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Read about the role of accountants in the film industry
From big budget movies to independent projects, the film industry involves high risks and rewards. To succeed, studios and filmmakers have to handle complex tax arrangements, uneven cash flows and hefty payrolls.
This challenging financial picture goes some way to explaining the importance of accountants in the film industry and media. It’s an industry that calls on accountants’ technical expertise and commercial awareness, with the move away from traditional distribution channels towards digitisation and competitive tax relief making strategic planning increasingly important. In general, accountants in the film industry work either in an advisory role or in-house as a production accountant. Here’s a bit more information about the role accountants play behind the scenes in strategic planning, audits and production financing.
Accountancy and professional services firms are playing an increasingly important role in the film industry. Production companies and studios stand in need of commercial analysts who are able to improve reporting and assist with tenders, bids and financing. Accountants also provide invaluable advice on the complex corporate tax issues faced by companies in the film industry. With different countries, states and cities offering pro-film tax incentives, there’s pressure on production companies to ensure they’re making the most of the tax credits available. Many large private practice firms will have dedicated film and media departments, while there are also smaller firms that specialise in film tax matters.
Large film studios and production companies, with dedicated finance departments, employ accountants to work for them in-house. At the opposite end of the spectrum, accountants also work for smaller companies in the film industry, although the nature and scope of the work can range widely. Recent coverage of ‘Hollywood accounting’ tactics has highlighted the importance of professional ethics and competence for major film studios and their affiliate clients. High-profile disputes involved complicated auditing procedures and profits spread internationally over different tax jurisdictions, with the legislative and regulatory requirements this work entails. In this environment, the range of roles for accountants is wide and varied, and their importance is clear.
The role most commonly associated with the film industry, however, is that of the production accountant. It’s a role that requires familiarity with almost every aspect of the filmmaking process. Traditionally, professional qualification wasn’t a prerequisite for becoming a production accountant, with many people working their way up the ladder from file clerk to production manager, but the role is now becoming increasingly professionalised. Production accountants need to have in-depth knowledge of the industry, and use this to predict overruns and oversee budgeting and re-forecasting.
Broadly speaking, the skills required fall into one of three categories, namely, bookkeeping (in particular, handling petty cash), reporting and auditing. In many cases, production accountants acquire enough experience to go on and enjoy successful careers in film production. One downside to production accounting is the fact that it is, more often than not, contract work, with employment only lasting as long as the filmmaking process. But for those with the right experience, expertise and a willingness to travel, production accounting can provide a rewarding and exciting career.