Artificial neural networks and the accounting method choice in the oil and gas industry

Abstract

On three occasions, accounting regulators considered eliminating full cost accounting as an acceptable method and at the same time requiring all oil and gas producing companies to adopt successful efforts accounting. In response, full cost companies appealed to the Securities and Exchange Commission to allow the continued use of full cost accounting arguing that companies using each method are different. They outlined three primary variables along which full cost and successful efforts companies can be differentiated: exploration aggressiveness, political costs, and debt-recontracting costs. Prior studies used these variables to explain the accounting method choice by oil and gas producers. ..