THE FILM PROFESSIONAL ON-LINE TRAINING SERIES – Part 1

For the past few years I have been doing live weekend workshops – sometimes in a flurry and sometimes spread out over time. The biggest hurdle is scheduling the location and time. Not just for me, but for you all as well.

DILEMMA

It’s a dilemma. Some of you want more than I have on the Agendas, some less, and some want more emphasis on related areas, etc. For example, some want the full detail of how to do Hot Cost, and some want only enough to know how to budget for Screen Actors Guild costs. I will continue to do live workshops, but it’s tough on all concerned to arrange their schedules, their travel, hotels, etc. So, my dilemma has been how to get what you want out to you all in a way that works for you and can fit into our busy schedules.

SOLUTION

So, I have decided to start doing a series of advanced online training webinars that can offer a wider variety. Some will be Live – and recorded simultaneously for you to review at your convenience. Others will be pre-recorded and made available with all of the materials. In each case I’ll keep the webinars ‘bite-sized’ so that you can zero in on the material you need to know in order to advance your career in film.

EACH RECORDED ONLINE TRAINING WEBINAR HAS ITS OWN SPECIALIZATION

One series will be general and the next series will have more details.

One series will be for those interested in Managing (i.e. Line Producers, Unit Production Managers, etc.) and the second, more detailed series, for those who want to know how to The topics that can be done.

RECORDED FOR PRIVATE UNLIMITED VIEWING AND FILE ACCESS

Note that each recorded webinar has attached to it, through an ingenious web site called Screencast.com, all of the materials used in that webinar and all files are easily downloadable – such as template budgets in Excel and MMB, Guild/Union agreements, vital links, gross payroll calculating templates, actual cost reports, template cost reports, etc.

TO START – TWO TRAINING TOPICS

(To Be Continued)

Film Accounting – Los Angeles/Toronto May/June 2012

Hello, all.

I’m back in the tour mode of delivering workshops – I also just finished fine tuning 5 on-line payroll courses. Sorry for being out of communication for a while there. I have been swamped with a big TV Series which we just closed last Friday.

The workshops are in Los Angeles on Sat/Sun May 19th and 20th, as well as Toronto on June 2nd and 3rd. I’s also looking at going back to Detroit as well as well as a first visit to Mississippi, if there’s enough interest in that area.

The workshops are on Film Accounting with a follow up series of 6 live on-line webinars – all on the topic of Managing Film Budgets and Cost Reports – something which all levels of Producers should know about. You can find out more by visiting my web site at http://www.talkfilm.biz.

As a freebie, here area couple of interesting videos about SAG and an introductory video to IATSE crew agreements for the “National Low Budget Agreement” and the “Area Standards Agreements”.  The Low Budget Agreement covers all crew agreements throughout the US and Canada for all union productions under $12Million. If you want to produce, you’ve got to be on at least a handshake agreement with this one. The Area Standards Agreement covers bigger budget shows throughout most of the land mass of America (excluding the West Coast, New York, Chicago and San Francisco).

The workshops are for those who really want to know about Film Accounting from the ground up. The webinars are for those who either want to get the tools required by any level of Producer, or are interested in being a Key Film Accountant.

The video links are:

  http://www.talkfilm.biz/Payroll/IAASINTRO/IAASINTRO.html

  http://www.talkfilm.biz/Payroll/IANLBINTRO/IANLBINTRO.html

The links to the agreements are:

http://www.talkfilm.biz/Payroll/IA-Other/Agreements/IATSEAreaStandardsAgreement2009-2012.pdf

http://www.talkfilm.biz/Payroll/IATSE/Agreements/IATSENationalLowBudgetAgreement2010-2013.pdf

Best to all / John

Presenting the Film’s Weekly Cost Report-#7 of 7

Over the last 10 years, or so, Film Director’s have slowly started to be on the weekly distribution list to receive the weekly cost report  – especially by the Major Studios (Disney, Warners, Universal, etc.). But, hey, very few film directors have a clue what to do with it. (Mind you, no one else but a chosen few ever get to see it, so why would the Director know about it?).

