In July 2010, British Petroleum (BP) released its second quarter 2010 earnings report. The report discussed...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
In July 2010, British Petroleum (BP) released its second quarter 2010 earnings report. The report discussed the risks associated with the ongoing events and cleanup effort in the Gulf of Mexico due to the oil spill associated with BP. It also included an income statement with a $32 billion pretax charge and a notation that "second quarter and first half 2010 include a charge of $32,192 million in production and manufacturing expenses, and a credit of $10,003 million in taxation in relation to the Gulf of Mexico oil spill." In conducting the annual audit, BP's auditors would have obtained assurance that the client accurately reported and disclosed the contingency in connection with the oil spill. In its FYE 2013 Form 20-E BP disclosed that the total charge since the incident had risen to $42.7 billion and that the company had put an additional $20 billion into the Deepwater Horizons Oil Spill trust to fund future expenditures relating to the oil spill. There is a movie about British Petroleum's oil spill in the Gulf of Mexico, Deepwater Horizon, which documents the failures in oversight and internal controls, and poor decision making that led to the disaster If your instructor asks, or you are just curious, watch the movie and consider the following questions: Who was most at fault in causing the disaster? Who were the heroes and what did they do right? What types of internal controls and governance might have prevented the disaster? Why didn't one of the people on the oil rig cut off the well sooner? What role did BP's corporate culture play in the disaster? What types of evidence do you think the auditors would have obtained to assess the appropriateness of the disclosuure? In July 2010, British Petroleum (BP) released its second quarter 2010 earnings report. The report discussed the risks associated with the ongoing events and cleanup effort in the Gulf of Mexico due to the oil spill associated with BP. It also included an income statement with a $32 billion pretax charge and a notation that "second quarter and first half 2010 include a charge of $32,192 million in production and manufacturing expenses, and a credit of $10,003 million in taxation in relation to the Gulf of Mexico oil spill." In conducting the annual audit, BP's auditors would have obtained assurance that the client accurately reported and disclosed the contingency in connection with the oil spill. In its FYE 2013 Form 20-E BP disclosed that the total charge since the incident had risen to $42.7 billion and that the company had put an additional $20 billion into the Deepwater Horizons Oil Spill trust to fund future expenditures relating to the oil spill. There is a movie about British Petroleum's oil spill in the Gulf of Mexico, Deepwater Horizon, which documents the failures in oversight and internal controls, and poor decision making that led to the disaster If your instructor asks, or you are just curious, watch the movie and consider the following questions: Who was most at fault in causing the disaster? Who were the heroes and what did they do right? What types of internal controls and governance might have prevented the disaster? Why didn't one of the people on the oil rig cut off the well sooner? What role did BP's corporate culture play in the disaster? What types of evidence do you think the auditors would have obtained to assess the appropriateness of the disclosuure?
Expert Answer:
Answer rating: 100% (QA)
The Deepwater Horizon rig owned and operated by offshoreoildrilling company Transocean and leased by oil company BP was situated in the Macondo oil prospect in the Mississippi Canyon a valley in the c... View the full answer
Related Book For
Intermediate Accounting
ISBN: 978-0324592375
17th Edition
Authors: James D. Stice, Earl K. Stice, Fred Skousen
Posted Date:
Students also viewed these accounting questions
-
An income statement is a summary of revenues and expenses and gains and losses, ending with net income for a specific period of time. Indicate the two traditional formats for presenting the income...
-
Create an income statement and a balance sheet for years X1 through X5. You may use any accounting principles that seem appropriate, providing that they are GAAP/IFRS. Your goal is to maximize the...
-
Preparing Both an Income Statement and a Balance Sheet from a Trial Balance Jordan Sales Company (organized as a corporation on April 1, 2011) has completed the accounting cycle for the second year,...
-
Question 1: Presented below is information related to Al-Arab Company. Its capital structure consists of 80,000 ordinary shares. At December 31, 2020 an analysis of the accounts and discussions with...
-
Consider the following transactions for Garnier Packing Supplies: Apr. 10 Garnier Packing Supplies buys $156,000 worth of merchandise inventory on account with credit terms of 3/10, n/30. 12 Garnier...
-
Find the Thevenin equivalent of the circuit in Fig. 4.128? 0.li o a 10 40 20 O b 210
-
Can a duty to care be established by statute or contract? Discuss your answer.
-
Haaki Shop, Inc. is a large retailer of surfboards. The company assembled the information shown below for the quarter ended May 31: Total Sales Revenue...
-
Calculate the sum of the currents at each junction And the sum of the voltage around each loop Table 1: Switch Closed Resistor R R-100 V P (ohms) (volts) (milliamps (milliwatts R-100 R-50 R1 102.2...
-
Usonic, Inc., has collected the following information on its cost of electricity: Required a. Prepare a scattergraph of Usonic's electricity costs for the year. Plot the total electricity cost on the...
-
On January 1, 2025, ABC Company, a calendar-year company, issued $2,000,000 of notes payable, of which $500,000 is due on January 1 for each of the next four years. What is the proper balance sheet...
-
How do gender dynamics and societal expectations influence the negotiation of power dynamics and social roles within interpersonal relationships, and how can these dynamics be redefined to promote...
-
Why is it important for mental health workers to be able to analyze legal challenges facing families today? In your own family or family of origin, how was your family affected by laws specific to...
-
Go to Westlaw. Once in Westlaw, click on the "Law" tab at the top left. Then, in the "Find" section under "Shortcuts" on the left-hand side of the page, enter the citation 537 A.2d 1227. This will...
-
What is the correct cited code section that discusses Indiana's custody provisions? Using the Indiana Code section that discusses our state's custody provisions.?
-
How do cultural, political, and ideological clashes intersect with the process of globalization, and what are the prospects for achieving global harmony and cooperation amidst divergent worldviews...
-
A vibration isolation unit consists of two blocks of hard rubber bonded to plate AB and to rigid supports as shown. For the type and grade of rubber used, the allowable shear stress is 5.5% *SN (MPa)...
-
Assessing simultaneous changes in CVP relationships Braun Corporation sells hammocks; variable costs are $75 each, and the hammocks are sold for $125 each. Braun incurs $240,000 of fixed operating...
-
Apple Inc. is one of the countrys most successful computer technology companies. The company designs, manufactures, and sells computers, digital music devices, communication devices, and various...
-
The Abbott Construction Company has several contracts to build sections of freeways, bridges, and dams. Because most of these contracts require more than one year to complete, the accountant, Dave...
-
Use the following account balance information to construct a trial balance: Cost of Goods Sold ........... $ 9,000 Accounts Payable ........... 1,100 Paid-In Capital ............ 2,000 Cash...
-
Explain the working of domestic refrigeration system with a neat sketch?
-
Fluid is a substance that: (a) Cannot be subjected to shear force (b) Always expands until it fills any container (c) Has the same shear stress at a point regardless of its motion (d) Cannot remain...
-
Discuss about psychrometry and their properties?
Study smarter with the SolutionInn App