CPA Canada Viewpoints: Accounting for flow-through shares (Oil and gas)

Published on: May 31, 2015

If your company has an oil and natural gas property, you may be wondering: How do I account for flow-through shares under IFRS? While IFRS does not specifically address accounting for flow-through shares, Viewpoints: Applying IFRS in the Oil and Gas Industry: Flow-Through Shares discusses how an entity could account for flow-through shares under IFRS.

Prepared by Chartered Professional Accountants of Canada (CPA Canada), the Canadian Association of Petroleum Producers, and the Small Explorers and Producers Association of Canada, this resource for junior oil and gas companies includes information on:

  • journal entries to account for flow-through shares, both at the time eligible capital expenditures are incurred and at the time of obligation fulfilment 
  • accounting considerations relating to the timing of renouncement
  • accounting for flow-through shares with attached share purchase warrants
To help clarify this issue, this document also includes a practical and detailed example of a publicly traded Canadian oil and gas entity involved in issuing flow-through shares to investors.


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