IFRS for Oil & Gas Accounting
Course Overview:
This course provides a focused understanding of the International Financial Reporting Standards (IFRS) as they apply specifically to the oil and gas industry. Participants will learn how to interpret and apply key IFRS standards to the unique accounting challenges in exploration, development, production, and decommissioning activities. The course aims to equip finance and accounting professionals with the skills to ensure compliance, transparency, and accuracy in financial reporting within this sector.
Course Objectives:
By the end of this course, participants will be able to:
- Understand the framework and key principles of IFRS relevant to oil and gas accounting
- Apply IFRS standards to exploration, evaluation, and development costs
- Account for property, plant, and equipment in oil and gas projects
- Handle revenue recognition and joint venture accounting
- Manage asset retirement obligations and decommissioning costs
- Comply with disclosure requirements specific to oil and gas operations
- Address challenges related to impairments, reserves, and environmental liabilities
Who Should Attend:
- Accounting and finance professionals in the oil and gas industry
- Auditors and consultants specializing in energy sector financial reporting
- Controllers, financial managers, and CFOs of oil and gas companies
- Professionals involved in regulatory compliance and financial governance
- Analysts and investors focusing on oil and gas financial statements
- Anyone needing to understand IFRS application in oil and gas accounting
Course Outline:
Introduction to IFRS and Oil & Gas Industry Overview
- Overview of IFRS and its importance globally
- Unique characteristics of the oil and gas industry
- Key accounting challenges in oil and gas operations
- Overview of oil and gas lifecycle: exploration, development, production, and abandonment
IFRS Standards Relevant to Oil & Gas
- IFRS 6: Exploration for and Evaluation of Mineral Resources
- IAS 16: Property, Plant and Equipment
- IAS 37: Provisions, Contingent Liabilities and Contingent Assets
- IFRS 15: Revenue from Contracts with Customers
- IFRS 11: Joint Arrangements
- IFRS 13: Fair Value Measurement
Accounting for Exploration and Evaluation Activities
- Recognition and measurement of exploration and evaluation assets
- Capitalization vs. expense policies
- Impairment testing and indicators
- Cost pools and reclassification criteria
Property, Plant, and Equipment Accounting
- Recognition and measurement of development and production assets
- Depreciation methods and useful life estimation
- Asset revaluation and impairment considerations
- Accounting for asset transfers and disposals
Revenue Recognition in Oil & Gas
- Identifying performance obligations under IFRS 15
- Measuring transaction prices and allocating revenue
- Handling joint venture revenues and profit sharing
- Revenue recognition challenges in long-term contracts
Joint Ventures and Partnerships Accounting
- Accounting for joint operations and joint ventures under IFRS 11
- Combining financial statements and equity method application
- Disclosure requirements for joint arrangements
Asset Retirement Obligations and Decommissioning
- Recognition and measurement of decommissioning liabilities
- Accounting for changes in estimates and revisions
- Impact on asset cost and depreciation
Impairments and Environmental Liabilities
- Indicators of impairment in oil and gas assets
- Measurement and recognition of impairment losses
- Accounting for environmental restoration and compliance costs
Disclosure and Reporting Requirements
- Key disclosures for oil and gas accounting under IFRS
- Segment reporting and transparency
- Managing audits and regulatory reviews
- Best practices in financial reporting for oil and gas entities