From what I have understood, when the owner signs the artist, they pay the artist, which is a business expense. Again, I may be wrong, but I heard that some labels do this;
Another reason nikkaz get shelved is because they sign artist development deals, not record deals....artist development is like the D-League for hip hop...you gotta get your name extra hot and prove to the label that you are worth the money they invest in different ways..if the artist does not deliver quality (commercial) shyt that can get hot, then they either resign another artist development contract, or they get dropped...