2. Funding & Budgeting
One of the first and most important questions when planning an event is "Where is the money coming from?"
2. Funding & Budgeting
Apart from earned income such as box office, admittance fees or workshop fees there are various income sources that can help finance your event.
Use your money wisely. Some things must be paid for eg. performers fees. Others can be found for free or at a reduced rate. All financial arrangements with artists, performers and hire companies should be confirmed in writing well in advance of the event. This will avoid confusion and disagreement later.
Hawkesbury City Council provides sponsorship to events that will benefit local residents through their community sponsorship program. There are numerous forms of sponsorship available including financial, human and material assistance.
Wherever you apply, the principles are the same:
- Get the application in before the deadline
- Check the criteria and address them in your application
- If you get a grant, it can take some weeks for the cheque to arrive
- Make sure you include a detailed budget
Find out about more funding sources:
- The NSW Ministry for the Arts and the Australia Council both publish guidelines annually, in hard copy and on their websites at www.arts.nsw.gov.au and www.australiacouncil.gov.au
- A guide to all commonwealth government funding is available at www.grantslink.gov.au/
- Grantsearch Australia claims to be Australia's most extensive funding database, with 18,000 opportunities and $8 billion for organisations and individuals www.grantsearch.com.au
Things to consider:
- Be prepared to receive less money than you apply for.
- Know when to say no. You may be offered funding that is so minimal compared with your anticipated need that it would compromise your project to an unacceptable level - establish a baseline at which your organisation can still produce the event and don't go below it.
- Temper your funding application to the potential grant you may receive. Smaller community grants do not need so much information. You could spend 40 hours or more compiling a thorough funding application. Make sure the size of the grant you could receive will justify this expenditure.
- Have a 'plan B' - what will you do if you don't get funded?
If you are registered for GST, tax must be paid if the grant or sponsorship moneys have strings attached, which is usually the case - Eg, if the agency giving the money expects it to be spent in a certain way, or if they require publicity and/or other benefits via your event. This is the case even if no money changes hands, E.g., where the arrangement is for in-kind support.
If you are successful in your application for funding under either of Hawkesbury City's two cultural grant programs described above, you will be asked to
submit either a Tax Invoice (if you have an ABN and are registered for GST)
or a Statement by Supplier stating why you don't have an ABN.
2.3 Other Avenues of Sponsorship
Look locally for sponsorship:
- local businesses
For example, a local business may provide a tent to be used for information or changing, in return for hanging their banner and handing out some pamphlets. Local businesses and your local newspaper may wish to support the event by sharing the cost of a full page advertisement in the local paper - the event advertisement can occupy a portion of the page and local businesses can take out advertisements on the remainder of the spaces. You need to remember that sponsorship is essentially a business arrangement, not a handout. It is about making a mutually beneficial deal. Document all negotiations and agreements to ensure that both parties' needs are met and to ensure that you have something in writing in case things don't go as both parties planned.
Looking for large amounts of sponsorship money can take time and skill. If possible draw on the experience of someone who has negotiated sponsorship deals of this size before. Leave at least 8-12 months or more, if feasible, to begin searching for sponsorship and be aware that most companies apportion their sponsorship funds at the beginning of their financial year.
In-kind support can be very valuable to your event budget. Goods may be used to generate extra income - Eg, prizes in a raffle - or you may be offered goods, services and assistance which can directly aid the event programme. For example, a local office may allow you to use their photocopier and telephone or a local printer may print some promotional material for you at a discounted rate. A local children's activity centre may agree to run a sand sculpture competition and children's games on the day of the event. Another group who are having an activity close to your event, and which complements your event theme, may agree to do reciprocal publicity of your event in exchange for you publicising theirs with your promotional material.
Professional businesses, local traders, shopping centres, organisations and service clubs can all be approached. This should be done months prior to your event as it can take some time for people to respond to your requests. A good place to start locating these groups is our local community directory, the Hawkesbury Gazette, the Hawkesbury Courier and the Hawkesbury District Independant News.
Look at what you need in terms of equipment, props and staging. The possibilities and variety of support your event can gain through donations and in kind support are endless.
How to Attract Donations and In Kind Support
Once you have decided who you are going to approach, you must plan how to gain their support. Writing a letter and then following it up with a phone call or a personal visit is a good process. Your approach in the letter is very important. Make sure you tell them the following information:
- details of the event
- what you are trying to achieve
- who you anticipate attracting to the event
- why you need their support
- how they may benefit
Recognising Donations and In Kind Support
There are many ways in which you can recognise people's support. Here are a few examples:
- Mention people/organisations/businesses that have helped you through your advertising, eg. on the back of the promotional flyer or poster, or in the local newspapers.
- Have a luncheon or morning tea and invite all those people that have provided support and perhaps present them with a small token of appreciation such as a certificate of support.
- Have a special 'VIP' area (such as a marquee) set aside for sponsors/supporters
- Provide them with a complimentary gift; eg. tickets to events.
- Present all event sponsors with publicity material, such as programmes. These could be displayed in their shop describing their support for the event.
- Let them display promotional material for their business or organisation at the event.
- Send them a letter thanking them for support and involvement and indicate how you utilised their support and the benefits it provided. Also indicate your interest in having their support again in the future.
- Where publicity and advertising are used as methods for recognising support the amount and location of advertising time and space must be agreed upon by both parties.
