ExxonMobil, one of the world's largest oil companies, was investigated
ExxonMobil, one of the world's largest oil companies, was investigated
September 19, 2016
[China paint information]
Eric schneiderman, Attorney General of New York, is investigating ExxonMobil, one of the world's largest oil companies, on accounting issues
when the oil price fell, the oil giant did not withdraw assets in accordance with accounting standards. This approach is different from other oil and gas companies, including Chinese oil companies
since 2014, the global crude oil price has fallen by 60%, forcing a large number of oil companies to accrue equipment, particleboard, medium density fiberboard and plywood, all of which belong to wood-based panel plants and properties. If they are not depreciated, the public will be misled into thinking that the financial situation of the enterprise is still healthy. However, ExxonMobil did not make any provision for this
PetroChina (,, Se) explains "asset accrual" in this way: when the book value of assets may not be recoverable due to the occurrence of events or changes in the environment, it is necessary to conduct an impairment test on property, plant and machinery equipment, including oil and gas assets
generally, oil enterprises will accrue bad debts, non-performing assets and goodwill arising from the decline of oil prices. In PetroChina's 2015 annual report, first finance and economics found that the company's depreciation, depletion and amortization in that year was 202.875 billion yuan, an increase of 14.3% over 2014. The explanation was that the provision for asset impairment was 25.022 billion yuan, an increase of 2.3% year-on-year in the same caliber
PetroChina also said that the actual turnover of the company's overseas business in 2015 was 540.239 billion yuan, accounting for 31.3% of the group's total turnover, and the pre tax loss was as high as 8.349 billion yuan, mainly due to the provision for impairment of oil and gas assets made by some overseas subsidiaries. Throughout the year, the provision for impairment of oil and gas assets of PetroChina affecting profit and loss was 19.893 billion yuan. The impairment of these assets was mainly caused by high production and operation costs and low oil prices. The book value of these assets has been reduced to the recoverable amount
some accounting experts also believe that it is too early to draw a conclusion whether ExxonMobil should be blamed for not accruing. Accounting rules give enterprises a certain choice in this regard. Due to the different methods of accrual, there are great differences in whether impairment accrual is made after three stages of cooling: hot water, warm water and cold water, and the results of accrual
"this is a subjective field," said tomselling, an accounting blogger. "Everyone will draw different accrual conclusions based on the company's cost and the age of the oil well."
PetroChina has said that determining whether assets are impaired and the amount of impairment includes the management's estimates and judgments, such as the future price of crude oil, the price of refined oil products and chemical products, production, etc. The test and calculation of impairment provision are based on the assumption that the current economic situation is consistent with the group's business plan. There is no change in some assumptions or there is a favorable change, which may exempt the group from the impairment of these assets. Changes unfavorable to some assumptions may lead to the impairment of assets
a spokesman for ExxonMobil said that the company followed the regulations of the securities and Exchange Commission and the financial accounting standards board. "Historically, Exxon Mobil did not make large withdrawals when commodity prices plummeted." Edward Jones oil analyst said
Larry Crumbley, an honorary professor at Louisiana State University, said, "companies are generally unwilling to accrue. Once you reduce income and assets on the balance sheet, it is difficult for you to turn back."
Terry Crain, an honorary professor at the University of Oklahoma, told the media that when the oil price temporarily drops, enterprises do not need to accrue, which is stipulated in the accounting standards. However, the code does not specify the time range of "temporary decline", which is "one month, two months or half a year? It's hard to say, this is a gray area."
it is worth noting that Chevron made a provision of $2.8 billion for some of its businesses in the second quarter of this year
Carter, robertmctamaney, a lawyer of Ledyard Milburn, said that if the company judged that the oil price would rise quickly in the short term, then impairment was a wrong behavior. He also said that ExxonMobil is the oldest oil producer in the United States, and the cost of drilling rigs and other equipment owned by ExxonMobil is low, so there is no need to accrue
as one of the largest oil equipment enterprises in China, the announcement of COSL (,) on August 29 showed that the net profit of the enterprise was -8.403 billion yuan. The decline of net profit is closely related to the accrual
affected by the market situation, the recoverable amount of some overseas drilling platforms of COSL is lower than the book value of assets, so the provision for impairment of fixed assets is about 3.688 billion yuan. In 2008, COSL also acquired awilcooffshore as, forming goodwill. Due to the continuous deterioration of the global oilfield service market, the recent low oil price, the continuous reduction of capital expenditure in the field of global oil exploration and production, and the decline of the service price of plants and machines, and the utilization rate of platforms, according to the impairment assessment results, COSL also accrued the above goodwill impairment loss of about 3.455 billion yuan, the total of the two items is 78. The maximum diameter of the sample: Ф 630mm143 million yuan
looking at ExxonMobil, it is not the first company to conduct accounting under the supervision of the attorney general's office in New York. The former CEO of AIG also discussed AIG's accounting practices with prosecutors in New York
in addition, in 2013, although ExxonMobil's natural gas business plummeted and "did not make money", the company also insisted on not mentioning it, which was questioned by the SEC and analysts. In 2010, ExxonMobil acquired natural gas producer XTO energy company and became the largest natural gas producer in the United States, but who had expected the natural gas price to decline, and fell to a ten-year low in 2012
in the second quarter of this year, ExxonMobil's net profit was $1.7 billion, or 41 cents per share, lower than that of the same period last year. 4 Jinan experimental machine factory reminds you to choose a large manufacturer of $190million to buy experimental machine 1. The company's revenue also fell sharply by 22% to $57.69 billion in the quarter. Closely related to oil prices is the "oil and gas exploration and production" sector. The revenue of this part of the business fell by $1.7 billion to $294million
Copyright © 2011 JIN SHI