How do I account for events that make a surplus / loss or that are subsidised?

This article explains how you can use the Projects functionality in ExpensePlus to account for events that generate the funds needed to cover their costs (for example, a youth weekend away), and keep track of their balance over time.

It also explains how to cross-charge expenditure (for example, to subsidise the event from General funds, or where some of the expenditure is to be covered by other parts of your organisation); and how to zero-out the surplus (or loss) once the event has finished.

How to account for self-funding events

Some activities or events operated by your charity or church may generate the funds needed to cover their costs. They may even generate a profit - for example, a youth weekend away costing £2,000, with 25 attendees each paying £100, will generate a £500 profit.

For each event, you should ensure it has at least one income category and one expenditure category. (You can have more income and expenditure categories if you wish.)

You can then link the categories together as a Project, and use the Projects report to view and drill into the income and expenditure, and view the project balance at any given time.

Within the Projects settings screen, you can click on the project to manage linked Project categories and assign user access 'per project' to the project report, so the person leading the project can find all the information they need in one place.

The Projects functionality removes the need to set up a separate fund for each event you run. Typically, the categories of your projects would either be within your General Fund or a specific segregated 'Projects and Events fund'.

If you are using the general fund, we recommend you create an Income category group called 'Events' and an expenditure category group called 'Events' where you list any categories associated with the specific events.

Some organisations operate a segregated and unrestricted 'Projects and Events' fund (purely for self-funding events), in which all event-specific categories are kept, to exclude them from the General Fund Income and Expenditure report.

How to record a subsidy or cross-charge expenditure

Where you wish to subsidise an event, for example with money from your general fund, typically this is done via a transfer between categories. You can do this in one of two ways - both methods have the same effect on the Project balance.

Method 1:

You can use an Income Category Transfer to reduce the level of income from one category and instead apply it to another income category. In the example below, we are subsidising the Weekend Away Event with income from the general Youth Events category. You will see the subsidy reflected in the Project report below.

Method 2 (recommended):

You can accomplish the same net effect by using an Expenditure Category Transfer. In the same example, you would leave the income for youth events with 'youth events' and instead reduce your expenditure on the weekend away by subsidising it from general youth expenditure.

The effect on the Project balance (shown in the report screenshot below) will be the same, but you will have intentionally decided to account for the change as an increase in youth expenditure, as opposed to a decrease in youth income. This is arguably the preferred method as it maintains greater transparency.

How to cross-charge expenditure

Similarly, you may wish to cross-charge expenditure to another category. In the previous example, this might be where employed staff members are also attending the youth event, and your organisation will cover the cost for these people (for example, from your training budget). This can be done via an Expenditure Category Transfer.

Closing the event with a zero balance

If an event is recurring, you may wish to carry over any surplus to the next event. Typically, however, at the end of each financial year, you would zero-out the surplus or loss to or from your general fund.

You can do this using the 'category transfers' option within the Adjustments screen, as above.

If the project has a shortfall, follow the subsidy guidance above.

If you have a surplus (positive balance) to transfer, you can complete an income category transfer to account for the surplus within another category - for example, 'General Income: Income (other)'.

Any projects you no longer need can be deactivated within the Project Settings screen.

To help you better understand the Adjustments module as a whole, please visit the module overview page here.