Film Production Accounting

This post has been well received ever since I first posted it in 2009. I’m updating now to bring it up to 2014 standards.

There is a professional accounting niche that is little known – Film Production Accounting. I regularly receive queries to my web site, or my blog, about film production accounting and of how to enter this field. Most of the queries used to be from the Los Angeles area, but over the past 4 years there has been an equal number of queries from the Film Tax Incentive States.

FILM PRODUCTION ACCOUNTANT CATEGORIES AND EXPECTED PAY

Production accountants have traditionally fallen into the field without much of any kind of accounting background. I believe that film production is the last industry in the world to hire accountants who don’t have some kind of formal training in accounting. Currently, the field of film accounting is looking more appealing to a wide variety of CPA’s who are looking for something more markets to penetrate – or even to change careers. Most film accountants get into that position through a period of apprenticeship as assistant accountants. The levels usually go from File Clerk, 2nd Assistant Accountant, 1st Assistant Accountant to Key Production Accountant (sometimes referred to as the Production Auditor). Another position that is classified as an assistant accountant is the Payroll Accountant. The Payroll accountant is an expert in calculating complicated union payroll time sheets and is usually too busy to do much else than just that one function. A good payroll accountant can make in the area of $1800 to $2,000/week on the bigger Hollywood productions and are worth every cent.

The File Clerk would start in the range of $500-$900/Week, a 2nd Asst Accountant in the $900 – $1400/Week range, a 1st Assistant Accountant in the range of $1,500 to $2,300/Wk.  usually the accountants get a little more on a big Studio production, and less on a small independent production.

THE SKILLS OF A FILM PRODUCTION ACCOUNTANT

The Film Production Accountant needs to be conversant with every area of film production, if not downright expert when it comes to predicting cost overruns. The rapidity of spending during the production of the feature film, or TV show, is so high that it would be a nightmare for someone who hasn’t been exposed to the usual reporting system. That’s why an experienced Film Production Accountant doesn’t get out of bed for less than $2,500 a week (a 5 day week). Experienced production accountants demand and get at least $3,500/5 day week, and if they go on location ask for another $1,000 to cover off Saturdays worked (even though they don’t need to work many Saturdays).

The Film Production Accountant’s job falls into the same three categories as any other accounting function:

– Bookkeeping: the speed of bookkeeping has to be experienced to understand. Petty Cash is often in the $60,000 to $80,000 a week range.

-Reporting: there are very specific Budgeting and Weekly Cost Report formats which can be a bit of an IQ test until you get used to it. This type of report is used throughout the film production world from Australia to India to Europe to North America.

-Auditing: because the money appears to be spent so helter-skelter it can be abused, mostly by producers and department heads. It’s up to the production accountant to see the signals and prevent it before someone embarrasses themselves. There really are lists kept of those deemed to be A, B or C listed. Those that are B and C listed are almost always because of their inability to control their departmental budgets.

So, if you have an accounting background you can pick it up very quickly, but you really do need some experience first. The fact that you’re intimately dealing with so many facets of the actual film production it’s certainly a challenge and, I have to say after 30 years, tons more challenging and rewarding than working in manufacturing, banking, etc.

MY JOURNEY TO, AND IN, FILM PRODUCTION ACCOUNTING

My own background started out in Engineering in the 70’s. Then, when I graduated I saw that open pit mining wasn’t doing it for me, so I started working with an accounting firm to earn a designation. My original purpose was to become skilled enough to be able to use both Engineering and Accounting to help failing businesses turn around. However, after I got my accounting designation I discovered that I would be taking a steep cut in pay to go back to being a junior engineer so I took a job as a Chief Accountant/Controller at a place with about 15 branches. After 5 years I went out on my own, starting a small accounting practice with a couple of other people. After a couple of years of beating the bushes and working 7 days a week I saw that I could make more money as a Film Production Accountant than I could in my practice, so I dropped my office space, my 2 staff, and started working as an assistant accountant.

STEPPING STONE TO FILM PRODUCING AND PRODUCTION MANAGING

Like other industries, after spending many years accounting for and auditing the money, including advising producers and production managers, you start to get the idea that you can do as good as, or better job, at producing. There are many production accountants who have gone on to related film production careers – although, funnily enough, they often keep quiet about it. I presume because they want to distance themselves from the infamous “Blue Suit” – the much maligned Big Studio Exec. (Not a job for me – man, talk about pressure).

