Sustain Your Business During Oil Abundance

Since the decline in oil and natural gas prices since 2014,  independent operators in the U.S. have struggled to find their footing. Thanks to the hydraulic fracturing technology that has opened up the doors to more-easily accessible shale oil, we’ve entered into an era of oil abundance. So how do you sustain your business when oil floods the market?

Ernst and Young ‘s recent report explains how operators can move with the market to protect themselves from a financial bottoming-out. We have no affiliation or ties to Ernst and Young, but I found the article interesting to see as a whole how the independent operators (our entire client base) is handling the rocky oil and gas climate today.

The three ideas for sustainability despite low commodity prices suggested were: operational excellence, aligned capital structure and building the right portfolio.

Operational Excellence

Low oil and gas prices affect everyone in the industry. Make your operations as agile as possible by looking at your office processes, systems and personnel. These three factors decide how fast you can make decisions, and what funds are needed to make your organization function.

Aligned Capital Structure

Manage how your cash flows and cover debt payments right now. To move forward into the future, operators will need to step away from mega-projects with high operational risks involved. Instead, focus on projects that require less capital and shorter payback periods to allow your company to move forward.

Building the Right Portfolio

Many operators are selling off assets in a larger scale to stay afloat. As more and more assets continue to enter the market, companies gain assets that will help them grow in the future and increase equity are the ones that will come ahead when the prices begin to rise once again.

Read the full article and it’s analysis.

Customize your oil & gas accounting software for more functionality

In our 24+ years in business working with oil and gas operators and accountants, we know that each business is unique in how and what processes it needs to handle revenue distributions.  These processes are sometimes complex enough that a whole new software program is used. It’s why we often suggest clients customize their oil & gas accounting software to get more functionality.

What falls outside of normal distribution processes?

Commons tasks often include: Delay Rental Payments, Authorization for Expenditure (AFE), Free House Gas, and State Reporting requirements. Most oil and gas accounting software programs will offer optional modules to make the standard software more functional.

This allows you to handle multiple tasks within one software program.

How operators sometimes handle this

Smaller companies will often manage with spreadsheets. While sometimes cheaper, these aren’t as professional and can be timely to use and update as your company grows. Mistakes are often made with spreadsheets and these can quickly become costly in terms of both money and public image.

The time spent managing your spreadsheets should also be considered. The labor will affect your bottom line and sometimes you just don’t have the extra time.

When mistakes, public image, labor, and peace of mind are all factored in, it quickly becomes obvious that the cost of an add-on module is a huge savings.

A simple add-on module allows for better historical records, a more professional look and any costs are typically recouped in only a few months.

Some of the optional modules SherWare offers clients include:

AFEs

Land Management/Delay Rental Payments

House Gas

Payroll

Direct Deposit

Online Reporting

Offsite Backup

MICR Check Printing

Document Manager

Advanced Reporting (build your own reports)

Cloud Version of the Software

 

Hidden Software Costs and How to Avoid Them

The initial price of the software is typically pretty clear. However, people are often surprised when they run into hidden software costs down the road. When picking a software program ask about any future costs that may be involved. Here are two charges that are the most irritating to run into after you purchase and how to not be surprised by them.

1. Software Updates/Upgrades

Many software companies sell the software wholly for a stand-alone price. The buyer will then need to re-purchase every few years or purchase any major upgrades that are released. These updates are necessary so that the software will continue to work with all other new technology that is released each year. But when not expected, these charges can be surprising and discouraging.

The best way to avoid this is to purchase a software program that offers yearly maintenance or support contract that includes all updates. These contracts are generally cheaper than re-purchasing the software every few years. This allows you to more easily see what the ongoing costs are going to be and budget accordingly.

Expired Support Contracts

The oil & gas industry is always changing and updates are regularly needed for newer operating systems, 1099s, regulation changes, and various other reasons. To save money, some clients will try to skip out of a year of support.

The intention is to save money this year, and then renew later if needed, or to simply skip out of paying support for a few years. This typically doesn’t work very well as most software companies require that you purchase past updates as well.

When a support contract is used for updates, then a fee is typically charged to be reinstated to support. The result is that the savings weren’t very much and typically not worth the hassle.

Software is typically only supported for a set number of years and if you skip out on support for the duration of that period, then you may find yourself in a spot where you have to re-purchase the software because support is no longer available for your version.

To avoid the costs associated with re-establishing a support contract it is best to simply maintain your relationship with the software provider by staying current on support. This is typically the cheapest way to maintain long term use of a software program.

