Film Accounting Glossary
Audit trail
What is an audit trail?
An audit trail is the unbroken documentary chain behind a cost: the purchase order, the approval, the invoice, the proof of payment, and the account it was coded to.
Tax credit auditors, completion guarantors, and studio auditors all test costs by walking that chain, and a cost that cannot be traced is a cost that gets disallowed. Keeping the trail intact during the shoot is far cheaper than reconstructing it at wrap.
Example
A $6,400 charge for a period-correct taxi survives audit because the file holds the purchase order, the UPM's approval, the vendor invoice showing rental dates, the cleared check, and the account code. The same charge supported only by a credit card statement gets disallowed.
Figures are illustrative, chosen to show the mechanics rather than to quote market rates.
Where you'll see it
Assembled during the shoot as vouchers, then tested at wrap by the incentive auditor, the completion guarantor, and any studio audit.
Common mistake
Assembling it at wrap. Reconstructing approvals and delivery evidence a year after the fact is far more expensive than filing the paperwork the week the cost was incurred.
Related questions
- What documents make up an audit trail?
- The purchase order, the approval, the vendor invoice, proof of payment, and the account it was coded to. Evidence of delivery or the rental dates where relevant.
- What happens if a cost has no audit trail?
- On an incentive claim it is disallowed, reducing the credit. On a studio or guarantor audit it becomes a question the production has to answer from memory.