Archive for January, 2008

Tithing Considerations for Business Owners

Written by Nick B. Nicholaou on . Posted in Articles

© 2006 by Nick B. Nicholaou, all rights reserved
President, Ministry Business Services, Inc.
Submitted to Leadership Handbooks of Practical Theology

Calculating a tithe for employees is easy because they receive a paycheck.  Doing so for business owners is more difficult because there are so many organization models, income sources, and accounting system standards.  The result has been that business owners are left to themselves to identify their own methods for calculating a tithe.  I hope this attempt at identifying factors for business owners to consider is the beginning of a discussion that helps many to do what our Lord challenged us to in Malachi 3:10-12:

Bring the whole tithe into the storehouse, that there may be food in my house. Test me in this,” says the LORD Almighty, “and see if I will not throw open the floodgates of heaven and pour out so much blessing that you will not have room enough for it.  I will prevent pests from devouring your crops, and the vines in your fields will not cast their fruit,” says the LORD Almighty.  “Then all the nations will call you blessed, for yours will be a delightful land,” says the LORD Almighty.  (NIV)

Over-Arching Considerations

As business owners, we wrestled through these issues and found ourselves having to work through a number of challenges.

  • If the IRS limits how much a business can write off of its contributions (10% of net profit for corporations, 50% of adjusted gross income for unincorporated businesses), should that be our guideline?  While this definitely impacts us, we asked ourselves what we would do if we lived in a country that offered no tax incentives at all.  The answer we came to was that we would honor God with our tithe regardless of any tax considerations.  Working through that one issue framed how we approached everything else.
  • Should we tithe before or after taxes are paid?  It seems clear in the Scriptures that we are to tithe based on pre-tax amounts.  Leviticus 27:30-33a says:  ‘A tithe of everything from the land, whether grain from the soil or fruit from the trees, belongs to the LORD; it is holy to the LORD.  If a man redeems any of his tithe, he must add a fifth of the value to it.  The entire tithe of the herd and flock — every tenth animal that passes under the shepherd’s rod— will be holy to the LORD.  He must not pick out the good from the bad or make any substitution.'”  (NIV)

This was told to those in an agricultural economy, and there are adjustments we need to make as we apply the principal in today’s economy.  But what it does not say is to tithe what’s left from all that your fields produce each year after you’ve paid your taxes.

  • How obligated should we feel to tithe?  2 Corinthians 9:6-8 says:  Remember this: Whoever sows sparingly will also reap sparingly, and whoever sows generously will also reap generously.  Each man should give what he has decided in his heart to give, not reluctantly or under compulsion, for God loves a cheerful giver.  And God is able to make all grace abound to you, so that in all things at all times, having all that you need, you will abound in every good work.  (NIV)  Rather than seeing our tithe as a bill to pay, we approach it cheerfully as a privilege.  In fact, giving to our church is my favorite part of worship because it is my tangible offering to our loving and gracious Lord.

Calculating a Business’ Tithe

Many business owners want their business to be a “tithing business”.  The best “first fruits” model (calculating based on gross earnings) is to have the business tithe 10% of its book net income before taxes.  This calculation should include all forms of income.


  • Sole-Proprietorship.  Sole proprietors might think they should use their Schedule C net profit / loss (line #31) as their tithing basis.  However, the amount on this line can be reduced by some tax incentives in a way that it is no longer “first fruits”.
  • Partnership.  A majority of partners must agree on being a tithing business.  If they don’t, individual partners should base their business tithe on their K1’s total of lines 1-11 in Part III.
  • S-Corporation.  A majority of shareholders must agree on being a tithing business.  If they don’t, individual shareholders should base their business tithe on their K1’s total of lines 1-10 in Part III.
  • C-Corporations.  A majority of shareholders must agree on being a tithing business.
  • Accrual Basis Accounting.  Accrual basis accounting refers to when income and expenses are booked.  Since this method recognizes both income and expenses when they’re incurred, the tithe should still be based on the book net income.

