Analysis of non-current assets in oil and gas industry

Abstract

Ukraine's oil and gas industry carries out a full range of operations on exploration and development of oil and gas fields, exploitation and exploration drilling, transportation and storage of oil and gas, supply of natural and liquefied natural gas to consumers. Naftogaz of Ukraine in the accounting for the presentation of financial information on fixed assets, the revaluation model is used, that is, objects are recorded at a revalued amount, which is its fair value less any accumulated depreciation and subsequent accumulated impairment losses.

Financial statements are based on the historical cost basis, except for property, plant and equipment valued at revalued amounts. Historical value is determined on the basis of fair value, compensation paid in exchange for goods and services. Fair value is calculated as the price received for the sale of an asset or paid for the transfer of a liability in the ordinary course of business between market participants at the valuation date, regardless of whether the price is directly observable or measured using another method.

The assessment of certain components of non-current assets in the accounting of "Naftogaz of Ukraine" basically meets the requirements of international practice.

Keywords: accounting, non-current assets, fixed assets, initial cost of fixed assets, fair value, international accounting standards, financial statements