THE DOWNSIDE

A downside to Production Accounting is that you don’t ever have a JOB. You get CONTRACTS which last anywhere from 5 weeks to 9 months (pretty seldom longer than that). I’d say that my average contract on a film or TV production in the $20Mil to $40Mil range was about 6 or 7 months. Honestly, I really liked the fact of working with different people. I have often talked with other people in the biz, and we almost all agree that the independence that brings is worth the stress of looking for contracts. Once you’ve been in the business for 3 years, and if you haven’t messed up, you’ll be on call, especially if you’re willing to travel.

So, there’s the pros and cons to getting into the film production industry as an accountant.

HOW TO BUST IN

I spend some time talking about ways to bust in during the weekend workshop. With the advent of tighter and tighter money I see even more opportunities for film accountants as aides to producers, or even film accountants producing projects on their own. Subjects like Film Tax Incentives, verification of paperwork required during Crowdfunding of “Accredited Investors”, cash-flow schedules, familiarity with equity terms, etc can all be easily learned by film accountants, or by professional accountants and bookkeepers interested in penetrating this market. (If you are interested in how this all fits together see this short video).

Good luck in your career, whatever you choose.

For more about training as a film accountant see this link to film accounting workshops and training online.

John Gaskin

Daily Hot Costs – Becoming a “Key” Film Production Accountant

In my last blog I identified 4 barriers to becoming a “Key” Film Production Accountant:

1. Film and TV Budgeting

2. Film and TV Union and Guild Payroll Knowledge

3. Hot Costs

4. Cost Reports

In this blog I will address the barrier of Hot Costs.

WHAT IS THE DAILY HOT COST?

The Daily Hot Cost compares the actual costs of the previous day’s shooting with the budgeted costs for a generic day of shooting. It measures the costs of the on-set shooting crew, cast, footage/processing and catering. I also like to add into the Hot Cost that non-labor costs I know are over-budget, like construction costs, equipment rentals, etc. that may be over-budget.

HISTORY

Hot Costs first started in the early to mid 90’s. It was a quick estimation done manually on the back of the penciled copy of the DPR (Daily Production Report). The departmental costs were averaged out with only a regard for +/- 10% accuracy. Not more than 1/2 hour was taken on it. Within a few years a couple of the Majors insisted on a higher degree of precision. Now it’s often used as a Daily “Cost Report”, even though that’s not it’s original purpose. So, it takes up at least 2 or 3 hours of the Production Accountant’s time each day.

THE FORMAT OF A HOT COST

The Major Studios have one-page Hot Cost templates, where the format is very similar from one to the other. Some Indies use a different looking template, which I generally call the “Indie Template”. Most Production Accountants create Excel schedules to feed to these one-page templates, saving a ton of time trying to get accurate labor costs manually. Even though the Studio Execs, and Indie Bonding Companies, only want to see the one-page Hot Cost, it behooves the production accountant to have schedules of the calculations to support any challenges.

PROBLEM #1 – KNOWING WHAT A PROFESSIONAL HOT COST TEMPLATE LOOKS LIKE

I solve this for you by providing you with a couple of templates common in the film and television industry. I call one the “Majors Template”, and the other the “Indies Template”. The templates automate the calculation of all labor costs based on the Daily Production Report (PR), and this estimated labor cost is compared to the budgeted costs, for:

  • every crew member on the floor,
  • every fixed category of Transpo who worked,
  • every cast member who worked that day,
  • every line-item in the budget classified as “ManDays” (an example, a slug line in the budget saying “allow” 25 man-days without much thought put to it),
  • Background Extras and Stand-In’s

The variance between the estimated cost, and the budgeted cost, is then summarized by department on the On-Page Hot Cost.

PROBLEM #2 – KNOWING THE UNION/GUILD PAYROLL RULES FOR CAST & CREW

If you don’t have a background in Film and Television Payroll, you will need to learn how to manage Overtime, Meal Penalties and Rest Penalties for the cast and crew. It may seem a daunting task to find the Agreements needed, then to find the applicable rules within the Agreements; however, it doesn’t need to be a barrier. I will address this in more detail on my next week’s blog

PROBLEM #3 – KNOWING HOW TO WRITE EXCEL FORMULAS

You do not need to be a genius with Excel, but you do need to know how to write “IF Statements” and “VLOOKUP Statements”. I’ve gone through this with some First Assistant’s who have gone on to be “Keys”, and in every case it was easier than it originally looked to them.

FILM ACCOUNTING 101 WORKSHOP

In the Film Accounting Workshop you will see how I use the Hot Cost in preparing the Weekly Cost Report. I can provide you with Templates at that time.

See http://www.filmaccounting.com to find out more about the Film Accounting Workshop coming up soon in Los Angeles.