What other hidden software costs have you run into?

5 Resources You Don’t Want to Ignore When Starting with SherWare

At SherWare our goal is to help you run distributions accurately and quickly from the time you start with us. Here are five resources we’ve created to help you get software support quickly.

Getting Started Guide:

The first tool we recommend starting with is our step-by-step getting started guide. This succinct guide walks you through the process from installation to printing checks after completing your first distributions.

Consulting Sessions:

Clients who purchase at the professional or enterprise levels receive free consulting sessions with our lead support member. These online trainings coincide with the install, setup, entry, and processing tasks as the user works through them for the first time. On each call, the user’s progress is reviewed to make sure you’re on the right track and have time to get any questions answered. Guidance is given for the next few tasks that will need to be completed prior to the next session. This has proven to be an invaluable experience for new users as they quickly achieve a confidence in the setup and processing of their distributions.

Help File:

Our built-in Help File offers an organized explanation for every window and field within the software. Accessed by pressing F1 on any screen, the Help File gives topical explanations of various processes handled in SherWare. This allows the user to quickly identify what each window and field is used for. The Help File represents the information that would normally be in a User Manual. Many tips, tricks, and shortcuts can be learned when skimming through the information provided within.

Video Tutorials:

Our video tutorial database offer short videos that walk you through to complete common tasks within the software. They provide a visual learning experience for those that don’t enjoy digging into the written documentation as much. You can see the software in action as various tasks are explained.

Support:

Rated as the best in the industry, our support staff  is available to answer support questions through phone, e-mail or via chat, depending on what level of support you feel suits your needs. Simply call or email SherWare support with any questions that you have and they will be happy to give you a timely answer. While the other resources are helpful, sometimes you just need to talk to someone for validation or direction.

With all of the tools available you can be confident in an efficient and accurate transition into SherWare.

Find out more about our software support.

4 Things to Consider When Considering a Data Conversion

To Convert or Not Convert

When you purchase new software, should you do a data conversion or to start from scratch? You save time by converting your data, so here’s what you should know before going through with the conversion.

1. In what format is the current data stored or what format can it be exported to for conversion?

A conversion is easiest if the data from reports in the current software system can be exported to a Microsoft Excel or comma delimited format.

The data a software system uses can be stored in several different formats. Terminology used for the table and field names are most often cryptic and only make sense to the software developer. Having the data appear on a report with common column names such as “Well ID” makes it much easier to convert.

2. What data should be converted?

Choose what data you want to bring from your current oil & gas software system to the new software program. At a minimum, wells, owners division of interests should be converted since that is the heart of the system.

What about historical data?

The answer is: it depends.

What condition is your historical data in?

Is it clean? If not, do you want to go through it and clean it up before the conversion?

Do you want to include wells that have been sold or that are now inactive?

If you keep track of suspense (such as owner amounts on hold, owners under your check minimum and owners in deficit) convert these amounts so that your first distribution can take them into account.

The rest of the historical data can wait until later.

3. What data can be converted?

Find out what data can be converted to the new format and who needs to do the conversion. Most application vendors will do the conversion for you for an added fee, SherWare included.

The data in an accounting, revenue distribution and joint interest billing system is intricately woven together in such a way that the conversion needs to be handled with care so that all the related records are kept together.

Wells, owners (both royalty and working) and their addresses, settings and the division of interests can be converted.

The historical information can sometimes be converted depending on the format from which the data is being converted.

4. How long will the conversion take?

Having your data converted won’t do much good if it can’t be done in a reasonably quick fashion.

When you’re going through the conversion process, you won’t be able to use your existing system until the conversion is complete. If the data can be converted quickly, there will be no down time for your processing.

Most data conversions we do at SherWare take three days or less depending on the format of the information. Comma delimited and Excel files convert the quickest. Text files come in at a close second and other formats take longer.

What to do after a data conversion

After the data is converted, run comparable reports in the existing software and new software to make sure balances and division of interests match.

If you convert historical data, check the balances on well history and owner history reports, especially if you plan to create 1099s on the new system for the current year.

Converting to a new software system doesn’t need to be hard. If you take the steps to make sure your data is converted properly then you should be able to take off running with your new software system and never look back.

Invest in Oil & Gas Accounting Software that Scales With Your Growth

When looking for new oil & gas accounting software, select a program that will scale with your company.  Here is a short list of characteristics that indicate a software program will scale with the growth of your company.

