Where possible all production bank accounts should be closed at the end of a production, with the balance on the account usually being transferred to the production company’s main bank account.
Generally a final cost report can only be produced when all outstanding supplier queries have been resolved, all insurance claims finalised and all floats have been accounted for. Finance Executive approval is required for any journals which move items off balance sheet. Examples of such entries requiring approval are petty cash write offs and fixed asset write offs (or transfers of fixed assets to the main company at valuation).
A final cost report should not include any costs to completion (any un-invoiced liabilities should appear in the cost report as accrued costs) and a list of accrued creditors must be provided so that other parties are able to identify who is owed further money.
In addition to the ‘bible’ and final cost report there may be further final paperwork required. The finance contract will usually define what is required but the following are examples of additional paperwork that may be required from the accounts department:-
1) A signed statement from the Accountant to the effect that they consider the cost report to be an accurate representation of the income and expenditure on the project and that the cost report is in accordance with the accounting records.
2) An independent auditor’s opinion on the accuracy of the final cost report.
3) A breakdown of expenditure by location and information on the number of people employed by location (this is usually required where a regional grant makes up part of the funding).
4) A certificate from the DCMS which confirms that the production meets its criteria with respect to it qualifying as a British film either as a Schedule 1 film or as a co-production. In both cases it is necessary to complete an application form to DCMS. The Schedule 1 film requires some financial information such as UK spend and non qualifying spends. The co-production form requires a detailed spreadsheet of income and expenditure by territory. On co-productions the DCMS usually require a preliminary application before production begins based on the budget and funding plan and they review this to make sure that their requirements are met before giving a preliminary approval of the package. At the end of production the DCMS then require an audited final application based on actual income and expenditure and if their requirements and funding ratios are still met, they will issue a certificate to this effect. The certificate is important because without it, UK tax relief cannot be claimed and overseas co-Producers are unable to access their equivalent tax relief.
5) A schedule of artists/writers’ residuals. Many broadcasters require an excel spreadsheet which they can use to calculate the residuals due in the event of additional transmissions of the Programme or overseas sales. The entitlement to residuals in the UK is set out in the Equity/PACT production agreements.