open Programme: ACCOUNTING, FINANCE & FINANCIAL MANAGEMENT
Financial Reporting Standards: IFRS For Oil & Gas Sector
There are diverse accounting practices among companies in the upstream oil and gas industry and many commercial and contracting arrangements which are unique to it.
To provide guidance and a transition for entities in the extractive industry that are adopting IFRS, the IASB issued IFRS 6 Exploration for and Evaluation of Mineral Resources, in December 2004. Since then no further authoritative guidance specific to oil and gas has been released and no date given for when work on the extractive industry project might recommence.
This four-day course summarizes the main accounting and disclosure requirements for upstream exploration, development and production before looking at the application of other key IFRS’s to the unique and diverse contracting arrangements of the industry. We will examine how IFRS applies to presentation of financial statements, in particular presentation of income statement; revenue recognition including revenue recognition points, under and over lift and revenue sharing under production sharing agreements amongst others.
At the end of the course, participants will be able to:
- Understand and apply IFRS to the upstream oil and gas industry.
- Appreciate the diversity in accounting practices in the extractive industry and the IASB’s project to review those practices
- Apply hedge accounting as it relates to the oil and gas industry
- Recognize the relevant accounting guidance for the extractive industry under US/Canadian GAAP
- Understand the options available for valuing tangible assets
- Comprehend the complex rules on evaluating assets for impairment to Complete a smooth transition to IFRS
- IFRS-first time adoption workshop
- Understand how to get started with IFRS
Who Should Attend
This course is ideal for individuals at all levels within an organization who need to have detailed knowledge of IFRSs. In essence, it is an opportunity to transfer a crucial new skill set to those responsible for making accounting decisions and preparing, reviewing or approving IFRS financial statements.
- Knowledge of basic accounting under national standards.
- It would be advisable to have an understanding of the main principles of accounting for exploration, development and production under local GAAP
- Types of oil and gas contracts and typical features – leases, concessions and PSA’s and technical service agreements
- Recap of IFRS 6 Exploration for and Evaluation of Mineral Resources and how it interacts with IAS 16 Property, Plant and Equipment, IAS 38 Intangible Assets and IAS 36 Impairment of Assets
- Application of IAS 1 Presentation of Financial Statements; contrasting different formats used for the performance statements, treatment of write offs and classifications of oil and gas assets in the balance sheet
- Specific issues posed by Production Sharing Agreements including control and de-recognition of assets, cost recovery treatments and reserves estimation
- Application of IAS 18 Revenue Recognition; when is revenue recognised by upstream companies, how are under and over lift balances treated, how is revenue calculated and shared following cost recovery methods in PSA’s?
- Overview of IAS 37 provisions as it relates to asset retirement obligations with application of IFRIC 5 Rights to Interests arising from Decommissioning, Restoration and Environmental Rehabilitation Funds
- Application of IAS 12 Income Taxes; distinguishing between sales type and income taxes, treatment of tax oil in PSA’s, treatment of tax holidays and taxes paid on behalf of, deferred taxes arising on asset retirement obligations
- Application of IAS 17 leases and specifically IFRIC 4 Determining whether an Arrangement contains a Lease and update on the IASB leasing project
- Application of IAS 21 Foreign Currency, in particular to the identification of functional currency
- Application of IAS 39 / IFRS 9 to management of financial risks in upstream oil and gas, use of derivatives and hedging
- Application of IAS 28 and IFRS 11 to joint ventures and arrangements, including accounting by operators to non-operators
- Accounting for asset exchanges and conveyances
Location Pricing (Ex. VAT) Dates
Nigeria N295,000 16th - 20th May 2016