CCEP Budget Management 5

Question 1

A non-profit event planner must ensure the event budget complies with IRS rules on unrelated business income. What is the primary concern?

Accepted Answer

Ensuring event revenue from non-mission activities does not jeopardize tax-exempt status

Answer

Non-profit organizations must monitor unrelated business income (UBIT) because excessive revenue from non-mission activities can threaten tax-exempt status.

Question 2

What is the purpose of establishing a 'budget freeze' policy during the final weeks before an event?

Accepted Answer

To prevent unauthorized expenditures that could disrupt the financial plan

Answer

A budget freeze restricts new spending commitments close to the event date, ensuring the financial plan remains intact during the high-pressure execution phase.

Question 3

Which tool BEST helps a planner visualize cumulative cash outflows against the event timeline?

Accepted Answer

Cash flow projection or S-curve analysis

Answer

A cash flow projection or S-curve chart maps when money leaves the organization relative to the event timeline, helping planners manage liquidity.

Question 4

An event's final reconciliation shows actual costs 8% below budget. What should a planner do with unexpended funds?

Accepted Answer

Return them to the general fund or apply them per organizational policy and document the variance

Answer

Unexpended budget funds must be handled according to organizational policy—typically returned to the general fund—and all variances must be documented for financial transparency.

Question 5

A planner is evaluating whether to outsource event registration management or handle it in-house. This is called:

Accepted Answer

Make-or-buy analysis

Answer

Make-or-buy analysis compares the total cost of performing a function internally versus outsourcing it to an external vendor.

(CCEP) Certified Conference and Events Professional Practice Test

(CCEP) Certified Conference and Events Professional Practice Test

CCEP Budget Management 5