# THE BAKER: Australian Offset Model

**Date:** 2026-05-08  
**Use:** Detailed Australian finance model for Cannes asks, deck finance slides, and follow-up with Australian producers, accountants, lenders, and co-production partners.  
**Status:** Strategic model pending production accountant, Screen Australia, Screen NSW, lender, and producer verification.  
**Primary sources:** Ronny WhatsApp Producer Offset recording, call transcript, market research dossier, current budget model.

## 1. Core principle

The Australian Producer Offset should be treated as the measurable finance anchor of the package.

The Cannes posture is pitch and pressure-test, not confirmation. The deck should not imply that first meetings will lock the structure. It should use the offset model to start better conversations:

> What is the plausible QAPE, what offset receivable could it create, who might cashflow it, what net closing requirement remains, and which production choices increase or reduce the Australian anchor?

## 2. Formula

Working formula:

> QAPE × 40% = Producer Offset receivable

Planning cashflow formula:

> Producer Offset receivable × 90% = estimated cashflow facility

Sensitivity rule:

> Every AUD 1.0M moved into QAPE creates AUD 400K of offset value and approximately AUD 360K of cashflow value at a 90% advance rate.

Reverse sensitivity:

> Every AUD 1.0M lost from QAPE removes AUD 400K of offset value and approximately AUD 360K of cashflow value at a 90% advance rate.

## 3. Budget cases and offset values

| Case | Total budget | Estimated QAPE | QAPE share | Offset at 40% | Cashflow at 90% | Gross cash still needed after cashflow |
|---|---:|---:|---:|---:|---:|---:|
| Lean | AUD 8.5M | AUD 6.5M | 76% | AUD 2.6M | AUD 2.34M | AUD 6.16M |
| Target | AUD 10.5M | AUD 8.0M | 76% | AUD 3.2M | AUD 2.88M | AUD 7.62M |
| Stretch | AUD 12.5M | AUD 9.7M | 78% | AUD 3.88M | AUD 3.49M | AUD 9.01M |
| Ceiling planning case | AUD 15.0M | AUD 11.5M | 77% | AUD 4.6M | AUD 4.14M | AUD 10.86M |
| Ceiling theoretical maximum | AUD 15.0M | AUD 15.0M | 100% | AUD 6.0M | AUD 5.4M | AUD 9.6M |

The theoretical maximum is included only to show the ceiling. The planning case should use a realistic QAPE share based on schedule, cast, crew, post, location, and co-production structure.

## 4. Target case detail

Recommended working target:

| Item | Amount |
|---|---:|
| Total target budget | AUD 10.5M |
| Estimated QAPE | AUD 8.0M |
| Estimated non-QAPE or regional spend | AUD 2.5M |
| Producer Offset at 40% | AUD 3.2M |
| Estimated cashflow at 90% | AUD 2.88M |
| Implied lender holdback, fees, interest, or reserve before final offset receipt | AUD 0.32M |
| Gross cash still needed after offset cashflow | AUD 7.62M |

The AUD 7.62M remaining requirement is the post-offset conversation Cannes partners can help shape through France, Screen NSW, MENA equity or services, presales, gap, private equity, and producer contributions.

## 5. Target case conversation stack

| Source | Working amount | Status |
|---|---:|---|
| Producer Offset cashflow | AUD 2.88M | Requires QAPE model, Screen Australia path, lender terms. |
| Screen NSW or local support | AUD 0.60M | Requires NSW spend and application path. |
| France co-production or public funds | AUD 1.60M | Requires French partner and treaty analysis. |
| MENA equity, services, or presale | AUD 1.20M | Requires cast-driven partner interest. |
| Private equity, Australia or diaspora | AUD 2.30M | Requires investor case and recoupment plan. |
| Presales or gap | AUD 1.50M | Requires sales estimates and attachment strength. |
| Producer deferrals or in-kind support | AUD 0.42M | Requires acceptability in completion structure. |
| **Total** | **AUD 10.50M** |  |

## 6. QAPE sensitivity in the target model

This is the most useful table for partner conversations.

| Target budget | QAPE | Offset at 40% | Cashflow at 90% | Change vs base cashflow |
|---|---:|---:|---:|---:|
| AUD 10.5M | AUD 7.0M | AUD 2.8M | AUD 2.52M | minus AUD 0.36M |
| AUD 10.5M | AUD 8.0M | AUD 3.2M | AUD 2.88M | base |
| AUD 10.5M | AUD 9.0M | AUD 3.6M | AUD 3.24M | plus AUD 0.36M |
| AUD 10.5M | AUD 10.0M | AUD 4.0M | AUD 3.60M | plus AUD 0.72M |

Cannes implication:

> The project should be scheduled and structured to protect at least AUD 8.0M of QAPE in the target model, while testing whether AUD 9.0M to AUD 10.0M is achievable without damaging the screenplay.