 

The poor director who gets a copy of the film production’s Weekly Cost Report is caught up as a character in a living ‘Dramatic Irony’ (per my dictionary that’s: ‘the irony occurring when the implications of situation, speech, etc. are understood by the audience but not by the characters in the play’.) The audience (the Studio, and to a lesser degree, the Producers and Production Accountant), feel that the Director/Department Head/etc. (the characters in the play) should know what’s going on with cost over-runs, or cost savings, but those poor characters in the play only use the cost report as a place mat for leaky coffee cups, agonizing the outraged audience.

 

Okay, so I’m being overly dramatic here, but…knowing how to read and influence the presentation of the Weekly Cost Report is a very important key to surviving, and expanding, in the film production business. It really doesn’t matter your position in the film industry, if you work in film & video production at all, you need to be familiar with the basics of how to present your costs incurred in the best light. If you gleaned one thing from the previous articles, let it be this:

 

MONEY IS VERY IMPORTANT TO THOSE WHO HOLD THE PURSE STRINGS!!!

 

All right. I promised you a bit of practice in this final article of this series. So, let’s investigate ways to ‘direct’ the costs of producing your film, regardless of your position in the film industry.

 

There are several ways to categorize the ways you can ‘Direct’ the costs. In all of them you’re looking hard at the Estimates-to-Complete. Have a look at the chart below. It’s a typical representation of the Electric Department of any Cost Report: (if your computer screen sees this chart as fuzzy, then you can either print it out – the print on the page shows very clearly – or click the attached PDF file for page 92 of my book).

 

Keep in mind that you’re looking for one of two things,

 

(i) Available ETC’s (Estimates-to-Complete) which can either be used to satisfy the Director’s creative vision more effectively, or to cover off known cost overruns in other areas, or

           

(ii) Under estimated ETC’s which when found, allows you the luxury of not being blindsided with an embarrassment but rather grants you the ability to plan an offsetting cost savings.

 

 So, how do you look at this department to see if there’s any fat in the Estimate-to-Complete?

 

As you might expect, about 25% of the production departments are some form of labor cost. Labor is usually paid the week after it’s worked (the only exception is New York city). Look at Column 3, the Actual Costs This Period. The amounts in the first 4 lines are what the crew in the Electric Department is paid for the previous week’s work. 

 

Look at the Best Boy Electric line – you can see in Col. 3 that he was paid $3,060 for his work last week. So, rounding to an easy number to work with, we can say that he will probably make $3,000 per week for the rest of the shooting period + let’s add another week for wrap (wrapping out the equipment, ensuring there are no missing rental items, etc.).

 

Now, still looking at the Best Boy’s labor line, have a look at Column 7, the Estimates-to-Complete – you can see that we have $21,930 left in ETC’s to pay for the Best Boy’s labor for the rest of the show. Again, rounding to an easy number to work with, we can say that there’s $22,000 left to pay the Best Boy.

 

Here is the simple rule that Producers and Production Managers use all of the time:

Take the rounded number in the ‘Actual This Period’ column and multiply it by the number of weeks left to shoot + 1 for wrap. Compare that number with a rounded amount of ETC.

 

In the Electric Department example above let’s say that there are 6 weeks left to shoot and one week of wrap for a total of  7 pay-weeks to go.

 

Best Boy $3,000 x 7 Pay-Wks  =   $21,000    

Compared to the ETC               =   $22,000

 

Nope. No fat there; but, at least we’re not in trouble there, either. After practicing this for a while it only takes about 20 minutes to go through all the labor accounts in a 12 page cost report, which will tell you a surprising amount. Anyone who plays cards, like bridge or whist, will tell you that this is child’s play.

 

One of the labor accounts in the Electric Department is in trouble – the projection of the labor cost is quite a bit less than the ETC. Can you tell which one? (If not, check out page 93 of my book.)