Calculating a Business Owner’s Personal Tithe

A business owner should personally tithe 10% of his/her income from all sources before taxes.  This includes all types of income received from the business (paychecks, rents, interest, leases, etc) and other sources.  Excluded from this calculation are any investments that have changed value— up or down— but have not yet been realized.

Business owners are cautioned from approaching the tithe like a tax.  U.S. tax regulations allow many expenses that are really personal expenses to be paid by the business.  When considering the spirit and intent of God’s challenge to tithe, however, these expenses must be backed out to arrive at an appropriate “first fruits” amount.

The goal is not to live by a strict rule, but rather to live a life reflecting the generosity we received from our Lord.  He challenges us to tithe and live generously towards his works.  These guidelines will help in working through the issues, establishing a starting point, and living the generous lives we intend.

Protecting Data– Is It Really Worth the Hassle?

Written by Nick B. Nicholaou on . Posted in Articles

© 2007 by Nick B. Nicholaou, all rights reserved
President, Ministry Business Services, Inc.
Reprinted from Christianity Today’s Your Church Magazine

Some church assets are difficult to assess.  Personnel, congregational goodwill, and data are just a few examples of assets whose value is usually understood only once it’s gone.  None of us would say our data has no value to the organization, but trying to figure out what it’s worth so we can adequately protect it is challenging.

Data is one of the most valuable assets a church has.  Protecting it isn’t difficult, but must be approached as deliberately as the fire and security protection we apply to our church buildings.

Data Classifications
Churches have different kinds of data, and classifying them can help set a value to strategically protect them.  While some data is mission-critical, others (like our favorite song recordings) are merely convenient.  Data that might be considered mission critical includes:

  • Databases.  Databases contain names and contact information, and sometimes include contribution, attendance, baptism, and other data that help us serve our congregation well.  Unfortunately, most churches have more than one database.  In addition to lost efficiencies and synergies, having multiple databases adds complexity to making certain they are adequately protected.  Church databases can include true databases, spreadsheets, document files, contact lists, and, of course, the Rolodex™.
  • Sermons / Lesson Prep.  The research behind them, and the actual sermon and lesson files themselves.
  • Communications.  Letters and email between the organization and others— both internal and external.
  • Graphic Files.  Photos, videos, bulletins / programs, promotional posters, and audio files.
  • Governmental Documents.  Church’s minutes, agendas, meeting notices, etc.
  • Custom Programming.  Templates and anything else that has been customized to help communicate and serve with uniqueness.

The question that begs an answer is, “What would happen if these were made public or were destroyed?”

Data Threats
Data threats are internal and external:

  • Internal.  Good employees sometimes become disgruntled employees, hardware sometimes crashes, vendors sometimes have sticky fingers, we are constantly being attacked with malicious software (called ‘malware’) in the form of spyware and Trojan horses, and buildings are sometimes destroyed by internal causes.

A large client of ours told us their previous network engineering firm realized the value of their database and took a copy.  They rented the list to those who wanted to reach people in their community, segmenting it by various demographics including contributions!

  • External.  Burglars, external catastrophes like hurricanes and earthquakes, and those who try to hack into systems that are connected to the Internet.

As we monitor our clients’ network security, we see almost constant evidence of Internet programs (called ‘bots’) trying to exploit operating system vulnerabilities.  Their goal is to grab data or computer resources to serve the interests of others.

Prioritizing Data Protection
Some data, if lost, would cause no damage (like our favorite song recordings).  But other data losses could really hurt!  Consider, for instance, if the database were no longer available, or if members’ private information was made public!  This is exasperated because many churches and ministries now process online or ACH contributions, and have all of the information on hand that, if in the wrong hands, could let someone raid members’ financial accounts!

It’s important to think through the data we have and how it should be prioritized.

