Notes On Reserve Value Ratios - 1137 Words

Reserve Value Ratios Value of Proved Reserve Additions per BOE As with the finding costs ratio per BOE, the value of proved reserve additions ratio has several different methods of calculation. Because the finding costs ratio and value of additions are both used to calculate the value added ratio, discussed later, this analysis uses the simplest formula without revisions to maintain consistency. The cost changes used in the ratio came from the changes in the standardized measure of discounted future net cash flows disclosure and the denominator was taken from the reserve quantity disclosure. The BOE results of the multi-year analysis were: 2013 2012 2011 Continental $14.87 $15.94 $14.05 Cimarex $15.69 $13.52 $16.99 Whiting $25.99 $45.52 $23.83 From the table above, it can be determined that Continental and Cimarex have higher quality reserves than Whiting, as they do not call for excessive extra costs for production. Value Added Ratio The value added ratio is the combination of two previously calculated ratios to determine whether the finding costs per BOE will eventually be replaced by the value of the new proved reserve additions. This ratio is great at gauging the efficiency of the company and whether they are able to find high quality reserves at low costs. The firms’ value added ratio results for the three years were: 2013 2012 2011 Continental 12.088 7.723 4.568 Cimarex 8.970 8.710 7.278 Whiting 7.784 8.505 2.886 Because there were issues withShow MoreRelatedAbercrombie Fitch vs. HM: Financial Analysis848 Words   |  3 Pagesshare capital, reserves, retained earnings and profit for the year. There are some distinct differences. For example, on the HM statement, profit for the year and retained earnings (presumably from prior years) are listed separately, even though they are both forms of retained earnings. 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