 

When projecting the labor cost in this way keep in mind two things:

 

1.It doesn’t work on accounts that have on-again-off-again labor, like Riggers, Special Effects labor, Construction labor, Stunts, etc. However, it does cover most of the crew.

 

2.Allow a little for ‘hard’ weeks and for ‘easy’ weeks. For instance, in our last example you could have said to yourself that the Best Boy had a particularly hard week last week, and reduce the amount. But, don’t get too complicated. It’s just a quick analysis tool.

 

I call this procedure ‘Projecting the Labor Cost’ rule. It’s not a new thing. Producers, UPM’s, and Department Heads use this rule every week in film & video productions everywhere. It works.

 

There are several more simple procedures to ‘direct’ the costs. They all work just as easily. I call them:

 

-Offsetting the +/- variances within the department

-Offsetting the +/- variances to the bottom line

-the Hot Cost savings or over-runs

-Projection Through to Completion

-Projected Fringes Technique

-The Missing Purchase Order

and more.

They’re available in my book – see my web site here “Walk The Talk”. All of them are simple but effective.

Visit my web site at www.talkfilm.biz. To buy my E-Book “Walk The Talk”, click here , for the full information and training on ‘Directing the Money’.

New Orleans -Production Payroll For Accts and Line Producers

Film Production Payroll – The Most In-Demand Job in Film: Saturday, May 21^st in New Orleans

Film Production Payroll has never before been open to a training program. It has been open only to those with insider’s exposure.  

Film Payroll Accountants do not do any of the complicated deductions and remittances to the unions and the IRS, nor does the Payroll Account write the paychecks – that is all the task of an outside service called an “Entertainment Payroll Service”, who also becomes the Employer-of-Record. However, before submitting the timecards to the payroll service, the Payroll Accountant must calculate all of the three producer’s sins first:

1.        Overtime
2.        Meal Penalties, and
3.        Rest Period Violations

Arriving at what is called “Gross Payroll”.

So, the Payroll Accountant must know how to calculate the “Gross Payroll” – i.e. how to calculate the Overtime, Meal Penalties and Rest Violations for each of the applicable unions. This may seem daunting at first, until you see that each union has a set of rules which can be referred to for every circumstance.

You just need some practice and someone like John Gaskin to point out the applicable rules for each Union, as follows:

-          SAG (Screen Actors Guild) for Day Performers

-          SAG for and Weekly Performers

-          DGA (Directors Guild) for the Assistant Directors and DGA Trainees

-          IATSE (International Association of Stage and Theatrical Employees) for Crew working on what is called a “Low Budget Agreement”, meaning productions less than $12Mil

-          IATSE, for the “Area Standards Agreement”, i.e. for local productions in excess of $12Mil.

-          Teamsters – i.e. the drivers on film productions.

The workshop will be held on Saturday, May 21^st in New Orleans. It counts as 8 hours of Continuing Professional Education. This one-day workshop also includes on-line courses for follow-up self-training at your own pace, with John Gaskin available for mentoring over the email lines.

The workshop is delivered by John Gaskin, a production accountant who has 25 years experience working on over 45 film and television productions of every size, in 5 different countries. John is also an engineer, an instructor, and an author of a book used in the mentoring program at the American Film Institute, the U. of S. California’s producer program, and the U. of Tampa’s producer program.

There are many testimonials on John’s home page. For more information on the “Film Production Payroll” workshop see http://www.talkfilm.biz/filmworkshops6.htm

New Orleans -Managing Film Budgets and Production Costs

My final series of workshops are coming up in New Orleans. I’ll be delivering three workshops over three days. Here’s the one for Line Producers, Emerging Producers, or just anyone who wants to learn more about managing film budgets and costs - Sunday, May 22^nd in New Orleans

The attendees will review a $9Mil budget from several angles, learning the practical methods of managing a film budget used by film producers and production accountants everywhere. From that very important step, we practice the essential steps in controlling and reporting the production costs through the Weekly Cost Report – this report is fundamental to ALL media-based productions, and is reviewed weekly by the completion guarantors, the financiers, the studios, etc. In addition you will be introduced to the 6 basic ways that you can use to control the costs before they are spent.