  1. Losing the database would have the greatest impact, so protecting it should be highly prioritized.  This can take multiple forms:
    • Reduce the number of databases as much as possible, the ideal being only one.  This helps ensure that a high-priority focus on protecting it will be as effective as possible.  It also has the benefits of saving staff time (updating a record only once takes less time than updating it multiple times in every database) and increasing staff synergies.  The downside is that some ministry areas may have to adjust the way they to maintain their data to accomplish this goal.
    • Perform multiple daily backups, easily done with many of today’s database engines.  Some choose to have their database backed up every two hours, for example, so that if there were a problem, less work would have to be re-entered.
    • Send a copy of database backups to an off-site server.  If there were a regional catastrophe (like Hurricane Katrina) in which staff evacuated in many directions, the database could be securely accessible via the Internet.

    Jason Powell, Granger Community Church’s IT Director (Granger, IN), said, “Our database is the center of what is done on our network.  If it were lost, the cost to reconstruct it would be huge; worth it, but huge.”  Spending a little to protect it in advance is good stewardship.

  2. Safeguard files that are foundational to the ministry.  These include communications with governmental authorities as well as the church’s own governmental records (agendas, minutes, meeting notices, etc).  Records of this type may become critical in re-establishing a church or ministry following a catastrophe.
  3. Likewise, safeguard letters and email communications which cannot be easily re-created.
  4. Few things tangibly say who you are like familiar graphics.  Whether these are bulletins and programs, promotional formats, or photo, video, and audio files, these are often irreplaceable pieces of church history that help many feel a little more comfortable in a crisis.  They communicate who you are, and should be protected.  Because of their size, however, these are often the files eliminated from daily backup routines.
  5. Custom programming, usually in the form of templates and database modifications should be protected.

Layers of Protection
Protection from those who want to do you harm, we recommend:

  • Server rooms should be locked and accessible only to those with a need for access.
  • Passwords should meet or exceed minimal policy requirements, avoiding words, names, dates, etc that are easily guessed, and should never be shared with other staff members.  David Brown, Capital Christian Center’s IT Director (Sacramento, CA), told us, “When someone lets us know they shared their password for any reason, we immediately change it for them.”  Capital, like many ministries, doesn’t allow users to change their own passwords.  This helps ensure that passwords are high quality.

Some are even moving toward the use of biometrics to eliminate passwords altogether!  Dell, for instance, will often include fingerprint scanners for no additional cost.  These easy-to-use devices increase the protection of networks and sensitive data.

  • Most of today’s systems have fulltime connections to the Internet.  That means the following are a must:
  • A firewall that is fully configured, updated, and tested to keep unwanted intruders (bots and hackers) out.
  • SPAM filtering that is fully configured and updated to minimize the impact of malware contained in email.
  • Secure in-house instant message systems rather than public systems (AIM, etc) avoid security back doors that are easy to exploit.
  • Daily (Monday thru Friday night) backups of the entire system with tapes for a minimum of three weeks of backups.

Protection for local and regional catastrophes, we recommend:

  • If the heaviest workload happens on Mondays, take Monday night’s backup tape off-site every week, rotating it with the previous week’s backup.
  • Copy high-priority data to an off-site location on a daily basis via secure Internet connection.  Though many vendors offer this service, only a few also have the ability to restore a database backup and securely host it over the Internet as an interim solution following a catastrophe.  This is especially important for databases.

Your data, though difficult to objectively value, is one of your most significant assets.  Implementing some fairly simple policies and procedures can go a long way towards protecting your data and your ministry.

Recommended Solution Provider Table

SPAM:  Barracuda (

Firewall:  SonicWall (

Hardware w/Biometrics:  Dell, Inc. (

Instant Message System:  OpenFire (

Online Backup:  MozyPro (

Online Database Backup:  MBS, Inc. (

‘Can I Get a Mac?’

