Suspense Beginning Balances/Adjustments

This window allows you to either enter a beginning suspense balance or make adjustments to an owners suspense balance. Entries made on this screen will be specific to an owner's interest in a well and will be made by production period.

General Fields
Revenue Expenses Tab
Taxes Tab
Interests Tab

The suspense adjustments entered on this screen will affect the next revenue run closing for the group this interest is in. Entries made here will NOT affect the G/L, but will affect 1099 amounts.

Since the entries here do not create general ledger entries, be sure to enter a journal entry in QuickBooks for the suspense account that will be affected by this adjustment. The accounts used for suspense tracking are found in the Rev Dist/JIB Posting Preferences, and are the Owner Deficit Receivable, and Legal/Min Suspense Accounts. The amount of the Journal entry should be equal to the amount of the adjustment made on this screen.
- Debit the Owner Deficit Receivable account if you are increasing the amount that an owner owes you. This amount would be for a netted owner that had more expenses than revenue.
- Credit the Legal/Min Suspense account if you are increasing the amount that you owe an owner. This amount may be from a check minimum, owner on hold, interest on hold, or if an owners disbursement frequency hasn't released yet.

The reason that SherWare does not post anything when this screen is used is because one may be adjusting the suspense for a variety of reasons. Due to the number of possibilities (write off, unclaimed funds, transfer of interest, payment, etc.) we do not know what account you will want to use in each situation, so we leave this up to you. If you are not sure what the offsetting account should be we suggest consulting with your accountant.

If an interest is marked as a "JIB Int" on the division of interest window it will never have a deficit suspense balance. Balances for JIB owners are tracked in QuickBooks with the JIB receivable account. Balances for JIB interests can be created/adjusted in QuickBooks with a Journal entry to the JIB receivable account.
Even though the JIB interest will not have deficit suspense they may have legal suspense (minimum, held, or frequency) on the revenue side. You will still use this window for these adjustments.

General Fields
The fields on that are in the gray shaded part of the window and not on one of the tabs. This includes both above and below the whiter section that is the tabs.

Owner ID
The owner that the beginning balance/adjustment is to be made for.

Well ID
The well that the beginning balance/adjustment is to be made for.

Year & Period
The production year and production period that this beginning balance/adjustment should be associated with.

Date
The accounting date that this beginning balance/adjustment should be associated with.
If you have not closed any runs within the software then use December 31st of the previous year as the date. If you have closed any runs within the software then I suggest using the same date that was used for the last run closing.

Group
Select the group that the well is associated with. You can see what group this well is associated with on the well information window by looking at the "group" field that is located on the "well info" tab.

Owner Type
Select the interest type that corresponds with the interest type specified on the division of interest window for the interest that this beginning balance/adjustment is for. The three choices are: Royalty, Override and Working.

Program
If the interest that this beginning balance/adjustment is being made for is associated with a program then select that program here. If it is not associated with a program then leave this field blank. You can see if the interest is associated with a program by looking at the respective interest on the division of interest window.

Type of Suspense
Choose the type of suspense this beginning balance/adjustment represents. For beginning balances the suspense type should correspond to the type of suspense that the balance would be if it were created by a run closing. For adjustments to suspense you can look at the suspense report for this owner to see what type of suspense is used for his current suspense balance, then use the same type for the adjustment.
Minimum Amount - A balance you owe the investor because the owner did not earn enough to cover the minimum that is required to create a check. The minimum amount that is needed may be specified globally in the check printing preferences or individually on the codes tab of the owner information window.
This suspense type is used for beginning balances when you owe the owner an amount of money that should be released when the first/next revenue run is processed or if the amount owed is minimal and will likely still be under the check minimum for a while.
Deficit amount - A balance the investor owes you. Generally this is from the investor having more expenses than revenue for a given period. This will be used on a beginning balance/adjustment when the owner owes you money that should be netted from the future revenue that he earns.
Interests that have the "JIB Int" (JIB Interest) option marked on the division of interest window will never have a "Deficit" Suspense Balance. The balances for a "JIB Int" will be stored as a JIB balance instead of a suspense balance.
Owner on Hold - A balance that can be either positive or negative that is created because the "Owner on Hold" option is marked on the options tab of the owners information window. This is generally the case when an owner cannot be located or if a legal dispute is taking place with the owner.
Interest on Hold - A balance that can be either positive or negative that is created because the "Int (Interest) on Hold" option is marked on the division of interest screen. This is generally the case when an owner cannot be located or if a legal dispute is taking place with this interest.
When the interest is on hold the owner will still be allocated revenue and expenses from other interests.
Quarterly Owner Hold - A balance that can be either positive or negative that is created because the owner has a "Quarterly" disbursement frequency specified on the codes tab of the owner information screen.
Quarterly owners only receive a check on runs that are closed in March, June, September, and December. Any run closed in a month other than those listed will put the amounts earned by the respective owner into this suspense type.
Semi-Annual Owner Hold - A balance that can be either positive or negative that is created because the owner has a "Semi-annually" disbursement frequency specified on the codes tab of the owner information screen.
Semi-Annual owners only receive a check on runs that are closed in June and December. Any run closed in a month other than those listed will put the amounts earned by the respective owner into this suspense type.
Annual Owner Hold - A balance that can be either positive or negative that is created because the owner has an Annual disbursement frequency specified on the codes tab of the owner information screen.
Semi-Annual owners only receive a check on runs that are closed in December. Any run closed in a month other than December will put the amounts earned by the respective owner into this suspense type.

