Cost Accounting Techniques and Overhead Allocation in Oman Society for Petroleum Services-OPAL

Cost Accounting

Table of Contents
1. Description of Oman society for Petroleum Services-OPAL......................................................3
2. A discussion on the manufacturing and non-manufacturing overheads of the company............3
3.......................................................................................................................................................5
a. A discussion on the method of overhead allocation in the company...........................................5
b. Reasons of choosing this specific method of overhead allocation in that company...................5
c. Evaluation of the chosen method of overhead allocation in terms of its merits and demerits.....6
4.......................................................................................................................................................7
a. Techniques of inventory accounting of the chosen organization.................................................7
b. Techniques of labour accounting of the chosen organization.....................................................7
5.......................................................................................................................................................8
a. Description of the costing techniques used in a company........................................................8
b. Evaluation of the effectiveness and suitability of this technique.............................................9
References......................................................................................................................................10

1. Description of Oman society for Petroleum Services-OPAL
OPAL or the Oman society for Petroleum services is a non-profit organization and is the first
society of the Oman’s Petroleum Industry that become officially registered as a society with
Sultanate of Oman in 27 October, 2001.The registration of the OPAL society has been done
according to the regulation that is governing the registration of the society as per the Ministry of
Social development. There are 400 members in the organisation and the organization includes
the Producers of Oil & Gas companies and the large and small operators, contractors and
suppliers of the oil and gas industry of Oman.
Leaders of OPAL meet on a quarterly basis in order to identify the area and strategies that will be
beneficial for all the members of the society. An elected board of directors govern the society for
ensuring the highest standard of good corporate governance.
The main objective OPAL is to provide to work as an umbrella body that will promote the
standard, work efficiency and professionalism in the Oman Petroleum Industry. The standard
will be set in such a way so that it will be equivalent to the standard and practices of international
petroleum industry which will ensure the optimum allocation of the petroleum resources of the
country(Opaloman.org, 2017).
2. A discussion on the manufacturing and non-manufacturing overheads
of the company
The chosen organization regulates their accounting process of resources and inventories as per
the International Financial Reporting Standards that is issued by International Accounting
Standards Board (IASB) and the interpretation of the accounting policy of the organization has
been given as per the International Financial Reporting Interpretations Committee (IFRIC)