Oil and Gas Accounting Software Buyers Guide
This detailed guide will help you find and buy the right oil & gas accounting software for you and your business.
Last Updated on November 08, 2023Executives in the oil and gas industry are responsible for monitoring a wide variety of financial operations to ensure profitability in addition to overseeing different kinds of regulatory filings at the state and federal levels. Because of these demands, they need a user-friendly and effective accounting system that meets the field’s unique needs.
In this guide, we’ll break down the energy software tools available in today’s market to help business leaders make decisions and identify trends in the company’s finances. The technology we’ll discuss automates tedious tasks so staff can focus more of their efforts on delivering excellent services and products to customers.
Keep reading if you’re interested in finding out how the right software solution can help your energy company become more lean, productive and profitable.
Here's what we'll cover:
What is oil and gas accounting software?
What are the common features of oil and gas accounting software?
What are the benefits of oil and gas accounting software?
How to evaluate oil and gas accounting software?
What are the deployment options for oil and gas accounting software?
What is oil and gas accounting software?
Oil and gas accounting software focuses on tracking energy projects and partnerships, including the acquisition and development of land leases for natural resources. It can also track the status of leases and share it throughout a company while automatically posting land payments to the general ledger.
Companies can also monitor the financial positions of each general or limited partner. Larger-scale companies might require additional features, such as multiple currency options.
What are the common features of oil and gas accounting software?
Energy accounting systems typically include standard features in addition to a number of industry-specific functions that buyers should be aware of. Here are some examples:
Core accounting | Includes modules all businesses rely on to manage finances, including a general ledger, tracking accounts payable (A/P) and accounts receivable (A/R), bank reconciliation and fixed assets. |
Land lease tracking | Defines tracts of land nationwide and documents the ownership and lease terms from initial offer to signing. Manages lease obligations like rentals and renewals and provides automatic notifications for payments or lease expiration. |
Documentation & compliance | Helps manage lease documents and receipts. Also keeps you updated on legal issues to support development and delivery of relevant, accurate compliance reports. |
Dispatch tracking | Provides schedule and dispatch maintenance/repair workers information needed to optimize their routes by skill/location to improve efficiency and quality of service. Also includes the ability to estimate job costs and manage service contracts, inventory and purchasing through the dispatch management feature. |
Energy procurement reporting | Streamlines energy procurement decisions using detailed data from loadshapes and special energy reports to create well payout profitability reports. |
Rate/tariff analysis | Compares utility billed rates to alternative rate schedules, including those of competitors and other markets. May also include cost avoidance analysis to see potential solutions, as well as weather data to its impact on costs. |
Well management | Stores everything you need to know about a particular well, including its lifting and status codes. |
Visual tools | Generates line graphs, pie charts and and other visual representations of data entered in the system. These are usually presented in a dashboard interface. |
Document imaging | Stores scanned versions of invoices so they can be routed and approved. |
What are the benefits of oil and gas accounting software?
Here are some benefits that explain how energy accounting software can empower employees to optimize financial operations:
More efficient workflows. Employees are able to save time and effort by using an intuitive system that eliminates the need for duplicate data entry. In a recent survey of accounting software buyers, 36 percent cited a desire to automate business process as a major purchase driver.
Greater accuracy. A digital solution reduces the margin of human error when it comes to performing complex financial calculations or tracking fixed assets.
Faster decision making. With the dashboards and reporting functionalities we described above, executives can quickly drill down on the company’s finances. This enables them to come up with informed analyses on key performance metrics and make data-driven decisions to benefit the business.
These benefits to apply to every oil and gas company, regardless of its size or location. Solutions exist for startups, mid-size entities and global enterprises.
How to evaluate oil and gas accounting software?
Energy software packages can generate state and federal reports required by auditing government agencies such as the Department of Energy, Environmental Protection Agency or Department of Defense. Sorting profitability by site, activity, crew, geologist/engineer and customer is also a helpful tool in energy accounting systems. Software dispatch systems can help with scheduling and recording load pickups while providing information such as directions and gate combinations.
When evaluating these systems, buyers should consider the following:
Can it analyze the financial status of the company’s partners?
Can it track lease status and integrate it with accounting?
Do the features fit the size of the company, as in multiple currencies?
Can it generate the appropriate reporting documents for auditors?
It’s possible to start answering these questions before you contact any vendors. Simply check out the product profiles on this website to read real user reviews, get system overviews and watch demo videos for dozens of energy accounting systems.
What are the deployment options for oil and gas accounting software?
Energy accounting software can be implemented in one of two ways:
As a best-of-breed application
As part of an integrated solution that packages together accounting tools, in addition to other functionalities, such as oil and gas production reporting, gas balancing and/or human resources applications
Your ultimate selection will depend on your needs and budget. For example, integrated systems are often more robust and expensive than best-of-breed solutions, so they may not be ideal for smaller companies who only really need core accounting tools.
Pricing for oil and gas accounting software varies from vendor to vendor and it may be influenced by the number of modules a company needs or the amount of users that need to access the solution. Some software licenses require an upfront lump sum (also known as a perpetual license), while others use subscription-based pricing models.
Buyers must choose from cloud-based or on-premise solutions. Cloud software is typically hosted remotely on the vendor’s servers, so it’s especially appealing to smaller businesses with tighter budgets. On-premise systems are more traditional. These are hosted on-site, on the company’s own servers.