Written by Nick B. Nicholaou on . Posted in Articles

© 2008 by Nick B. Nicholaou, all rights reserved
President, Ministry Business Services, Inc.
Reprinted from Christian Computing Magazine

There’s a lot of buzz these days about Macs, and many in ministry are asking for them.  Historically this decision has been driven by the software / applications in use.  PC-centric churches usually say, “No.” to Mac requests pretty quickly.  But Macs can run PC software now, so the question is going to keep coming.  We need an updated response, and this article may help.

What’s the problem?
Apple recently began selling Macs that use the same Intel processors PCs use.  Before that happened, PC software couldn’t run well on a Mac.  While there were ways to access PC software from a Mac, the experience was usually a bad one, and few pursued the option strongly.  Since the decision for hardware is best made based on the software in use, the PC vs Mac issue had been relatively easy.  Now, though, we’re having to re-examine the PC vs Mac decision.

I am re-examining this issue from two perspectives:

  1. What does it take to run PC software on a Mac?  What are the limitations?  Can one have a total ‘PC running PC software’ experience?
  2. Macs cost more than PCs.  Is there intrinsic value in using a Mac to accomplish our tasks that justifies the additional cost?

There are many paths, Grasshopper…
There are at least five ways to run PC software on a Mac:

  • Remote Desktop via Terminal Services
  • Mac OS X’s Boot Camp (booting up in whichever operating system you want… switching means restarting the computer)
  • SWsoft’s Parallels
  • Microsoft’s Virtual PC for Mac
  • VMware’s Fusion

In my initial research I found many complaining about all of these possibilities except for Parallels and Fusion.  Many IT professionals are working with VMware’s virtual server products, and our firm has had great success with them.  So I decided to do my testing using their Fusion product to create a virtual PC on the Mac.  The Mac I used for testing was a MacBook Pro running Mac OS X 10.4.11 (Tiger) with a 2.4ghz Intel Core 2 Duo processor, 4gb RAM, 160gb hard drive, and 17-inch monitor.

How’d it go?
The software installation was surprisingly easy, and setup was too.  VMware’s Fusion uses the same approach on the Mac as it does in its server software.  You create a virtual PC following easy prompts asking how large the hard drive should be, how much RAM it should have, etc.  They give you suggestions along with minimum and maximum ranges.  I set up a virtual PC having one processor, 1gb of RAM, and a 60gb hard drive.  It then asked me to insert my Windows installation disk, and from there on it was like setting up any other Windows PC.

PC-on-a-Mac Fusion Observations
The first thing I noticed was how fast the PC ran!  That makes sense, of course, when you consider that it’s virtual and all running in the Mac’s RAM.  Then I decided to try Fusion’s ‘Unity’ mode.  It took my PC applications and allowed them to run as normal floating ‘windows’ on the Mac desktop!  So my PC applications looked very similar to my Mac applications!

There are some nice features on the Mac.  The monitor is much nicer than my PC monitors (desktop and notebook).  And the speakers are terrific!  But one thing surprised me:  the Mac’s keyboard illuminates in low light— VERY nice!  This makes using the Mac in low light enjoyable and easy… something I’ve always felt was missing from my PC notebooks.

Fusion also gave me the option of setting up the ability to share folders between the two desktops!

A Couple of Frustrations
The Mac keyboard is missing keys!  Like the Insert and Print Screen keys!  And the Delete key acts like a Backspace key!  It took some research, but I found the following keystrokes for PC users working on a Mac:

  • Insert = Fn + m
  • Delete = Fn + Delete (otherwise it’s a backspace key)
  • Print Screen = Apple + Shift + 3

The Mac uses a one-button mouse.  I discovered that right-click functionality is available using the Mac’s mouse while pressing the Ctrl key.  I also found that you can plug a two-button mouse into the Mac and get all of the functionality available in the PC.  And that functionality works in Mac programs too!

And though there’s no Command Prompt function, there is a similar Mac function called Terminal which opens a window you can run Unix commands in.

I also found that I couldn’t extend any PC programs across multiple monitors… they all must run in a single monitor.  VMware assures me that functionality is coming in an update.

