A continuing column which provides short summaries and updates of recent events that affect oil and gas taxation. This issue's column includes: IPAA, S Corporations, Self-Employment Income, Capitalized Costs, Depletion, Tax Shelters, and Bankruptcy.

Current Developments in Oil and Gas Taxation. Mark, Richard S., Fall/Winter 1988, pp. 1‑7.

Given the current economic environment for crude oil and natural gas, landowners need to develop programs to encourage producers to lease properties for exploration. The Province of Alberta developed several incentive programs to spur leasing activities. These programs are highlighted in this article.

A Report of Alberta's New Temporary Incentive Programs. Koch, Bruce S., Fall/Winter 1988, pp. 8‑22.

The question of whether the FASB's required disclosures of net present values of oil and gas reserves is useful information has been of interest to preparers and to the profession. Professors Harris and Olson find that stock market values of oil company shares are better explained by historical cost book values than by the standardized measure disclosure.

Accounting Disclosures and the Market's Valuation of Oil and Gas Properties. Harris, Trevor S. and Ohlson, James A., Fall/Winter 1988, pp. 23‑49.

Although accounting rules require a ceiling test for full cost companies, the rules are silent with respect to such a test for successful efforts companies. With the severe decline in crude oil and natural gas prices, many companies found that their historical costs exceeded the values of their properties. This paper reviews the extent to which successful efforts companies employ ceiling tests as well as the factors that are taken into account in those test calculations.

Survey of Implementation of a Successful-Efforts Ceiling Test. Gallun, Rebecca A and Bruno, Joan D., Fall/Winter 1988, pp. 50‑65.

Whether a taxpayer holds an economic interest in a mineral property can have significant tax consequences on the nature of transactions and depletion calculations. However, the Tax Code does not provide a precise definition of an economic interest. Professor Fenton looks to the decisions of the Tax Court to identify factors which the courts have held determinative of whether an economic interest exists.

Analyzing the Economic Interest Concept in Natural Resource Taxation. Fenton, Jr., D. Edmund, Fall/Winter 1988, pp. 66‑93.

Accounting practices in the U.S. Petroleum industry are subject to a number of different considerations than in other industries. This review of 148 oil and gas company corporate annual reports shows how the industry accounted for assets, liabilities and equities as well as the treatment of supplemental disclosure and footnote items. The article includes many examples of presentations drawn from these reports.

Financial Reporting Practices in the U.S. Petroleum Industry: Survey of 1987 Financial Reports. Deakin, Edward B., Fall/Winter 1988, pp. 94‑165.