software to aggregate information into an entity’s financial statements. The chart is usually sorted in order by account number, to ease the task of locating specific accounts. The chart is used to segregate expenditures, revenue, assets, liabilities and equity to provide an immediate snapshot of an institution’s financial health. 75

B. Statement of General Ledger accounts to support the church’s ongoing Activities (SoA) programs are reported in the SoA. Regular contributions (from pledges, building usage, etc.) as well as expenses C. Statement of (including payroll, utilities, supplies, etc) are captured in the Financial Position SoA for both budget and actual. These accounts (sometimes (SoFP) also called “operating accounts” for the organization) are budgeted for each month ahead of the fiscal year and D. Dedicated Accounts reported for actual values each month during the fiscal year (DED) to help CUCC leadership to make responsible spending decisions. Similar to a corporation’s Balance Sheet, the SoFP reports on asset balances, liabilities and net assets (assets minus liabilities.) The SoFP is a good indicator of CUCC’s financial condition. Dedicated Accounts represent funds for special events or projects. There is no budget for these funds. Balances of the DED carry over from year to year. IV. POLICY A. A Chart of Accounts is maintained by the Financial Administrator for managing the church and ECC financial records. B. The activities in the accounts which include asset/liability information, special fund balances, payroll, and budget/actual figures for income (contributions) and expenses are also maintained by the Financial Administrator. C. Financial duties are sufficiently segregated to prevent one person from manipulating a transaction, and there is ample overlap in accessibility to the systems and enough cross- training to allow the Financial Administrator to take vacation for at least one contiguous week every year. D. Bank statements are reconciled for both income (deposit slips for contributions and other income) and expense (receipts and disbursements.) E. It is CUCC policy that accounting data backups are taken at least weekly and access to the accounting system is restricted appropriately. F. Financial Reports (the Statement of Financial Position, Statement of Activity and Dedicated Accounts) are prepared and distributed by the 10th calendar day of the succeeding month, prior to the monthly meeting of the Board of Stewardship and Finance. G. The financial practices regarding funds management will ensure that CUCC’s not-for- profit 501c3 status is never in question. All accounting will follow FASB standards. H. All cash and bank accounts will be held in federally insured institutions. I. It is church policy that a financial review shall be performed at least bi-annually. 76

V. PROCEDURE A. System The systems currently used (May 2019) by CUCC for accounting and payroll is ConnectNow. ConnectNow is part of the ParishSoft suite of products. https://www.parishsoft.com/accounting Breeze Church Management Software (BreezeChMS) is used by CUCC to organize people, track giving, and manage events. Breeze is a software system hosted by the vendor and subscribed to by CUCC on a monthly basis. The Stripe system (which integrates with Breeze) provides online payment capabilities so that contributions to CUCC can be made via EFT or credit/debit card transactions. B. Chart of Accounts The Chart of Accounts is configured within ConnectNow Accounting. The accounts with the Chart of Accounts are identified by entity (CUCC or ECC), type of account, account number and account description. The account numbers are grouped by type to more easily distinguish the account. In addition, the accounts are grouped within a hierarchical structure using levels to allow for roll-ups (consolidation) and summary reporting. Account types are 1. Asset, Liability, Net Asset (reported on the Statement of Financial Position) 77

2. Income, Expense (reported on the Statement of Activities) 3. Dedicated (reported as Dedicated Accounts) C. Modifications to Chart of Accounts The Financial Administrator may create new accounts within the Chart of Accounts at the direction of the Board of Stewardship and Finance or the Senior Pastors. Accounts requested by the Board of the ECC should be submitted to the Board of Stewardship and Finance for approval. All accounts must follow the church or ECC structure for numbering and description. Accounts may be retired (deleted) within the Chart of Accounts at the beginning of the fiscal year and only after 12 months of zero balance and zero activity. D. Access to Financial Systems 1. Admin access to the ParishSOFT Accounting system, Breeze contributions software and Stripe systems for electronic contributions is given to the Financial Administrator and Senior Pastor(s). Read only access to ParishSOFT is given to the treasurer. 2. Access to the safe deposit box is given to the church Moderator, Moderator- Elect, Treasurer and Clerk. 3. Access to contents within the church safe (refer to Contributions 3.1) is given to the Financial Administrator AND the Counters. (Two individuals must be present to open the safe.) 4. Access to financial institutions for statements is given to the Financial Administrator, Treasurer, Moderator, Moderator-Elect, Clerk, Chair of the Staff Parish Relations Committee and Chair of the Investment Committee. All signature authorities are reviewed and updated at least annually at the beginning of each fiscal year. E. Bank Accounts Bank accounts shall be maintained and established in accordance with the Bylaws. Signature cards shall be kept current. F. New Bank Accounts Should the need arise to establish a new bank account, prior approval shall be sought from the Board of Stewardship and Finance. All bank accounts shall be FDIC insured. Approval to open new accounts will be conveyed to the Financial 78

