OIL AND GAS ACCOUNTING AND TAXATION
COURSE OVERVIEW & LEARNING OUTCOMES
Oil and Gas Financial Accounting and Taxation is a two-module training program presents with its peculiarities including in reporting and disclosures regarding exploration and production activities. Companies more than not have to deal with multiple accounting rules across jurisdictions. The structure of the business also requires distinct accounting rules in areas like joint interest operations, asset retirement obligations, leasing operations, and oil and gas reserve disclosures.
This course discusses the fundamentals of O&G accounting and how the inherent concepts apply in practice. The U.S. Generally Accepted Accounting Principles (GAAP) standards for exploration and production companies and the IFRS (International Financial Reporting Standards) will be compared in detail. Participants leave this training with the ability to understand the financial statements of exploration and production companies as well as the underlying issues that accounting and finance groups face when preparing financial statements and addressing commodity and foreign exchange risk exposure. Participants will also undergo a case study review and exercises of actual financial statements and the accounting principles used in preparing them.
TARGET PARTICIPANTS
- Accounting/Finance employees of O&G companies,
- Non-accountants –
- O&G attorneys and legal officers,
- administrators,
- Planning Analysts,
EXAMPLE MODULES
MODULE I
- Introduction the Oil & Gas Value Chain
- Upstream
- Midstream
- Downstream
- Minerals Rights
- Nigeria/ International
- US
- Complexity of Private Ownership
- Types of O&G Companies
- IOCs/Integrated
* Sample Financial Statements
- Majors/ Independent
* Sample Financial Statements
- iNOCs/NOCs
* Sample Financial Statements
- Accounting Standards
- Successful Efforts
- Full Cost
- Examples of Companies Using Either
- Lease Acquisition
- Accounting
- Types of Leases
- Joint Ventures
- Joint Operating Agreement
- Accounting for Costs
- Impacts to Financial Statements
- Exploration
- Types of Costs
- Successful Efforts
- Full Cost
- Development
- Types of Costs
- Successful Efforts
- Drilling
- Types of Costs
- Intangible Drilling Costs
* Tax treatment of IDCs
- Production
- Types of Costs
- Hydrocarbon Reserves
- Definitions
- How Reserves are Calculated
- SEC Requirements
- Types
- Upstream Business Model and Price Volatility Implications
- Production
- Reserves
- Revenue Accounting
- Royalty Contracts /JVs
- Service Contracts
- Production Sharing Contracts
- Main revenue recognition issues faced by the industry
- Oil & Gas Marketing
- International Natural Gas Marketing
- International Crude Oil Marketing
- International LNG Marketing
- Overview of US Gas and Crude Marketing
- Depreciation, Depletion and Amortization DD&A
- Depreciation
- Depletion
- Amortization
- Units of Production (UOP) Depreciation
- Proved Reserves
- Proved Developed Reserves
- Area of Calculation
- Field (Focus)
- Well
- Differences Between Conventional and Unconventional Wells and DD&A Rates
- Dynamics of Oil and Gas Pricing
- Hydrocarbon Demand and Supply
MODULE II
- Taxation
- Income Tax
* Upstream
* Downstream
* Inventory Impacts
* Manufacturers Credits
- International Operations & Tax Implications
- Indirect Taxes
* Excise Taxes
* Sales Taxes
- Other Taxes
* Duties
* Property Taxes/Inventory
- International Financial Reporting Standards
- Overview of Nigeria’s Financial Reporting Council (FRC)
- U.S. Generally Accepted Accounting Principles (GAAP) vs. IFRS
- How to apply IFRS to oil and gas exploration, development and production activities
- Capitalizing and expensing under IFRS during exploration and development
- How having multiple accounting practices affect financial reporting in O&G? (Thinks of IOCs.)
- IFRS reporting requirements and impacts under different petroleum contract systems.
- Impairment - how to assess unproved and proved reserves
- Calculating and interpreting financial and operational metrics used to analyze the costs, profitability, efficiency, and value added by a firm's exploration and production activities
- How do oil and gas companies present their financial statements when reporting under IFRS?
- How to establish chart accounts for an oil and gas company
- Management accounting and reporting requirements between joint venture partners?
- Abandonment and Decommissioning costs under IFRS?
- Joint Interest Accounting
- Establishing a Joint Venture - Operational and Financial Drivers and Types of Agreements
- Agreements - Types Used in Joint Ventures & Accounting Procedure Relationship to Governing Agreement
- COPAS (Council of Petroleum Accountants Societies)
* Historical Perspective on COPAS Accounting Procedures
* Dissecting a COPAS Accounting Procedure
* COPAS Vs. Other Accounting Procedures
- Direct vs. Indirect Costs - Accounting Procedure Language and Proper Charging
- Overhead - Development, Drilling, Production, MCO & Catastrophe
- Materials - CEPS, Casing & Tubing, Controllable vs. Non-controllable
- Special Joint Venture Adjustments - Non-consents, payouts, well pad adjustments
- Allocations - Accounting for Costs Benefiting Multiple fields/blocks
- Joint Interest Billings - AFE and Operational Costs
- Accounting for Joint Venture Costs - Key alternatives, Application
DURATION
5 Days per Module
LOCATIONS:
Dubai, Ghana, Houston, London, Kigali