CET Budget & Financial Management Flashcards

In the context of experiential event sponsorship, 'in-kind sponsorship' means:

Answer: A sponsor who provides goods or services instead of monetary payment

In-kind sponsors contribute products or services—such as beverages, printing, or AV equipment—rather than direct cash funding.

Which financial principle states that revenue from ticket sales or registrations should be recognized only after the event has occurred?

Answer: Accrual accounting / revenue recognition principle

Under accrual accounting's revenue recognition principle, income is recorded when earned (after the event) rather than when cash is received.

What is 'break-even analysis' used for in event financial planning?

Answer: Determining the point at which event revenue equals total event costs

Break-even analysis identifies the exact attendance number or revenue level at which the event neither profits nor loses money.

When a vendor submits a 'change order,' they are requesting:

Answer: A modification to the original contract scope, typically involving additional costs

A change order is a formal request to modify the agreed scope of work, usually triggered by client-requested additions or unforeseen circumstances that carry added costs.

What does a 'reconciliation report' produced after an event document?

Answer: The final accounting of all income and expenses compared to the original budget

A reconciliation report compares every budgeted line item to its actual cost, providing a complete financial record of the event's performance.

Which US tax consideration is MOST relevant when paying speakers or entertainers at an experiential event?

Answer: Issuing a 1099-NEC form to independent contractors paid $600 or more

Under IRS rules, event organizers must issue a 1099-NEC to any independent contractor—including speakers or performers—paid $600 or more during the tax year.