The workshop is delivered by John Gaskin, a production accountant who has 25 years experience working on over 45 film and television productions of every size, in 5 different countries. John is also an author of a book used in the mentoring program at AFI, the U. of S.Calif’s producer program, and the U. of Tampa’s producer program.

The workshop will be held on Sunday, May 22^nd in New Orleans. It counts as 8 hours of Continuing Professional Education.

There are many testimonials on John’s home page. For more information on the “Managing Film Budgets and Production Costs” workshop see http://www.talkfilm.biz/filmworkshops1.htm

Producers, Film Accountants, Admin – Excel Training A Must

One of the most vital tools to Production Accountants is Excel. It really is a necessity to analyzing and reporting the various elements of media based financing, budgeting and costs. So, in a recent workshop where emerging producers were predominate in the group it was a shock to see how little the group knew about spreadsheet software – a couple weren’t even sure if it was on their laptops. One of my attendees found a great free site for on-line Excel tutorials.

I pass her email on to you all:

_______________________________________________________________________________

Microsoft Excel Tutorial for Beginners #1 – Overview

Okay, here is a link to a series of fabulous tutorials on Excel by Motion in Training.  This is a guy is from England  . . . he’s a great teacher and wonderfully easy to follow.  I went through 16 of the tutorials today for beginners.  Here is the YouTube link to first tutorial:

http://www.youtube.com/watch?v=8L1OVkw2ZQ8&feature=related

Excel is a powerful spreadsheet program used in all businesses today . . . a must know!  It is a marketable skill that you will want to highlight on your resume! And believe me, as you look for a job in the arts industry . . . they will be asking for those skills. Even if you are not working in an office, you will need this for all accounting, inventory, merchandising, props lists, suppliers, expenses,  . . . . budgeting for almost anything.  In the film and television industry, you will need to know it as a production manager or assistant – whether you are on the set, or in the production office. If you are a producer, you will need to know this.

The better you are at it, and the faster you are at it, the easier your job will be and faster you will move up in the industry.

SO CHECK IT OUT!   It’s really worthwhile. 

-Virginia

Yes, Virginia, There Really Is A Film Career

On the last 2 Saturdays I delivered workshops to a Women In Film and Television in Toronto – about 20 people attended. I was blown away by most of the attendees. Their determination to get their stories told is something that I admire and learn from – especially the story that Virginia told me (yes, Virginia really is her name).

One of the women really blew me away. Virginia made a short film with relative ease – mostly because no one had told her how hard it was. She schmoozed a masted sailboat owner, talked her way through period costumes, as well as an historical fort and managed to tell a story that the schools are interested in – she’s even making money from her short.

The story is about a little known explorer, who isn’t a celebrated hero or anything, but who did some amazing things in his life. The explorer she used was Samuel Hearne – you can see his history on Wikipedia here.

When I asked her how on earth she came up with the story at all, she sent me the following narrative. I hope it gives you the same goose bumps it gave me:

“John, you might say my ancestors guided me.  It’s a story that goes back into my family history.  My great-great-great grandmother was a little girl in Fort Prince of Wales when the French attacked.  The native women and children who were left behind (partners and children of the  European fur traders) walked 150 miles to York Factory for help, but it too had been destroyed.  No one died as a result of battle, but thousands died as a consequence.Thousands of natives died that winter of starvation and small pox.  Hundreds of the Frenchmen died of cold and starvation before reaching France.  My g-grandmother survived that whole ordeal.  Her name was Margaret Norton, or “Nahoway”, as she was later called.   Hearne’s wife, Mary Norton, was likely  her her aunt or sister.  Mary Norton died on the trek.  Some years later, Nahoway married William Sinclair, a young fur trader who had been taken prisoner with Samuel Hearne.   Their prolific family became one of the most important Metis families in Manitoba history.”

