Because of the impact of reserves information in the

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: y input to fair value calculations in accounting for a business combination. Assumptions about future profit potential based on reserves estimates may be the basis for the recognition of deferred tax assets arising from unused tax losses. Because of the impact of reserves information in the financial statements, oil and gas companies typically include some information about reserves in the critical estimates and judgements note to the financial statements. 2011 KPMG International Cooperative ("KPMG International"). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. 2011 KPMG IFRG Limited, a UK company, limited by guarantee. All rights reserved. Impact of IFRS: Oil and Gas 19 Discussion Paper Extractive Activities Significant disclosure requirements proposed The project team's proposals relating to reserves reporting included the following. Use of Petroleum Resource Management System (PRMS) definitions for reserves and resources. The discussion paper noted that the PRMS is used by many oil and gas companies for internal resource management and it also corresponds closely to market regulator disclosure requirements in most jurisdictions that have formalised reserve disclosure requirements. Significant disclosure requirements relating to reserves and resources, including: quantities of proved reserves and proved plus probable reserves, with reserve quantities presented separately by commodity and by material geographical area; the main assumptions used in estimating reserve quantities, and a sensitivity analysis; and a current value measurement of reserves by major geographical region if historical cost is used to measure E&E assets. Reserve definition respondents' views Most respondents agreed with recommendations that industry-based definitions of reserves and resources be used in any future IFRS to set disclosures and complement the accounting requirements. Most als...
View Full Document

{[ snackBarMessage ]}

Ask a homework question - tutors are online