Oil and Gas Accounting

9 Credits: Accounting


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Oil and Gas Accounting

Course Level
CPE Credits

9 Credits: Accounting

Course Description

Oil and gas operations have some of the most unique accounting issues found in any industry. This course delves into acquisition, exploration, development, and production activities, covering many industry-specific accounting issues. Topics covered include the successful efforts method, full cost method, reserve reporting, the unit of production method, severance taxes, take-or-pay arrangements, transfers of mineral interests, and joint interest accounting, as well as industry-specific controls that should be installed. This course is the essential oil and gas desk reference for the accountant.

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Learning Objectives

Upon successful completion of this course, participants will be able to:

Chapter 1

  • Recognize the various steps in the process of exploring for, developing, and producing on an oil and gas property.
  • Identify the different types of wells.
  • Identify the documentation used to record produced oil and gas.
  • Recognize the contents of a lease arrangement.

Chapter 2

  • Define the different cost classifications associated with oil and gas activities.
  • Recognize the various types of production costs.
  • Describe the situations in which a joint operating agreement is used.
  • Define the contents of a lease database.

Chapter 3

  • Identify the different classifications of exploration costs.
  • Recognize the accounting for all aspects of drilling a well and subsequent well operations.
  • Identify the indicators of sufficient progress in regard to assessing the viability of a project.
  • Differentiate between the successful efforts and full cost methods.

Chapter 4

  • Differentiate between the successful efforts and full cost methods.

Chapter 5

  • Describe the calculation process for the unit of production method.

Chapter 6

  • Recognize the valuation rules relating to oil and gas inventory.

Chapter 7

  • Note the contents of a run ticket.
  • Identify the information contained within a division order.
  • Describe the accounting for producer gas imbalances.

Chapter 8

  • List the criteria used to report proved oil and gas reserves.
  • Recognize the indicators that can trigger a review of reserves.

Chapter 9

  • Recognize the accounting variations available when recording a nonmonetary exchange.

Chapter 10

  • Recognize all aspects of the accounting for joint interest arrangements.

Chapter 11

  • Describe the circumstances under which interest can and cannot be capitalized.

Chapter 12

  • State the situations in which asset retirement obligations can be deferred.
  • Note the rules used to determine the expected present value of an asset retirement obligation.
  • Recognize the accounting for environmental contamination costs.

Chapter 13

  • Describe the circumstances under which impairment testing should be conducted, as well as the rules for doing so.
  • Note the situations in which an asset can be classified as held for sale.

Chapter 14

  • Describe the disclosure requirements for reserves.

Chapter 15

  • Identify the appropriate costing to be used for exploration costs associated with mineral resources, as well as the indicators for when impairment testing should be conducted on mineral resources assets.

Chapter 16

  • Recognize the audit activities in which an auditor will be engaged when auditing an oil and gas firm.

Chapter 17

  • Recognize the different types of controls that are specific to an oil and gas firm.
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Course Specifics

Course ID
Revision Date
May 22, 2023

Basic accounting knowledge

Advanced Preparation


Compliance Information

NASBA Provider Number: 103220

CMA Notice: Western CPE makes every attempt to maintain our CMA CPE library, to ensure a course meets your continuing education requirements please visit Insitute of Management Accountants (IMA)

CFP Notice: Not all courses that qualify for CFP® credit are registered by Western CPE. If a course does not have a CFP registration number in the compliance section, the continuing education will need to be individually reported with the CFP Board. For more information on the reporting process, required documentation, processing fee, etc., contact the CFP Board. CFP Professionals must take each course in it’s entirety, the CFP Board DOES NOT accept partial credits for courses.

Meet The Experts

Steven M. Bragg Headshot

Steven M. Bragg, CPA, is a full-time book and course author who has written more than 250 business books and courses. He provides Western CPE with self-study courses in the areas of accounting and finance, with an emphasis on the practical application of accounting standards and management techniques. A sampling of his courses include the The New Controller Guidebook, The GAAP Guidebook, Accountants’ Guidebook, and Closing the Books: An Accountant’s Guide. He also manages the Accounting Best Practices podcast. Steven has been the CFO or controller of both public and private companies and has been a consulting manager with Ernst & Young and …

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