Reading Royalty Statements

One of the constant complaints I hear from fellow authors is how difficult it is to read royalty statements from publishers. I concur.

I have been with one of my publishers for eleven years, and I think I finally can decipher the royalty statement. I think. And this will soon become academic since they are exiting the mystery line so I won’t be publishing any further books with them.

Here are some of the challenges. First, there are up to three different editions for each book (hardcover, large print and e-book), and these are differentiated by a cryptic code. Second, not all of the editions for one book are grouped together on the royalty statement. Third, there is nothing on the statement that allows one to verify royalties earned. You have to know the retail price of the edition and then do the calculation. Fourth, there is a category called unspecified. After much study, I determined this included prior returns.

Over the years, I have caught a number of errors. The publisher did correct these. One time there was an error in my favor, but I never would have found this since it represented an erroneous sales figure, higher than actual. My concern: if this occurred, what’s to say that underreported sales didn’t occur as well? Without invoking an audit provision in the contract, I will never know.

I’m finding that some small publishers are addressing this to make things easier for an author. This is a simple as showing the number of units sold (or returned) by edition, the basis for royalty calculation, percentage paid to author and amount paid to author. The author can then quickly calculate if the royalty is correct.