Kurt Ullman wrote:
[snip]

> 
>  The studios seldom play games with either IRS or SEC requirements.. 
> probably. But their are many forms of perfectly legal accounting over 
> and above that. Heck the accounting for taxes is very different from 
> that of SEC requirements. Both are legal. Probably so is the other kind 
> for profit participation.
> 
The trick the studios appear to play is charging the costs of several
films to each of the films.  Only the profitable films actually pay
this since the lost making films do not even cover their own costs.

Actors and producers counter this by padding the costs.  Things like
birthday parties appear as film production costs.

Babylon 5 was filmed on minimum cost with none of the luxuries.  No
one got three trailers.

If the studios were being both fair and controlling costs the profit
based residuals would start when the films genuine own costs had been
covered and have a major increase when the 10 time payback point was
reached.  Producers, actors, directors and writers would then be
rewarded financially for keeping costs down.

It would be difficult to bring in residual based cost control now
because the artists have evidence that for many years the accounts
were lies designed to cheat them.

Andrew Swallow
--- SBBSecho 2.12-Win32