In the mean time, have a look at this YouTube Video that I made about the online Hot Cost Course that I have:

Hot Costs

Hot Cost Course

Hot Costs in Film Production

Cheers / John

Film Budgeting – Becoming a “Key” Film Production Accountant

In my last blog I identified 4 barriers to becoming a “Key” Film Production Accountant:

1. Film and TV Budgeting

2. Film and TV Union and Guild Payroll Knowledge

3. Hot Costs

4. Cost Reports

In this blog I will address the barrier of Film and TV Budgeting.

FILM BUDGETING – INDUSTRY STANDARDS

On film and television productions it is normally the responsibility of the Film Production Accountant to prepare the budget in collaboration with the Producers and Financiers. It is expected that the Film Production Accountant knows the usual industry standards, as well as being familiar with the Film Budgeting software. Some questions that I have when reviewing a budget are:

  • Are the headings in the expected format for a professional film budget?
  • Who is it addressed to?
  • Are the union rules applied consistent with the geographic area?
  • Has the local Tax Incentive Credit been addressed within the budget?
  • Does the Production Budget include the Completion Guarantor’s fee?
  • Are the number of days worked consistent with the Shooting Schedule?
  • How many hours of work per day is budgeted for?
  • Is it a standard to allow for contingencies?
  • Are the terms used for positions, tasks, benefits, etc, the same as the Industry Standard terms?
  • etc

FILM BUDGETING – KNOWLEDGE OF UNION & GUILD PAYROLL RULES AND “FRINGES”

The “Key” Film Production Accountant must have a very good working knowledge of of those rules, both to be able to budget and to be able to prepare Hot Costs (that is, comparing the actual labor costs with the budgeted labor costs on a day-by-day basis). I will spend some time on my next blog going over the four major categories of union and guild payroll.

FILM BUDGETING SOFTWARE

When I prepare a budget I almost always start from an earlier budget that I have from previous features or television series. Then I massage it to suit the current shooting schedule/script. That saves an extraordinary amount of time verifying rates for local crew, equipment and sound stages. Once you have done your homework digging out the local rates, then it’s a matter of having a fluid familiarity with the film budgeting software of your choice. Below are 4 of the more common budgeting software that I have been exposed to.

  1. Movie Magic Budgeting: This has become the most popular film and television production budgeting program. It has a look and feel of late early-days database management software; however, many producers, and studios, have learned it over the years, and because of that, it will very likely remain the industry standard in the near future. There are some very good training videos at this link which are helpful. I have delivered many weekend workshops and am available to deliver more on demand.
  2. Showbiz Budgeting: This is very useful for Reality Shows, smaller Indie productions, commercials, etc. It has a full rundown here.
  3. Gorilla Film Budgeting: This is a definite grade up from MMB. There is a comparison between the two budgets on their site. Have a look.
  4. Excel: Good old Excel is still a way to go for most low budget Indie Productions. Actually, it is still used by many bigger productions in Europe. I have a couple of templates that I give away free in my workshops.

Once you get over the what to include in a Film/TV Budget, it’s really a matter of knowing which buttons to push in your Film Budgeting Software. Practice, some guidance, followed up with some experience., is the only way to get over this barrier. You CAN do it by yourself; but, it’s difficult.

We don’t address MMB in the Film Accounting 101 Workshop, but we do thoroughly review a 72 page professional Indie film budget, along with practicing how the accounting functions of a standard film production accounting software relate to the “locked” film budget.

FILM ACCOUNTING 101

If you’re interested in getting started in Film Production Accounting, or just getting some Continuing Professional Education, see www.filmaccounting.com for my next workshop coming up in Los Angeles.

 

Cheers / John

 

___________________________________________________________________________

 

John has worked since 1985 on over 56 different film and television productions, spanning 6 different countries. He has written a book, “Walk The Talk” which is used in some universities. Since 2009, John has delivered numerous workshops in several cities throughout North America, including Los Angeles, New York, Detroit, Atlanta, Toronto, Montreal, Winnipeg, Tampa bay and Orlando. For more information, visit www.filmaccounting.com

Becoming A “Key” Film Production Accountant

How do you get hired as a qualified Film Production Accountant?

THE FILM PRODUCTION ACCOUNTANT

The Film Production Accountant is the person in charge of gauging and reporting the financial condition of the film or television production on a daily and weekly basis. When you read, or hear about, productions going over budget, it’s the film production accountant ‘who blew the whistle’. The position is earned through experience with earnings normally well in excess of $125,000/year.

