Halfway through a shoot the weekly cost report shows the production is running over, and the contingency is almost gone. A few days later someone from the completion guarantor visits the production office, asks for the latest schedule, and wants to know how the producer plans to catch up. The completion guarantor is the company that has promised the financiers the film will be finished, and it wants to see that it will be.
What a completion guarantor does
Banks and investors who put money into a film want to know they will get a finished film in return. A completion guarantor gives them that assurance through a completion bond, a contract that says the film will be completed and delivered on time and on budget. If the producers cannot do that, the guarantor pays the extra cost or, in serious cases, takes over the production.
The guarantor gets involved during financing. Before signing, they review the script, the budget, the schedule and the key crew. They want to see a realistic plan with a proper contingency. From then on they receive the cost reports, daily progress reports and editing schedules, and keep an eye on them until delivery.
Responsibilities
- Review the budget, schedule and script before agreeing to bond a film
- Check the experience of the producer, line producer and key heads of department
- Agree the bond terms with the producer, the financiers and their lawyers
- Monitor weekly cost reports and daily progress reports during the shoot
- Raise concerns early and agree a recovery plan when costs or time run over
- Step in, fund the overrun or take control when a production cannot finish on its own
- Confirm delivery to the financiers at the end
How the role touches the budget
Strongly, from the outside. The bond fee itself is a line in the budget, usually a small percentage of the total. More importantly, the guarantor reads the budget more critically than almost anyone else and can insist on changes before signing. During the shoot they rely on the production accountant for honest cost reports. A guarantor who sees an overspend coming will ask for cuts long before the money runs out.
How people get into the role
Most people who work for a completion guarantor were line producers, production managers or production accountants first. The job needs someone who can read a budget and schedule and spot what is unrealistic. Bond companies are few, so the role is a specialised step for experienced production people.
When a bond is used
Completion bonds are common on independent feature films with outside financing. Studio productions and most TV commissions rarely need one, because the studio or broadcaster carries the risk itself. Commercials rarely use them.