Welcome to the Practice Guide to Auditing Oil and Gas Revenues and Financial Assurances for Site Remediation.
The purpose of this Practice Guide is to provide contemporary guidance for public sector auditors on how to plan, carry out, and report on performance audits of oil and gas revenues and financial assurances for the remediation of oil and gas extraction sites.
Scope of the Practice Guide
This Practice Guide’s focus is strictly concerned with activities that are considered to be part of the upstream portion of the oil and gas industry, including exploration, production and decommissioning activities. It focuses on private sector extraction activities on public lands.
The Practice Guide does not cover:
- revenues from downstream activities, which include refining, distributing, and selling petroleum products and natural gas;
- revenues from general taxes, such as income and sales taxes;
- the operations of state-owned energy corporations; or
- the spending of royalty revenues by governments.
Contents of the Practice Guide
The Guide has been designed to meet the information needs of auditors at the various stages of their audit projects.
The first part of the Guide provides useful contextual information on the oil and gas sector, including information on:
The second part of the Guide provides guidance on audit methodology that will help auditors to plan and conduct audits of oil and gas revenues or audits of financial assurances for site remediation. For each of these two topics, the Guide provides:
The second part of the Guide also includes a short section on the Reporting Phase of the audit process. This section provides guidance on setting the context of the audit and on drafting recommendations.
Using the Practice Guide
The Practice Guide is a flexible tool that has been developed to be used within each audit office’s existing processes and procedures, in accordance with existing auditing and assurance standards. It is therefore a complement to current audit methodology.
Users of the Practice Guide do not have to read all its sections in order. Rather, the Guide has been designed to provide easy access to any section of interest and to allow readers to jump rapidly from one section to any other. Auditors are thus free to consult only the sections that best meet their needs.