“The HEARNE story deserves to be a huge epic production, . . . big budget for sure.  So I think I would be wise to work on  some lower budget films first.  I will try to put something together in a budget.”

I will definitely be staying in touch with her. You can see her YouTube clip here (note: her husband is a musician and she and her husband composed the music herself).

Best / John

Film Payroll Workshops – Video Of How It Works

Here’s a quick video on how the Payroll Workshops are set-up and the general procedure. As you can see there’s lots of practice geared toward actual references to the relevant Agreement.

Independent Film Studios – Cost Managing

A young man working for a well established independent film studio, and recently promoted from an assistant, asked me a question about cost managing. The studio produces live action. He wanted to know what kinds of costing was involved and how often the reports were prepared. Here’s what I emailed to him in response:

___________________________________________________________________________

Cost managing is a pretty broad topic. Working within a film studio like
yours would probably be a mix of:

-Monthly/Quarterly costing within the usual operating expenses of the
company (rent, payroll, overheads of the office, etc.)

-Monthly costing of the projects in development (the writing fees, trips
to Cannes, meetings with ATL personnel, etc.)

-Quarterly/Annually writing off any "abandoned" projects (some projects
just never get off the ground after shopping around, so the costs that
were allocated to that project are written off as an expense)

-Monthly/Quarterly allocating costs from the operating account to
development projects, or to projects already in, or completed, production (sometimes
it's wise to invoice "Management Fees", or assignable costs, from the
operating company directly to projects that are making money - it's a
legal way to reduce the net income of successful projects).

-Monthly/Quarterly review of the distribution and licensing revenues by
source. (This is a tricky business to manage, as so much is dependent on
legal clauses within each agreement where each distributor/licensee has a
different territory, viewing category, demand, rate-per-view, amounts
taken off the top for Guilds, etc.)

-and, for actual live-action production there would be Weekly costing
against the approved film budget and cash flow for each film production
project (a matter of comparing the Cost Report to the Approved Budget and
Shooting Schedule, and the Cashflow Schedule created in prep with the
actual demand for cash during the film production).

I have worked in an independent studio before (but not as well established
as yours) so I have a good idea of what general controls you should be
looking for in production managing of a live-action film production and
I have workshops for those;
however, I don't have any particular workshop for the other types of cost
managing. I do cover, briefly, the inter-relationship between the
Independent Studio and the sole purpose company used to produce the film
production. Most of the time in my workshops is related to the production
side of things, rather than the Studio viewpoint.

So, if you're mostly interested in the costing from a studio point of view
of film productions, you would definitely benefit greatly from either, or
both, of:

-Managing Film Budgets and Cost Reports,
-Film Accounting & Auditing for Professionals

I hope that helps.

Best regards,
John

MovieScope – Directing The Money

Directing the Money

Production accountant John Gaskin relates the skills and experience required to manage the business and creative aspects of film production.

There is skill, creativity and good old blood ‘n’ guts involved with directing the money in film production, with reputations at stake and careers on the line for more than just the  producers and directors. Even in

"Devil"

this turbulent financial climate, we still hear of budgets raging wildly out of control. Ever been curious as to how that could happen, or how to prevent it? Who’s watching the shop? Well, (gulp)… I am. The production accountant/auditor.Money is a hot topic anywhere, but especially so when addressing a creative and business collaboration.

Accounting bores the creatives, and their financial blind spots annoy the business executives. So, how do we get the two sides of the trench  cooperating?

There are a few tried-and-true accounting techniques which compare the actual shooting process with the schedule and film budget. This entails a rapid-fire cataloging of the costs, which include labour, expenses and overheads committed and paid. Then there are detailed procedures of categorizing actual costs by labour/equipment/overheads and measuring them, line-by-line, with the approved budget. All of us film production accountants know these daily and weekly techniques and we dutifully ply our trade to inform our  producers and financiers of what’s happening. Nobody shout Eureka. Chaos still occurs.

Let’s examine two factors senior to the details: Headology and Directing the Money.

