Different Components of a Joint Venture
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Russ: This is the PKF Texas Entrepreneur's Playbook. I’m Russ Capper, this week’s guest host, and I’m here with Brian Baumler, Senior Vice President with Joint Ventures Strategic Advisors and an audit director with PKF Texas. Welcome back to the Playbook Brian.
Brian: It’s really great to be here.
Russ: We’ve talked before about the services of your strategic advisor practice. You mostly focus on audits which seem to be very important.
Brian: That’s correct.
Russ: Are there things you do outside of audits.
Brian: Another piece of business that we do is actually joint venture management services. And those are actually involved where we actually are representing management and providing some insights into the joint venture projects that they’re doing. Certain components of those represent things like reviewing of the various vendor contracts that are in place; there are things like instruction contracts, there are gathering arrangements, there are transportation arrangements. There are – especially in oil and gas – farm out arrangements, there are farm in arrangements. There’s the joint venture operating agreements themselves. So we just make sure that the company is properly representing themselves to their actual non-operating interest parties.
Russ: Well I would assume the management services have to take place right up on the front end of a deal coming together, us that right?
Brian: Yeah, absolutely. Those types of things really need to be put in place on the front end of those joint venture arrangements just to make sure they’re not tripping up along the way while they’re providing the various operator services providing to the non operating partners.
Russ: And when you’re talking about reviewing agreements and contracts are you talking about encouraging both sides to review the other side’s or are you talking about actually PKF reviewing them? Or both?
Brian: Well we represent management on behalf of the joint venture and we just make sure that the spirit of those agreements are being maintained for the benefits of both parties actually.
Russ: Okay, I can imagine that’s pretty important because everybody doesn’t have enough time to have dotted all the I’s and crossed all the t’s.
Brian: Well that too and I think what’s even more important is just because we bring so much experience to the table we have the benefits of seeing a lot of different arrangements and opportunities where things can go awry in those processes.
Russ: Well Brian I really appreciate you sharing that perspective once again with us.
Brian: Thank you very much Russ.
Russ: You bet. For more about the joint venture services visit JVSA.com. This had been another Thought Leader production brought to you by PKF Texas Entrepreneur’s Playbook.