Administrator by the Treasurer. Notification of the new account shall be given at the next Council meeting and shall be incorporated into the minutes of that meeting. G. Reconciliation Account statements are received from the financial institutions (e.g. Wells Fargo, UCF) either monthly or quarterly. All bank reconciliations should be prepared by the Financial Administrator (who is without signing authority on any bank accounts), and the reconciliation should be reviewed monthly by the Treasurer. The beginning and ending balance must match the Asset balances of the Statement of Financial Position. Deposits are checked against the counting records and disbursements are checked against receipts by the authorized check signer(s). The Treasurer is responsible for reviewing with the Financial Administrator any discrepancies in reconciliation and reporting anything that cannot be immediately resolved to the Senior Pastors and Board of Stewardship and Finance. H. Financial Review The financial records of the church (including the ECC) shall undergo a financial review by the Board of Stewardship and Finance or by an accounting professional at least once every year for the prior year, after year-end close. VI. REFERENCES 6/25/17 Claremont United Church of Christ Bylaws 79

FINANCE Subject: Doc Number Revised Effective Date Contributions & Revenues 3.01 5/7/19 6/23/19 Approvals: Policy & Procedures Committee X Yes Date/Initial Investment Committee Yes Stewardship & Finance Yes No 5/8/2019 Church Council No X Yes No No 6/4/2019 I. PURPOSE This policy is to safeguard CUCC finances and assets by governing the process for collecting, depositing and recording contributions and revenue. II. SCOPE A. Applies To: All cash and electronic giving for annual “pledged” contributions, special events and dedicated funds; ECC tuition payments; any refunds for expenses; all revenue from building usage B. Administrator: Administrator with support from all CUCC staff and volunteers to the finance office C. Policy and Procedure Responsibility: Board of Stewardship and Finance III. DEFINITIONS Contributions by EFT or credit card A. Electronic giving B. Finance Office Office of the Financial Administrator C. General Ledger Describes the electronic (software) system for capturing D. Church Safe financial transactions and reporting finance activity The church safe is bolted to the furniture and located in a locked room within the main office. The safe can be accessed by anyone for putting something into the safe but can only be opened by two individuals present with their two distinct safe access codes. 80

E. Counter Representative of the Board of Stewardship and Finance to F. Safe Drop Log assist with counting of collections/receipts to deposit. The representative need not be a member of StewFin but StewFin minutes shall reflect that the Counter has been appointed. Sheet located next to the Church Safe for recording envelopes (funds) dropped into the safe (Appendix A) IV. POLICY A. To provide for the financial safekeeping of CUCC assets: 1. Written procedures are followed for collecting, counting, depositing and reporting funds; 2. There are always at least 2 adults to move money from collection (or special event) into the church office safe; there are always at least 2 adults present during the counting of offerings. 3. The teams of ushers and counters are different. An individual may participate in more than one activity, but the same two individuals cannot do both for the same collection. 4. No one may take funds home for any reason, including counting. 5. Funds not yet deposited are secured within the church safe inside the locked church office; the drop slot in the Financial Administrator’s office should be used for funds only as a last resort when access to the church safe is not possible. Deposits are made into the church and ECC bank accounts in a timely manner; deposits for money received from collections will be made within 3 business days of receipt. V. PROCEDURE A. General Deposit Procedures at CUCC 1. All checks and cash collected at events and sales should be deposited at the appropriate location in the Church immediately after the close of the sale or event for that day. No cash or checks should ever be taken home. 2. Checks and cash collected at the event and sales should be counted by 2 persons and placed in a sealed envelope, with the name and date of the event written clearly on the outside of the envelope, along with the total amount counted and the initials of the counters. It would be helpful to note either the number or the name of the account to which the money should be deposited (especially if it is to be put into a dedicated account) and preferred that a CUCC Deposit Slip (Appendix B of Policy & Procedures 3.5) be included with the funds in the envelope. 81

