The oil & gas industry is a high-stakes, complex sector, and financial management is among the most important factors of success. Due to a variety of business processes ranging from exploration, production, refining, and distribution networks, this industry generates massive and complex financial transactions. Implementing accounting software for the oil and gas industry can offer long-term benefits such as enhancing efficiency, accuracy, compliance, and decision-making across the board. In this blog post, we will delve into why implementing this industry-specific accounting software is worthwhile. Read more below.
Why Accounting Software for the Oil and Gas Industry is a Worthy Investment
1. Improved Accuracy and Efficiency
Manual accounting is not only time-consuming but also error-prone. In oil and gas, where deals can cross borders, between joint ventures and different tax jurisdictions, the complexity can lead to large numbers – and there is little room for error in the fine chemistry that turns crispy brown bank notes into liquid gold. Energy accounting software performs these calculations automatically, minimizing errors and facilitating fast results. The solution automates everything from data entry and reconciliations to invoicing and financial reporting — allowing accounting teams to spend time working on strategy rather than grinding away on spreadsheets.
2. Compliance and Reporting
Oil and gas are heavily regulated, obliging companies to adhere to all sorts of rules, from environmental to tax to accounting. Energy accounting software tailored to this sector also comes with standard compliance features, to make sure businesses are compliant with both local and international regulations. These platforms also make it easy to produce detailed financial reports and audit records, which in turn help lower costs and shorten the time frame of external audits and regulatory reporting.
3. Better Financial Insight and Decision-Making
Through accounting software for the oil and gas industry, management can determine the company’s financial position accurately and make informed decisions with key metrics such as cash flow, profitability, and cost centers. It’s a level of visibility that is important in an industry where significant investment and project timelines are long. The provision of accurate and timely financial information enables decision-makers to assess project feasibility, estimate budget, and alter operations according to economic circumstances and market orientation.
4. Cost Control and Resource Optimization
The oil and gas industry requires substantial capital investment and ongoing production costs. Good expense tracking is essential to keep on top of added costs. Energy accounting software promotes categorization of individual expenses and monitoring against the budget, so that cost overruns, if any, can be detected quickly. Furthermore, built-in asset management functionality enables users to monitor the use and maintenance of equipment to help ensure resources get used and downtime is minimized.
5. Scalability and Integration
As oil and gas businesses expand in scale, whether by expansion, combining operations, or collaborating with partners, their accounting requirements also change. Modern accounting software can scale side by side with your business, and add users, regions, or entities without the need to change your system.
Avatar Systems Inc. is a trusted provider of accounting software for oil and gas companies. Call us today for a free demo.
