What do outstanding final-cut approvals say about a video production company’s cash flow?

In video production, the final invoice often depends on the client accepting the finished piece. A pile of waiting approvals therefore means cash that has been spent on crew, gear and editing time but not yet received. How big that pile is, and how long it has been there, tells you a lot about the company’s cash position.

Ask for a list of every project awaiting approval: the client, the delivery date, the amount invoiced or due and the reason for the delay. Some delays are innocent, such as a busy client. Others point to disputes over the edit, requests for more revisions or a client who is unhappy and may refuse to pay in full.

Compare the list with the accounts receivable and the cash records. Check whether the company counts income when it delivers or when the client approves, since that changes how the statements look. Your accountant can explain the difference and what it means for the figures you see. Finally, ask what the owner does to close jobs: firm deadlines for feedback, contract terms for deemed approval and a limit on revision rounds. A company that has none may be carrying more risk than its statements suggest.

Key takeaways

• List every job awaiting approval, with the amount outstanding and the reason for the delay.
• Compare that list to receivables and cash records to see how long money has waited.
• Ask whether contracts limit revisions and set a deadline for client feedback.