Accounting for artists

accounting1As an artist you are a business. Besides giving amazing concerts and making the best music there’s also a necessary evil called accounting. Maybe not the sexiest way to spend your time, but we promise: you will pick the fruits.

What is accounting?

Accounting is about keeping track of your money: how much is coming in and how much is going out. The books you keep must show:

1.    Income - all the money that comes into the band (gigs, sponsoring, merchandise sales, …)
2.    Expenditure - all the money that is spent by the band (bank charges, catering, transport, …)
3.    Balance - the money that is left over at the end of each month

Why should I be keeping records?

Every captain knows where his ship is going. Keeping records of incomes and expenses will give you valuable insight in your career. Are you making a profit yet? What are your biggest expenses? Was that investment in that keyboard a good idea?

Next to that the number 1 reason for band split-ups is a disagreement on money. You simply don’t want to take that risk, so avoid it by having a transparant financial system.

A third reason is taxes. Especially when you have a registered company you need a paper trail of your finances. Most of the expenses are tax-deductible and will assist you in complying with the law.

The finance man

Which band member is reliable good with numbers? Appoint him as the finance man or woman. He will monitor the earnings and costs of the band. He’s the one that makes sure everyone gets paid and the one that will ring the alarm bell in time.

Earning money as a group

1000 Rand rolls in after a gig. Your band has 5 members. Easy, every band member gets RAND 200. No, don’t be mistaken! The money you earn as a bandaccounting4 belongs to the group as a whole. It’s this money that you will be using to fund all the other activities that you undertake as a band, such as petrol for shows, making merchandise, going on tour, recording, …

If besides these costs there is still some money left, off course you can decide that every band member gets a share. Just make sure you have a clear agreement on this matter. How much of the profit will be divided between the artists and how much stays in the jar?

The band bank account

The best way to keep all the band money separate is to bank it. An own bank account provides a clear and trackable record of all your finances. Promotors and venues can pay you easily with electronic transfers and it’s easier for the band to pay for things using the same method.

If you’re not registered as a company, your best option is to open an account in the name of the finance person whose job it is to look after the money.

Keep the slips

Keep every single slip that relates to purchases made by the band, be it for petrol, food or equipment. As you start to pay your expenses or have any income invoices, just hole punch them and put them in the ringbinder.

If you have lots of little receipts, some people like to staple them to a piece of paper and others like to keep them in envelopes and mark the month that it was incurred.

Tools to make it easier

You’re lucky, you live in the 21st century! The internet is bursting of software and tools to make your life easier, also when it comes to accounting.

Try artright business tool. This free excel-file is simple to use and will help you better understand your financial position.

 

CONTACT US

PostNet Suite #5
Private Bag X04
Dalbridge 4014

Tel   031 7111 524
Cel   073 678 1901 or 072 3090550
Email info@onexusonline.com

© Onexus 2013
Designed and developed by Creative Lead