An Interview With David Melito, Hollywood Production Accountant
I met David Melito a few weeks ago when I was on vacation in Los Angeles. We were talking about our shared interest in money, mine because—well, you’re reading The Billfold right now, aren’t you?—and his because he’s a production accountant in the film industry.
So I asked him if he’d be interested in talking about his work for The Billfold. The conversation that followed was fascinating.
Okay, so what is a production accountant?
A good production accountant is really a person who’s in charge of the finances and the technical money side of the movies.
People who don’t work in the industry often say “Oh, you’re the guy who does the books and says that Avatar didn’t make any money.” That is completely not what I do. That happens on the studio level, and I only have a vague understanding of how that works.
I’m on the spend side. So if you have a $15 million movie, you’re going to spend $15 million in a year, $12 million in probably three or four months.
It’s an enormous amount of cash flying out the door, and one of my jobs—and I manage a staff to do this—is kind of acting like the gas meter on your house. I’m telling people “This is how much is going out the door right now.”
I’m also working with a producer to come up with a budget, and working with different scenarios before we start shooting to determine how much the film is going to cost. Once the film starts shooting, it becomes “Okay, we thought the film was going to cost $15 million, but on Day 1, we ran three hours long.” So now we’re overbudget by this amount of money. But maybe two days later, we have a short day, so now we’re even. It’s called a hot cost.
Every day I’m reporting to the producers and letting them know where they are, because the money truly goes that fast. If you’re not watching, a week can go by, and you’ll go “Oh, we budgeted for 13-hour days, and everyone worked 15-hour days. Now what do we do?” So part of my job is stopping the surprises.
It sounds like there’s some project management involved there. Do you do that yourself, or do you work alongside a project manager?
I don’t do project management. Instead, I’ll come out and be like the mattress ad guy, like “You’re killing me, Larry!” I’ll come out and say “this doesn’t work,” or “what you’re trying to do is a violation of union rules, and if you do that, this is the potential penalty.”
I’m the grownup, a lot of the times. I’ll say “This is not a good idea.”
My favorite example, that I use all of the time, is that if the producer were a Disney villain, I’d be the crow that sits on their shoulder. I’m Iago, on Jafar’s stick. We are the kings’ advisors.
I’m part of the producer’s team, helping them make choices, but ultimately the decision doesn’t fall to me. That’s the line producer’s job.
Here’s something we were talking about on The Billfold yesterday. Do you consider yourself in the movie industry or in the accounting industry? How do you identify?
That’s another question I get a lot. People say “Oh, you’re a movie accountant? How did you get into movies?” But it was the total opposite, and I think most film accountants are this way.
You get out of college, bright-eyed and bushy-tailed, and you want to work in movies, and everything is exciting. That gets old quick, and then you start wanting to pay bills and make a living and have a life.
I went to film school, and I wanted to be a director—I was obsessed with Twin Peaks, and I wanted to be David Lynch—and then you learn quickly, out of school, that to be an actor or director you need a passion that I didn’t have.
But I loved working in the movies, and the more you work, well, it’s almost like a Plinko machine but in reverse, because you move up. Like, every show you learn where your skill lies, and someone will look at you and say “You’re really good at that, and you should be in my department.”
So the route I took was: I interned on a movie, and I did the general production assistant stuff, but I was always the one who was helping fix the computers. I was the tech one. I liked the art department, but I can’t draw a straight line. So a producer, who I still work with today, said “This guy is really good at the numbers and the technical side of stuff, so why don’t we hire him as the art department coordinator?”
So I was an art department coordinator, and I started to excel, so I got to do bigger and bigger movies. The art coordinator job is really interesting because it’s the bridge between artistic people and money people. I would interface with accounting quite a bit, and I got really good at getting into the accounting office and getting what I wanted for the art department I represented.
Eventually, the accountants said “Why are you working in the art department? You should work for us!” So I became an assistant accountant. I did that for five or six years, moving back and forth between the art department and assistant accounting, and one day I woke up and looked at what the accountants were doing and said “I can do that! I want to do that.”
And that’s the learning process. A lot of people start with the dream of what they want to do, and then learn the reality of what they’re good at.
One day I may segue into producing, or maybe not. I’m really good at this.
That’s a really long-winded answer!
That’s an excellent answer. That’s a brilliant answer.
Did you have to go back and get another degree, then, or did you learn everything on the job?
That’s really the wonderful thing about the film industry. It’s one of the last careers that still gives you a mentorship or an apprenticeship-type relationship. I didn’t get an accounting degree; I learned everything on the job.
It’s funny because I get people who are CPAs who went to school for accounting, and they want to get in the film industry, and the applications really don’t cross over at all.
Production accounting is about spending money and keeping track of money. CPA accounting is so different. A lot of CPAs have a lot of trouble wrapping their brains around exactly what we do.
A lot of production accountants are asking for the title of financial controller, which does describe what we do a little bit more. My assistants, they’re the ones actually doing the accounting role. They pay the bills, they enter POs in the system, they do payroll. Then I synthesize all that information.
A good production accountant takes the numbers and presents them to the studio. They translate the numbers to people who might not understand them, like a creative producer. They say “this is what the numbers mean and this is what you can do with them.”
I consider myself a filmmaker, because at the end of the day, my job is to help the producer and director make the best film they can.
Without going over budget.