A large number of developed and developing countries in which extractive industries represent an essential part of the economy lack a specific accounting regulation, nor have they adopted the standards issued by the FASB, the SEC, the OIAC, or the NASB. In 1999 the International Accounting Standards Committee (IASC) launched a project aimed at developing an International Accounting Standard (IAS) applicable to mining, oil, and gas companies. This paper provides a view on (1) the accounting standards for extractive industries in Spain, (2) the actual accounting practices followed by the main Spanish oil companies, and (3) the limitations they find in the ability of the current accounting model to provide a true and fair view of their financial position.

Financial Accounting and Reporting in Extractive Industries: Evidence from Spanish Oil Companies. Escobar, Bernabé; García-Ayuso, Manual; and Angel Pérez, José, Summer 2000, pp. 1‑11.

Royalty payment disputes, particularly those involving gas, continue to be a major source of oil and gas litigation. Appellate courts offer little if any consistent guidance in royalty-related issues. Dr. Anderson addresses the question of marketable-product jurisdiction under the terms of typical royalty clauses.

Royalty Valuation: Calculating Freight in a Marketable-Product Jurisdiction. Anderson, Owen L., Summer 2000, pp. 12‑43.

One of the greatest strengths of the FASB is its practice of open due process procedures, yet participation in the FASB's standard-setting process has been poor with only an estimated 0.002 percent of corporations in the U.S. submitting a comment letter concerning the first 100 FASs issued. Companies in the petroleum refining industry, however, have been visible participants in this process. An analysis of Fortune 500 companies' participation from 1973-1997 reveals that of the 20 companies submitting the greatest number of comment letters, seven were in the petroleum refining industry. Furthermore, research indicates that differences exist between the petroleum industry and other industries for lobbying behavior, accounting choices, and tax rates. This study explores further the participation of petroleum refining companies in the standard-setting process during the FASB's first 25 years.

An Empirical Analysis of the Petroleum Refining Industry's Participation in the FASB's Standard-Setting Process. Tandy, Paulette and Wilburn, Nancy, Summer 2000, pp. 44‑61.

To mitigate the perceived inadequacies of historical cost information for oil and gas firms, both the FASB and the SEC require supplemental reserve disclosures, including both reserve-quantity and reserve-value measures as well as disclosure of their major components. This paper expands on previous work by further examining the information content of the proven reserve measure and its components, specifically the relative information content of the aggregate measure of proven reserves versus its components.

The Relative Information Content of the Components of the Reserve Quantity Disclosure. Berry, Kevin T.; Wilcox, William; O'Bryan, David; and Quirin, Jeffrey, Summer 2000, pp. 62‑78.

As margins have decreased in the petroleum industry, pressures have mounted to cut costs and increase efficiencies. A key issue, particularly within shared services, is whether or not to outsource. Activity based management (ABM) can provide a fresh perspective on cost control, process improvement, shared service management (e.g., service level agreements), and outsourcing analysis for even the most experienced shared service or business unit managers.

The ABC's of Activity Based Management (ABM) in the Petroleum Industry. Muras, Andrew D.; Calhoun, Dennis D.; and Stripling, W. Steven, Summer 2000, pp. 79‑100.

In a taxable acquisition, a buyer of property burdened by environmental contamination must capitalize the subsequent payment of environmental cleanup costs regardless of whether those costs would have been deductible to the seller. This does not necessarily hold true in the case of non-taxable transactions. Accordingly, taxpayers may want to consider the existence of environmental liabilities when negotiating the purchase price of property and may also want to consider the use of nontaxable acquisition techniques in appropriate circumstances.

The Deductibility of Environmental Remediation Expenditures Incurred in the Context of Taxable Acquisitions. Wilson, Jr., William H., Summer 2000, pp. 101‑106.

A report on the activities of the Board of Directors and the various committees of the Council of Petroleum Accountants Societies (COPAS) from the executive director.

COPAS: An Update. Gear, Jon, Summer 2000, pp. 107‑114.

Since the issuance last February of Financial Accounting Standards Board exposure draft No. 206-B, "Accounting for Obligations Associated with the Retirement of Long-Lived Assets," companies have approached the issue of accounting for future DR&A costs differently, and the result has been a range of diverse accounting practices. Questions regarding the manner in which companies who are using the various methods of accounting for future DR&A costs will make the transition to the new standard have been the subject of much debate. This column examines the various methods that have traditionally been used in practice in order to gain a better perspective of the implications of the exposure draft and the eventual implementation of the new standard.

Current Developments in Environmental Issues. Wright, Charlotte, Summer 2000, pp. 115‑120.

If, given a clean slate, you were asked by a newly created government to design the ideal fiscal regime from the ground up, what would that system be? This thought-provoking column offers an outline of what the key elements of such a system should be and how it would work.

Current Developments in Production Sharing Contracts and International Petroleum Concerns. Johnston, Daniel, Summer 2000, pp. 121‑127.