Vendor Checks Created At Run Closing

Vendor checks will automatically be created for any expenses entered on the Well Expenses by Well Window. Since the Fixed Well Expenses window is a template for the Well Expenses by Well window, these expenses will also have vendor checks created for them when the run is closed.

If you are not able to wait until the run is closed to create the vendor check then you should enter the expenses on the Enter Bills or Recurring Bills window instead.

Combinations of Net/JIB Interests:
If you have a mix of "net" and "JIB" interests, then it will be beneficial to understand how the closing determines the check amount. The remainder of this section is only dealing with the situation where you have a mix if Net and JIB interests within any of your wells. If all of your interests are net or all of your interests are JIB then that is all you need to know, you can skip the rest of this topic.

SherWare tracks what run each expense has been processed on behind the scenes. Every expense will process on both a revenue and JIB run. SherWare tracks the run number for both the revenue and JIB closing that every expense has processed on. Even if the expense fully processes on a JIB run it will still store the revenue run that would have processed the expense even though it did not affect anything on the revenue run.
- If you close the revenue run first, it will just create one vendor check for all expenses, even if the expense will fully process on a JIB run. This means that each vendor will get one check for all expenses.
- If you close the JIB run first, it is possible that you will have two checks created for the vendor. The first, created when the JIB run is closed, will only be for expenses that at least partially processed on the JIB Run. The second, created when the revenue run is closed, will only be for expenses that fully processed on the revenue run.

Example:
A $100 expense is processed on 3 wells. The "Both" well has both net and JIB interests, 50% net and 50% JIB. The "JIB" well has only JIB interests. The "NET" well has only net interests.

Closing the Revenue Run first:
Revenue Run Closing Summary
$150 Expenses Processed. $150 Expenses Allocated to net owners
1 Vendor Check for $300 (all wells)
JIB Closing Summary
$150 Expenses Processed. $150 Expenses Allocated to JIB owners
No Vendor check is created

Closing the JIB Run first:
JIB Closing Summary
$150 Expenses Processed. $150 Expenses Allocated to JIB owners
1 Vendor Check for $150 ("JIB" well & half the "Both" well)
Revenue Run Closing Summary
$150 Expenses Processed. $150 Expenses Allocated to net owners
1 Vendor Check for $150 ("Net" well & half the "Both" well)

Order of closing:
You do not have to close the revenue and JIB runs at the same time. However, if an expense partially processes on both and the interests in the well change between closings then this can cause a discrepancy in both how the amount was allocated to the investors and the amount that the vendor is paid. This would only be an issue if the interest change is moving the percentage from a net interest to a JIB interest, or vice versa. This can be prevented by simply closing both runs at the same time. If you do need to close at different times then just make sure that any DOI changes are made at a time when no expenses have been partially processed.
For example: If the "JIB Int" option is removed from an interest after an expense is processed on the revenue run but before it is processed on the JIB run this will cause a discrepancy. The interest would not have been billed for the expense on the revenue run. Then when the JIB run is closed, it will not be allocating the expense to the interest because it is not a JIB Interest. This expense will never get reported to that investor and the operating company will end up getting shorted. Likewise, if the situation is reversed the investor would get charged for the expense twice.