Flat Rate Record
Mark this option only if the interest that this beginning balance/adjustment is for is marked as a "Flat Rate" interest on the division of interest window.

Net Amount
The total amount of the beginning balance/adjustment that this entry is for. This field will automatically calculate based on the amounts entered in the Revenue/Expenses and Taxes tabs.

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Revenue/Expenses Tab
The fields visible only when the "Revenue/Expenses" tab is selected.

Oil Revenue
The amount of oil (BBL) revenue that contributes to the "Net Amount" of this beginning balance/adjustment.

Gas Revenue
The amount of gas (MCF) revenue that contributes to the "Net Amount" of this beginning balance/adjustment.

Other Rev
The amount of other (OTH) revenue that contributes to the "Net Amount" of this beginning balance/adjustment.

Trans Rev
The amount of transportation (TRAN) revenue that contributes to the "Net Amount" of this beginning balance/adjustment.

Misc Rev 1
The amount of Miscellaneous (MISC1) revenue that contributes to the "Net Amount" of this beginning balance/adjustment.

Misc Rev 2
The amount of Miscellaneous (MISC2) revenue that contributes to the "Net Amount" of this beginning balance/adjustment.

WI Expense
The amount of working interest expenses (Class 0) that contribute to the "Net Amount" of this beginning balance/adjustment.

Class 1 Exp - Class 5 Exp
The amount of expenses (Classes 1-5 respectively) that contribute to the "Net Amount" of this beginning balance/adjustment.

Gathering
The amount of gathering charges (GATH) that contribute to the "Net Amount" of this beginning balance/adjustment.

Compress
The amount of compression (COMP) that contributes to the "Net Amount" of this beginning balance/adjustment.

Flat Amount
The amount of the flat rate that contributes to the "Net Amount" of this beginning balance/adjustment.

BCP Expense
The amount of before casing point expenses (BCP) that contribute to the "Net Amount" of this beginning balance/adjustment.

ACP Expense
The amount of after casing point expenses (ACP) that contribute to the "Net Amount" of this beginning balance/adjustment.

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Taxes Tab
The fields visible only when the "Taxes" tab is selected.

Oil Tax 1 - Oil Tax 4
The amount of gas taxes (OTAX1-OTAX4 respectively) that contribute to the "Net Amount" of this beginning balance/adjustment.

Gas Tax 1 - Gas Tax 4
The amount of gas taxes (GTAX1-GTAX4 respectively) that contribute to the "Net Amount" of this beginning balance/adjustment.

Other Tax 1 - Other Tax 4
The amount of other taxes (PTAX1-PTAX4 respectively) that contribute to the "Net Amount" of this beginning balance/adjustment.

Tax W/H
The amount of state withholding that contributes to the "Net Amount" of this beginning balance/adjustment.

Backup W/H Amount
The amount of Federal Backup Withholding that contributes to the "Net Amount" of this beginning balance/adjustment.

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Interests Tab
The fields visible only when the "Interests" tab is selected.

All of the interests are for reference only. You do not have to fill them out. This is useful if you want to record what all of the owners interests were as of the time this beginning balance/adjustment was created.

The interests should be entered as a whole number. 87.5% would be entered as "87.5000000".