Specialized Accounting MCQs:

17. Proved reserves is defined as a. Reserves that are expected to be produced from existing wells b. Reserves that are expected to be produced from new wells c. Reserves that have at least 50% chance of being technically and economically producible d. Reserves that have a 90% chance of being technically and economically producible 18. The petroleum fiscal system (or regime) is either a. Royalty/tax (concessionary) system or contractual-based system b. Service agreement or production sharing contract c. Royalty/tax (concessionary) system or production sharing contract d. Contractual-based system or production sharing contract 19. The oil and gas industry is Jeecried by a number of unique conditions. These conditions create an unusual and complex set of rules and practices. Which one of the following is not part of the unique conditions in the oil and gas industry? a. Time lag b. Finite field life C. Costs unrelated to revenue d. License acquisition 20. In the oil and gas industry, inherent risks refer to a. The risks of finding, or not finding, commercially viable oil and gas reserves. b. Oil price volatility c. Force majeure risks (natural disaster, civil unrest, terrorism). d. Political stability of the host country 21. The reserves of oil and gas, which is the underlying resource for generation of income and value of exploration and production companies, cannot be objectively measured or verified until production is complete. This is in compliance with the_ in accounting. a. Periodicity concept b. Matching concept C. Objectivity concept d. Conservatism concept 22. A great deal of scope exists for variation in reporting on the financial performance of companies in the oil industry because oil company accounts are prepared using many different methods. This makes application of difficult in the industry. a. Periodicity concept b. Matching concept c. Conservatism concept d. Comparability concept