Good News!
I could run all of the PC programs I normally run on a PC very nicely using VMware’s Fusion! That includes MS Office 2007 (including Outlook and Visio), SQL databases, Bible study software (Libronix), and utilities I use to setup Microsoft networks.  I also setup virtual Linux and Windows Vista computers and had success in each.  This technology works, and is ready to help us as we focus on building The Kingdom.

Okay, PC apps run well on a Mac… but are they worth it?

The Mac Reputation
Macs are thought to be systems that run creative software better (music, graphics, and video editing) and that give users a better ‘personal’ experience.  This might be true, depending on the kind of user one is. Basic

Mac OS Apps
The Mac OS (operating system) comes with bundled software, like Windows does, to help users manage creative files.  These are sometimes referred to as applets because they’re simple applications when compared to their commercial counterparts.  (An example would be comparing Microsoft’s Paint with Adobe’s Illustrator.)  If one will only be using the bundled applications, there’s no doubt those provided with the Mac OS are better.

For a comparison, I took our vacation slides from this summer and made them into a DVD.  When I did it on the PC using Windows’ applets, it took me 26-28 hours.  It turned out very nice.  When I did it on the Mac using its applets, it took me 4-5 hours, and the end product was much better!  Honestly, I was surprised.

Editing pictures, video, and sound are all similarly better in Mac applets.

Full Applications
Full featured applications for these tasks can usually be bought to run on either the Mac or PC.  In those cases, the software is pretty close to the same in capability, with two exceptions:

  • The underlying OS requires some things to be laid out and approached differently.  Once someone gets used to the different approaches on either side, they will prefer doing their work in their familiar OS.
  • Some programs, like Microsoft Office, release OS-specific versions where each is a year or two after the other, so whichever was released last is often better.  The PC’s current version is 2007, and the Mac’s is 2008.  Office 2008 fixes some issues I had with 2007.

Mac Cost
Macs cost more than Windows PCs.  Mac users may argue that, but there’s really no argument.  My high-end MacBook Pro cost easily double what I would have spent for a similarly equipped PC.  It was worth it because supporting Macs is part of our business model, but I would otherwise have a hard time justifying the cost difference.

Mac Support Issues
I work in both OSs constantly, and I have been disappointed with the Mac OS (Leopard).  I’ve had to completely rebuild it from the ground up twice in the last month!  Honestly, that hasn’t happened to me in a Windows OS for many years.  Both were
caused by weaknesses in the OS that allowed it to corrupt itself:

  • When I first received this new Mac, it said it needed fourteen updates.  I told it to install them.  Little did I know that doing so with three needing restarts would corrupt the OS!  Escalated support told me that whenever there are updates needing a restart, they should be installed separately.  I believe the OS should know how to manage that.
  • A function I wanted to run between my virtual PC and my Mac didn’t have some file rights it needed.  I’m used to having full rights to the entire drive in Windows, so I told the Mac OS to allow me the same on the Mac harddrive.  That corrupted the OS again.  It should know that certain files cannot have their rights changed to protect the integrity of the system.

The Mac Mystique
Macs have an undeniable mystique about them, and it’s causing many on our teams to request them.  We can make them work with PCs on the same network, and even run PC applications on them very well. 

But few on church and ministry IT staffs can support them, relegating their support to the Mac user.  The problems are:

  • Those who will use them are likely called to minister, not to support computers.  Giving them support responsibility means they’ll be doing so at least some of the time we’d rather see them fulfilling their call to minister.
  • When users are responsible for their own support, they rarely backup their files.  When something happens (like what happened twice to me!), if their files aren’t backed up, they will have to spend quite a bit of time recreating them.

What’s the Bottom Line?
Requests for Macs will keep coming, and they can work in your environment.  They definitely cost more, but saying, “No.” just got harder.

If you’ve got the budget, it’s okay to say, “Yes.”  Make sure you have a team ready to help with the initial setup and ongoing support of your Macs, and you’ll be okay.