3. If the church offices are open, the envelope should be taken by one or two persons either to the Church Office where the staff member will verify the amount in the envelope, enter the deposit on the Safe Drop Log (Appendix A), and then make sure it is put into the safe in the safe room. 4. If the church offices are not open, the proceeds envelope should be deposited in the secure mail slot in the Financial Administrator’s office, or if it pertains to the Early Childhood Center, in the secure mail slot in the office of the Director of ECC. The respective staff members have the responsibility of ensuring that these envelopes are put into the safe for future counting and depositing. 5. Typically, on Monday morning the Financial Administrator and a Counter check the safe contents against the drop log maintained for deposits, count the collection and any deposits made from other sales and events, copy all checks (paper or digital preferred) for reference, and note if some envelopes or checks are designated for special purposes other than the general collection. 6. Deposit summaries are made out for the collection monies and for all other monies brought or mailed to the office during the preceding week. The summaries state the total amount of cash and checks that were counted and that are to be deposited. These summaries are signed by the two counters. The counters verify that the safe was locked when they arrive by initialing a box on the summary slip. This summary is mailed to the Treasurer by the Counter for his/her information. A copy is also kept by the Financial Administrator. NOTE: Additional information for this procedure is found in Appendix A for Policy and Procedures 3.5 General Deposit Procedures. 7. The Financial Administrator and/or Counter go to the bank to make the deposit. (Only one person needs to carry the deposit to the bank unless personal safety is a concern.) The validated bank deposit slip is kept for the church records. 8. The Financial Administrator enters the deposit into the appropriate income lines of the General Ledger. 9. All deposits are reflected in the monthly financial reports. B. The Church Safe The Church Safe is equipped with a one-way deposit slot whereby funds can be deposited without opening the safe. All monies collected by the Church must be deposited in the safe as soon as possible after collection. When dropping funds into the safe, care should be taken to make sure the parcels are small enough so as not to jam the slot. All monies are removed from the safe, accounted for, and deposited on Monday of each week unless that day is a holiday. The safe requires two combinations to open it. One combination must be from a staff member and the other from either another staff member or a lay leader identified as a Counter. The Finance Administrator maintains the list of individuals who have a safe combination; that list is reviewed annually by the Board of Stewardship and Finance. 82

C. The Safe Drop Log A Safe Drop Log is kept next to the Church Safe. When deposits are made, they are noted on the log. The information includes the date and time of the deposit, the origin of the funds, who is making the deposit, and how many pieces/packets are in the deposit. If the funds arrive via the mail, the Safe Drop Log should indicate the daily mail for that date and how many pieces. When the Church Safe is opened by the counters, the counters will reconcile the contents of the safe against the Safe Drop Log. Once it is reconciled, the Safe Drop Log will be initialed by both counters and included with the Deposit Sheet as part of the record. Any discrepancies between the contents of the safe and the Safe Drop Log are promptly reported to the Financial Administrator, the Treasurer and the Senior Pastors and reviewed by the Board of Stewardship and Finance. D. Funds Collected Other than at Sunday Collection Monies which are collected by the church, other than the Sunday collections, must be accounted for and secured. Pledge money, special collections and other funds which arrive either through the mail or are otherwise delivered to the Church will be deposited in the Church Safe. Funds which arrive by mail shall be placed in the safe in the envelopes they are mailed in. The envelopes will be opened only by the individuals with responsibility for counting that week. The only exception to this rule is by authority of the Senior Pastor(s). If the Senior Pastor determines that these envelopes need to be opened before the regularly scheduled counting, such opening and accounting must be done in the presence of another staff member or lay leader. Funds which are collected by the Church office, such as rents, payments as part of special events, or other income, should be placed in envelopes and appropriately identified, including the exact amount of cash or check, the account/account name for which the money was collected, and the person who collected it. The envelopes must be placed in the Church Safe as soon as possible. E. Revenues received by the ECC 1. Tuition is due on the 1st of every month, but there is a grace period until the second Thursday of each month. 2. Tuition is received in the mail or in person in the ECC Office. When received they are posted to the ledger and kept in the safe box (in ECC Director’s door) until deposit is made. 3. Before making the deposits, checks are copied and kept in a binder for each year. 4. Bank deposits are made 3 or 4 times a month. 5. Invoices for non parent participation fees and for extra time fees (when a child is picked up late) are issued at the end of the month, and checks to cover these come in throughout the month. 83

