The impact of the application of (IFRS 6) on oil and gas extracting companies and it’s role in enhancing the quality of their accounting earnings Applied research in Basra Oil Company / P


  • أ.د شاكر عبد الكريم البلداوي
  • حسنين سعد خلف السعدي


The extraction phase is one of the most important stages of the oil and gas industry, which Iraq pays great attention to because of its influential role in the national economy, and is considered the most attractive environment for foreign investment. It has recently been noted that there has been a growing interest in the professional accounting councils and organizations in the need to formulate an agreed international standard for reporting on exploration and evaluation expenditures at extractive companies and closing the door to differences in accounting treatments related to such expenditures. This approach has contributed to the drafting of IFRS 6. As a result of the weakness of the unified accounting system in providing an accounting mechanism for the fair reporting of exploration and evaluation expenses, some Iraqi extractive companies have adopted accounting mechanisms that aim to inflate expenses to achieve annual revenues that exceed their normal activity, which made their accounting profits honest and does not reflect the result of activity. The financial position is fair, so the aim of the research is to show the impact of the application of IFRS 6 on extractive companies in Iraq and its role in providing a mechanism that contributes to enhancing the quality of accounting profits. The main findings of the research can be summarized that the current method adopted by the company is contrary to the standard accounting system on the one hand and contrary to the international standard (IFRS 6) on the other hand and the company achieved profits estimated at tens Billions of dinars per year without any activity, the most prominent recommendations is the need to apply the standard (IFRS 6) on the Iraqi extractive companies with the application of the policy of successful efforts steadily and this in turn will make accounting profits for those companies more quality