COLLEGE EDUCATION

No amount college education can contribute towards attaining a career in Film and TV film production accounting. Nor does it help if you have an education in accounting. It’s earned through a series of hands-on experience through the junior levels of File Clerk, 2nd Assistant Accountant, Payroll Accountant, 1st Assistant Accountant and finally, the “Key” Film Accountant. The experience gained at each level brings about a natural progression of promotion from File Clerk to 1st Assistant; however; it’s much more difficult to jump from a 1st Assistant to a Key Film Accountant.

THE CATCH 22 SYNDROME

The 1st Assistant is extremely busy running the accounting functions of the department and can seldom find the time to learn from the Film Accountant; and, conversely, the Film Accountant is far too busy with the budget, and with the subsequent projection of costs as compared to the approved budget, to spend time training the 1st Assistant accountant.

THE 4 MISSING AREAS OF EXPERIENCE

Having trained a few 1st Assistants to become successful Key Film Production Accountants I can say with certainty that the missing areas of experience are:

  1. Film and TV Budgeting: Not only is there a gap in understanding the process of budgeting, there is also the lack of experience in using the most popular budgeting software in the ‘biz, “Movie Magic Budgeting”. In the case of budgeting for episodic television, the Film Accountant needs to understand the relationship among the locked Pattern Budget, the locked Amort(ization) Budget and the Episodic Budgets.
  2. Film and TV Payroll: In order for the Film Accountant to be able to budget for, and to estimate, costs, the Film Accountant must have a very good grounding in film and television payroll. That would entail a good working knowledge of SAG, DGA, IATSE (crew) and Teamsters (drivers). The level of skill does not need to approach the level of a good Payroll Accountant, but the Film Accountant must be conversant with the various Agreements and know the rules for Overtime, Rest Invasion and Meal Penalties.
  3. Hot Costs: The Hot Cost report is prepared by the Key Film Accountant every morning. It is an estimate of the payroll (and other) costs as compared to the budgeted costs on a line-by-line basis. Each Film Accountant has their own Excel spreadsheet which they have programmed themselves, to get through this task efficiently. (Occasionally, the Payroll Accountant does this task for them, but it is considered inefficient to do it that way). This is one of the toughest areas for the 1st Assistant Accountant to get some exposure to.
  4. Cost Reports: The preparation and the reporting of costs is completed in a very specific way throughout the Industry. The report has the practical name of The Cost Report. It is the financial report card of the production and is distributed to all of the financiers and producers. Again, there aren’t many opportunities for the 1st to learn the routines and processes of cost reporting.

TRAINING FOR EACH OF THESE AREAS

I have delivered workshops for each of these areas over the past several years. I will be writing blogs over the next few weeks expanding on each of these 4 elements.

FILM ACCOUNTING 101

If you’re interested in getting started in Film Production Accounting, or just getting some Continuing Professional Education, see www.filmaccounting.com for my next workshop coming up in Los Angeles.

 

Cheers / John

 

___________________________________________________________________________

 

John has worked since 1985 on over 56 different film and television productions, spanning 6 different countries. He has written a book, “Walk The Talk” which is used in some universities. Since 2009, John has delivered numerous workshops in several cities throughout North America, including Los Angeles, New York, Detroit, Atlanta, Toronto, Montreal, Winnipeg, Tampa bay and Orlando. For more information, visit www.filmaccounting.com

The Purpose and Product of Film Accounting

(NY CPE Licensed Sponsor – CPE 14 Hrs)

PURPOSE and PRODUCT of FILM ACCOUNTING

The Purpose of Film Accounting is to help the producers create the best feature film, or television series, that is possible for the money invested. This would be considered by some to be the “Overall Goal”.

The Product of Film Accounting is the “Weekly Production Cost Report” – the financial report card, letting the producers, and investors, know if we are progressing on time and on budget.

REPORTING TO FILM & TV PRODUCERS AND INVESTORS

Whenever you have multiple creative people planning and spending their budgets through short periods of time, there are bound to be tempers flaring and cross currents happening among powerful leaders in the industry. All through that chaos and flared tempers, the Film Accounting Team must predict and report succinctly the financial status to the producers & investors.

CAREER AS A FILM PRODUCTION ACCOUNTANT

Film Production Accounting is the last accounting career of stature, earning very good income, where a CPA Is not a prerequisite. The career usually starts at the bottom of the Accounting Department, where you work your way up through 3 levels to being the “Key” Film Production Accountant. The keener you are, the faster you rise through the levels.