## 7. What increases QAPE value

Potential QAPE-positive choices to test:

- Australian production company and IP structure
- Australian writers and director structure
- Australian cast in major roles
- Australian crew and department heads
- Sydney and Western Sydney shoot days
- Australian studio, location, equipment, transport, accommodation, and services
- Australian post production, sound, picture, VFX, colour, music, legal, accounting, and insurance where eligible
- official co-production structure if it allows qualifying co-production expenditure
- Screen NSW eligible local spend

## 8. What can reduce QAPE value

Potential QAPE pressure points:

- large non-Australian cast fees
- large Lebanon or regional shoot spend outside the qualifying structure
- offshore post production
- non-Australian above-the-line costs
- unclear copyright ownership or control
- unofficial co-production structure that fails to preserve Australian qualification
- late Screen Australia planning
- budget line items that cannot be substantiated with eligible invoices

## 9. Cannes asks by counterparty

### 9.1 Australian producer or production accountant

Ask:

1. Build a line-by-line QAPE model for the AUD 8.5M, AUD 10.5M, and AUD 12.5M cases.
2. Identify the minimum QAPE required for the package to remain financeable.
3. Clarify which above-the-line and below-the-line costs are likely to qualify.
4. Advise on the Screen Australia certificate pathway and timing.
5. Check the six-month pre-production rule noted in current research.
6. Map completion bond and audit requirements.

### 9.2 Screen Australia adviser or experienced offset producer

Ask:

1. Pressure-test Producer Offset eligibility for the project structure.
2. Advise whether the project should seek a provisional certificate or another in-principle pathway.
3. Map Significant Australian Content assumptions.
4. Explain how official co-production could affect qualifying expenditure.
5. Outline application fee, timing, and documentation requirements.

### 9.3 Cashflow lender

Ask:

1. Indicate likely advance rate against the offset receivable.
2. Outline interest, fees, reserve, and security requirements.
3. Advise whether a provisional certificate is required before drawdown.
4. Explain whether cast, sales agent, completion bond, or distribution agreements are required.
5. Estimate likely cashflow amount for AUD 2.6M, AUD 3.2M, AUD 3.88M, and AUD 4.6M offset scenarios.

Named candidate from Ronny's recording:

- Fulcrum Media Finance

### 9.4 Screen NSW or state incentive contact

Ask:

1. Estimate local support for a Sydney and Western Sydney Lebanese Australian feature.
2. Clarify eligible NSW spend categories.
3. Map jobs, locations, post, and cultural-value requirements.
4. Advise on application timing and whether support can stack with the Producer Offset.

### 9.5 French co-production partner

Ask:

1. Explore whether an Australia-France official co-production is viable.
2. Identify what the French partner could bring in cash, services, funds, or sales credibility.
3. Pressure-test how the French structure could affect QAPE and Australian qualification.
4. Explore whether Lebanon-related spend can be supported through the co-production or remains separate.

### 9.6 MENA partner or film commission

Ask:

1. Explore whether regional equity, services, or in-kind support can sit alongside the Australian offset.
2. Identify which cast attachments change the finance case.
3. Pressure-test whether regional spend supports the film without weakening QAPE.
4. Estimate distribution or platform value by territory.

## 10. Deck-ready slide language

### Slide title

> The Australian anchor is measurable.

### Body

> In the target planning case, AUD 8.0M of QAPE would generate a projected AUD 3.2M Producer Offset. At a planning advance rate of 90 percent, that would create approximately AUD 2.88M of cashflowable value. Every additional AUD 1.0M protected inside QAPE adds AUD 400K of offset and approximately AUD 360K of cashflow.

### Pitch line

> Cannes should pressure-test the QAPE, certificate pathway, cashflow lender appetite, Screen NSW range, France co-production fit, and the AUD 7.62M post-offset conversation.

## 11. External caution

Use conditional language externally until verified:

> The project is being structured to qualify for the Australian Producer Offset, subject to QAPE modelling, Screen Australia certification, and final production structure.

Avoid saying the full AUD 15M produces AUD 6M of offset unless the full budget is confirmed as QAPE. Use the AUD 6M figure only as a theoretical maximum.