Mgt. Accounting and Production Sharing Agreements for the Oil & Gas Industry (1 day)
The internal reporting challenges that face accounting professionals in oil and gas companies mirror those relating to external reporting. The particular nature of oil and gas industries and their activities determine the way in which their operations and financial condition are reported. While the external reporting environment is largely regulated by accounting standard setters, there are no parallel accounting standards relating to internal reporting.
This one-day course summarises and discusses the information requirements of oil and gas company management and goes on to relate these requirements to the accounting and reporting procedures that are common in production sharing agreements (PSA) between national authorities and private sector oil companies.
The programme answers questions such as:
- What accounting issues are particularly relevant to the oil and gas industry?
- Which steps should be undertaken to establish a strong management accounting system?
- How are appropriate management accounting procedures established?
- What are the characteristics of production sharing agreements?
- What are recommended best practices to meet PSA accounting and reporting requirements?
- In what areas are control and reconciliation issues expected to arise and how should they be addressed?
- The Characteristic Features of the Oil and Gas Industry
- Scale of operations
- Nature and timing of cash flows
- Determination of success
- Accounting Issues in the Oil and Gas Industry
- Capitalisation vs. expense
- Exploration costs
- Site restoration costs
- Revenue recognition
- Reserve quantities
- Management Accounting Issues
- Relationship of management accounting to external financial reporting
- Selection of management accounting policies
- Identifying the audience(s) for management accounting information
- Creating a chart of accounts
- Selecting cost centres
- Selecting cost elements
- Expenditure reporting vs. commitment reporting
- Reporting expenses
- Reporting capital expenditures
- Management Accounting Procedures
- Detail of reporting
- Frequency of reporting
- Overhead allocation
- Responsibility accounting
- Introduction to joint venture accounting issues
- Production Sharing Agreements
- Nature of production sharing agreements
- Comparison with other risk sharing arrangements
- Typical provisions of a PSA
- Accounting and Reporting Under Production Sharing Agreements
- Typical provisions of PSA accounting procedures
- Allowable and non-allowable expenditure
- Cost recovery
- Profit oil and gas
- Ownership of assets
- Non-financial information and reporting
- Reconciliation Issues
- Between external financial reporting and internal management accounts
- Between internal management accounting and PSA accounts
- Treatment of tax
- Treatment of activities outside the scope of PSA
- Benefits of convergence
- Group live instruction
- Explanation and demonstration of the accounting issues relating to management accounting and production sharing agreements
- Presentation and discussion of worked examples
- Group discussion and interactive participation is encouraged
- All participants receive a comprehensive binder containing copies of the presentation slides, handouts and other course materials
Basic knowledge of accounting processes and objectives. No advance preparation is required for this course.
- Appreciate the role of management accounting in the oil and gas industries
- Learn the steps and procedures recommended to establish a strong management accounting system
- Appreciate the differing needs of various users of financial information
- Comprehend the nature of Production Sharing Agreements (PSA)
- Understand the PSA accounting and reporting requirements
- Consider the implications of these reporting requirements and determine how they may be addressed
- Ensure maximum convergence between reporting processes
Who should attend?
- Financial accountants in the oil and gas industry
- Management accountants of IOC’s
- Finance staff responsible for PSA’s
- IT staff responsible for developing G/Ls for IOC’s
- Auditors with responsibilities for PSA audits
- Staff of revenue authorities and national oil companies working with IOC’s
- Financial analysts seeking to improve their understanding of PSA operations
CPE / CPD Accreditation
IASeminars is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org.
Field of study: Accounting
ICAEW Partner in Learning
IASeminars is proud to have been named as an ICAEW Partner in Learning, working together to offer the ICAEW IFRS Certificate to our clients worldwide. ICAEW (The Institute of Chartered Accountants in England and Wales) is a world leading professional membership organisation that promotes, develops and supports over 145,000 chartered accountants worldwide. CPE certificates obtained from attending IASeminars courses are an ideal way for ICAEW members and others to demonstrate their continuing professional development, provided that the topic is relevant to their learning and development needs.
Texas State Board of Public Accountancy
IASeminars is registered with the Texas State Board of Public Accountancy as a CPE sponsor. Our CPE Sponsor ID is: 009689. This registration does not constitute an endorsement by the Board as to the quality of our CPE Program.
- Our London seminars take place in 4 star professional conference facilities, generally in city-centre hotels like the Marriott, Sheraton or Hilton brands. Detailed Joining Instructions are sent to all registered delegates by email approximately one month before the event. The Joining Instructions will confirm exact venue details and nearby (or onsite) hotel recommendations with bedroom rates where available. Coffee and lunch will be provided.
Alan Mayo is a highly experienced instructor in the field of international financial reporting, with a particular professional interest in IFRS for oil and gas companies and also in IPSAS for the public sector. He is a UK chartered accountant with over 20 years of experience as an auditor and consultant with PricewaterhouseCoopers in both London and Paris. A founding member of the PwC Client Training business in London, Alan delivered courses on financial reporting and financial management to a wide range of PwC clients. Alan regularly instructs courses on international oil and gas accounting, and he has delivered in-house programmes for such organisations as ENI, Petronas, Kogas, Saudi Aramco, Nigerian Liquefied Natural Gas and the Ugandan Revenue Authority. He previously worked as an auditor on the privatisation of British Gas, and taught financial reporting and financial controllership programmes for Shell. Alan also managed a team within PwC that provided training and change management support to UK public sector agencies as they transitioned from cash to accruals based accounting, including the Foreign and Commonwealth Office and the Ministry of Defence. His current work includes supporting UK local authorities and not for profits in developing the financial management skills of their staff, and he has worked extensively with the UN and other international organisations in their transition to IPSAS. An independent training consultant since 2001, Alan has been a senior instructor with IASeminars since 2004.
To bring this course in-house please contact us and we will be pleased to assist