About this course
The aim of this 5-day 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 board range of relevant topics. You are encouraged to challenge existing methods as a basis for reviewing procedures and introducing improvements in your own workplace.
What You Will Learn
- Enhance your knowledge of accounting and reporting issues unique to the E&P industry with emphasis on the application of International Financial reporting Standards (IFRS).
- Improve your understanding of the accounting and reporting of Sales Revenue and E&P Industry Taxation.
- Improve your knowledge of the Fiscal / Contractual frameworks commonly used in the E&P industry, including the use of Production Sharing Contracts and the related accounting implications.
- Develop your understanding of 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.
The course content has been designed to be delivered via a ‘Live’ Remote Instructor Led platform. It is a highly participative course using a combination of instruction, group discussions and practical examples and exercises to ensure attendees absorb both the theory and the practical application of the topics. The first session will run for 2½ hours to allow for introductions, subsequent sessions will be 2 hours long. Each day will consist of 2 sessions (1 morning/1 afternoon) with a break of 10 minutes during each of the sessions, time will be allowed for questions and discussions.
Accounting Policies – Regulation and Accounting for Exploration & Appraisal Costs
- Features of E&P industry and the related accounting implication
- Accounting standards applicable to the E&P industry
- Understanding the scope for the use of differing accounting policies and practices in the capture and reporting of exploration and appraisal costs
Accounting Policies – Reserves and DD&A
- The nature of commercial reserves and their significance in accounting and reporting
- Calculating DD&A on a Unit of Production basis
Accounting Policies – Changes in DD&A and Decommissioning
- Updating the DD&A calculation to reflect changes in costs and reserve estimates
- Interpreting and applying IAS 37 in accounting for Decommissioning
Accounting Policies - Asset Impairment Test
- Performing Asset Impairment Tests under IAS 36
- Commitments, Provisions and Contingent Liabilities
- A review of IFRS 16
Accounting for Sales Revenue plus an Introduction to E&P Taxation
- Shared pipelines
- Understanding and accounting for Overlift/Uplift adjustment
- E&P tax – a review of common industry taxes
State Frameworks for the Control & Exploitation of Petroleum Reserves
- Overview of issues pertaining to the ownership of oil & gas
- The PSC System – understanding the difference between cash flow and cost recovery
- The relationship between cost oil & profit oil
- Calculating and accounting for entitlement barrels
- Overview of Joint Ventures and the Bidding Process
- The Joint Operating Agreement (JOA) and the Accounting Procedure
- The principles of JV Accounting
- Understanding JV Farm In / Farm Out arrangements
Joint Ventures – Unitisation and Redetermination, Cash Calls & Billings
- Understanding the impact of Unitisation and Redetermination
- Principles of Cash Calls and Invoice Funding
- JV Billing – a practical example including modified cost sharing due to an equity redetermination
Planning & Budgeting
- The top down / management by objectives approach
- Preparing a budget including the Key Financial Statements
Performance Measurement & Company Strategy
- Review of the most commonly used industry key performance indicators
- Compare and contrast Large & Small E&P company strategy
- Team exercise to prepare and present an E&P company strategy
Who should attend
We recommend that, to derive maximum benefit from this course, you first attend our predecessor Level 1 course. Otherwise, this course is suitable for personnel with a good foundation knowledge in exploration and production accounting.
"Full of insight. The course goes beyond what you can learn from books. For someone without oil and gas industry experience, the course gave me a feel of what it is like to be in the business i.e. the risks involved, market behaviour, current trends, politics behind transactions and a lot more."Almira Landicho, UT Global Services
"This course has exceeded my expectations; I shall recommend it to my staff and peers."Edwin Kamar, Office of Auditor General
"I am very pleased with the course delivered by Mr. Drew LEITCH. I well appreciated his deep knowledge of the topics discussed, his experienced in the E&P industry, and the human touch of the course."Armel LANGAMA, Assala Energy
"Superb! Many Ahh! moments when I finally understood certain E&P concepts and principals."Yong Ai Min, Petroleum Brunei