Accounting for Artists
By Amanda Kriaski
This workshop aims to provide you, the artist, with simple bookkeeping practices to keep track of the
financial side of your artistic practice.
What we will cover:
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Useful accounting terminology.
How to use a basic accounting spreadsheet.
Bookkeeping tips and tricks.
Budgeting and how to use a basic budget spreadsheet.
Handy resources.
Some useful terminology:
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Accounting – the process of identifying, recording, and communicating the economic events of a
business to interested users of the information
Bookkeeping – recording financial transactions
Revenues/ income –economic resources that result from the operating activities of a business,
such as the sale of a product or provision of a service OR cash coming into your practice
Disbursements/ expenses – the cost of assets consumed or services used in ordinary ongoing
operations to generate revenue OR cash going out of your practice
Profit – when revenues exceed expenses
Loss – when expenses exceed revenues
Depreciation – the process of allocating the cost of a depreciable asset over its useful life.
Known as Capital Cost Allowance (CCA) by the Canada Revenue Agency
*Some definitions taken from Financial Accounting by Kimmel, Weygandt, Kieso, Trenholm, Fourth Canadian Edition
The accounting spreadsheet:
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The spreadsheet provides a way to keep track of all revenues and expenses (money in and
money out)
You can immediately see how much money you have available (if it’s up to date!)
It sorts revenues and expenses into useful categories
- You can easily see how much is spent on each type of expense
- It can help you determine whether you are pricing your work fairly.
- Preparing taxes will be simpler.
You can easily reconcile the spreadsheet with your bank statements.
Tips and tricks:
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Remember, you are a business, so conduct yourself in a businesslike manner! Keep accurate
records of your activities, revenues, expenses.
Stay up to date! Try and input all of your transactions once a month.
Open a separate bank account and use a separate credit card.
Keep a cheque log.
It is good business practice to use a daytimer to record your mileage (where you went, when,
why, who you met with), travel (where, why, when), meals and entertainment (who you met
with, why, write on receipt as well).
Maintain a filing system – keep everything in one place!
GST – you must register for a number if you have more than $30,000 in sales in any twelve
month period.
Budgets and budgeting:
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Budgets allow you to plan ahead to help you meet your targets and goals.
They help you anticipate revenues and expenses and how they will affect the total picture.
Be realistic when preparing a budget – it is not useful if you are not being reasonable.
You can use the budget to track your progress throughout the year by changing the budgeted
amounts to actual amounts once the month is over.
Resources
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Accounting
- Information for Artists: A Practical Guide for Visual Artists, book published by
CARFAC Ontario
Business:
- www.iheartmydreamjob.com
- The Studio Handbook for Working Artists by Ted Godwin
- Craft Inc. by Meg mateo Ilasco
Taxation:
- Visual Arts Alberta has a link on their website with details on taxation:
http://visualartsalberta.com/professional-development-2/taxation-for-artistsworkshop-notes/
- Elephant Artist relief Society runs tax workshops during tax season.
- Canada Revenue Agency Interpretation bulletin IT-504R2 Visual Artists and Writers
- Canada Revenue Agency Guide for form T2125 Statement of Business Activities:
http://www.cra-arc.gc.ca/E/pub/tg/t4002/README.html