Once the project has been given the go ahead, the funder will expect both a budget and a schedule for the production. The schedule will vary in length and complexity depending on the nature and size of the project and as soon as it has been prepared and agreed by the Producer, Director and Line Producer it will form the basis on which the budget is produced. In television responsibility for the initial budgeting rests with the Line Producer.
The Production Accountant’s function usually is to assist by verifying that:
- The budget is consistent with the schedule,
- There are no obvious omissions,
- Budget rates are reasonable,
- Fringes have been correctly applied etc. etc.
It would also be sensible to check all budget additions as ‘input errors’ can cause items to be excluded from the overall budget total.
The budget review is best completed by someone different from the person who created the original budget, as it is generally very hard to question your own logic. The rule of thumb when reviewing a budget is to read the synopsis and then try to think imaginatively of factors that might apply to that production which are not reflected in the budget. Experience is helpful in this process but even an inexperienced person can use common sense to imaginatively review a budget. It must also be remembered that the purpose of the budget review is not only to identify un-budgeted or under-budgeted items; the review should also identify areas of the budget that may not be needed or which are over-prudent. Every production will have areas that go over-budget and it follows that the Line Producer/Production Manager needs to make some budget savings to compensate for over-budget areas.
Whilst everyone will have their own method of budget review there are one or two things that every budget review should entail as follows:-
|The overview||Look at the total budget figure and compare it to the budget for similar programmes or to the published tariff for that genre of programme (many broadcasters publish a guideline tariff on their website for each genre).
Look at the budget for each area of the budget and consider whether it instinctively feels right. Whilst this review is by no means an exact science it can focus your attention on specific areas (such as post-production) that merit further review.
|The detailed review||This part of the review entails looking at each line of the budget and deciding whether it is correctly costed and consistent with the schedule, the synopsis and other parts of the budget.
|The Integrity review||Verify that the mathematical logic in the budget is correct so that it adds up, that all budgeted lines are included in the total budget and that all fringes have been correctly applied. A fringe is a calculation within the budget that automatically budgets for items that depend on the level of other costs in a budget. For example, in the UK, national insurance costs depend on the level of salary paid to non-freelancer and a national insurance fringe would therefore estimate the national insurance likely to be incurred on certain salaries which have been tagged as non-freelance salaries.
Where a budget review indicates that a budget is unrealistic it is very important that this is addressed before going into production. If a budget is inadequate then either additional funding must be found or the programme must be shot in a different way to enable it to be made for the budgeted sum. Pressing on regardless and hoping it all works out is not a sensible option!
Sources of production finance
There are a number of production finance sources and it is important that the Production Accountant is aware of all these sources. See Section on Development and Pre Production for more details.