Film Accounting Glossary
Completion guarantor
What is a completion guarantor?
Also called bond company, or guarantor.
A completion guarantor is the company that issues a completion bond and monitors the production to protect its exposure.
In practice it reviews the budget and schedule before closing, receives weekly cost reports and cash flows during the shoot, and can require cuts, approve or refuse budget changes, and in the worst case step in and finish the picture itself. Its involvement is one of the main reasons independent productions run disciplined weekly reporting.
Example
Week four comes in $310,000 over with the schedule slipping. The guarantor can refuse a budget amendment, require the producers to cut two scenes, insist on a co-signatory for the account, or in the worst case take over and finish the picture itself.
Figures are illustrative, chosen to show the mechanics rather than to quote market rates.
Where you'll see it
Receives the weekly cost report, cash flow, and bank reconciliation. The main reason independent shows run disciplined weekly reporting.
Common mistake
Managing information rather than reporting straight. Guarantors have seen every version of an optimistic estimate to complete, and a surprise costs far more than a warning.
Related questions
- What powers does a completion guarantor have?
- Approval over budget and schedule changes, access to the books, co-signatory rights on the account, and ultimately the right to take over and finish the picture.
- What does a completion guarantor receive each week?
- The cost report, the cash flow, and the bank reconciliation, plus the variance narrative. Its reporting requirements are why bonded shows run tight weekly cycles.