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IFRS Course


IFRS Fundamentals for Upstream Oil and Gas (3 days)

Course Details

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There are diverse accounting practices among companies in the upstream oil and gas sector, and many commercial and contracting arrangements which are unique to that industry.

To provide guidance and a transition for entities in the extractive industries that have adopted IFRS, the IASB issued IFRS 6 Exploration for and Evaluation of Mineral Resources in 2004. Since then no further authoritative guidance specific to oil and gas accounting has been released, and no date given for when work on the extractive industry project might recommence. However, since then there has been a gradual convergence of best practices within the industry.

This three-day course provides an in-depth overview of the principal accounting and disclosure requirements as applied by upstream exploration and production businesses reporting under IFRS, including those with SEC listing. We will see how IFRS 6 is being applied to exploration and evaluation activities, which development costs are capitalised and look at alternative approaches to the depletion, depreciation and amortisation of oil and gas assets. The course also considers the application of other Standards to oil and gas assets such as IAS 23 to capitalisation of borrowing costs, IAS 37 for asset retirement obligations and IAS 36 to impairment. This course will also review aspects of presentation and disclosure, in particular, that required by SEC reporters of oil and gas reserves and related information.

An overview of US GAAP treatments relevant to IFRS preparers is also presented. The program answers questions such as:

  • How does the diversity in accounting practices in the extractive industry affect financial reporting and what is the IASB’s response?
  • Where can relevant accounting guidance for the extractive industry be found under both IFRS and US GAAP?
  • How are asset retirement obligations and rehabilitation funds being accounted for?
  • Which standards apply when reviewing oil and gas assets for impairment?
  • What has happened with the IASB's project for Extractive Industries Financial Reporting?
  • What supplementary disclosure requirements does the SEC require for oil and gas producing activities?
  • How to use the information presented for analytical purposes?

Learning Objectives

  • 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
  • Recognize the relevant accounting guidance for the extractive industry under US GAAP
  • Understand the options available for valuing tangible assets
  • Comprehend the complex rules on evaluating assets for impairment

Who Should Attend

  • Financial accountants in the oil and gas industry
  • Management accountants of IOC’s and NOC’s
  • Internal and external auditors of oil and gas companies reporting under IFRS
  • Staff of revenue authorities and NOC’s working with IOC’s
  • Financial analysts seeking to improve their understanding of the accounting by oil and gas companies


  • Fundamental concepts of oil and gas accounting methods
  • In depth review of IFRS 6 Exploration for and Evaluation of Mineral Resources and its application in practice
    • Full cost treatments as permitted by IFRS
    • Successful efforts methods of accounting
    • Non-drilling exploration costs
    • Drilling exploration costs
  • Application of the IFRS Conceptual Framework, IAS 38 and IAS 16 to the treatment of pre-exploration activities and development expenditures
  • Application of IAS 16 to production assets, including depreciation, depletion, and amortization
  • Application of IFRS 6 and IAS 36 to the impairment of assets during exploration, development and production
  • Application of IAS 16, IAS 37 and IFRIC 5 to dismantlement, restoration and abandonment ("asset retirement obligations") and related rehabilitation funds
  • Capitalization of borrowing costs – IAS 23
  • Presentation and disclosure, including applications of IAS 1 Presentation of financial statements and IAS 7 Statement of cash flows
  • Proved oil and gas reserve quantities and related disclosures required by SEC oil and gas reporters
  • Discussion of using disclosures to derive key performance metrics
  • Overview, introducing the key commercial and contracting arrangements (joint ventures, concessions and PSCs) with guidance on where to look for help with their accounting implications

Teaching Method

  • Group live instruction with interactive participation encouraged
  • Explanation and demonstration of the accounting rules relating to expenditures for the exploration for and evaluation of mineral resources
  • Presentation of the requirements for impairment of assets, with practical examples
  • Explanation and demonstration of the recognition and measurement principles for tangible and intangible assets
  • Discussion of US GAAP in so far as it is relevant to IFRS reporters in the extractive industry
  • Presentation and discussion of real financial statements and disclosures
  • All participants receive a comprehensive binder containing copies of the presentation slides, handouts and other course materials


The instructor for this course will be drawn from one of our core faculty of subject matter experts. Further details will be published at the earliest opportunity.


Our 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.

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


Knowledge of basic accounting under national standards or IFRS. No advance preparation is required for this course.