Exploration and Production Accounting - Level 2MDT International
Exploration and Production Accounting - Level 2 - 5 day Training Course
The aim of this training course is to raise to an intermediate level your knowledge and understanding of international E&P finance and accounting. This is achieved by in-depth examination of international practices and current developments across a broad range of relevant topics. You are encouraged to challenge existing methods as a basis for reviewing procedures and introducing improvements in your own work place.
What You Will Learn
- Enhanceyourknowledgeofaccountingandreportingissuesunique totheE&Pindustry with emphasis on the application of International Financial Reporting Standards (IFRS).
- Improve your understanding of the accounting and reporting of Sales Revenue, Farm In/Farm Out, and Carried Interest.
- Enhance your knowledge of Production Sharing Contacts and Joint Venture Accounting issues including Unitisation & Redetermination.
- Improve your knowledge of the Corporate Budget and Planning process including a review of Key Performance Indicators and Company Strategy.
- Raise your awareness of the E&P business activity for which we are accounting and reporting.
Suitability - Who should attend?
This Exploration and Production Accounting - Level 2 training course is suitable for personnel with a good foundation knowledge in exploration and production accounting.
It is strongly recommended that, depending on current level of E&P Accounting knowledge, maximum benefit from this course would be increased by attending our predecessor Level 1 course.
Outcome / Qualification etc.
Participants on this course are eligible for 35 hours of CPD accreditation on completion.
Training Course Content
Regulation of Oil and Gas Company Accounting
- Accounting standards applicable to E&P companies
Accounting for Exploration & Appraisal Costs
- Understanding the scope for the use of differing accounting policies and practices in the capture and reporting of exploration and appraisal costs - all of which are permitted under IFRS.
- The nature of commercial reserves and their significance in accounting and reporting.
The DD&A calculation
- Calculating DD&A on a Unit of Production basis
- Dealing with changes in costs and reserve estimates
- Raise awareness of the differing approaches in use by E&P companies when interpreting and applying IAS 37 in accounting for decommissioning.
- Testing for impairment of assets. Comparison of IAS 36 and FAS 144 requirements
Accounting Policies - Review
- Team exercise to consolidate E&P accounting policy topics covered to date.
Accounting for Financing Arrangements
- Common practice on accounting for E&P company financing and risk sharing arrangements, such as, farm in/farm out and carried interests.
Accounting for Sales Revenue
- Recommended practice on accounting for oil and gas sales, including pipeline blends and overlift/underlift adjustments.
Accounting for E&P Company Taxes
- Introduction to types of E&P taxes and, specifically deferred tax accounting.
State Frameworks for the Control & Exploitation of Petroleum Reserves
- Overview of issues pertaining to the ownership of oil & gas.
- Comparing the Concessionary System to the Contractual System.
Production Sharing Agreements / Contracts
- Understanding the difference between cash flow and cost recovery.
- The relationship between cost oil & profit oil.
- Calculating and accounting for entitlement barrels.
- Understanding ‘R’ factors and their application.
- Risk Service Contracts.
- Accounting for production bonus in a PSA / PSC.
- Reserves movements in a PSA / PSC.
- Overview of Joint Ventures and the Bidding Process.
- The Joint Operating Agreement (JOA) and the Accounting Procedure.
- The principles of JV Accounting.
JV - Unitisation and Redetermination
- How to account for product and cost sharing changes following an equity redetermination.
JV Cash Management
- Cash calling, invoicing and cash management.
JV Billing Arrangements
- How to account for JV billing statements.
- Accounting for redetermination adjustments.
JV Cost Allocation
- Key issues in allocating JV costs, such as, transportation costs, PCO and G&A.
- A review of typical JV audit issues.
Planning & Budgeting
- The top down / management by objectives approach.
- Using the Budget <=Model.
- Review of the most commonly used industry key performance indicators
- Compare and contrast Large v Small E&P company strategy.
- Team exercise to prepare and present an E&P company strategy.
Course Fee: £2750.00 (+ VAT for attending UK courses). Fees include your attendance at the relevant training course/s and the provision of a comprehensive training course manual, course completion certificate, plus lunch and refreshments during the training day. Fees do not include accommodation and living costs.
MDT International can also provide this course on an in-house course basis, to discuss please submit enquiry.
Following this Level 2 course, the next level is Level 3 which introduces more advanced knowledge and techniques.
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