Adaptability

Flexible programs with many options and features allows you to handle many different situations. A rigid program limits data entry, processing, and corrections. These limitations will force you to change your process or handle special situations outside the program.

If the program offers optional modules, they allow you to add additional features needed as you grow.

Network Capability

Select software that can be installed on a server and workstations. You’ll also want a solid security process that allows multiple users with access to designated areas of the software is necessary.

Growing companies are often adding new employees, which results in a need for additional computers with access to the distribution.

Learning Curve

New employees need to be brought up to speed quickly to run the distributions. Select a software that offers a variety of platforms for training and support.

General video tutorials give an overview of the program.

Help Files and manuals allow a new user to dig into the depths of a particular feature.

Live web training provides one on one discussion with an expert guiding the trainee through the setup process.

On-Site training helps when a group is being trained, but it is often costly and not as effective as several live web training.

A knowledgeable support desk allows you to quickly resolve any questions or issues that come up.

Seek out a software that provides most of these tools for smooth transitions as new employees are added.

Customization

Unique deals in the oil and gas industry create challenges that no software program or process would have ever dreamt up. Some software companies are willing to create custom processes and reports for just your company.

A willingness to work with the user and create custom processes will assure you that you will be able to tackle any new challenges that appear.

An advanced reporting module gives you the ability to create your own reports is also a key feature for growing companies.

Find out if SherWare’s oil & gas accounting software is exactly what you need to grow your business.

Speed Up Switching Oil & Gas Accounting Software

Switching oil & gas accounting software is hard. One of the reasons it’s hard is because of how it takes to transfer and train your office on a new system. It doesn’t have to be this way!

Here are 5 tips for helping to speed up the switch:

  1. Come up with an execution plan of what needs to be done when. It’s much easier to switch from your current oil & gas accounting software to a new system if you know the steps that need to be done. Having a deadline for each of the steps also helps move the project along more quickly. Part of this plan should also spell out who is responsible for each action item.
  2. Plan the switchover during an accounting down-time. You need your accounting system every day but there are times during the month that you can’t do with out it. Those times are when you need to process a revenue distribution or joint interest billing. Plan to execute the software switch at the slowest accounting time between processing cycles. This will make the switchover less stressful and help to make it run more smoothly.
  3. Determine the best cut off time for your current data to be converted to the new accounting system. The best time to do a conversion is when you don’t have many open items hanging around. This is most usually right after a distribution processing cycle before you’ve started entering data for the next cycle.
  4. Schedule training with your SherWare support team to help get your team the information they need when they need it. You need to learn the new oil & gas accounting system and you need to learn it quick. We’ve developed a training program that works for you and is included with your software purchase. The training is broken into “bite-sized” chunks that gets you the information you need and helps you to digest it. You’re working with your data during the training which helps to make the procedures “real”.
  5. Be confident that you’re getting the right information out of the new accounting system. The best way to do this is to run a parallel revenue distribution or joint interest billing. Ideally you’ll have a small run that you can do in both systems that will allow you to compare the numbers. Once you see that you’re getting the right results you can move forward confidently.

We at SherWare have helped hundreds of companies move from their current oil & gas accounting software to SherWare successfully. We can help you do the same.

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Source: SherWare Blog

4 Ways To Cut Costs During the Oil & Gas Downturn

With the price of oil below $40, everyone in the industry need to cut costs. Here are 4 quick ways to cut costs during the oil & gas downturn.

  1. Look at your credit card and bank statements to look for recurring charges that can be eliminated. You’ll be surprised by how many services or subscriptions you might have signed up for and forgotten. It might not seem like much but these charges add up quickly. Cancel all subscriptions and services you aren’t using or can do without.
  2. Cut back on company paid lunches and other special perks. You really don’t need to go out for lunch everday but you can if you want. Just don’t make the company pick up the tab. These meals can add up quickly to hundreds of dollars a month.
  3. Hold off on hiring new people until you find ways to justify and pay for them. Too often we hire because we think we see a need but don’t take into account what those wages will do to the bottom line. Will hiring increase efficiences and add to the bottom line? If so, go for it. Otherwise be hesitant to add overhead.
  4. Look at other high cost items you’re using that might have made economic sense during high prices, but now are a drain on cash. One of these could be your monthly software costs. If you’re using an Oil & Gas Accounting system that made sense during $80 oil but now isn’t giving you enough in return for it’s on-going maintenance costs, it might make sense to switch to a lower cost alternative that has the same functionality.

