EVNT_1010_Lesson_2.2_Bedgets_presentation

Lesson 2: Services & Budgeting : 

Lesson 2: Services & Budgeting EVNT 1010 Salt Lake Community College Julia Westlake

Overview : 

Overview Service Offerings Budgeting Ratios Financial forecasting Tracking Budgets Budget allocation Budget reconciliation

Service Offerings : 

Service Offerings Event – Meeting Based Pre-planning consultation Planning Timelines Scheduling Budget Tracking and Reconciliation (Accounting and Finance) Registration (Signing up attendees, check in, tracking) Communications Marketing Keeping Stakeholders informed Obtaining sign-offs Evaluation Staff Management Project Management Problem-solving Vendor and Site Selection Vendor-Type Catering Videography – Photography Staging Decorations Venue Supply Printed Material Copies Brochures Name Badges etc Staffing Audio Visual Technology Transportation Entertainment Supplies Chairs Tables Parking cones etc Note: You can offer other services and you don’t have to offer all of these goods and services.

Sample Service Offering 1 : 

Sample Service Offering 1 Wedding Planner Event pre-planning consultation Budget consultation Project Management Vendor interviewing and management Accounting and Financial Services Venue Catering Event Supplies Photography

Sample Service Offering 2 : 

Sample Service Offering 2 Meeting Planner Project Management Schedule development Staff Management Vendor interviewing and selection Detailed accounting timeline and itemized invoicing from vendors

Sample Service Offering 3 : 

Sample Service Offering 3 Meeting and Event Planner Project Management Event execution Travel planning Transportation planning Scheduling Printing Services Event staffing Evaluation

Sample Service Offering 4 : 

Sample Service Offering 4 Site-based Event-Meeting Planning Assess and clarify goals and objectives Work within budget restraints Configure venue for client Provide detailed invoicing Act as point of contact at venue Catering Audio-visual Rooming/reservations Destination Management

Budgeting – Basic Terminology : 

Budgeting – Basic Terminology Accrual Basis All charges are entered on the ledger regardless of cash flow Account Ledger Like a “check register” where debits and credits are entered to track cash flow. This type of ledger is part of the general ledger and is maintained for only one account such as one department or a specific event. Appropriation Money set aside by formal action for a specific use Assets Any item of economic value owned by a company or individual Authorization Formal sign off allowing payments to occur and contracts to be entered into Capital Outlay Initial cash set out for a specified purpose such as an event Cash Basis Charges are made and entered into the ledger based on when cash is available Consumer Price Index (CPI) Pricing that is common for a set of goods or services: http://www.bls.gov/CPI/ Contingency A plan or fund set aside for unexpected or emergency events Cost Center Code used to identify the type of payment and account to which it is charged

Budgeting – Basic Terminology : 

Budgeting – Basic Terminology Deficit When spending goes beyond allocated or available funds Encumbrance A claim against property or a company for money owed Expenditures Money paid out or spent Expense Good or service for which money will be owed Fiscal Year For accounting purposes when the year begins and ends. Common: January – December September – August Broken into Fiscal Quarters (4 month periods) Fixed Assets Long-term tangible asset that is not expected to be sold for cash Examples: buildings, land, manufacturing equipment General Ledger Like a “check register” only it is for multiple accounts and records both debits and credits Interest Money charged for the use of money or borrowing money Liabilities Monies owed for goods or services to another party Object Classification Using a code to classify payment and charge types (Types of services or goods) Reimbursement Method by which others incur initial charges then file for payment from another based on rules and guidelines set forth Request for Proposals (RFP) Company or organization states they are looking for proposals for goods, services, information, etc

Budgeting – Basic Actions : 

Budgeting – Basic Actions Request deposits Request fund approvals Make payments Enter payments and payment obligations into the General Ledger or an account ledger Post or send out RFPs (Request for Proposals) Review budget Compensate staff Analyze financial information and find patterns Report on spending Review invoices Obtain authorization for payments Provide authorization for payments NOTE: **Authorization for payments often depends on the amount and the company or organization.

Financial Ratios : 

Financial Ratios Current Ratio Total Current Assets ÷ Total Current Liabilities Return on Investment (ROI) (Gain from Investment – Cost of Investment) ÷ Cost of Investment Price-Earnings (P/E) as applied to events Price of good or service ÷ earnings from price of good or service Price to Cash Flow (Net Profit + Non-cash expenses) ÷ Current portion of long term debt EBIT Interest Earnings Before Interest and Taxes ÷ Interest Charges Gross Profit Margin Gross Profit ÷ Total Sales Net Profit Margin Net Profit ÷ Total Sales Return on Assets Net Profit before Taxes ÷ Total Assets Return on Equity Net Profit Before Taxes ÷ Net Worth Accounts Payable Turnover Cost of Goods Sold ÷ Accounts Payable

Financial Forecasting : 

Financial Forecasting Align budget with strategic plan and goals Estimate sales (if any) Research past spending and costs Use records on hand Consumer Price Index Ask around (may get quantitative and qualitative data this way) Organize data and look for trends Estimate budgeting needs based on trends and estimated sales Ensure estimated budget is aligned to strategic plan and goals

Tracking Budgets : 

Tracking Budgets Enter all estimated charges in a proposal document Create a budget spreadsheet or account ledger Enter all payments and future payments into the document (code each separately for tracking purposes) Keep detailed records of upcoming payments and interest as well as cash on hand Always use itemized invoicing Keep invoices or receipts for everything! Implement a review process for reviewing invoices as well as payments Always balance the budget account

Budget Allocation : 

Budget Allocation Identify needs Estimate spending Gather spending proposals Select spending opportunities Adjust budget as needed and where allowed Make payments Track payments

Budget Reconciliation : 

Budget Reconciliation Compare estimated and approved spending to invoices Always double check itemized spending Review spending recorded in the account ledger and general ledger Review payments made

Budgeting – Basics of Creation : 

Budgeting – Basics of Creation Identify the event/meeting goals Prioritize goals Identify funds available for meet goals Write out all expenses Align spending with goals Decide which expenses will require obtaining bids Collect/request bids Negotiate with vendors Make final vendor selections Create a final budget with final estimated costs

Common Expenses : 

Common Expenses Audio-visual Catering Decorations Destination management companies Equipment and furniture rentals Meeting - Event venue Printing costs Online registration services Speakers and entertainment Transportation (bus companies, shuttles) Marketing Taxes Gratuities (Tips)

Fixed vs. Variable Costs : 

Fixed vs. Variable Costs Fixed Costs Occur regardless of attendance Examples of Common Fixed Costs: Meeting space Venue Staffing Event planner fees Printing Marketing Variable Costs Vary according to the number of attendees Examples of Common Variable Costs: Catering (Food & Beverage) Transportation Housing/Rooming

Revenues : 

Revenues Registration fees Grants Sponsorships Exhibitions fees Product Sales Ticket Sales Host underwriting In-kind donations