3 Terms Every Artist in Accounting Should Know
These terms are essential for artist accounting
Chart of Accounts
It is important that your organization’s money moves are informed and precise. In coordination with your Budget and Financial Reports, a consistent Chart of Accounts (CoA) is useful for making accurate financial comparisons from year to year. It’s an organized and detailed list of accounts generated in spreadsheets or accounting software.
Cash Basis Accounting vs. Accrual Basis Accounting
These two principal accounting methods can be confusing at first. It really just comes down to when the expense or revenue is recorded. Using Accrual Basis Accounting is generally standard practice. However, depending on the size of your organization, Cash Basis Accounting may be the more appropriate method.
Fiscal Sponsorship for artistic entities originally cropped up as a way for artistic entities to seamlessly transition into 501(c)3 incorporation. Artists now consider Fiscal Sponsorship to be a viable and sustainable business model on its own. It is a great way to take advantage of opportunities usually only available to nonprofit organizations.
Learn more accounting terms by searching ‘What is’ in the nextSteps search bar
For more information, reach out to us on LIVE CHAT and we can walk you through how these terms apply to your specific circumstance.
To learn about Fiscal Sponsorship available in NYC, check out our full list here.
Pentacle remains dedicated to continuing to provide a high level of support to artists during these extraordinary circumstances. Alongside many other key and respected organizations in the field, we have begun accumulating and curating resources for artists and organizations experiencing income loss and other troubles as a result of the COVID-19 crisis. Find our list of resources here.
NEXTSTEPS | 08.13.2021
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