Asset Retirement Obligation

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Asset Retirement Obligation

In accounting, a requirement that a long-term liability that must be retired in the future be recorded at its estimated, fair market value at the time of retirement instead of its value at the time the liability was acquired. This is codified in FASB No. 143.
References in periodicals archive ?
Accretion of discount on asset retirement obligations is expected to be $3 million to $6 million.
The series of Dispositions eliminates approximately $4.1 million of asset retirement obligations associated with the assets and significantly strengthens the Company's balance sheet.
With the transaction, Cliffs' previously disclosed costs of closing the Australian operations were reduced by approximately $85 million, which included asset retirement obligations assumed by MRL.
Additionally, Cliffs' disclosed the costs of closing the Australian operations were reduced by approximately USD85m,which included the asset retirement obligations assumed by MRL.
Fitch's enterprise value multiple assumption is 4.5x given how much of the industry is distressed and the need for asset valuations to incorporate asset retirement obligations. Fitch notes that its going-concern EBITDA together with its multiple assumption result in an enterprise value that is close to a liquidation value.
On the other hand, upcoming exposure drafts seem to be more narrowly focused (irrevocable split-interest agreements, criteria for the use of amortized cost by external investment pools, blending for not-for-profits in which the government is the sole corporate member, asset retirement obligations).
However, both an increase in asset retirement obligations (AROs) from recently acquired North Sea O&G assets, which nudged up the Group's total adjusted debt (includes operating lease commitments and AROs) to AED 89.16 billion, and reduced equity from an AED 1.77 billion net loss in FY Dec 2013 led to a higher adjusted gearing ratio of 7.49 times and a correspondingly weak annualised adjusted funds from operations debt coverage (FFODC) ratio of 0.16 times.
The purchase price is USD100m and the assumption of USD6.4m of future asset retirement obligations.
Capital and carry commitments and decommissioning liabilities: As investors look to enter new upstream geographies they need to give adequate consideration to asset retirement obligations that are being introduced into new agreements or renewals and their impact on the project economics, the government's take and operator's carry obligations.
As a result of the adoption of the Statement No.18, all of them have accounted for their asset retirement obligations on their financial statements.
The extra losses included 5.52 billion yen on adjustment for changes of accounting standards for asset retirement obligations, said the holding company for the Mitsukoshi and Isetan department store chains.
The document clarifies environment-related disclosure requirements for stock issuers, including environmental risks, trends and uncertainties, environmental liabilities, asset retirement obligations, innovative information on environmental goals and targets, and financial and operational effects of environmental protection activities.