How to create a project or event budget

One of the most important steps when planning an event, is to create an event budget. To many of us setting up a budget and managing the budget as the event plan unfolds, may be a very daunting task. Fortunately, it's a repetitive activity so once you've set up a basic framework for a budget by following the easy steps and tools given to you in this course, and you adjust the budget as you go along, you will soon become a budget guru.  

Section 1 - What is an event budget?

Definition of an event budget

An event budget is a forecast of the income to be generated and the expenditure that the event will incur based on the plans made and information gathered.

Setting a budget is a crucial step in planning an event as it is important for an events manager to determine beforehand whether the event will be financially viable or not. By totaling all expected incomes and costing all probable expenses, the expenses and incomes can be compared to forecast the financial outcome of the event.

Section 2 - The various sources of income and expenditure

Sources of income

Depending on the nature and purpose of the event, sources of income will vary. The most common sources of income are:

(i)   The main host of the event i.e. a company, a person/s

(ii)  Participant fees

(iii) Entrance/ spectator fees

(iv)  Sponsors

(v)   Raffles

(vi)  Selling merchandise

(vii) Government grants

Sources of expenditure

Again, the nature of the costs to be incurred to host an event will depend on the type of event and the scale thereof. Here are a few categories of costs that may apply:

(i)    Venue hire

(ii)   Food and beverages

(iii)  Décor

(iv)  Audio / visual equipment hire

(v)   Trophies and awards

(vi)  Printing, stationary, photocopying costs

(vii) Travel and accommodation of staff

(viii) Salaries / wages of staff

(ix)   Insurance

(x)    Marketing of event

Which one of the following expenses are NOT an event expenditure:

  • Income tax payable by the event manager
  • Equipment hire
  • Insurance premiums
  • Marketing of the event

Section 3 - How to create an event budget

An Event Budget Template

Watch the video: How to Use an Event Budget Template – Microsoft Excel, enhancentertainment

Tips when creating a budget

When drawing up a budget:

(a) Preferably make use of Excel spreadsheets

(b) Create sheets for Income and Expenditures separately

(c) Create columns for Item Description, Budgeted Cost, Actual/Agreed Cost, Variations, Final Cost (Agreed + Variations), Spent To Date, Notes

(d) Group income and cost figures into categories according to the types of sources listed above

(e) Add a percentage of costs for contingencies / unexpected costs