1. Building a Better
Budget
Hannah Grannemann
Managing Director,
PlayMakers Repertory Company
North Carolina Theatre Conference
July 23, 2012
2. Agenda
101: Budgeting basics
201: Budget management
301: Telling a story with numbers
Questions
3. 101: Budgeting Basics
PREPARE
What question are you trying to answer?
Who is your audience?
What will you want to track or measure?
4. 101: Budgeting Basics
Example: PlayMakers Operating Budget
PREPARE
What question are you trying to answer?
Primary: Can we afford the season we want to do?
Secondary: Are we making good decisions?
Who is your audience?
Primary: Staff responsible for financial oversight
Secondary: Chair and University administrators
What will you want to track or measure?
Primary: Income and expenses in enough detail
for decision making
Secondary: Finances in format that allow our accountant to translate
from university systems
5. 101:Budgeting Basics
GETTING STARTED
Start with the essential costs with fixed prices
Add the essential costs with variable prices
Build the marginal costs
Build for success, not a specific cost
6. 101:Budgeting Basics
FINDING BENCHMARKS
Theater Communications Group (TCG)
www.tcg.org
Theater Facts (under Tools & Research)
With membership and participation
Raw data of Fiscal Survey
Salary Survey results and custom reports
7. 101:Budgeting Basics
GETTING STARTED
Start with the essential costs with fixed prices
Add the essential costs with variable prices
Build the marginal costs
Build for success, not a specific cost
Move to the revenue side
→ This is an iterative process
8. 201: Budget management
Finalize budget
Determine timeline and process for reviewing and
adjusting
Incorporate goals and tracking set in preparation
Determine levelof autonomy at each level
(department heads, leaders, board)
Autonomy ownership
Autonomy≠ lack of oversight by leaders
Consider how to incorporate new opportunities
9. 201: Budget management
PLAYMAKERS OPERATING BUDGET PROCESS
Request budgets from departments
Iterative process to get to balanced budget
Departments manage their own spending
Make requests if changes in strategy, significant
re-allocations, or more funds are required
Quarterly re-projections
10. 201: Budget Management
FINAL Q3 Q2 Q1 Budget
DEPARTMENT
Category $ $ $ $ $
Subcategory $$ $$ $$ $$ $$
DEPT TOTAL $$$ $$$ $$$ $$$ $$$
11. 201: Budget management
Staff Role Board Role
• Determine content and frequency of reports
• Commit to open, pro-active communication
Provide information and Request information
welcome transparency
Eagerly assist in the ongoing Take responsibility for
education of Board educating yourself
Respect members’ skills, Respect staff’s professional
experience and skills and perspective
fiduciary duty
12. 201: Budget management
Recommended book:
The Art of Governance:
Boards in the Performing Arts
Edited by Nancy Roche and Jaan Whitehead
**Chapter on Financial Statements by
Pat Egan and Nancy Sasser
Published by TCG
13. 301: Telling a story with numbers
To the Board and internally:
Clarity: using notes, comparisons,
appropriate level of detail
Transparency
For grant proposals and others outside:
Present yourself honestly, to your advantage
Transparency doesn’t mean sharing every detail
Answer the question
Put yourself in their shoes
