Esanda Engineering

Monthly routine accounting cycle

Month end closing routine – checklist
Preliminary and final close
Key account analysis and reconciliations
Standard monthly reports & key performance indicators
Inclusion of non financial reporting
Inventory accounting: materials & supplies
WORKSHOP:
Prepare a set of monthly accounts and basic reports
Prepare a set of quarterly accounts and basic reports

Quarterly / year end accounting routine

Quarter end closing routine – preliminary and final close
Quarterly reporting
Adjustments to make financial statements IFRS / GAAP compliant
Additional entries for year end
Preliminary closing routing for year end
Closing entries at year end
Final close, analysis and prepared by client schedules
Preparing a set of year end accounts
WORKSHOP:
Preparing a set of quarterly accounts and basic reports
Preparing a set of year end accounts and basic reports
Make required adjustments for a set of year end accounts to comply with IFRS / GAAP reporting requirements

Variance analysis and reporting routine

Preparing monthly variance analysis commentary
Preparing quarterly variance analysis commentary
Preparing year end variance analysis commentary
Monthly non financial reporting and analysis
Quarterly / year end non financial reporting and analysis
WORKSHOP:
Write the variance analysis commentary for a set of monthly reports
Write the commentary for a set of non financial quarterly reports
Write the variance analysis commentary for a set of year end reports

Background to oil and gas accounting

Overview of life cycle of an oil and gas project
Technology behind the industry
Disclosure of commercial reserves
Major issues facing upstream oil & gas accountants

Accounting and reporting system

Fundamental principles of financial reporting
Developing a robust chart of accounts – variables / fields
Entity reporting and consolidations
Nominal accounts, main and sub codes
Pyramid structure to facilitate recording joint interest billings
Establishing and reporting against cost centres
Generating budget and AFE cost control reports
Use of charge codes
Joint venture bill codes and corporate costs
Single and dual currency ledgers
Exchange rates and revaluation entries
Capturing and recording data / journal entries / all data on the system
Journal entries, supporting documentation and posting
Journal entries, supporting documentation and posting
What data is on the system / location of data
Backing up and protecting your database – separation of tasks
Cash basis v accruals basis reporting
Adjustments and correcting entries

Recording cash calls and monitoring costs

Payment and receipt of cash calls, bank accounts
Recording costs of monitoring non-operated projects

Recording expenditure, estimating and analysis

Exploration and appraisal costs
Drilling and completion costs
Project development expenditure
Operating expenditure
Direct and indirect time written costs and allocated overheads
Parent company overhead charge
Accruals and estimates
Recording joint interest billing – estimated and actual

Recording revenue and DD & A

Measurement of production and production records
Revenue accounting and sales receipts
Calculating underlift / overlift position, booking revenue
Calculating revenue under take or pay gas contracts
Recording royalty and production taxes
Reserve classifications and reporting and their use in accounting
Calculation and recording of DD&A
Recording provision for decommissioning
WORKSHOP:
Prepare a set of production accounting records
Calculate the entries to book oil revenue in an overlift position
Calculate the entries to book gas revenue in a pay position