7 Reasons to Replace Your Legacy Plant Accounting Software: Eliminating the Need for Excel Workarounds
By Blake Fraley
UPDATED: April 30, 2020
| 3 min read
Part 5 – Eliminating the Need for Excel Workarounds
Midstream companies are realizing how critical a software solution is to support their employees and customers. Whether accountants need to handle new ASC 606 revenue recognition standards, quickly answer how values were calculated, or ensure accurate NGL shrink calculations, the last thing you want is to perform those calculations in Excel. After all, you purchased plant accounting software—right? It’s crazy to think that companies invest money in accounting software while their users are forced to rely on Excel because of system limitations, a lack of transparency, or no trust in the software.
Why Users are Forced to Use ExcelIn my years of experience assisting clients go-live on our software, I’ve seen several instances where clients provide me with spreadsheets of things their software couldn’t do accurately. For example, during a discovery call with a company in Denver, I was told they wanted to convert from a common legacy plant accounting solution. However, when we kicked off the project, I quickly learned this client was settling their plants in Excel because “we don’t trust our legacy software”. I was shocked at the pain that exists in the marketplace!
Sure, it can be tempting to turn to Excel when faced with uncertainty about whether their ERP solution is performing calculations correctly or there are software limitations. However, manually validating calculations and creating spreadsheet-based workarounds are costly and create nightmares for internal/external auditors. In addition to the potential for human error that exists in manually verifying high-volume transactions, companies that work with financial data outside their ERP put compliance at risk. Standalone Excel workarounds also carry a high cost in terms of maintaining what can be hundreds of different spreadsheets, not to mention overhead costs.
To put the uncertainty and functionality gabs into perspective, the following list includes some of the reasons why legacy plant accounting software forces customers to adopt Excel as a method for verifying calculations and filling functionality gaps:
Calculating inflation rates
Verifying escalation schedules
Calculating fixed recoveries and changing from ethane recovery to rejection
Tracking minimum volume commitments
Creating deficiency invoices
Handling cumulative imbalances
Handling Prior Period Adjustments
Calculating tier-based fees/POP percentages
Tracking contract management terms, provisions, and dedications
Applying Revenue Recognition requirements for ASC 606 Journaling
Ditch the Spreadsheet, Drop More Revenue to Your Bottom Line
There’s a real and high cost of relying on Excel because you don’t trust the calculations, financial results, and the ability of legacy plant accounting software to consistently perform tasks. In fact, one of our most recent clients (a large Permian midstream company) previously relied on nearly 100 spreadsheets. These spreadsheets included several of the workflows listed above and many more with the underlying premise being their legacy plant accounting solution wasn’t matching expectations. This client is now saving thousands of dollars between time saved, audit costs, less knowledge transfer, and a better total cost of ownership. It’s not your fault if legacy plant accounting software requires you to rely on Excel for daily/monthly tasks. However, if you are experiencing a lack of trust in the data or waiting on new functionality that was promised months ago, maybe you should look for something different.
At W Energy Software, we believe midstream companies deserve better than the status quo. We’ve designed a product differently from the ground-up. We’ve listened to the pains our clients have had and designed effective solutions so they can quickly replace those spreadsheets. We continue investing in our product to ensure it continues to exceed expectations. I’m not promising you’ll never use another spreadsheet and I wouldn’t like that either since I’m an Excel nerd. What I am suggesting is that you don’t pay for software that cannot handle your business or work with companies who don’t listen to your needs and develop solutions for you quickly.
One of my favorite things each year is sharing the new enhancements our innovative development team has created over the past year with our clients during our annual user group conference WE Connect. We share this state-of-the-art functionality with our clients during each annual release at no added cost. Now, that’s what I call a partnership!
So, if you’re frustrated with being forced to use dozens of spreadsheet workarounds to close out your month, be sure to reach out to W Energy Software to learn how you can close your assets faster and with complete confidence.