Advanced Oil & Gas Accounting (1) - HRODC Training Institute

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Advanced Oil and Gas Accounting (1) Course - For Whom Designed? - Who Should Attend?

This Programme is designed specifically for all who work with financial information and measures of performance for Oil & Gas Exploration & Production activities, and people seeking to advance their career by improving their understanding of industry financial management. The target people seeking to broaden knowledge to improve job performance include:

Finance Directors and Managers

Financial Controllers

Chief Accountants

Treasury Officers

Asset Accountants

Joint Venture Accountants

Management Accountants

Internal and External Auditors

Government Regulators

Financial Analysts

Public Accountants

People who have good Financial Accounting Skills and who are interested in learning Oil and Gas Accounting.

Duration: 6 Days

Cost:

£3,600.00 + V.A.T. Per Delegate for UK Delivery

£4,000.00 + V.A.T. Per Delegate for Non-UK EU Delivery;

£4,000.00 for Non-EU Delivery (No VAT is Payable)

Cost includes:

Continuous Servings of Tea/Coffee;
Hot Lunch;
Seminar Guide;
Seminar Supplement;
Stationery
HRODC Diploma - Postgraduate or
Certificate of Attendance and Participation

Location: Central London UK – Other International Locations at:

http://www.hrodc.com/HRODC_Seminar_Schedule_06-07.International_Seminar_Schedule_UK_Seminars.htm

Course runs from 9:30 to 4:30 pm.

Registration is at 9:00 on Day 1

Date: Please see Seminar Schedule at:

Schedule - Part 1:

http://www.hrodc.com/HRODC_Seminar_Schedule_06-07.International_Seminar_Schedule_UK_Seminars.htm

Schedule - Part 2:

http://www.hrodc.com/London_Postgraduate_Courses_Postgraduate_Diploma_Postgraduate_Executive_MBA_Schedule_MBA_Diploma_London_UK.htm

Click to book this course: http://www.hrodc.com/Course%20Booking%20Form.htm

Click To View or Download Course Schedule Part 1

Click for Advanced Oil and Gas Accounting (1) Course Brochure

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Specialist Postgraduate Diploma – Postgraduate Diploma in Oil and Gas

Accounting and MSc in Advanced Oil and Gas Accounting

Please note that Advanced Oil and Gas Accounting (1) is the second in the series of Oil and Gas Accounting Courses, the first being Upstream Oil & Gas Accounting & Contracts: Oil & Gas Operation, Mineral Rights, Leases & Successful Efforts Accounting. The full series, therefore consists of:

Upstream Oil & Gas Accounting & Contracts: Oil & Gas Operation, Mineral Rights, Leases & Successful Efforts Accounting - Level 1

Advanced Oil and Gas Accounting (1) – Level 2

Advanced Oil and Gas Accounting (2) – Level 3

Advanced Oil and Gas Accounting (3) – Level 4

Successful Completion of all 4 courses will lead to the HRODC Postgraduate Diploma in Advanced Oil and Gas Accounting. Delegates, who start at Level 2, will need to study an Advanced Financial or Accounting Course, in order to meet the Minimum Hour Requirement (180 hours) for the Postgraduate Diploma.

On successful completion of Advanced Oil and Gas Accounting (2) – Level 3, Delegates may register for the MSc in Oil and Gas Accounting;
They will be assigned a Dissertation Supervisor, who will guide them towards the research in Oil and Gas Accounting;
They will be required to successfully complete Seminar #7 - Research Project: Design, Conduct & Report Seminar
They will be required to successfully complete Advanced Oil and Gas Accounting (3) – Level 4, before submitting their dissertations for assessment.

Course Objectives

By the conclusion of the specified learning and development activities, delegates will be able to:

Demonstrate a heightened understanding of the differing levels of Financial Reporting Regulation and Standardization, as they apply to Oil and Gas Accounting;

Demonstrate a heightened understanding of salient accounting concepts and governance

Demonstrate a heightened understanding of the differing levels of regulation and standardization applied to Oil and Gas accounting;

Deconstruct the role of finance and accounting in an Oil and Gas Organisation;

Exhibit a heightened understanding of the requirements of International Financial Reporting Standards;

Demonstrate a heightened ability to analyse their company’s performance, as an oil and gas player or regulator;

Demonstrate their ability to determine the extent to which financial measurement techniques such as full cost, successful efforts and reserve recognition can be used to evaluate oil and gas producing operations;

Exhibit their ability to utilise Advanced Financial Measurement Techniques such as full cost, successful efforts and reserve recognition are used to evaluate oil and gas producing operations;

Exhibit their ability to manage risk effectively in oil and gas project contracts, averting pitfalls of key contractual clauses;

Demonstrate the most appropriate contract formulation for Take-or-pay thresholds, accounting, transportation agreements, tariffs, reserving pipeline capacity, respectively;

Determine the roles and interplay of the Governments of territories containing hydrocarbon reserves, National Oil Companies, International Oil Companies, the Major Product Suppliers, the Engineering & Contracting Companies and the Service Companies,

Suggest the principal standard form contracts used in the industry including the North Sea LOGIC/CRINE standard form contracts and the Association of Independent Petroleum Negotiators (AIPN) standard form contracts;

Explain the international dispute resolution framework and institutions in the context of expert decisions, mediation arbitration and litigation.