6. Deposit slips made by ECC are given to the Financial Administrator for posting to the ECC General Ledger accounts. F. Sunday Collection The Church group in charge of ushering for that particular Sunday, or the head usher when no particular group is in charge, shall arrange for eight individuals to collect funds during the Offertory. At the conclusion of the Offertory, the collection is taken by the ushers and placed on the altar. G. Securing the Collection Immediately after each of the Sunday services, a church staff member (currently the Sexton) and a lay leader (current the PowerPoint person) go to the altar and collect the offering plate. They take the funds immediately to the Church office. The money which is collected from the Children’s Time is kept separate and identified as such. Once in the Church Office, the door is locked. The cash and checks are placed in envelopes labeled for the service from which they were collected. The envelopes are sealed and initialed by both individuals and then placed in the Church Safe through the one-way deposit slot. The Safe Drop Log (Appendix A) is updated accordingly. H. Other Collections On a frequent basis there are other events or fundraisers at the Church which generate donations and income, either in the form of cash or checks. When the funds for these events have been collected, they are taken to the Church Office by two people. The money is placed in an envelope and sealed. The source of the money is clearly labeled on the envelope and a CUCC Deposit Slip (Appendix A) form included when possible. The envelopes are then placed in the church safe through the one-way deposit slot. The Safe Drop Log is updated accordingly. I. Counting The Board of Stewardship & Finance maintains a schedule of one member (or other lay leader) to work with the Financial Administrator on the Monday immediately after the Sunday service to count the funds in the safe. All counting takes place in the church’s Financial Office. During counting the doors will remain locked. The Financial Administrator and the Counter are the only people allowed in the office during counting. The contents of the safe are first reconciled with what is listed on the Safe Drop Log. Any discrepancies between the contents of the safe and the Safe Drop Log are promptly reported to the Financial Administrator, the Treasurer and the Senior Pastors and reviewed by the Board of Stewardship and Finance. The funds are divided into three categories: • Mail and other income (rental payments and other sources of income) • Sunday 8:15 am service • Sunday 10:00 am service 84

The funds for each category are counted and totals written on a Weekly Collection Count Record (Appendix B). Loose cash contained in envelopes is separated from the envelopes and placed with the other cash. The envelopes containing money from identified sources is noted with the exact amount and the initials of the person counting that money. These envelopes are included in the count so that they can be captured into the donor giving records. The completed Weekly Collection Count Record reflects the income from the above noted three categories, and any additional categories as they are deemed necessary. Once the money has been counted and verified, the Weekly Collection Count Record is initialed by both individuals. The funds are turned over to the Financial Administrator for deposit. The safe is secured and checked by both individuals. J. Deposit Verification The Weekly Collection Count Record is signed, scanned and emailed to the Treasurer by the counting team. Reconciliation of the deposit with the bank statement is described in the 3.0 Funds Management documentation. VI. REFERENCES Undated General Deposit Procedures at CUCC Jan 2010 Written Procedure for Collecting, Counting, Depositing and Reporting Funds Jan 2010 CUCCC Financial Safekeeping Guidelines Jan2010 3.0 Funds Management 3.5 Appendix A General Deposit procedures 3.5 Appendix B CUCC Deposit Slip 3.1 Appendix A Safe Drop Log 3.1 Appendix B Weekly Collection Count Record VII. APPENDICES A. Safe Drop Log B. Weekly Collection Count Record 85

