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Session – iii financial management & budgeting

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Session – iii financial management & budgeting

  1. 1. Session – III Financial Management & Budgeting <ul><li>Aim of the Study: </li></ul><ul><ul><li>To provide an overview to some financial planning , control and budgetary issues in running event </li></ul></ul><ul><ul><li>To consider budgetary organization of events in terms of break – even analysis </li></ul></ul><ul><ul><li>To understand the cost-sheet analysis. </li></ul></ul>
  2. 2. Session – III Financial Management & Budgeting <ul><li>Financial planning and good financial control are important aspects of the event management process. </li></ul><ul><li>Long term financial results are also an significant consideration in event management </li></ul><ul><li>In the initial stage following question needs to be asked: </li></ul><ul><ul><li>Is the aim to make a profit? </li></ul></ul><ul><ul><li>How much will be the event cost? </li></ul></ul><ul><ul><li>What are the revenue sources ? </li></ul></ul><ul><ul><li>How to get at Break-event position? </li></ul></ul><ul><ul><li>What is the cash-flow situation? </li></ul></ul><ul><ul><li>What control system are required to avoid fraud? </li></ul></ul><ul><ul><li>How to deal with legal and taxation matters? </li></ul></ul>
  3. 3. Session – III Financial Management & Budgeting <ul><li>The Budget: </li></ul><ul><ul><li>Preparing budget is the initial planning stage </li></ul></ul><ul><ul><li>The budget plans are based on actual quotes received from partner agencies. </li></ul></ul><ul><ul><li>Financial objective is crucial while framing the budget . </li></ul></ul><ul><ul><li>Some common budgeting mistakes includes: </li></ul></ul><ul><ul><ul><li>Ignoring the objectives of the event while preparing the budget </li></ul></ul></ul><ul><ul><ul><li>Deciding the ticket rates before working out the event cost </li></ul></ul></ul><ul><ul><ul><li>Failing to identify the full range of costs accurately </li></ul></ul></ul><ul><ul><ul><li>Over-optimism about demand for the event </li></ul></ul></ul><ul><ul><ul><li>Overlooking issues related to safety and security </li></ul></ul></ul><ul><ul><ul><li>Not having sufficient capital on hand to get the event off the ground </li></ul></ul></ul><ul><ul><ul><li>Not maintaining the receipts or invoices for the payments made. </li></ul></ul></ul>
  4. 4. Session – III Financial Management & Budgeting <ul><li>The Event Budgeting Process </li></ul>Event Planning Budget Expenditure Income Cash Flow Analysis P & L Account Balance Sheet Evaluation Report
  5. 5. Comparative outline budget for proposed company get-together 8 water rides & indoor games free Snooker and bowling Rs. 150/- per frame for 1 hrs Swimming Rs. 30/- per hrs. Table tennis, carrom and chess free Games 00 Ghazal / Disk jockey Rs. 7000/- for 3 hrs Live classical music Rs. 6000/- per hour Entertainment Rs. 350/- per plate * 600 pax = 210000/- + taxes [Starters one veg + one non veg included] Rs. 425/- per plate * 600 pax = 255000/- [inclusive of taxes] Rs. 400/- per plate * 600 pax = 240000/- + Luxury taxes Food [Welcome drink, soup to Icecream – inclusive of one non-veg & two veg dishes] Rs. 26/- per kms * 75 kms * 10 buses [56 seating capacity] = Rs. 19500/- + toll tax 00 00 Transport Cost: in Rs. 600 600 600 Attendance expected 1200 pax 750 pax 600 pax Capacity Kumar Resorts, lonavala Hotel Pride Taj Residency - Venue:
  6. 6. Comparative outline budget for proposed company get-together Kumar Resorts, lonavala Hotel Pride Taj Residency Venue: MNO ABC XYZ Total estimated Cost Rs. 200/- per 30 ml, Beer/Breezer Rs. 125/- per bottle, Rs. 40/- for cold drinks – 200 ml. Rs. 275/- per 30 ml, Beer/Breezers. 200/- per bottle, Rs. 60/- for cold drinks – 200 ml Rs. 300/- per 30 ml, Beer/ Breezer Rs. 200/- per bottle Rs. 75/- for cold drinks – 200 ml Hard & Soft Drinks Rs. 5000/- Rs. 25000/- Rs. 25000/- Floral Decoration Rs. 15000/- Rs. 28000/- Rs. 30000/- Hall decoration [Floral decoration not included]
  7. 7. Session – III Financial Management & Budgeting <ul><li>budget template.xls </li></ul>
  8. 8. Break-Even Point Fixed Cost Total Cost Revenue Audience Total revenue Break even point Profit
  9. 9. Thank You <ul><li>Ananya Mehta </li></ul>

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