Film Accounting Glossary
Participation statement
What is a participation statement?
Also called profit statement, or participation report.
A participation statement is the periodic report a distributor issues to a profit participant showing gross receipts, deductions, the running unrecouped balance, and any amount now payable.
Statements arrive quarterly or semi-annually and typically lag the underlying revenue by months. Because the arithmetic depends entirely on a contractual definition, statements are the primary object of participation audits, and audit rights are usually time-limited by contract.
Example
A statement arrives 14 months after release showing $80M of gross receipts, $76.1M of deductions, and an unrecouped balance carried forward. The next statement is six months later, and audit rights typically expire two or three years after each one is issued.
Figures are illustrative, chosen to show the mechanics rather than to quote market rates.
Where you'll see it
Issued periodically by the distributor to each participant. The primary object of participation audits, on a contractual clock.
Common mistake
Filing statements without reviewing them. Audit rights are time-limited, so an unexamined statement can put the right to challenge it beyond reach.
Related questions
- How often are participation statements issued?
- Usually quarterly or semi-annually, and typically lagging the underlying revenue by months because each stream reports on its own delay.
- What is on a participation statement?
- Gross receipts, the deductions applied, the running unrecouped balance, and any amount now payable to that participant under their specific definition.