Private equity owners and management of an oil & gas company that leases working interests were experiencing delays and inconsistencies in its accounting. They came to Aventine Hill Partners for help.

Our Solution

We provided a CFO Advisory Partner who was an expert in the upstream oil and gas industry to step in as part-time Interim CFO with a focus on assessing the current problems and recommending corrective actions and improvements. The CFO consultant reviewed current processes for receiving Lease Operating Expense (LOE) statements from EnergyLink (formerly JIBLink), receiving production data and remittances from the operators, and loading these to the accounting system. Next, the procedures for preparing financial statements and Lease Operation Statements (LOS) were reviewed. There were both timing problems with receiving data and challenges with loading data into and extracting data from the accounting system.

• Master data gaps in the accounting system were identified and corrections made to allow for a more accurate posting of financial transactions.
• An Excel model used to prepare the financial statements was reviewed and updated to better integrate with the accounting system, allowing for more accurate and efficient reporting.

With a better structured accounting system, options for improving and adapting to timing challenges with the operators were evaluated. The trade-offs between accruing for certain data or waiting for actuals were reviewed and a path forward chosen.

An audit was in progress during the assessment and our CFO Advisor took a hands-on role in reviewing draft financial statements prepared by the Controller and preparing adjustments to correct for impacts from prior accounting process and system challenges. For other adjustments, a detailed action plan was provided that the Controller could execute.

Last, the CFO Advisor provided recommendations for improving the accounting organization. Options were presented for adding different types of roles to rebalance workload and ensure the proper expertise would be in place on an ongoing basis. Areas where training would improve the existing team's capabilities were also recommended.

Results

By bringing in a part-time Interim CFO, the private equity owners and company management quickly and cost effectively regained an understanding of the financial results of the company. Improvements in processes and systems were made and a revised accounting organization defined that will result in the proper in-house expertise to sustain the improvements.

Learn more about our:

• CFO Advisory Services
• Accounting and Finance Services

An exploration and production company participated in multiple joint ventures along side its wholly owned operations. They desired help in overseeing the financial aspects of their joint ventures without requiring a full-time senior-level employee to oversee joint venture accounting. They turned to Aventine Hill Partners for assistance.

Our Solution

We provided a CFO Advisor with deep experience in E&P companies and joint venture accounting to supplement the CFO and Controller for the company. Our Advisor took on accounting and finance oversight for the JVs assuring that policies, processes, and reporting were in place to meet the needs of company management and financial reporting for the publicly-traded parent.

Existing company staff performed the transaction processing. Our CFO Advisor performed monthly detailed analysis of results and oversaw the generation of financial statements.

Results

This company was able to utilize the strong leadership and expertise that their size and complexity required on a part-time basis, achieving a more flexible and cost effective solution. Learn more about our CFO Advisory services.

When a publicly traded exploration and production company found itself facing a variety of complex accounting issues and new financial reporting requirements, including IFRS reporting, Aventine Hill Partners was prepared to meet the challenge though with accounting and finance consulting. 

Our Solution

The first issue we approached was the improper allocation of overhead. Our consultant reviewed the accounting processes and methodology the company was using and streamlined the allocations resulting in a more accurate and useful view of costs all the legal entities.

Next, the company found they were having difficulty forecasting revenue and depletion. After reviewing the existing process, our consultant identified where inaccuracies were being generated and implemented improvements that solved the problems.

Intercompany accounting for this company was complicated due to the number of entities involved. The existing accounting processes were becoming cumbersome and leading to incorrect entries being made. Our consultant reviewed the intercompany accounting process and made revisions, which saved time and increased accuracy.

The company was also having challenges with its CAPEX accrual predictions. Using prior experience working with similar issues, our consultant implemented a new methodology tailored to this company that improved the process and results.

When the company was required to provide financial reports based on IFRS accounting standards, our consultant led the conversion from Full Cost Accounting to Successful Efforts Accounting to make IFRS reporting possible.

Results

With the improvements implemented by Aventine Hill Partners, this exploration & production company could more efficiently and confidently account for its growing, complex business structure as well as prepare for future challenges. Learn more about our Accounting and Finance capabilities.

Accurate reporting is critical for almost any company, however it can present a particular challenge for exploration & production companies due to the numerous types of reports that have to be prepared for internal, external, and regulatory purposes. After identifying several significant reporting issues and being pressed with external reporting deadlines, a publicly traded E&P company turned to Aventine Hill Partners for help.

Our Solution

Using our experienced financial reporting consultants, we first helped this company meet all pending reporting deadlines. This included gathering information and generating SEC Filings such as the 10-K, 10-Q, and 8-K including all necessary disclosures. We assisted in generating financial statements for existing joint ventures and creating accurate reserve reports. Once necessary reporting requirements were met, we implemented improved processes for generating both internal and external reports including a redesign of how cash flows were reported.

Results

As a result of our efforts, this E&P company not only met its SEC reporting requirements, it was also left with sustainable processes to ensure those reporting requirements would continue to be met in the future. Learn more about our SEC, Financial, and Management Reporting services.