HOW TO GET IN THE INDUSTRY

Get some experience and familiarity with the tools of the trade. Where do you find out about work? What are the skill sets required? Is there a specific general ledger software you need to know more about? All of these questions are answered and practiced in my Film Accounting 101 workshop in NYC, September 15th and 16th, 2018. Come join us in the heart of Times Square at 1441 Broadway Ave for a weekend of learning and sharing.

ABOUT THE WORKSHOP

This is a weekend of practicing the “film studio standards” of film production accounting. You work with all the usual tools, such as a real film budget, cost reports and hot costs, and the commonly used proprietary general ledger software used in the Film Industry. From all the testimonials over the past 6 years, the workshop is fun, effective and has started many careers in the industry.

There are more benefits to doing the workshop. Check them out at http://www.filmaccounting.com

I’m on a production in NYC for 6 months.  I’m rarely in this city. We have a group of professionals attending and have room for a few more.  I hope to see you there

Cheers / John

 

John Gaskin is a New York licensed CPE sponsor.

Film and Television Production Accounting (CPE 14 Hours)

HOW DOES FILM ACCOUNTING DIFFER

Film Accounting has the same elements as any business – Bookkeeping, Reporting and Auditing. However, the rapidity and convention of the film accounting process has to be experienced to believe. There’s “Petty Cash” of $40,000 a week, about 200 to 500 Purchase Orders a week (at least in the last weeks of prep and the first weeks of shooting), etc. The paperwork can trample the accounting system IF you aren’t prepared with a workable system. And THAT’s what separates Film Accounting from any other – the workable industry specific system that’s the same from production to production and which the producers, financiers, crews and the cast have grown accustomed to.

LIFE CYCLE OF A FILM OR TELEVISION PRODUCTION

The production of a film or TV project can be seen as a full-blown dramatization of the life cycle of a manufacturing company. In a few months the crew move into an empty warehouse/studio, rent or buy furniture, equipment, vehicles, props, wardrobe, shoot the ‘product’ for a very specifically locked-in budget, and then  return all the rentals and sell whatever was bought, wind up the bank and leave the warehouse/studio as they found it – empty of everything except maybe the dumpster awaiting pick-up. Most business accountants don’t see the full life cycle of a business – ever. So, the production personnel and production accountants have developed a niche for this kind of thing – especially, given the very specific type of budgeting and cost reporting that is entailed in such a fast life cycle.

UNIQUE PROPRIETARY GENERAL LEDGER SOFTWARE

The film and television production industry uses proprietary general ledger software not available in the market place. In my workshop we work with that software giving you 2 days of practical experience unattainable any other way. We pay specific attention to the general terminology, the film production industry specific accounting practices as well as the general flow of all accounting forms and reports.

FILM ACCOUNTANT: WHAT ARE THE PREREQUISITES

Film Accounting is the only business category on earth which doesn’t require you to have previous accounting training. The assistant accountants usually rise on the food chain with a series of on-the-job clerical jobs (with pay). Of course, you’d be ahead of the crowd if you had accounting and bookkeeping fundamentals, but really the only requirement is a sharp mind and bright attitude.

For all of you CPA’s, I am a “Licensed Sponsor” for Continuing Professional Education in New York State.

Whether your intention is to enter the film industry, or just to get some fun CPE, I hope to see you at our next workshop in September, 2018. If you have any questions, please email HeleneWorkshops@gmail.com

For more information see http://www.filmaccounting.com

Cheers / John

 

John Gaskin has worked in Film Accounting since 1985 on over 50 film and television productions of every size, in 6 different countries. Visit http://www.filmaccounting.com for testimonials and agendas, etc.

 

Section 181 Returns in 2018

Section 181 has always been interpretive, and as such, scary for investors. The 2018 Section 181 is no different. I haven’t heard of anyone who has actually taken advantage of this provision yet, but there’s no question that it’s a legitimate way to interest wealthy investors to invest in your project, and I would say it’s an even better deal than during the Obama era.

How the 2018 Section 181 Works

The following is my own understanding of the new Section 181 rules applicable through to December 31, 2022. I’m not a lawyer so please consult an entertainment lawyer when you’re getting closer to pitching Mr. Big-Bucks. In the meantime, here is my take on Section 181 as of 2018 written in layman’s terms:

  • Section 181 is now applicable straight through to December 31, 2022, giving you plenty of time to plan with your investor how he can save tax dollars by investing in your project.
  • The investments made, or more properly stated, “qualified property acquired”, between Sept 27, 2017 and December 31, 2022 will qualify for the investor’s 100% write-off as “Bonus Depreciation” (meaning it’s another form of depreciation, but instead of writing-off a % of the investment, it’s now a 100% write-off of the investment).
  • There’s an incentive for the investor to get busy before December 31, 2022 because after that he 20% less write-offs each year for the following 4 years.
  • Section 181 includes qualified film, television and live theatrical productions.
  • There isn’t any limit to the amount of investment .
  • Section 181 does not apply to property that has already been commercially exhibited.
  • The investor can only write off the investment when the project is initially released, broadcast or stage performed.

