Afren Plc - SunSystems Implementation

Background

Afren Plc is an independent Oil & Gas company listed on the Main Board of the London Stock Exchange and a constituent of the FTSE 250. Afren has a diversified portfolio of production, development and exploration assets. 

When Afren approached Progressive in 2007, the London and Lagos based business was operating on a much smaller scale and was on the verge of considerable growth with the planned acquisition of several key assets.

Overview

Afren's requirements had begun to outgrow their Sage based accounting system. A new finance and reporting solution was required, that would support growth by providing the means to store financial data and create statutory and venture reports, to meet the requirements of an increasing number of stakeholders. Progressive stepped in to source the optimum finance and reporting system, assess the credentials of a selection of prospective suppliers and project manage the implementation across a growing network of international offices. 

The Problem

Whilst suitable for a smaller operation with a simple structure, Sage does not have the necessary depth of analysis, reporting or cost allocation functionality to support the workings of a company undertaking joint venture projects. Sage also has limited multi-currency functionality, which can lead to resource-intensive accounting processes and duplication of work.

Afren's existing time reporting process was not scalable; Excel-based time sheets being used to record staff hours would prove a logistical challenge in the allocation of staff hours to multiple projects. 

The Solution

Requirements Assessment 

In order to identify the most relevant solution, a thorough assessment of the client's requirements was necessary. Progressive reviewed the usage and current transaction levels of the Sage system, also determining expected future user-base in-line with Afren's expansion plans.

Progressive provided a full assessment of requirements - including business, functional, budgeting, general ledger, cost allocations, reporting, operations and workload - to form the basis of the system selection process. 

Selection of Systems & Suppliers

We conducted in-depth research and analysis of several finance and reporting systems, including Agresso and SAP Business One, critiquing each system and assessing each provider's Oil & Gas experience. 

Our findings were presented to Afren's senior staff, along with a recommendation for the installation of SunSystems, selected for its multi-currency reporting capability, flexibility of analysis structures and processing. Importantly, SunSystems supports joint venture accounting processes and has the functionality to support multi-company transaction processing. Our client was keen to begin using the core functionality as soon as possible; as an easily customisable and scalable system, SunSystems was a quick, yet future-proof solution. 

Having researched a range of systems suppliers, we presented the two strongest options to our client, showcasing each to clearly demonstrate strengths and weaknesses to reach a well-informed selection. 

SunSystems Build & Reporting

Progressive project managed the implementation of SunSystems with Vision reporting, combining our solid industry background with our joint venture accounting experience and acting in the client's interests to direct the suppliers throughout the build. 

SunSystems was required to process day-to-day costs, enable production of company and group monthly management accounts and annual statutory financial statements, record Afren's net expenditure of assets from operator billings, track details of all intangible and tangible fixed assets and process sales invoices. We integrated the Vision reporting toolset to report actual costs from SunSystems. 

A suite of reporting and analysis tools was set up on Vision, including multi-currency reporting and budget variance analysis. Where possible, reporting was automated to improve efficiencies. 

We allowed for additional modules to process employee expenses, project costing and commitment tracking, anticipating that they would be required over the coming five years. 

A multi-user environment and web interface was created to enable remote access to SunSystems, Vision and Time@Work records by Afren's London and Lagos based finance personnel. 

Time@Work Implementation & Integration

A time-recording system was required to accurately record staff hours against an increasing range of projects, allocating time for cost recovery. Time@Work was the obvious solution for its compatibility and easy integration with SunSystems. This system is well suited to the Oil & Gas industry, with capabilities for multi-location operations and reporting. Progressive managed the full integration, seamlessly interfacing project codes and hours worked between SunSystems and Time@Work. 

Data Migration

Accurate data migration is essential to ensure integrity of data is maintained. Progressive managed the migration of Afren's data from Sage, including opening balances, transactions and purchase invoices. Staff hours were transferred to Time@Work.

Testing & Training

Following installation, Progressive performed rigorous testing of the system. We worked with Afren's staff, providing full training to ensure they were able to take full advantage of the systems' range of functionality. We were on-hand to provide extra support and training as and when required. 

Roll-Out Across New Acquisitions 

The initial implementation was completed on time and within budget. 

As expected, in the years following the initial implementation of SunSystems, Afren acquired several new assets. Progressive provided ongoing support to transfer and integrate new data, assist with setting up reports, and train staff within acquired companies on the use of SunSystems and Vision. 

2008: Devon Energy Corporation – Cote d'Ivoire

When Afren completed the acquisition of Devon Energy Corporation's interests in Cote d'Ivoire in September 2008, Progressive was tasked with project managing the integration of the data and the finance departments. In 2009, Progressive travelled out to offices in Abidjan to train staff, test the system and to transfer and integrate data. The quality of data produced allowed for easier analysis, streamlining month end processes and enabling them to meet the corporate demands of the London office. 

2010: Black Marlin - East Africa Exploration 

Progressive travelled out to Black Marlin's Dubai office to transfer and integrate data and train users. We worked with Afren's financial accountant to develop her skills as a trainer, increasing her knowledge base, thereby giving Afren the capability to bring training in-house.

The Results

Since Progressive started working with Afren, the company has experienced considerable growth. The implementation of suitable financial and procurement systems has provided a robust infrastructure and given Afren the ability to grow and become a key player in the global market of Oil & Gas.