In this 3-day course, participants will gain comprehensive knowledge of accounting principles and standards as they apply to the oil and gas industry.

The oil and gas industry is a complex and highly regulated sector, and understanding the intricacies of accounting within this industry is vital for professionals in the field. This multi-day course is designed to provide participants with a deep understanding of accounting principles and standards specific to the oil and gas sector.

Day 1 - Fundamentals

Understanding the Nature of Oil and Gas Entities

In the first day of the course, participants will delve into the unique characteristics of oil and gas entities. This section will help you grasp the intricacies of this industry, setting the stage for more in-depth learning.

An Overview of the IASB Framework

International Accounting Standards Board (IASB) plays a significant role in shaping accounting standards. In this segment, you will gain insights into the IASB framework and its relevance to the oil and gas sector.

Composition of IFRS Financial Statements

Understanding the structure and components of financial statements is crucial. You will explore how International Financial Reporting Standards (IFRS) apply to the oil and gas industry.

Accounting for Reserves and Key Relevant Standards

Reserves are the lifeblood of the oil and gas industry. This section will delve into accounting for reserves and the standards that govern it.

Financial Statement Presentation and Disclosures

Learn how to present financial statements effectively and ensure that the necessary disclosures are made. This knowledge is essential for compliance and transparency.

Case Studies Reviewing Presentation and Disclosures by IFRS E&P Companies

Real-world case studies will provide practical insights into how IFRS exploration and production (E&P) companies present their financial statements and disclosures.

Accounting for Fixed Assets under IFRS

Fixed assets are a significant part of the oil and gas industry. Understand the principles, initial recognition, and measurement of these assets under IFRS.

Examination of Impairment Principles and Comparison to US GAAP

Impairment can significantly impact financial statements. This section compares impairment principles under IFRS with US Generally Accepted Accounting Principles (GAAP).

Treatments on Disposal and Discontinuance of Assets

Learn how to account for the disposal and discontinuance of assets, a crucial aspect of managing oil and gas operations.

Day 2 - From Prospecting to Evaluation

A Comparison of "Traditional" Full Cost and Successful Efforts Accounting Methods

In this section, you will explore different accounting methods and their implications on financial reporting.

Review of IFRS 6 and Its Impact on Accounting Methods

IFRS 6 is a standard tailored to the extractive industry. Understand its impact on accounting methods within the oil and gas sector.

Treatment of Dry Holes and Impairment of Exploration Expenditure

Dry holes are a common occurrence in exploration. This part of the course explains how to account for them and manage exploration expenditures effectively.

Case Studies on Accounting Policy Choices and Their Impact

Through case studies, you'll gain a practical understanding of how accounting policy choices can affect financial outcomes.

Recognition, Measurement, and Classification of Development Spend

Development spend is a significant component of oil and gas projects. Learn how to recognize, measure, and classify these expenses correctly.

Treatment of Abnormal Expenditures and Application of Impairment Standards

Abnormal expenditures can arise during oil and gas operations. This section discusses their treatment and the application of impairment standards.

Case Studies on Cash Generating Units Impairment

Real-world case studies will highlight how cash generating units are assessed for impairment in the oil and gas industry.

Day 3 - Provisions, Decommissioning, Production, and Revenue Recognition

Definitions, Measurement, and Provisions under IAS 37, IFRIC 1 & IFRIC 5

Gain an understanding of provisions under IAS 37, IFRIC 1, and IFRIC 5, and how they impact financial reporting.

Capitalization of Environmental Damage and Decommissioning Obligations

Environmental responsibility is a critical aspect of the oil and gas industry. Learn how to account for environmental damage and decommissioning obligations.

Accounting for Rehabilitation Funds and Measurement of Asset Retirement Obligations

Discover how rehabilitation funds are accounted for and how asset retirement obligations are measured.

Application of IAS 16 to Production Assets

This section explores how International Accounting Standard 16 applies to production assets in the oil and gas sector.

Units of Depreciation Method and Their Application

Understand the units of depreciation method and how it is applied in the oil and gas industry.

Revenue Recognition and Measurement Issues

Revenue recognition can be challenging in this industry. Learn about the issues and how to address them effectively.

Accounting for Royalty, Production Tax Payments, and Revenue Allocations

Royalties and production tax payments are part of the revenue landscape. This section provides insights into their accounting treatment.

Measurement of Inventories

Managing inventories efficiently is crucial in the oil and gas sector. Learn how to measure them accurately.

Conclusion

In conclusion, this course provides a comprehensive understanding of accounting principles and practices in the oil and gas industry. It covers everything from the fundamentals to specific accounting methods and real-world case studies. By the end of this course, participants will be well-equipped to handle the intricacies of oil and gas industry accounting.

The learning objectives of this multi-day course on accounting principles and practices in the oil and gas industry are as follows:

1. Comprehensive Understanding: Participants will gain a deep and comprehensive understanding of the accounting principles and practices specific to the oil and gas sector.

2. Industry-Specific Knowledge: Learn about the unique characteristics of oil and gas entities and commercial arrangements, allowing for informed decision-making and financial reporting.

3. International Accounting Standards: Gain knowledge about International Financial Reporting Standards (IFRS) and their application in the oil and gas industry, ensuring compliance with global accounting standards.

4. Financial Statement Competence: Understand the composition of IFRS financial statements, enabling participants to create accurate and transparent financial reports.

5. Reserves Accounting: Learn how to account for oil and gas reserves and key relevant standards, crucial for the valuation and management of these critical assets.

6. Presentation and Disclosures: Acquire skills for effective financial statement presentation and disclosures, ensuring transparency and compliance with reporting requirements.

7. Real-World Application: Engage in case studies that review the presentation and disclosures by IFRS E&P companies, providing practical insights into industry-specific financial reporting.

8. Asset Accounting: Understand the accounting for fixed assets under IFRS, including principles, initial recognition, and measurement, crucial for asset management and financial accuracy.

9. Impairment Principles: Examine impairment principles, comparing them to US Generally Accepted Accounting Principles (GAAP), and learn to manage asset impairment effectively.

10. Asset Disposal: Gain proficiency in the treatment of asset disposal and discontinuance, an essential aspect of asset management in the oil and gas sector.

11. Accounting Methodologies: Explore the comparison between "traditional" full cost and successful efforts accounting methods, ensuring informed choices for financial reporting.

12. IFRS 6 Impact: Review the impact of IFRS 6 on accounting methods within the oil and gas industry, enabling compliance with industry-specific standards.

13. Exploration Expenditure: Learn how to account for dry holes and impairment of exploration expenditure, managing exploration costs efficiently.

14. Development Spend: Understand the recognition, measurement, and classification of development spend, essential for budgeting and financial reporting.

15. Environmental and Decommissioning Obligations: Acquire skills in capitalizing environmental damage and decommissioning obligations, ensuring responsible accounting practices.

16. Rehabilitation Funds: Learn how to account for rehabilitation funds and measure asset retirement obligations, contributing to environmental sustainability.

17. Production Asset Accounting: Explore the application of International Accounting Standard 16 to production assets, improving asset management.

18. Revenue Recognition Challenges: Understand revenue recognition and measurement issues specific to the oil and gas industry, ensuring accurate financial reporting.

19. Royalty and Tax Payment Accounting: Gain insights into the accounting for royalty, production tax payments, and revenue allocations, crucial for revenue management.

20. Inventory Management: Learn how to measure inventories accurately, ensuring efficient management of critical resources.

By the end of this course, participants will be well-prepared to navigate the complexities of accounting within the oil and gas industry, make informed financial decisions, and create transparent, compliant financial reports in accordance with international standards.