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Extractive Activities

Description

The IASB's Extractive Activities project aims to resolve the issues that are unique to upstream extractive activities. 

History of the project

In 2002 the IASB decided that it was not feasible to complete a comprehensive project on accounting for extractive activities in time for IFRS adoption in 2005. Consequently, in 2004, the IASB issued an interim standard IFRS 6. 

Recent developments

In February 2018, following its discussion on 2015 Agenda Consultation, the IASB re-started its work on the Accounting Standard. In September 2021, the IASB tentatively decided that the project’s scope and objectives should be to explore two aspects of IFRS 6:

  • developing requirements or guidance to improve the disclosure objectives and requirements about an entity’s exploration and evaluation (E&E) expenditure and activities to provide more useful information to primary users of financial statements;
  • removing the temporary status of IFRS 6.

In more detail, the IASB tentatively decided to:

  • to explore developing requirements or guidance to improve disclosures about E&E expenditure and activities.
  • not to develop requirements or guidance about the unit of account to apply to E&E expenditure or about which E&E expenditures to capitalise and when to start and stop capitalisation.
  • not to develop requirements for standardising the accounting for intangible E&E expenditure and research and development expenditure. The Board also tentatively decided not to develop additional requirements or guidance for the impairment of E&E assets.
  • not to develop requirements or guidance for the application of other IFRS Standards as part of its Extractive Activities research project. 
  • not to consider further the accounting for collaborative arrangements or disclosures that are not specifically required by the standards as part of this project.
  • not to explore developing requirements or guidance for reserve and resource information in financial statements.

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