18 – 21 May 2011 | Manado

12 – 14 Oct 2011 | Surabaya

14 – 16 Dec 2011 | Bandung

Course Overview

Most people are reluctant to hear and face the word of control and it seems that they feel can escape out of the control meaning itself. Budget, System Operating Procedures (SOP), Company Policies and Procedures, and Laws, decrees, and regulations are all intended as Control apparatuses, which are by themselves have provided the doers and performers in the high, medium, and  low levels of management and staff to make the controls as mandated in said individual topics. For example: Budget itself has determined the control stage, which clearly detailed the number-volume-quantity to be realized at the end of period of time come through, when such performance achievement of the number-volume-quantity will be done? How much it will costs the company in-terms of US Dollars? Budget-objective has to spell out the WHAT, Time Boundary, and Dollar value should have reflected Control tools during the month or budget year coverage. Cost Control will follow this budget details’ components as actual costs that occurred when performing the budgeted works or drilling or facility, the management can see simultaneously the three variations: in the quantity-Volume-quantity; timing different of realization, and in dollar schemes. Usually such variance is shown in on the line of the monthly, quarterly, or annual accounting-financial reports, of course this typical variance has been contributed by several doers. Let’s see more individual signs of control. A person took breakfast in the morning certainly such breakfast has: quantity-volume-number of breakfast, yet time is in the morning; when lunch time is coming the stomach of that person will automatically give signs that individual need some nutrition for his/her lunch time, which yet involving the quantity-number-volume of the lunch package; also inevitably at dinner time such time will claim the stomach of such person feel hungry

Focus of Cost Control is to make sure and see if the plan-program is done accordingly or if it has difference, then we have to find out why? Cost reduction may be needed when actual cost is under the budget soon after closely analyzing and matching: the number-volume-quantity; timing phase; and dollars different? Internal Control implementation must be from of “the top management”, the President & CEO of the company shall be the first person who shall declare the needs of “good governance” solution. Whenever Top Management clearly instructed that the company’s operations and activities must reflect business performance, then all executive management underneath will case down to lower level of organization of the company for proper implementation.

The Control is intended to assess and test the performance of the company at all level transactions in each section of the functional organization. Upon the assessment and testing then management will take action to cut the budget, which means cost reduction opportunity, revision of the budget means is to appreciate current performance and have corrected for next periods operations. The weakest Control, as an example was experienced by Enron Company in USA triggered the government agencies (Committee Of Sponsoring Organizations – COSO), SEC to a recommendation that Internal control must be the responsibility of the top management focus on: Control environment; Risk Assessment, Control activities, Monitoring, and Information-communication phases, specifically on the information and communication must be “top-down and bottom up” of all business activities will eliminate such Enron’s case.

Course Objectives

This training course will provide information, and tools to the participants the urgency of good control-internal control has achieved reference that company has run its operations effectively and efficiently in accordance with and in compliance with company policies and procedures, PSC Agreement, BPMIGAS budgeting procedures and financial manual procedures, system operating procedures, Indonesian’s tax laws, and other decrees that may be interrelated to PSC operations.

Course Benefits

After completing this course each participant has internalized the concepts and implementation of cost control and Cost reduction possibility, which inter related among the policy and procedures, system operating procedures, budgeting procedures and financial manual procedures into respective job assignments within the company, which produces clear, true, proper transactions are geared through the financial reports.

Course Contents

Day one:

1. PSC Agreement as a legal base of business operations or activities of oil & gas industry
2. POD
3. WP&B
4. AFE
5. Participating Interest
6. Oil reserves
7. Gas reserves

Day two:

1. Exploration Drilling Expenditures
2. Development Drilling Expenditures.
3. Completion Drilling Expenditures
4. Production Costs
5. Inventory

Day three:

1. Cost Recovery
2. Interchangeable costs between Oil and Gas costs
3. Interchangeable between administrative and capital investment
4. Sharing costs and revenues between government and PSC company
5. Reflection of good cost Control will reduce cost
6. Reflection of good control to tax liability: Corporate Income Tax and withholding taxes
7. Closing Summary

Course Leader

Jamaluddin Siregar, BBA, Sth, Dipl Int’l Management, MBA