Malone Petroleum Consulting



We Can Audit Your Oil and Gas Partnership Audits and Contract Audits

Partnership Audits, Joint Venture Audits and Alliance Audit Services

Partnerships, joint ventures and alliances are commitments and relationships between two or more entities, based on trust, common goals and understanding of the individual expectations for the purpose of achieving specific business objectives by maximizing the effectiveness of each party's resources resulting in rewarding the participants hopefully extraordinary profits based on a usually short-term basis. Partnerships vary in time.

In order to achieve the maximum, envisioned success, it is fundamental that a careful selection and background evaluation of partners is conducted. It is also essential that principles, goals, objectives and roles and responsibilities of the participants must be clearly defined, fully understood, agreed and documented in a formal agreement at the outset, including the continuous provisions for the accounting of the resulting costs and revenues and auditing during the life of the project. The earlier our involvement in the venture, the greater the benefits will be for our clients, for instance, you should go back as far as ten years into the legal history of the companies you are considering. Even though it is unrealistic to assume a company will have a perfect legal record, it helps to know any legal issues companies have endured which can easily predict the legal issues that you might encounter in the future. Also, it is very easy to inquire as to the reputation of the entity you are considering. Even asking for references is one simple process a lot of trusting entities do not perform since they do not wish to insult the other party; however, "It is just good business".

Each individual or company puts in capital, whether it's funds or equipment. This capital is usually divided percentage wise (50 percent for each company or 70 percent and 30 percent, 40 percent and 60 percent, etc.) with the initial investments recorded appropriately from the outset. Once the combined effort begins, profits and losses should be analyzed and recorded properly and fairly. It is critical that each party not just rely on the recording of all accounting information, but take a controlling, hands-on approach in order to prevent any unknown and guaranteed temptations that almost always abound in any business relationship when only one party has more control than the other(s).

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