Depending on the Investors Tax Bracket …

So, assuming that Me. Big-Bucks is in the 40% to 50% tax bracket, for every $1,000 used to acquire the “qualified property”, i.e. your film/TV production, he will save $400 to $500 in tax dollars. So, that means that he’s still out the other $600 or $500 in cash, so you still need to convince Mr. Big-Bucks of your project’s ability to earn at least 50% to 60% of it’s cost just to help Mr Big-Bucks break even.

Adding State Tax Incentives

If you shoot your project in a State that has decent Film Incentives, such as Georgia, Louisiana, Ohio, New Mexico, etc you could quite easily estimate another 25% of your production’s cost.

If you present it properly to your investor, you can confidently tell Mr. Big-Bucks that you can get him 25% back on his investment in State film tax credits, which, along with his tax savings from Section 181, amounts to a 75% guaranteed return!

Ways to Help You Convince Investors

We just finished a workshop on Hot Costs in Montreal, Canada and there is a Film Accounting 101 workshop coming up in May in Chicago. These types of workshops all help you to convince investors of your ability to control the production costs and to bring it in “On Budget and On Time”.

For more info on workshops and online training visit my web site at http://www.filmaccounting.com

 

Cheers,

 

John

 

 

A Key Film Accounting Task – The Hot Cost

One of the daily tasks of a Film Production Accountant is to prepare a “Hot Cost”.  It’s a major task that would seem to be impossibly grueling, unless you knew the system of things that is behind the Hot Cost.

As an exercise, recall your favorite movie scene, then try to imagine what it would take to estimate the costs of all that scene’s cast, extras, crew  of every kind, as well as the various gun battles, sinking ships, etc etc. Well, that’s the task assigned to the Production Accountant on a daily basis. It can be a challenge, especially since the Film Accountant is expected to send out the report by lunch time the next day.

How is that even possible?

In my opinion the task becomes not only possible, but routine for four reasons:

A well drilled and standardized reporting system unique to the industry.

The daily film and television production reporting system has been perfected over the last century. It could even be described as militaristic. The primary tools are the Shooting Schedule, the Call Sheet and the Daily Production Report as well as the SAG cast report called an “Exhibit G”. The Production Accountant knows how to pull off the information needed to prepare a Hot Cost within 2 to 4 hours.

A working understanding of the Union and Guild Payroll Rules.

In addition to the well known guilds (SAG, DGA, WGA) there are several different union locals under the IATSE umbrella (International Alliance of Theatrical & Stage Employees). The cast and crew regularly work in excess of 12 or 13 hours, resulting in numerous penalties that requires a familiarity with union and guild rules, so a thorough understanding of those agreements.

A hands on familiarity with all costs as they occur 

The Production Accountant works with a team that processes purchase orders, timesheets, credit card/petty cash reports, etc. and every document is initialed or signed by the Production Accountant. All of the costs flow into a unique general ledger software system used throughout the film and television production industry. 

A thorough grounding in the line-by-line items in the Approved Budget

 Once the costs are gathered together they need to be compared, line-by-line, with the Approved Budget for that particular production. The Production Accountant not only is a major contributor to the preparation of the Approved Budget, but he/she and the team of assistant accountants use the Approved Budget every day as they code costs to be entered to the general ledger system.

In summary, a working understanding of each of those four categories provides the Production Accounting Accountant with the ability to comfortably pull off the Hot Cost in less than a few hours.

If you’re interesting in taking the first step towards each of these categories above, come to our Film Accounting 101 Weekend Workshop, coming up in Chicago in May, 2018..

 

To find out more, check out http://www.filmaccounting.com

Cheers / John

 

 

Online Film Production Payroll Courses

For several years now I have been teaching the functions of a Film Production Payroll Accountant. The job is in high demand, and is well paid; however, outside of my one or two workshops a year there is no avenue for someone to learn that role. So, drawing on my experience of fun and effective weekend workshops, I have developed a series of online film payroll courses. But, first let’s backup and look at the role of a Film production Accountant and what his/her skills must be.