3.01 Appendix A Safe Drop Log Week Ending ______________________________________ Date # of Pieces Initials Initials What is written on the envelope? 86

3.01 Appendix B Weekly Collection Count Record Week Ending Sunday, Counter #1 Counter #2 Total Cash Total Checks Safe Locked? (Two sets of initials) 87

FINANCE Subject: Doc Number Revised Effective Date Receipt & Use of Gifts 3.02 6/23/19 Approvals: Policy & Procedures Committee X Yes Date/Initial Investment Committee Yes Stewardship & Finance No 2/27/2019 Church Council X Yes No X Yes No 3/19/2019 No 3/26/2019 I. PURPOSE The purpose of this document is to set forth the process whereby individuals who wish to make special donations to the Church (as opposed to ‘normal’ pledges or plate contributions) can accomplish this transaction. II. SCOPE A. Applies To: All donors of cash or tangible property gifts to the Church All Staff and Board officers involved in the receipt and acknowledgement of gifts B. Administrator: Moderator, Church Treasurer, Financial Administrator, ECC Director, Pastor(s) C. Policy and Procedure Responsibility: Board of Stewardship and Finance III. DEFINITIONS A. Monetary Gifts Special donations to the church (as opposed to pledges/plate offerings). These may include currency or checks, cashiers checks, money orders, or electronic stock transfers. B. Gifts of Tangible Real estate, works of art, or personal items of value. Properties C. In Kind Donations A kind of charitable giving in which, instead of gifting money to buy needed goods, the goods themselves are given. IV. POLICY Gifts, monetary, tangible or in kind, shall be presented to, and accepted by, the Church either as a designated gift or as an undesignated gift. When there is a question as to the appropriateness of any gift or the donor’s proposed use of the funds, the Church Council will make the determination as to whether or not the gift should be accepted. 88

V. PROCEDURE A. Special gifts offered: When a donation to CUCCC is made, either of cash or tangible property, it can be either a gift to serve the Church in an unspecified way or a gift designated for a special purpose. 1. Cash: gifts of cash will be acknowledged with a letter that can be used to authenticate the gift for tax purposes. Appendix A 2. Tangible properties offered: an inspection shall be made by Church Staff to assess the nature and condition and suitability of the property before it is accepted or delivered to the Church. Appendix C and D 3. For gifts of Stocks and/or Bonds, these commodities will be cashed in as soon as possible after receipt and the proceeds deposited in an appropriate account. Stocks will be sold and converted into cash as soon as received. Appendix B 4. For cash gifts, whether a designated gift or not, the Financial Administrator will deposit the funds in an appropriate account. 5. In the case of funds designated for a specific purpose by the donor, every effort will be made to carry out the donor’s wishes in a timely manner. B. Acknowledgements: A letter of acknowledgement and “thanks” will be sent as soon as feasible to the donor for any gift that is given to and accepted by the church (see Appendices A, B and C). The letters are prepared by the Office Manager and signed by the Financial Administrator. In the case of gifts of art, a Transfer of Ownership form (see Appendix D) will be included with the acknowledgement letter. This form must be signed, dated, and returned to the church office before the artwork is accepted. VI. APPENDICES A. Cash Gift Acknowledgement Letter B. Stocks and Bond Gift Acknowledgement Letter C. Art Gift Acknowledgement Letter D. Art Transfer of Ownership Agreement E. ECC Donation Acknowledgement Letter 89

3.02 Appendix A Date Name Address Address Dear ______________________, On behalf of Claremont United Church of Christ, I thank you for your donation of ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________ We received the above items on ____________________. The Internal Revenue Service requires the church to state that you were not provided any goods or services in consideration for your donation. Thus, your full donation is tax deductible. Our EIN is 95-1660339. Thank you for your support of Claremont UCC. Sincerely, Jocelyn Bocking Financial Administrator