- Acknowledge major sponsors in any speeches
2.4 Raffles/Lotteries/Art Unions
A raffle is a lottery conducted for the purpose of raising funds for a non-profit organisation, where the total value of prizes does not exceed $20,000, and prizes are distributed by a draw of tickets from a barrel. A permit is not required, but there are some restrictions. An art union is a lottery where the total value of prizes exceeds $20,000 and may only be conducted under an authorising permit.
Guidelines for the conduct of raffles, lotteries and art unions are available from The Office of Liquor, Gaming and Racing www.liquorandgaming.nsw.gov.au or you can contact the department by phone 9995 0300.
2.5 Drafting A Budget
It is essential that you have an idea of how much money you will need to run the event and what the money will be spent on. Remember - you can only spend what money you have.
- When drawing up a draft budget, be as realistic as possible with your costings.
- Don't forget to include ALL areas of the event programme. Check if there is a cost for permits and extraneous services that may be incurred, Eg, fees for staging an event in a community park; the cost of advertising a road closure; the cost of a letterbox drop to local residents; paying First Aid staff etc. Often these items are overlooked.
- Don't make wild estimations of costs - research each individual area or item and get realistic quotes.
- By costing each activity or aspect of the event separately it may help you in obtaining sponsorship or a grant (see above). Businesses and organisations may be interested in sponsoring a particular part of the event that may be compatible with their operations.
- All artists, musicians, performers and support staff, Eg, technicians, cleaners etc. should be paid for their services. Check with APRA (www.apra-amcos.com.au) the Musicians' Union, or Actors' Equity regarding current rates of pay. Don't expect artists to give their services cheaply or for free. This is their means of earning a living.
- When costing out the hire of equipment or other goods or services it's advisable to ring at least three firms and obtain quotes to give you an idea of going rates. If a firm doesn't have what you want or can't help you, explain exactly what you're after and ask them if they can refer you to a more appropriate place.
- If possible, leave a little extra in the budget for extra costs. It is difficult to anticipate all the unexpected situations that will happen on the day. The nearest you can get to this is to anticipate that some situation will occur that will cost you money. Also you may need to pay for some repairs for damage incurred during the event. (see below)
2.6 The Role of the Committee in Overseeing and Approving The Budget
It is the role of the committee to secure funds for the event and to ensure that the event stays within budget. The committee is generally accountable to other organisations, Eg, funding bodies, and has contractual or legal responsibility to ensure funds are appropriately spent.
The Treasurer or Financial Manager informs the committee of the event's financial situation. The committee then decides the appropriate course of action based on this information.
The Treasurer/Financial Manager oversees all financial aspects of the event. For this reason, this role should be filled by someone who knows about accounting and/or finances. The tasks of the Treasurer/Financial Manager include:
- estimating costs and drawing up a draft budget
- presenting up-to-date financial reports to the committee so that it can ensure that the event remains within budget
- establishing a receipting and expenditure system
- establishing prices for:
- tickets for performances
- workshop fees
- controlling ticketing
- establishing a system for revenue collection on the day
- finding out current award rates for payment of salaries and on-costs (eg. preparation of a financial report for funding bodies)
- arranging an audit if required
It is vital that once you have budgeted for the various program areas that you stick to your budget. It is no good deciding a week before the event to add extra activities, shows, and exhibitions or employ additional people if you don't have money set aside for this purpose. Even if it's a brilliant idea, don't try to fool yourself that you'll come up with the money later. Better to save the idea for next time and budget it into your overall event programme.
If there isn't sufficient funding for everything you planned where will you make cuts? Will it be over the whole programme or particular aspects of it?
Make sure money donated or promised is received and receipted. All monies received and spent should be accounted for. There should be an event accounts book and the Treasurer/Financial Manager should record everything in this.
Ideally funds should be readily available as required. It is wise to plan your grant applications with this in mind (see Grants). A certain amount of cash in hand will be required for minor or on-the-spot expenses. In addition, a large amount of money may be required on the day to pay performers' fees. Remember to safeguard money collected on the day of the event. (link to 'Security').
Finalise all event accounts promptly. A final budget should be presented to the committee as soon as possible after the event.
2.8 Example of event income and expenditure items
Grants: Council grant; State Government; Federal Government; Other
Salaries/Wages: Event Organiser/Coordinator, Artists; Performers; Technicians; Labourers; Office; Other staff
Donations: business & individual
Merchandising: t-shirts; other clothes; programmes, posters; badges; stickers; postcards; water bottles; toys; candles/glow lights etc.
Administration eg. phone (including mobiles), electricity, gas, water, office rental and equipment; postage /fax/email/internet charges; stationery; photo-copying, binding/laminating etc.
Fees: stalls; amusements; subscriptions; workshops; exhibitions, vendors
Venue Hire, Cleaning, Marquees, site decorations
Ticket sales: raffles; performances; box office; admissions; liquor sales
Publicity & Advertising: design; layout; printing; brochures; posters; programme; flyers; banners; signs; installation media releases; media packs; newspaper/radio/television ads; translation; distribution; evaluation forms
Documentation: photos; videos
In kind support: office space; translating/interpreting services; materials and equipment; services; staff; use of phone/fax/email/internet; free advertising, product, refreshments
Security: guards; walkie-talkies
Equipment Hire: tables; chairs; sound and lighting; stages; costume hire; portaloos; rubbish bins; transport
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