 

SKILL OF THE FILM PRODUCTION PAYROLL ACCOUNTANT

So what does a Film Production Payroll Accountant do? The Payroll Accountant has nothing to do with the processing of government and union deductions and benefits. That’s almost always processed by one of a handful of Entertainment Payroll Services. The skill that the payroll accountant gets paid for is his/her smooth application of the various union and guild payroll rules.

AGREEMENTS WITH THE AMPTP

The unions and guilds commonly paid by a Film Production Payroll Accountant are SAG (cast), Director’s Guild (the Unit Production Manager and the various Assistant Directors), IATSE (Crew) and Teamsters (Drivers). (I am ignoring the Writer’s Guild only because there is usually one person to pay and that fee is usually arranged and known well before production starts). Each of these unions/guilds make agreements with the AMPTP (Alliance of Motion Picture and Television Producers). Some of these agreements are monsters (the SAG Agreement is in the range of 700 pages); however, there are very specific rules within each of the Agreements related to payroll.

THE USUAL PAYROLL CATEGORIES THE FILM PAYROLL ACCOUNTANT MUST KNOW

The Film Production Payroll Accountant knows where to find those rules, and has become very familiar with the references. I always make a summary of the applicable rules, which I call my “Cheat Sheet”. That summary is usually no more than a page and half long, widely spaced.

I do “Cheat Sheets” for each Guild, each IATSE Agreement and each Teamster Agreement. The usual breakdown of guild/union Agreements is:

  • SAG Schedule A (Day Performers),
  • SAG Schedule B (Weekly Performers),
  • SAG Schedule C (Weekly Performers paid in a higher range) and Schedule F Performers (Deal Performers paid in even a higher range)
  • NOTE: There are more SAG Schedules; however, if you know the Schedule A and B rules you can then very easily pickup the payroll rules associated with the other Schedules, including the payment of Schedule C , F and Stunts)
  • DGA (UPM and all levels of Assistant Directors),
  • IATSE Low Budget Theatrical (for any feature film production across America and Canada less than $14.2 Million)
  • IATSE Area Standards (applies to all Television and Features greater than $14.2Million throughout middle America including Georgia, Louisiana, Ohio, DC, Florida, etc but excluding the New York and surrounding area)
  • IATSE Basic Agreement (Crew on the West Coast 14 States) and
  • IATSE New York Area (generally known as east Coast rules).

This short video introducing the Area Standards  helps to differentiate the IATSE geographical breakdown of their various Agreements.

FOUR TYPES OF PAYROLL RULES TO HIGHLIGHT IN EACH AGREEMENT

The world of union and guild agreements can get overwhelming, so just remember that the payroll accountant just needs to concentrate on FOUR types pf payroll rules:

  • Overtime,
  • Violation of Rest Periods,
  • Violation of Meal Periods and,
  • finally, any Travel related rules and allowances.

All of the Agreements highlight those rules. It’s simply a matter of breaking that ground in an orderly manner, and getting familiar with the rules through practice.

USING AN LMS (Learning Management System) TO CREATE ONLINE COURSES

A couple of years ago I went out of my way to produce two really sparkling online courses from which I’ve received positive feedback. I used an LMS (Learning Management System) called Skyprep. It allows me to use clear mp4 videos, to link easily to downloadable material, and even offer tests and certificates.

Due to the success of those two courses, SAG Schedule A and SAG Schedule B, I decided to use Skyprep to update three more online payroll courses. The new courses are:

 

DGA (payroll for UPM’s, 1st AD’s, key 2nd AD’s, 2nd 2nd AD’s and additional AD’s):

DAG payroll is deceptively tricky. At first glance it would appear to be straightforward, and indeed it is; however, a lot is happening on that timesheet. This course takes you though their salaries, production fees, extended days, rest period violations, completion of assignment and their various “allowances”.

The course includes:

  • 7 instructional videos,
  • links to a bookmarked Article 13 of the DGA Basic Agreement (which covers all payroll factors),
  • a Power Point of the course,
  • a One-Page Cheat sheet describing each element of payroll as well as the reference to the Article 13 of the DGA BA,
  • and Excel time-card templates formulated for your ease of calculating DGA payroll in future.

Watch this short YouTube video to see how it works and what the course includes.

 

IATSE Area Standards Payroll:

The IATSE Area Standards crew payroll covers all television and features over $14.2 million throughout middle America (including Georgia, Louisiana, DC, Ohio, Mississippi, etc).

This course takes you though all payroll related rules pertaining to the payment of crew payroll, including overtime, rest period violations, meal penalty calculations and related travel rules including the payment of “idle time”.