3.02 Appendix B DATE NAME ADDRESS ADDRESS Dear NAME, On behalf of Claremont United Church of Christ, I thank you for your donation of XX shares of STOCK NAME (SYM) stock received on DATE. The high for that day was $XX.XX and the low for that day was $XX.XX. The Internal Revenue Service requires the church to state that you were not provided any goods or services in consideration for your gift. Thus, your full donation is tax deductible. Our EIN is 951660339. Thank you for your support of Claremont UCC. Sincerely, Jocelyn Bocking Financial Administrator

3.02 Appendix C Date Name Address Address Dear ______________________, On behalf of Claremont United Church of Christ, I thank you for your donation of ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________ We received the above items on ____________________. In order to document the terms under which this gift is accepted, we have attached a Transfer of Ownership form for you to complete and return to the church at your earliest convenience. The Internal Revenue Service requires the church to state that you were not provided any goods or services in consideration for your donation. Thus, your full donation is tax deductible. Our EIN is 95-1660339. Thank you for your support of Claremont UCC. Sincerely, Jocelyn Bocking Financial Administrator

3.02 Appendix D Transfer of Ownership of Gift of Art In giving this Gift of art to Claremont United Church of Christ Congregational (CUCC), I/we understand that we are unconditionally transferring ownership of the work and all related rights to CUCC. CUCC is accepting this Gift with the understanding that the church has the right to determine retention, location and other considerations relating to the use or disposal of the artwork. Consequently, CUCC may choose to display the gift or not. CUCC may also choose, if needed, to sell the item and use the proceeds for any purpose appropriate to the church’s mission. Once the item is accepted, CUCC will be the sole owner and will coordinate the display, usage, upkeep, storage and or disposal of the item without providing notice or obtaining the consent of the donor. I/We have read the above and agree to the terms outlined. ____________________________________________________ _______________________ Donor Date _________________________________ ______________________ ___________________ Authorized Representative of CUCC Title Date 93

3.02 Appendix E Date Name Address Address Dear __________________, It is my pleasure to acknowledge your generous donation of ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ to the Claremont United Church of Christ Early Childhood Center. We received the above item on ____________________. Your contribution has helped to make our dreams possible. It is deeply appreciated. The Internal Revenue Service requires the church to state that you were not provided any goods or services in consideration for your donation. Thus, your full donation is tax deductible. Our EIN is 95-1660339. On behalf of the Early Childhood Center children and staff, I thank you for your generous gift! It is deeply appreciated. Sincerely, Kristy Knight, Director CUCC Early Childhood Center Early Childhood Center 233 Harrison Avenue Claremont CA 91711 (909) 624-2916 94

FINANCE Subject Doc Number Revised Effective Date Budget Process 3.03 6/23/19 Approvals: Policy & Procedures Committee X Yes Date/Initial Investment Committee Yes Stewardship & Finance No 2/27/2019 Church Council X Yes No X Yes No 3/19/2019 No 3/26/2019 I. PURPOSE The purpose of this policy is to establish CUCC’s annual budget process. II. SCOPE A. Applies To: 1. Budget Committee 2. Board of Stewardship & Finance 3. ECC Director and the Board of ECC 4. Pastors 5. Financial Administrator 6. Church Council B. Administrator: Chair of Stewardship & Finance, CUCC Treasurer, Financial Administrator, ECC Director C. Policy and Procedure Responsibility: The Board of Stewardship & Finance III. DEFINITIONS Reflects the funding needs to undertake all of the possible A. Preliminary proposed programs and staffing for the following fiscal year. Budget The unapproved budget that reconciles the preliminary budget B. Proposed Annual with the available funds Budget The final budget as approved by the Church Council and the C. Annual Budget CUCC Congregation. IV. POLICY The preparation and approval of CUCC Annual Budget shall include the following: A. Preliminary Budget will be drafted by the Financial Administrator with the input from all boards and committees of CUCC and from church staff. 95