Headology is a term that was created by one of Sir Terry Pratchett’s Discworld characters, Granny Weatherwax. For the uninitiated, headology is basically using words and thoughts to get people to do what you want, without any spells or potions. In our case, I’m using the term to represent the ways and means used to generate the creative spirit and collaboration that is right for a film project. In filmmaking, those who know headology recognize the value of directing the money, and do it intuitively.

For those of you who have experienced one or more facets of successful filmmaking, you will always see at least one individual who is a master of headology. My best examples of its application are the two features that I did with director Ron Howard; they were hands down two of the most enjoyable productions I’ve worked on, and it was indisputably because of Ron’s skills in getting cast and crew to do what was necessary.

Directing the Money:

In filmmaking, nothing happens without a corresponding effect on the film budget. Here is an interesting maxim: without knowing what is right or needed, and just following a set of rules to direct the money, headology inadvertently falls into place. As a corollary,  anybody who knows headology is aware that, to some degree, performance is measured by your skill in directing the money.

My best example of successful directing of money is Disney; their longtime VP of finance has been doing so with an iron fist for over three decades. I cringed and debated under those rules, but ultimately bought into them, as their worth became very apparent with use over five or six feature film productions.

In my experience on 45 film and television projects spread over 25 years and 5 countries, I can say that the times I was in trouble with unapproved cost overruns were when the top end (defined as one or more studio executives, financier, producer or director) were without skill in headology nor directing the money, period.

I won’t be so superior as to instruct you on the nuances of headology, however, I can say with confidence that a study of the way Ron Howard runs his set, and how he has a strong interest in the budget, will carry you a long way down that path. I have observed several successful headology actions which I can share with you; how you bring those into your arsenal is something for you to ponder.

I previously said that by following the techniques of directing the money, headology would inadvertently fall into place. Now I’m entering a field that I’m qualified to  expound on, but, as promised, I won’t get into the details of hot costs, day costs, worked hours and pay hours, etc. Just ask the film accountant for the cost of an average day of shooting and for the labour cost of each consecutive hour of overtime. With a little practice you can use those two factors alone to direct a large part of the money.

Assuming that you are, or have ambitions to be, a director, producer, line producer, film production accountant or unit production manager, here are the characteristics and attitudes that I have observed of those who repeatedly avoid financial pitfalls during the production of a feature film:

Headology

1: If the decision that you’re about to make doesn’t feel right, it isn’t. Don’t try to convince yourself.

2: Demand that department heads take responsibility for their departmental budgets. Making decisions for them is counter-productive.

3: Always acknowledge a person’s existence. It creates positive energy.

4: Defuse messed-up situations by stating the truth exactly, then get on with it.

5: Respect the financiers who have placed their trust in you.

Directing the Money

1: Know the terms within sections, categories and line items of your budget, e.g., below the line, camera department, camera rentals respectively.

2: Clearly state your right to apply the savings you create through efficiencies against those costs not budgeted, e.g. work the crew fewer hours than budgeted, then use the savings for a crane shot that was not budgeted.

3: Insist on being informed of the number of worked hours in the budget and keep score, e.g., the number of worked hours budgeted for the grips and electrics.

4: Insist on having access to the film accountant. A director may want to have a producer accompanying him/her.

5: Ask the film accountant for a printout of the day cost, i.e., cost of an average day of production. Review it and clear any terms and rates with him/her.

6: Habitually direct your creative concepts towards a parallel concept of directing the money available per the approved budget.

7: Ask for a copy of the film production’s weekly cost report. This is the report sent to all the financiers, studio execs, bonding company, etc. Read any narrative on the covering memo to prepare for any potential explanations demanded of you in your capacity.

John Gaskin

John Gaskin has worked as a production accountant on over 40 projects, including Devil ( top). He is a film production auditor of 25 years experience, and is the instructor of film workshops and live online training webinars. John is also author of Walk the Talk, a book used by non-accountants to understand how to ‘direct the money’ in film production.

To learn more, visit John’s website at www.talkfilm.biz or email him at

johngaskin@talkfilm.biz

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