Don't project numbers without consulting others. Cross-reference your budget with other departments that might be involved in the event; you don't want to have overlapping line items or cost projections.
• Recruit a proofreader. Enlist a colleague or two to check your line items, math and to hunt for typos.
Keep It Confidential.
It's a general rule of thumb that most money-related endeavors are of a proprietary nature, so it's a good idea to use extreme discretion when sharing any budget information. As a best practice, never reveal your total budget to anyone outside your (or your client's) company.
Your budget serves as the blueprint of your meeting; it should be carefully nurtured before, during and after your event. Following are tips on how to avoid some lesser-known budget mistakes that can wreak havoc on your event's finances.
Set the Stage Right
Starting out with the right budget will help you avoid headaches in the later stages. Following are recommendations for early-stage budget planning.
• Project properly. Your budget can quickly go south if you don't project costs realistically at the outset. Take the time to be as accurate as you can. As rule of thumb, get three estimates from suppliers, and base your projected cost on an average of the three.
• Consider the costs of higher- or lower- than-projected attendance. If attendance can increase or decrease, keep in mind the reductions and increases frequently impact more than hotel rooms. For example, just 50 extra attendees in a breakout room can cost you extra in food and beverage, materials and even audiovisual needs.
• Create a contingency (aka "slush") fund. Last-minute costs are inevitable, so it's smart to budget for them. A best practice is to figure on adding 10-20 percent to each line item. You may end up not using all of these funds, so also determine in advance whether your company's accounting department prefers that the extra money be used in other areas or saved for future events. Note that the latter option might lead to your budget being cut the following year.
More Best Practices
The following tips will help you keep your finances in line at any stage of the budgeting/planning process.
• Find an accounting style with which you're comfortable. Choose accrual (record revenue or expenses when the actual transaction is completed, not when you spend or receive the cash) or cash accounting (record expenses when cash is actually received or spent). Resist the temptation to change methods mid-event; stick with the style you originally chose. For more details on accounting methods, go to bit.ly/1yffEIF.
• Pay attention to global currency rates. When the event is held outside the United States, a whole new set of issues can beset your budget. The most simple way to budget for international events is to negotiate fixed exchange rates with vendors, so currency fluctuations don't influence your projected costs. When in doubt, always follow your company's best practices/protocol.
• Keep track of revisions. Budgets sometimes change from the time they are projected until the date of the event. When changes are made, be sure to create an updated version of the budget and label it accordingly (e.g., "sales meeting budget, version 10").
Louise M. Felsher, CMP, CMM, is an event producer and writer who specializes in strategic global event marketing. She is based in Pacifica, Calif.