Typical Controller’s Functions/Processes

1. Typical Controller’s Functions/Processes Accounts Payable/T&E Establish and maintain Vendor master (sometimes in gen acctg or procurement) Sort and Prepare invoices (validity, completeness), scanning Code Invoices & approve within delegation Process payables in AP system (e.g. invoices/ credit notes, procurement card statements, electronic files, etc.) Control Data input Control and issue payments Handle vendor queries/relations Reconcile AP related accounts Manage AP document record retention Joint Venture Fixed Assets/Projects Cash and Banking Production Financial & Mgmt Reporting, Consolidations Maintain employee master files (in AP) Check expense reports (validity, completeness) as per policy Process expense claims Process advance payments/monitor Control data input Payment control and issue Employee Query Handling/relations Manage documents and record retention Fed, State, Ad Valorem Tax Reptg Internal Audit Production/Revenue Acctg/Reporting Division Order?

2. Typical Controller’s Functions/Processes Accounts Payable/T&E Establish and maintain Joint Interest master file and DOI Issue/respond to cash calls Calculate Overhead and Payroll Burden Process Joint interest cutback/billing Perform Non-op cost tracking/accounting Perform Payout/non-consent tracking/reporting Reconcile and collect Joint venture account receivables Plan, execute and facilitate Joint Interest audits Handle partner inquiry/response/relations Joint Venture Fixed Assets/Projects Cash and Banking Set up Project codes Monitor and determine project capitalization Post to Fixed Assets module Process Asset movements Partner/Operations Query handling Run and post Depreciation Reconcile Fixed Asset/GL Close FA module Post Accruals & provisions Statutory asset revaluation Prepare and distribute fixed asset reports Maintain coding structure within the Fixed Assets system Production Financial & Mgmt Reporting, Consolidations Fed, State, Ad Valorem Tax Reptg Internal Audit Production/Revenue Acctg/Reporting Division Order?

3. Typical Controller’s Functions/Processes Bank account closing/opening support Control, reporting and claim administration of agreed bank fees and conditions Bank statement information processing Transmission of payment information or files to bank (s ) Banking interface(s) monitoring Daily cash management input Bank account reconciliations Policy setting & LOAs Accounts Payable/T&E Joint Venture Fixed Assets/Projects Cash and Banking Establish and maintain organizational hierarchies Maintain and Process Allocations Balance sheet and income statement reconciliations and adjustments Data collection, analysis and recording of journal entries Business unit allocations Consolidations Closing schedule creation and co-ordination Period end adjustments and accruals General Ledger processing Pro-forma Reporting (management) Pro-forma Reporting (statutory) Variance Analysis Intercompany accounting Ad hoc reporting/special projects Maintenance of chart of accounts, cost centers Budgets and forecasting Payroll Accounting/Allocations Initiate vendor and customer master setups and maintenance Production Financial & Mgmt Reporting, Consolidations Fed, State, Ad Valorem Tax Reptg Internal Audit Production/Revenue Acctg/Reporting Division Order?

4. Typical Controller’s Functions/Processes Accounts Payable/T&E Joint Venture Interpret and maintain tax rates Manage inventory movements re tax treatment Calculate income tax journal entries Manage and reconcile tax books vs GAAP Tax model definition Generate Income tax reports, payments, refund requests Calculate and file ad valorem tax reports by local area as required Fixed Assets/Projects Cash and Banking Production Financial & Mgmt Reporting, Consolidations Co-ordinate and assist external auditors Create and execute internal audit plans Co-ordinate SOX compliance Create and manage internal controls framework Fed, State, Ad Valorem Tax Reptg Internal Audit Production/Revenue Acctg/Reporting Division Order?

5. Typical Controller’s Functions/Processes Collect and input production volumes, other info Collect/analyze/input revenue prices/values Create and record Revenue estimates and/or accruals Book and distribute Revenue Reconcile Revenue accounts (ar/royalty payables, etc) Handle Owner inquiry/response/relations Perform variance analysis of monthly/annual revenue Handle business unit/field inquiry/response Perform ad hoc reporting/special projects Produce volume balancing statement creation/reporting/analysis Perform Gas Plant Accounting Apply cash and/or revenue booking via revenue checks/stmts Coordinate data collection/file monthly state production tax reports Coordinate data collection/file monthly state and federal royalty reports Reconcile tax/royalty accounts Handle agency inquiry/response/relations Accounts Payable/T&E Joint Venture Fixed Assets/Projects Cash and Banking Production Financial & Mgmt Reporting, Consolidations Coordinate with Land Admin to create ownership at marketing arrangement level Establish and maintain revenue ownership master files Establish and maintain revenue owner name and address masters Update master files for transfers, divestments and acquisitions Manage legal and negative suspense owner status/balances, escheat Collection/maintenance of owner tax data, i.e. W9’s. 1099’s Handle Owner inquiry/response/relations Fed, State, Ad Valorem Tax Reptg Internal Audit Production/Revenue Acctg/Reporting Division Order?

6. Determining the scope and level of competencies in Controller’s Sample organization questions that need review/solved: Regional/central location of various activities, e.g. invoice approval and prep, AFE establishment, etc. Operations/accounting split of duties re production reporting/accounting, e.g volume entry, state volumetric production reporting, marketing contract maintenance, etc. Split of duties between Land Admin and Controllers re divisions of interest, Joint Interest and Revenue, who establishes master files in Oracle, who maintains, how are owner inquiries managed between the two groups. Is state tax and regulatory reporting part of revenue function or is it managed as a separate group, team? Is there a separate group responsible for product marketing accounting, e.g. ngl’s, natural gas, crude oil exchanges? Does Newfield operate natural gas plants? Does Newfield utilize outside suppliers to assist or handle certain tasks therefore making them out of scope, e.g. ad valorem tax calc/filings, state or federal income tax filings, scanning or document preparation and retention Is internal audit a part of controllers or separate? Which group handles vendor/customer masters to create separation of duties? Is there a separate Treasury function or is it a part of general/financial accounting, part of Controller’s? Are owner/partner/vendor/employee inquiries handled in a single help desk environment or within each function? Is there a separate team that deals with international accounting? Which group manages project budgets? Company/Business unit budgeting? Lease operating statements?

7. Determining the scope and level of competencies in Controller’s Examples of potential ‘cross-controller’ competencies: Reconcile accounts – pertains to almost every function even though type of account will have varied nuances, volume and complexity Timely collection/analysis and input of data into Newfield financial systems – pertains to almost every function although the complexity of the analysis and collection of the data will require higher proficiency in areas such as revenue. Respond to third party inquiry/maintain relations – occurs with vendors in AP, WI owners in JV, with WI, RI and purchasers in Revenue, employees in AP, owners in Division Order, etc. Preparation of ad hoc reports/execution of special projects – occurs in most every function though the system from which the reports are pulled or perhaps ability to be proficient in Excel will vary. Special projects could be M&A, litigation or management initiated. Ability to Interpret Oil and Gas Contract terms and conditions – especially important in JV, Revenue, Division Order although the specific contracts will vary. Perform Monthly and Annual Closing Processes – applicable to most functions although proficiency would be highest in financial reporting where accountability for the end to end closing process generally resides. Given the variety of tasks that are performed within controller’s and to limit the number of competencies that will need to be established and maintained, we recommend that we develop as many of the competencies as possible to be ‘cross-controller’…and potentially…’cross-commercial’ as possible.