SENIOR HIGH SCHOOL

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Leadership and Management
in Different Arts and Fields
Quarter 4 – Module 1

Budgeting for an Art Project

SELF-LEARNING KIT
 Hello dear learners! I will guide you ask you go through this
Self-Learning Kit (SLK). This SLK was designed and written
with you in mind. The following are some reminders in using
this module:

1. Use the module with care. Do not put unnecessary mark/s on any part
of the module. Use a separate sheet of paper in answering the exercises.
2. It is illegal to copy, duplicate nor publish in any means any part of the
module without permission from the author. You are prohibited to
upload or share your answers online or in any communication
platforms.
3. Answer all activities included in the module.
4. Read the instruction carefully before doing each task.
5. Observe honesty and integrity in doing the tasks and checking your
answers.
6. Finish the task at hand before proceeding to the next.
7. Compile your learning modules per subject area. Remember that this
will serve as your notes in studying for the examinations.
8. Make sure to submit your answer sheets on time.

This module was designed to provide you with fun and meaningful
opportunities for guided and independent learning at your own pace and time.
You will be enabled to process the contents of the learning resource while
being an active learner.

Remember, you as a learner is capable and empowered to successfully achieve

the relevant competencies and skills at your own pace and time. Your
academic success lies in your own hands!

If you encounter any difficulty in answering the tasks in this module, do not
hesitate to consult your teacher or facilitator. Always bear in mind that you
are not alone.

We hope that through this material, you will experience meaningful learning
and gain deep understanding of the relevant competencies. You can do it!

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LEARNING COMPETENCIES
 AD_LMA12-IIIg-j-68 Analyzes the different budget items for different art
forms;
 Identify the costs involved in undertaking an art project;
 Makes a project budget and an expense-income report for an art event.

After going through this SLK, you are expected to:

 Identify the costs involved in undertaking an art project;
 Analyzes the different budget items for different art forms;
 Makes a project budget and an expense-income report for an art event.

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 What’s New
This module will teach the learner to identify the various budget items
required in undertaking an arts project, and to categorize them properly. This
will make it easier to analyze these and determine the costs involved. In
addition, the learner will learn to monitor the budget by making a financial
report in order to track income and expenses. He or she is expected to
demonstrate discipline in handing finances. A good arts manager is
knowledgeable about managing funds ad takes responsibility and
accountability for the proper appropriation and dispensation of funds as well
as monitoring incurred expenses.

What is It

Before you develop the budget

Something you should not do when you are developing a budget is make
it up as you go along”. As with most good practice in managing an
organization, good practice in budgeting involves clarity of purpose, detailed
planning and considerable thought.

Among the questions you should be asking yourselves throughout the

preparatory budgeting stages, and while you are actually developing your
budget, are:

Could we have spent less last year and still achieved the same results,
or better?
Have we wasted money in the past? If so, can we avoid doing so in the
future?

What is a budget?
A budget is a document that translates plans into money - money that
will need to be spent to get your planned activities done (expenditure) and
money that will need to be generated to cover the costs of getting the work
done (income). It is an estimate, or informed guess, about what you will need
in monetary terms to do your work.

Two key questions you should be able to answer about budgeting are:
Why budget? and
Who should be involved in budgeting?

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Why budget?
Why is it important for an organization, project or department to have a budget?

The budget is an essential management tool. Without a budget, you are like
a pilot navigating in the dark without instruments.

 The budget tells you how much money you need to carry out your
activities.
 The budget forces you to be rigorous in thinking through the
implications of your activity planning. There are times when the
realities of the budgeting process force you to rethink your action plans.
 When used properly, the budget tells you when you will need certain
amounts of money to carry out your activities.
 The budget enables you to monitor your income and expenditure and
identify any problems.
 The budget is a basis for financial accountability and transparency.
When everyone can see how much should have been spent and
received, they can ask informed questions about discrepancies.
 You cannot raise money from donors unless you have a budget. Donors
use the budget as a basis for deciding whether what you are asking for
is reasonable and well-planned.

Budgeting Elements
Undertaking arts projects entails many different costs and expenses.
They need to be identified and properly classified so they can be effectively
monitored. Generally, the can be classified as follows:

 Overhead Costs
These are costs that remain fixed such as rentals and leases. This applies
to an organization which is leasing space or paying yearly association dies
in a village or building. Monthly salaries of employees, office supplies, and
utilities also fall under this category.

 Direct Activity Costs

These are variable costs because they depend on the scale and duration
of each project. It may include costs incurred for equipment, materials,
food, and all other expenses for the project.

 Direct Income
This is income acquired from ticket sales and the like. Ways to earn from
sales of tickets include subscription, group sales, single ticket sales, or
sales per bundle (Kaiser 2009). An organization can boost its direct income
by being creative in the creation of pricing schemes. This can be in the
form of special discounts for children, senior citizens, alumni, and other
special groups.

 Contributed Income

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 This is income derived from donations, grants, and sponsorships. Donors
may be a private company, a government official, or an art enthusiast who
has the capability and willingness to fund a certain cause. Note that this
item is tentative, unstable, and may vary from period to period depending
on the approval of and the release of funds by the grant-giving institution.

 Profit or Surplus
Surplus is something that is acquired often by accident, while profit is
something that happens by design. Profit is used for entrepreneurial
ventures in the arts while surplus is used for non-profit endeavors in the
arts. Profit or surplus can be determined after all the costs.

Balance Sheet
Monitoring and reporting is done through the balance sheet. It answers
questions pertaining to the overall financial health of an organization, and
whether it has liquid cash or operation at a loss. The balance sheet is an
important document that informs the arts manager about the financial health
of the organization or project (Raj et al. 2007). The balance sheet also gives
an idea of profits and losses. Profit and surplus refer to what the project
earned. It includes amounts received from the following:

 the contributed income;

 overhead and direct activity costs;
 the direct income from sales of tickets; or
 works in the inventory.

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Examples of Project Budget
Please note that the currency is in US Dollars and not in Philippine Peso due to
reference/source available.
These are just samples for your guidance and you are not required to follow
this format.

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 What’s More

Activity 1: What is It?

Determine the following items and arrange them in a table.

1. Overhead Costs
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2. Direct Activity Costs
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3. Direct Income
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4. Contributed Income
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5. Profit or Surplus
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 What I Can Do

Budget It!

Create your own budget for an arts event or project (you may base it on your
project proposal from the 3rd quarter or from other related subjects).

Guides and templates are provided above but you are not required to follow
it. Thus, you can make your own format.

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 What I Have Learned

Let me know what you have learned in this

module by completing the paragraph below.

I have learned that ____________________________________________

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Assessment
Write a short paragraph explanation of why budgeting is important in arts
projects.
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References

Boquiren, Laya. Leadership and Management in the Arts. Quezon: Vibal Group,
Inc., 2019.

https://www.ndi.org/sites/default/files/budgeting_EN.pdf

The cover in this module is from freepik.com.

DISCLAIMER
I do not own or license any copyright rights in the texts, images,
photographs, graphics and other content provided in this self-learning
kit (SLK). I created this SLK solely for non-commercial, informational
and educational purposes. There is no intention on my part to claim
ownership as to the contents or make profit out of this SLK.
Prepared by: Joanne Y. Cutamora
SHS Faculty
Mandaue City School for the Arts
April 2021

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