Finance Questions? Ask a Financial Expert for Answers ASAP
Since there is no trace of the previous employee and also since the account is closed, you will not be able to complete the church's contribution to the said 403 B Account.
However, as you say, the said amount must be showing as a liability in the account books.
You have a option. IRS allows to contribute for a former employee. Your church may chose to open a new account, if possible make contribution for the former employee, i.e. former pastor.
I quote from IRS FAQ, " Can an employer contribute to a 403(b) plan for a former employee?"
Yes, if the plan allows, an employer can make non elective contributions, up to the annual limits ($49,000 for 2011 and subject to annual cost-of-living increases), to a former employee's account for 5 years after the date of severance. However, no portion of these contributions can come from money otherwise payable to the former employee by the employer and must cease at the death of the former employee."
Refer http://www.irs.gov/retirement/article/0,,id=172433,00.html for details.
So, consult a local accountant and see if this can be done. This may be possible.
See if this helps... Don't hesitate to revert for further help or clarifications.