A critical analysis of the use of accounting standards’ comment letters as lobbying tools by extractive industry firms

Ayodele Oshokamere Asekomeh, Alex Russell, Heather Tarbert

    Research output: Contribution to journalArticle

    Abstract

    Current international GAAP allows companies to choose either the full cost (FC) or the successful efforts (SE) method to report the results of their exploration and production activities. These two methods are conceptually different and can produce radically divergent reported results. Since the accounting method adopted determines the timing, recognition, and amortization of exploration and development costs, it follows that method of choice inherently confers some discretionary control over capitalized expenditures and thereby empowers managers to engage in income management.
    Original languageEnglish
    Pages (from-to)55–76
    Number of pages22
    JournalPetroleum Accounting and Financial Management Journal
    Volume25
    Issue number3
    Publication statusPublished - 2006

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