B. The preliminary budget of ECC will be drafted by the ECC Director with input from the Board of ECC, and church staff. C. Stewardship Campaign Drive results. D. Reconciliation of the Stewardship Campaign results with the Preliminary Budget of the church, and reconciliation of enrollment projections with the Preliminary ECC Budget. E. Review and approval of the Proposed Annual Budget by the Church Council. F. The Proposed Annual Budget will be disseminated two weeks prior to the June Annual Congregational Meeting. During this two week period, budget forums will be held for the congregation. V. PROCEDURE CUCCC OPERATES ON A FISCAL YEAR (JULY 1- JUNE 30) A. July through September: - The Chair of the Board of Stewardship and Finance, with input from the Moderator, Senior Pastor(s), and the Stewardship Committee, will develop a procedural timeline for the next Annual Budget and present it to the Board of Stewardship and the Church Council. (It is current practice that the Stewardship Pledge Campaign begins the first week after Easter Sunday.) B. January through April – Preliminary Budget will be developed with input from all boards and committees and administrative staff before the Stewardship Campaign C. April through June – 1. Stewardship Pledge Campaign will be held for a three week period 2. Results of the Campaign Pledge Drive will be reconciled with the Preliminary Budget by the Budget Committee and the Board of Stewardship and Finance into a Proposed Annual Budget. Budget Committee and Board of Stewardship and Finance should take action to recommend approval by the Church Council. 3. The Proposed Annual Budget will be presented to the Church Council for review and approval in time to publish and disseminate to the Congregation two weeks prior to the Annual June Congregational Meeting. 4. Upon approval by the Congregation, the Annual Budget will be implemented and reviewed monthly by the Board of Stewardship and Finance. 5. Within the first quarter of the fiscal year, a communication acknowledging pledges and thanking donors is sent to each pledging unit within the church. 6. During the third quarter of the fiscal year, a second personalized communication is sent to those who have pledged, thanking them again and giving a synopsis of some church activities supported by their regular support. 96

FINANCE Subject Doc Number Revised Effective Date CUCC Investment Policy 3.04 1/28/20 6/23/19 Approvals: Policy & Procedures Committee Yes Date/Initial Investment Committee X Yes Stewardship & Finance X Yes No Church Council X Yes No 2/2/2019 Congregation No 4/16/2019 Yes No 6/4/2019 No I. PURPOSE A. Establish clear goals and objectives for the invested funds of the Church B. Establish regular procedures and prudent standards for the receipt, management, and disposition of funds and other properties given to the CUCCC either for its endowment funds (hereafter “the Endowment”) or for other specially designated purposes C. Establish relevant investment horizons for which invested funds will be managed D. Establish a basis for evaluating investment results E. Present a philosophy and attitude, specific enough to be meaningful yet flexible enough to be practical, that will guide the management of invested funds toward desired results. F. Authorize the Committee to provide guidance to the Church’s investment manager(s) in managing the Church’s invested funds in order to achieve its stated goals and objectives. II. SCOPE A. This Policy is set forth by the Investment Committee (hereafter “the Committee”) of the Claremont United Church of Christ Congregational (hereafter “CUCC” or “the Church”) and supersedes all previous policy documents for the Investment Committee. It covers investment policy, objectives, and constraints of the CUCC as it concerns the Church’s. Applies To: Any individual or group of individuals in the church whose actions impact the Church’s investments, including the Board of Stewardship and Finance, the Investment Committee, the Church Council, the Pastor(s) and the Financial Administrator, 97

B. Administrator: The Church Council, The Board of Stewardship and Finance and the Investment Committee. This Committee is responsible for: 1. Investment of gifts received by the Church Council for the Endowment and for other dedicated account funds 2. Prudent management of all investments on behalf of the Church Council and Congregation 3. Preservation, growth, and wise distribution of the principal and income from said investments 4. Determination of what is principal, income, book value, and market value according to generally accepted accounting principles 5. Notifying the Church Council of all recommendations to hold, sell, exchange, rent, lease, transfer, convert, invest, reinvest, and in all other respects to manage and control the assets of the Church’s Endowment, including stocks, bonds, debentures, mortgages, notes, or other securities 6. Educating and promoting the Congregation regarding planned giving 7. Periodic review of this policy C. Policy and Procedure Responsibility: The Investment Committee, the Church Council, The Board of Stewardship and Finance, the Pastor(s) III. DEFINITIONS Cash, property or other goods owned by an organization. Assets A. Asset may include investments, buildings, art, furnishings, or other items B. Bequest of value. C. Draw A gift designated in a will, which is typically paid upon the donor’s death. The will might read as follows: “I give, devise, and bequeath to <NAME OF ORGANIZATION>, the sum of <AMOUNT> for its general uses and purposes.” The bequest may also indicate a percentage of assets, other specifically described personal or real property, or even the residual of an estate after other bequests have been paid. This is the withdrawal by an organization from its invested endowment at regular intervals (usually annually). The amount withdrawn is typically a percentage of the average market value of total invested funds over a given period. 98