The course includes:

  • 6 instructional videos,
  • Links to all materials required,
  • A bookmarked IATSE Area Standards Agreement for easy reference of each payroll element,
  • a One-Page Cheat sheet describing each element of payroll as well as the reference to the Agreement,
  • and Excel time-card templates formulated for each of Feature and Television rules, for your ease of calculating IATSE Area Standards payroll in future.

Have a look at this short video to see the map that Area Standards covers – it’s a big chunk of production in America – and how the course works.

 

IATSE Low Budget Theatrical is applicable to crew payroll for all feature film productions throughout America that has a budget less than $14.2 Million.

This course takes you though all payroll related rules pertaining to the payment of crew payroll, including overtime, rest period violations, meal penalty calculations and related travel rules including the payment of “idle time”.

The course includes:

  • 7 instructional videos,
  • Links to all materials required,
  • A bookmarked IATSE Low Budget Theatrical Agreement for easy reference of each payroll element,
  • A One-Page Cheat sheet describing each element of payroll as well as the reference to the Agreement,
  • A Power Point of the course
  • and Excel time-card templates formulated for the rules of the agreement, for your ease of calculating IATSE Low Budget Theatrical payroll in future.

Have a look at this short video to see how the course works and how thoroughly the materials are covered.

For more information see www.filmaccounting.com

Online Courses for the west Coast and the east Coast, as well as Teamsters, is in development. I have the Excel Templates made, as well as the one page cheat sheets and bookmarked Agreements, I just need to complete the teaching videos and assemble the elements into online courses.

Note: I continue to deliver weekend workshops when we have a group of 15-20 persons committed to attending.                                                                 For details please contact Helene at heleneworkshops@gmail.com

 

Cheers / John

 

 

Feedback From An Experienced Production Accountant

John Gaskin

John Gaskin Workshops

Quite often my workshop attendees go back to their respective cities and towns, get busy, and I don’t hear from them for months/years. Occasionally, I get a feedback from someone else about a former attendee, and that is always very gratifying.

A TESTIMONIAL FROM AN EXPERIENCED FILM PRODUCTION ACCOUNTANT
Here is some very positive feedback about one of my Film Payroll Workshop attendees. What’s particularly validating, at least for me, is that the author is a 26 year industry veteran:
“I’m a production accountant and I felt I had to write to you.  I’ve had several people ask me about your classes and unfortunately I could only tell them that I didn’t know anything. Of course, in this industry getting outside training was never there for many of us back in the day.  We learned as we went.  
I needed a filler for my payroll accountant on a series I’m currently working on – I found LaVeda Lewis thru a friend.  She came in needed no help and got a hefty load of payroll, new starts & SAG completed beautifully (week before shoot starts).   I asked her who trained her since she had only worked on a few projects.  It was you!  
So just wanted to say – I will now be able to tell people to take your classes with confidence that they will learn things the right way.  Thank you for what you do – the next generation will be off to a great start because of it! 
Have a great weekend!”   – Shari Sontag, Production Accountant, May 25/17  (See Shari’s 26 years of experience by clicking here).
We have another payroll workshop coming up in August. To learn more, click here.
Cheers / John

Film Payroll Workshop – Testimonial

Here is an email that I received on May 25/17. It’s a great testimonial, from an experienced production accountant, encouraging me to carry on with the Payroll Workshops:

_______________________________________________

“I’m a production accountant and I felt I had to write to you.  I’ve had several people ask me about your classes and unfortunately I could only tell them that I didn’t know anything. Of course, in this industry getting outside training was never there for many of us back in the day.  We learned as we went.

I needed a filler for my payroll accountant on a series I’m currently working on – I found LaVeda Lewis thru a friend.  She came in, needed no help, and got a hefty load of payroll, new starts & SAG completed beautifully (week before shoot starts).   I asked her who trained her since she had only worked on a few projects.  It was you!
 
So just wanted to say – I will now be able to tell people to take your classes with confidence that they will learn things the right way.  Thank you for what you do – the next generation will be off to a great start because of it!”
 
-Shari Sontag, Film Production Accountant, May 25, 2017
_______________________________________________

The two-day live workshop will concentrate on the actual calculation of gross payroll for each of SAG, DGA, IATSE (Low Budget Agreement and Area Standards).

The emphasis is on the practical application of the guild/ union payroll rules according to each Agreement.

This practical workshop is vital for anybody wanting to work as a Film Payroll Accountant, or as a Line Producer who must understand the various union /guild agreements for budgeting purposes.

Cheers / John
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