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STRUCTURE OF A BUDGET

Your budget will be your blueprint.  It's the culmination of all the script and scheduling work you've done this far.  The budget will (should) dictate how you proceed with most every decision while making the project.  You will need to know this document inside and out - backwards and forwards.  You need to understand where you can 'steal' money from to pay for other things and what accounts are untouchable.  I cover the actual budgeting process by department in Line by Line, but before we get there, I thought it wise to review how to read a budget.

 

CAUTION

Please be aware that no two budgets are created equal.  Every studio has their own way of structuring accounts and fringes - some even dictate globals which need to be used.  Even myself, when doing an independent film will use my own derivation of a budget (my template).  Every Line Producer has their own, however all of them are a sum of basically the same parts.

Also, when creating a budget for a studio you need to get ahold of their Budgeting Guidelines documentation and Chart of Accounts.  Review it and stick to it or else you'll face the wrath of their accounting departments.  You have been warned.

 

TOPSHEET

The topsheet is the 'cover' of the budget.  It shows a total of each account in a list.  A grand total at the bottom and production information at the top.  You may sometimes get asked by a producer to "just give me a topsheet" - but understand, that's like asking a construction contractor to just give you a roof, with no walls or foundation to hold it up.  You need to have that structure to the accounts and details to allow the topsheet to have any hope of accuracy.

Also, let me briefly warn you about using topsheets from 'similar' projects.  There is no cookie cutter.  Sure, you want to say, "Well, both of these films are $35M, shot in New Mexico in the summer".  That's cool and all, but do they have the same cast?  Same crew?  Was that shot last year with different scale rates?  Did that project have 17 locations, when yours has 37?  Did that project have a CG creature who disintegrate metal on touch?  Do you get my drift?  It's totally fine to get another budget and modify it - but don't get stuck in the trap of relying on someone else's 'similar' project for a rough topsheet.  Chances are, the producer is going out to investors with that topsheet and now you are "on the line" to ensure you stick to it.  Won't you feel silly when you do your own later and you find that your project can be done for a million less - or needs a million more?  Silly indeed.

Also, while I am on this subject, more advice:  You'll find more often than not that producers will bring you on and then tell you that a budget is a certain number.  Gosh, why do they need you then?  You'll need to do your first pass of the budget in a mode I call "Kitchen Sink".  That means, everything is in there - no deals, no negotiation, no free favors, no special treatment.  Once you do it this way on the first pass, you'll have room to go in and cut - but if you start with lower figures hoping to get them lower - you're already starting out on the wrong foot.  I digress.

The topsheet denotes each department or broad-stroke subject which is non-departmental.  For example:

  • DEPARTMENTS
    • Camera
    • Grip
    • Make-up
    • Transportation
  • NON-DEPARTMENTAL
    • Production Office
    • Stages
    • Scouts
    • Second Unit

Don't worry too much about this now, I am only illustrating the differences.  Accounts will be ordered different on most every budget you see (unless they are all from the same studio).  Also, some Line Producers/studios may combine departments, the most common combo is Make-Up & Hair, and sometimes Sound & Video.  These combinations have a lot to do with the governing union, but, again, is a preference.  Do what makes you or the studio happy.  I separate those into their own areas, and I also separate Crafty out of Grip.  It's my party, I can cry if I want to.

Heres' a sample topsheet.  I did not include the header info to keep the project name secret - but know that above this is information about the project. 

 

CHART OF ACCOUNTS (COA)

On the topsheet above, you may notice all the account numbers to the left.  All these accounts create a list of all accounts in a budget to create the hierarchy of its construction.  This list is called a "Chart of Accounts" (COA).  I am sharing one with you as an example and to illustrate all of the detail you need to think about when creating a budget. Keep in mind that every studio, every line producer/UPM and most every project may have a different COA.  Each studio will demand you adhere to theirs.  When you do indie features - you are free to do as you like (per the Producers).  I created a basic budget template which I use on most every indie project, however when I do studio projects - I must use their COA.

 

ACCOUNTS

Accounts are the next level down from the topsheet.  Each account usually denotes a crew member type or divisions of cost based on subject.  For example:

CREW (for this example, I'll use the Production Department) 

  • Unit Production Manager
  • First Assistant Director
  • Production Coordinator
  • Accountant

EXPENSE SUBJECTS (for this example, I'll use the Transportation Department)

  • Production Vans
  • Fuel
  • Star Trailers

Don't worry too much about these now, I am only illustrating the differences.  Accounts will be, as mentioned before ordered different on most every budget you see (unless they are all from the same studio).  Of course too, the above example are far from exhaustive.  They are simple examples.

  

DETAIL

The real meat of it all.  The numbers here drive the totals in the account and thereby the totals on the topsheet.  There is such wide range of details you can put here, but in general, the following guidelines are sound.

Details for Crew

  • Crew Member Details
  • Prep, Shoot & Wrap Days
  • Special Days, such as: Holidays & Travel
  • Possibly, OT Coverage

Details for Purchases & Rentals

  • What the item(s) is/are
  • Scene Specific costs
  • Set / Location Specific costs

The detail area of a budget has multiple columns to help you segment and digest costs, while still giving you an accurate total.  The basic columns include:

  • Description
  • Amount
  • Units
  • "X"
  • Rate
  • Subtotal

These should all be self-explanatory - except "X".  This is a shortened denotation for 'times'.  For example, you are renting one single item - let's say a prop gun - (Description), for 6 (amount) Weeks (units) at $100 (rate) per week.  Your "X" column could say "1" which would add no multipliers to this line of detail and confirm that you are indeed renting one gun.  However, making it a "2" would double the entire calculation and signal that you are renting two guns.  This allows you to multiply a single item to the number of those items you are renting/buying - as opposed to entering 10 individual lines for one gun each or calculating 10 guns times $100 each is $1000 as the new Amount.  Let me know if anyone finds that confusing and I'll re-word this paragraph.  If you are renting 10 different guns, perhaps you do want to put ten lines if each gun is different cost or rental period.  Commonly, this is where some people get lazy and they might put in an allowance for the total cost of all guns for all time.

Subgroups can also be applied to individual detail lines.  There is no direct notation for this unless the subgroup is set to display text in a different color.  All said the detail area is where you'll spend most of your time honing the elements of the budget and their associated costs.  Know how to use it, and you'll be a hero.

 

FRINGES 

The first budget I was ever asked to create, the producer said to me, "Make sure you fringe everything."  Of course, I said' "No problem."  Then, to myself, I wondered what the heck a fringe was. 

Fringes are the taxes an employer pays for mostly payroll, but you can also 'fringe' purchases to denote sales tax and other tricks.  I'll talk more about fringes in a later Budget section, but for now know that fringes are part of the budget, per detail line.  You can have them show per account detail, account or budget section.  Where they show is a matter of preference per the LP or the studio.

Those are the basics.  Each budget you do should generally include all of the above.

 

Hire Stephen

View my Resume  |  IMDb Pro

~  Knowledgable, detailed, problem-solver

~  Budget experience from $300k to $143M

~  International experience in 18 countries

~  Member DGA, PGA & SAG-AFTRA

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