Depends on the industry and client doesn't it. I've heard of "Hollywood accounting" where movies were intentionally made unprofitable so that percentage-of-prof

Depends on the industry and client doesn't it. I've heard of "Hollywood accounting" where movies were intentionally made unprofitable so that percentage-of-profit based payouts are low. You'd want to adjust how you do it based on the risk that expenses could be padded to make profitability look worse. Even if the client is completely legit, the incentive is there. It becomes like spending pre-tax money, so why not incur some more expenses.