We’ve helped many companies switch away from their high cost oil & gas accounting software to SherWare. The benefits include lower yearly costs for maintenance and increased productivty for your current staff. This is a win/win because you can cut costs and avoid adding more wages!

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Source: SherWare Blog

5 Ways Using SherWare Helps During The Oil Slump

If you’re reading this, you’ve been affected by the oil & gas industry slump. There’s a glut of oil & gas in the world markets and the prices have plummeted. This affects everyone.

Especially so if you’re a small oil & gas producer or work for one.

We understand.

We’ve been in business for over 20 years and have catered exclusively to small oil & gas oilguys.jpgproducers. Hundreds of them depend on us for their oil & gas accounting software needs. We talk to them daily and understand their struggles during this downturn. 

When looking for oil & gas accounting software, you have a few choices. Here’s the top five reasons that SherWare is the best choice, especially now.

  1. We solve your accounting problems in the most cost effective way.

    In your search for software, you’re not looking for features, you’re looking for the solutions to the needs your company has. Using SherWare can solve those problems you face. We’ll be glad to tout our features, but we’d rather listen to you to learn what problems you need to solve and then help you solve them.

    If you compare the cost of software to solve your problems, you will definitely spend less using SherWare.

  2. There are less training costs associated with using SherWare.

    Starting with SherWare is very cost effective because we include in your software investment, the training you need to not only get set up, but also to start using the software to run your accounting.

  3. We have lower on-going costs.

    The costs of maintaining your SherWare software are lower than any other oil & gas accounting software out there. We offer a yearly support subscription that includes all updates and upgrades. We even offer an online chat support option to help you get instant answers.

  4. We give you options for handling your accounting.

    If you’re looking for a fully integrated oil & gas accounting system that includes everything you need, we have it. If you’re using QuickBooks™ and don’t want to replace it, we can help you there too. We have an application that handles your revenue distributions and joint interest billing that integrates with QuickBooks in real time. You only have to enter your data once.

  5. You don’t have to hire an accountant to run the software.

    Don’t get me wrong. We love accountants. But extra hiring in this industry climate is extra overhead you don’t need. Our software is the easiest to understand and use that you’ll find on the market. We take pride in how fast we can get you up and running and feeling confident.

We understand your predicament.

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Source: SherWare Blog

ABC123: Passwords are ruining your software security

Last week we discussed how to beef up your software security to avoid data breaches in your own office. One thing we glaringly left out was how much of a danger passwords are to cyberscares like Heartbleed in 2014 – a security bug that left around half a million of the Internet’s secure web servers certified by trusted authorizes vulnerable to the attack, which allowed the theft of private user’s sessions and passwords.

password.jpgGeneric Passwords

As we support many clients around the country, it is surprising how often people use generic passwords like Admin, Password, 1234, or their name. These passwords are worthless and you would be just as good not having one. Some may claim that a bad password is better than no password, but that is simply not the case with these as they are the first guesses that anyone is going to try. These are the equivalent of having 3 deadbolts on a door yet choosing to leave it unlocked because the door handle will keep the door latched and you feel the appearance of the 3 deadbolts will deter everyone from entering.

SplashData periodically releases a list of the worst passwords for a year. In 2013 these were the top 10 worst passwords:

1 123456
2 password
3 12345678
4 qwerty
5 abc123
6 123456789
7 111111
8 1234567
9 iloveyou
10 adobe123

Do any of these look familiar to you? If so, run to your computer and begin changing them now. While most security experts recommend have a unique password for every site you login to, it’s really impossible to ask of people to do.

Shared Passwords

Another common practice that we run into is that a password may be a secure one, but everyone in the office uses the same one, or everyone knows each other’s login. When a non-Admin employee can log in as any one of five users and gain access to permissions not assigned to their login, then the whole purpose behind the user permissions is compromised. Your office may be small enough that you are ok with that, but this should encourage you to reconsider.

Plain-sight Passwords

Some people will create passwords that meet every qualification for top security, but will then stick them to the monitor with a Post-It note. While this is efficient against outside cyber attacks, it does no good for someone that is able to physically gain access to the computer. If you do need to write down your passwords then store them in a safe or other location that is not as easily accessible to everyone.

If you haven’t already stopped reading to check out your passwords, consider changing the ones that contain the most sensitive data of yours including personal and payment info. You can also check into apps and computer programs that save and create secure passwords so you don’t have to such as Dashlane and LastPass.


Source: SherWare Blog

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