Property, plant and equipment measurement models in South American oil companies

Abstract

Property, plant and equipment (PP&E) in oil companies represents the largest share of total assets, which is recognized through the installed infrastructure capacity to support the development and distribution of production processes. From the perspective of the above, the objective of this study was to determine the measurement models of property, plant and equipment in oil companies in South America during the period 2020-2021. Using a qualitative approach, a descriptive documentary research was developed for the study of the variable. The selected sample was represented by three companies associated to the oil industry geographically located in Argentina, Brazil and Colombia. The findings show the use of the revaluation model in its transition to international accounting and financial reporting standards, as well as the convergence on the application of standards governed by the definition of an accounting policy. Among the conclusions, the interactions between the cost models for measuring property, plant and equipment, the straight-line method for depreciation, except for assets associated with exploration and production activities, for which the method of technical units of production is applied, are promoted.