D. Earnings The sum of stock dividends, bond interest, cash equivalent interest, rests, royalties, and other net cash flows earned by assets held by an endowment over a specified period of time. It does not include principal appreciation, or realized gains or losses. Source: p. 3 of the June ’15 update to the Principles of Endowment Administration prepared by the Institutional Advancement, University of California Office of the President (https://www.ucop.edu/institutional-advancement/_files/principles.pdf). The 6- page document indicates the endowment–related terms defined on pages 3-6 are drawn from Webster’s Dictionary, Black’s Law Dictionary, and other sources. The specific source for the definition of “earnings” is not indicated. E. Endowments Donor-established endowments are institutional funds that, under the terms of a gift agreement, are not wholly expendable by the institution on a current basis. These are funded by and built with bequests, gifts like charitable gifts, annuities, and charitable trusts, and even by special capital campaigns. Endowment funds are established for a specific purpose, and set aside and invested for the long term. They are institutional funds with no anticipated end date—funds intended to be held in perpetuity, with returns used for the intended purpose for generations to come. The distinction between donor-established endowment funds and institution-established (“quasi”) endowment funds influences the manner in which endowments are promoted, managed, invested, and spent. F. Permanently These funds are donated with a donor restriction regarding the Restricted purpose, timing, or use of the principal or income earned. The acceptance of a permanently restricted gift legally binds the church Endowment to respect the restriction in perpetuity. G. Temporarily These funds are donated with a donor restriction that will be Restricted released upon a certain date or on the occurrence of a specified event. Endowment H. Quasi- A quasi-endowment is established from general, unrestricted funds Endowment (an by the institution, for a specific purpose. It is technically an Unristricted unrestricted endowment and may be revoked by the institution at Endowment that any time. At the CUCCC, these funds are typically set up in is also known as Dedicated Accounts. a Designated Fund) I. Endowment If an Endowment includes restricted gifts that are creating Release difficulties in management or spending, the institution may discuss these concerns with donors (if still living) and/or legal counsel to Restrictions determine whether restrictions may be lifted or otherwise eased. The UPMIFA permits the release of restricted gifts under special circumstances, with notice to the state’s attorney general. 99

J. Gift Instrument A record(s) including an institutional solicitation under which (also known as a property is granted to, transferred to, or held by the institution as an institutional fund. Statement of Bequeathment or a Gift Agreement) K. Income Traditionally, the “spendable” return on investments, like interest or dividends. Under current laws in most states, income includes not only interest and dividends, but also a portion of appreciation—both realized and unrealized—on investments. L. Invested Funds CUCCC assets that are under the jurisdiction of the Investment Committee. Such assets are those designated as Permanent Funds in the Church’s chart of Accounts, including assets of the Early Childhood Center. M. Investment • Book Value: the initial outlay for the investment, after expenses. Components It is the amount carried on the books of the organization and represents the basis for the investment. If an investment is moved from one investment vehicle to another, its new book value will equal the amount invested in the new vehicle, after expenses. This could be higher or lower than the original investment’s book value, due to unrealized gains (losses) that must be realized at the time the funds are moved. • Market Value: the amount an investment would bring if sold in the market. • Unrealized Gains and Losses: increases or decreases in market value that have not been realized because the asset in question has not been sold. N. Investment The time period over which the investment objectives set forth in Horizon this policy are expected to be met. The investment horizon is currently 15 years. O. Principal The original amount donated or invested and does not include income earned on the investment. See “Income,” “Book Value,” and “Market Value” for further clarification. P. Record Information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form. Q. Securities The marketable investment securities that are defined as acceptable in this policy. R. Total Return Current yield (interest and dividends) and accumulated changes in the value of the investment. 100