Programme for Advanced Oil and Gas Accounting (1)

Contents, Concepts, Issues and Assessment

Please note that the breakdown represents a guide only and not a rigid arrangement. The tutor has the right to deviate from the order, as he or she deems necessary. While we aim to cover as much as possible of the concepts and issues, it is impossible to discuss all aspects. As a Postgraduate Course, Delegates and Students are expected to conduct their own research. As for all academic and professional examination, this course assesses selected knowledge and skills area, for each course iteration (delivery). Delegates and students should take responsibility for all the contents, concepts and issues that are presented below.

General Contents, Concepts and Issues

Day 1 – ACCOUNTING CONCEPTS and GOVERNANCE

Accounting Concepts

The money measurement concept
The entity concept
The going concern concept
The dual aspect concept
The accounting period concept
Materiality (Proportionality) concept
The conservatism concept
Consistency concept
The realization concept
The matching concept
The cost concept
Financial Governance and Standardization Institutions
Financial Accounting Standard Board (FASB)
The Security and Exchange Commission (SEC).
Accounting Standards Board (ASB)
International Accounting Standards Committee (IASC)
International Accounting Standards Committee Foundation (IASCF)
International Financial Reporting Standards (IFRS)
Industry Specific Oil and Gas Accounting Standards
Generally Acceptable Accounting Principles (GAAP) for Oil and Gas Producing Activities
Oil Industry Accounting Committee (OIAC)

Day 2 – DRILLING DEVELOPMENT COSTS – SUCCESSFUL EFFORTS

Income tax accounting for drilling costs

IDC vs. Equipment

Intangible Drilling Costs (IDC)

Up to an including the installation of Christmas Tree

Prior to Drilling

G & G

Preparation of Site

During Drilling

Drilling contractor’s charges

Drilling mud, chemicals, cement, supplies

Fuel

Wages

Well testing

At Target depth and during completion

Well testing

Perforating and cementing

Swabbing, acidizing and fracturing

Labour related to the installation of subsurface equipment

Plugging and abandoning cost – for dry wells

After Christmas tree – following completion

Removal of Drilling Rig

Restoration of land and damages paid to surface owner

Wells other than Exploration and development Wells

Intangible costs for extending well (see lists 1 & 2, above)

Intangible costs incurred in drilling water supply and injection wells

Intangible costs incurred in drilling water and injection – where water well is being used to for exploration and development well or for injection.

Financial accounting for drilling and development costs

Well classification

Exploratory well

Service well

Stratigraphic test well

Proved developed oil and gas reserves

Proved undeveloped reserves

Successful Efforts, exploration costs

Exploratory drilling costs

Development drilling costs

Stratigraphic test wells

AFE’s and drilling contracts

Special drilling operations and problems

Workovers

Damaged or lost equipment and materials

Fishing and side tracking

Abandonment of portions of wells

Additional development costs

Development costs

Costs of gaining access and preparing well location for drilling

Costs of drill and equip development well, development-type Stratigraphic test well

Cost of acquiring , constructing and installing production facilities, e.g. lease

Support equipment and facilities

Drilling and development seismic

Post-balance sheet events

Accounting for suspended well costs

Interest capitalization

Offshore and international operations

Problems

And Issues associated with Successful Efforts Accounting for Drilling Development Costs

Day 3 – PROVED PROPERTY COST DISPOSITION – SUCCESSFUL EFFORTS

Costs of Property
Cost of lease and well equipment
Cost disposition through amortization
Reserves owned or entitled to
DD&A calculation
DD&A on a field-wide basis
DD&A when oil and gas reserve are produced jointly
Estimated future dismantlement, site restoration, and abandonment costs
Exclusion of costs or reserves
Depreciation of support equipment and facilities
Cost disposition – nonworking interests
Revision of DD&A rates
Cost disposition through abandonment or retirement of proved property
Successful efforts impairment
Problems

Day 4 – FULL COST ACCOUNTING

Principles of Full Cost Oil and Gas Accounting
Disposition of capitalized costs
Inclusion of estimated future development expenditures
Inclusion of estimated future decommissioning costs
Exclusions of costs
Impairment of unproved properties costs
Abandonment of properties
Reclassification of properties
Support equipment and facilities
DDA&A under successful efforts versus full cost
Reserves in place – purchase
Interest capitalization
Limitation on capitalized costs – a ceiling
Asset retirement obligations
Deferred taxes
Income tax effects
Assessment of the ceiling test
SFAS No. 144 and Full Cost Ceiling Cost
Post-balance sheet events and the ceiling test
Problems and Issues associated with Full Cost Accounting

Day 5 – ACCOUNTING FOR PRODUCTION ACTIVITIES (1)

Accounting treatment
Cost of production versus inventory
Recognition of inventories
Lower-of-cost-or-market valuation
Accumulation and allocation of costs
Individual production costs
Secondary and Tertiary recovery
Gathering systems
Saltwater disposal systems
Tubular goods
Severance taxes

Day 6 – ACCOUNTING FOR PRODUCTION ACTIVITIES (2)

Production cost statements

Joint interest operations

Decision to complete a well

Project analysis and investment decision making

Payback method

Accounting rate of return

Net present value method

Internal rate of return

Profitability index

Problems and Issues associated with Accounting For Production Activities