IFRS Joint Venture Accounting for the Oil & Gas Industry (1 day)

Introduction

Joint ventures are extremely common in the international oil and gas industry and, while no two joint ventures are the same, each has a number of common features and implications for the companies that participate in them. While International Financial Reporting Standards (IFRS) prescribe the recognition, measurement and disclosure rules for external financial reporting, there are also a wide range of internal and intra-partner accounting issues to be determined and implemented.

This one-day course explains the nature and form of joint ventures and covers in detail the relationships between operators and non-operators in joint ventures, the financing of joint venture operations and the reporting of joint costs. Our specialist instructors also describe internal accounting for the costs and revenues from joint operations from the individual participant's point-of-view. The program also covers the requirements of IFRS 11 Joint Arrangements and IAS 28 Investments in Associates and Joint Ventures and is fully up to date with the latest amendments to those Standards.

This course answers questions such as:

• How are joint ventures structured in the oil and gas industry?
• What are the external financial reporting requirements for joint ventures?
• How to account for interests in joint operations?
• What issues typically arise regarding intra-partner relationships?
• How have the IFRS accounting rules for joint venture arrangements changed?

Learning Objectives

• Understand the nature and structure of joint ventures in the oil and gas industry
• Learn the external financial reporting requirements for joint ventures
• Comprehend the mechanisms of financing and reporting the operations of joint ventures
• Appreciate the issues regarding intra-partner relationships, including cost allocation and audits

Who Should Attend

• Financial accountants in the oil and gas industry
• Management accountants of IOC’s
• Finance staff responsible for billing statements’
• Financial accountants in the oil and gas industry
• Auditors with responsibilities for joint venture audits
• Staff of revenue authorities and national oil companies working with IOC’s
• Financial analysts seeking to improve their understanding of joint venture operations

Topics

• Characteristic features of the oil and gas industry
  • Scale of operations
  • Nature and timing of cash flows
  • Risks
  • Determination of success
• The nature of joint ventures and reasons why oil and gas companies participate in them
• Types of joint ventures across the globe
• Typical provisions of joint venture agreements
• IFRS 11 Joint Arrangements and IAS 28 Investments in Associates and Joint Ventures
• Relationship between operator and non-operator participants
• The financing of joint ventures – billing statements and cash flow reporting
• Reporting of expenditures
• Budgets and approvals
• Cost allocation methods and issues
• Revenue recognition relating to over and under-lifting
• Unitisations and adjustment of interests
• Audits

Teaching Method

• Group live instruction
• Explanation and demonstration of the accounting issues relating to joint venture arrangements
• 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

Instructors

Venue

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

Prerequisites

Basic knowledge of accounting processes and objectives. No advance preparation is required for this course.