Joint Venture Audits
Vendor Recovery Audits
Contract Compliance Audits
Cost Recovery
& Risk Mitigation
Anti Corruption
& Fraud Prevention
Specialist Hydrocarbon Accounting
Field Office Accounting
Well Engineering Accounting

  Vendor Recovery Audits

The overall objective of performing a Vendor audit is to ensure that the Company has not been overcharged or paid twice in respect of services and purchases provided. Additionally a Vendor Audit can identify unscrupulous Vendors, mitigate future risk and identify fraud and corruption.

The Vendor audit will include but not be limited to the following types of Vendors:

  a) EPC Contractors
  b) Service Providers
  c) Drilling Contractors
  d) Consultants
  e) Suppliers of Inventory and Fixed Assets
Petroserve uses 'state of the art' software to examine and inspect vendor accounting records. Additionally we perform critical contract compliance on high value vendors focusing on Vendors with complex contractual terms and pricing. We would recommend examining records up to a maximum of three to four years. It is important that the audit is performed at a time when the Company still has an ongoing relationship with the Vendors or has sufficient influence to ensure recovery of over billed or overpaid amounts. Typically recovery rates demonstrate an average recovery rate of 0.05% to 0.1%.

How it works

  1. Work with client to determine audit scope.
  2. The first phase of the audit is to test for duplicate payments.
  3. Requirement is for client to supply a full data download into Excel. The download must include Vendor Number, Invoice Number, Invoice date and invoice amount.
  4. Petroserve will perform up to 20 separate tests on the data some of which will be exact match criteria and others that will be less precise incorporating various SQL scripts and algorithms.
  5. The results will be analyzed and investigated and a report of the findings will be issued to client together with recommendations and action plan for recovery.
  6. The second phase of the vendor audit is a contract compliance audit on high value and high risk vendors. Petroserve will work with client to determine full audit scope.
  7. We will require contract files, budgets and accounting records.
  8. We adopt stringent procedures in performing contract compliance to ensure compliance with the contract terms, prices and conditions. Our extensive experience in the field of contract compliance and risk assessment of Drilling and Operational contracts maximizes recovery to the client.
  9. Final report to client. Will incorporate all findings together with any malpractice issues, tax compliance failings, overcharging according to market prices etc…. together with any issues that may impact on future cost recovery.

Besides the obvious cost benefits there are a number of other benefits arising from performing Vendor audits.

  A. Identifies improper and unethical practices.
  B. Regular Vendor audits will deter future Vendor sharp practices.
  C. Identify possible fraud and corruption.
  D. Pinpoints any potential shortcomings for future cost recovery.
  E. Assist in process review and lead to potential improvements in systems and processes.
  F. An aid to developing and managing contract and vendor risk.
  G. Provides assurance for both JV and Internal audit.
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