Gas prices in other countries

[_JS]

You (nor anyone here) still haven't explained to me why the CEO lied.

about what?....not knowing what his actually salary is?  I don't actually know what my salary is....so I must be lying, right?  Besides being a question that's simply posed to stir emotion at the high amount he's making, what's the revelence?  There isn't any outside of doing precisely that, invoking animosity for someone daring to make as much as big corporation CEO's make.

No. I could give a shit less about that.

One of the oil execs said that his company's profits were justified because they reinvest most of it back into scientific research and plant development.

It is a blatant lie because of the rules of accounting. Research and improvements are expenses. Profits = net revenue - net expenses - adjustments. (It can be a bit more complicated, but that is the basic idea in every for-profit company)

So why tell such a blatant lie?

[Xavier_Onassis]

It is a blatant lie because of the rules of accounting. Research and improvements are expenses. Profits = net revenue - net expenses - adjustments. (It can be a bit more complicated, but that is the basic idea in every for-profit company)

So why tell such a blatant lie?
==================================
Perhaps it is in the nature of blatant liars to tell blatant lies.

[sirs]

One of the oil execs said that his company's profits were justified because they reinvest most of it back into scientific research and plant development.

So 10% profit is just too egregious, even when its claimed how most of it goes into R&D.  Amazing.  What was Microsoft's profit margain again?  Last time I checked, it was greater than 10%.  Where's the outrage??

What's seriously blatant here Js, is this complete lack of objectivity when it comes to concepts of supply & demand, as it relates to the global oil market.  You rage how more refineries wouldn't amount to anything, when our population has been growing exponentially, yet refinery buidling to keep up with that growth have been non-existant.  And it's NOT because oil companies don't want to make them, it's largely because one way or another, they're inhibited, when not out right prevented, and made cost prohibitive via insidious levels of litigation, permits, regulations, & zoning restrictions. 

So don't sit there and rail at their profits.  Yea, they probably aren't being completely honest in everythign they say....which is why they have perjury charges.  If this fella "blatantly lied", he'll be handed a perjuery indictment.....right??  Point being, that SO WHAT if they're making bazillions of dollars.  They're only making around 10% profit.  That's CONSISTENT with nearly every other company and much less than Microsoft.  Maybe if you can get past this apparent jealous animosity of rich people, you might actually become a tad more objective to the supply and demand issues that have helped fuel the current oil costs.  The market is volatile, and there is MORE oil we could extract........IF were were allowed

[Amianthus]

One of the oil execs said that his company's profits were justified because they reinvest most of it back into scientific research and plant development.

It is a blatant lie because of the rules of accounting. Research and improvements are expenses. Profits = net revenue - net expenses - adjustments. (It can be a bit more complicated, but that is the basic idea in every for-profit company)

So why tell such a blatant lie?

Actually, your definition (R&D are charged as expenses in the year they're accrued) comes from FASB Statement 2, issued in 1974. This statement specifically says that it does not apply to mining and drilling industries R&D.

FASB Statement 19 is the appropriate one for the oil and mining industries. In it, we find that R&D costs are capitalized and charged against future production - ie, it becomes a cost against production when the production starts producing income. Only costs related to "failed" ventures are charged as expenses, and only in the year that it becomes known to be a failed venture (they're capitalized until then).

I'm sure the auditors know all this. Or do you think the auditors who approve the petroleum company's financial statements are "in on it" too?

[sirs]

Wow.....there's an eye opener.  Thanks Ami

[Plane]

One of the oil execs said that his company's profits were justified because they reinvest most of it back into scientific research and plant development.

It is a blatant lie because of the rules of accounting. Research and improvements are expenses. Profits = net revenue - net expenses - adjustments. (It can be a bit more complicated, but that is the basic idea in every for-profit company)

So why tell such a blatant lie?

Actually, your definition (R&D are charged as expenses in the year they're accrued) comes from FASB Statement 2, issued in 1974. This statement specifically says that it does not apply to mining and drilling industries R&D.

FASB Statement 19 is the appropriate one for the oil and mining industries. In it, we find that R&D costs are capitalized and charged against future production - ie, it becomes a cost against production when the production starts producing income. Only costs related to "failed" ventures are charged as expenses, and only in the year that it becomes known to be a failed venture (they're capitalized until then).

I'm sure the auditors know all this. Or do you think the auditors who approve the petroleum company's financial statements are "in on it" too?

I am not sure yet that I understand this issue.

Was the executive in question stateing that they spend more on R&D than they harvest as profit?

Or was he saying that profit is reduced by R&D after it goes on paper as profit?

[_JS]

Thanks Ami, that was all I was asking. And no, I didn't think anyone was "in" on anything. I didn't realize there was an exception for drilling or mining industries.

I have no idea what your rant was about Sirs. Please quit going off the deep end. You started talking about profit margins...I never asked anything about margins.

I never "raged" about refineries. I tried to explain to you why they aren't being built. You try and make this into high school economics and it just isn't. You act like you understand, but you clearly do not. It isn't this grand conspiracy to harm the oil companies that you pretend it to be.

Your understanding of business and economics is remarkably sophomoric Sirs. I'm sorry to put it that way, but it really is. It is terrible. You buy into all of the political garbage like "energy independence" and the evil environmentalists, and the truth is you're no different than some nutty tree-hugger. You're just on the opposite scale, but you don't understand any more of the issue than they do. And you do not care to learn.

Maybe if you could get past your animosity of actually reading intelligent literature or possibly listening instead of taking everything so damned personally and defending anything that you see as remotely right-wing, then you could learn a little.

I don't mind making a mistake. I'm glad Ami corrected me. That was all I asked. I learned something new. You, on the other hand, learned nothing. You think ANWR is still the answer and energy independence is still possible if environmentalists just get out of the way. 

Fucking daft.

[Amianthus]

Thanks Ami, that was all I was asking. And no, I didn't think anyone was "in" on anything. I didn't realize there was an exception for drilling or mining industries.

I took accounting courses in college, and spent 5 or 6 years working on GL systems. Can be interesting stuff.

[sirs]

Thanks Ami, that was all I was asking. And no, I didn't think anyone was "in" on anything. I didn't realize there was an exception for drilling or mining industries.

I have no idea what your rant was about Sirs. Please quit going off the deep end....I don't mind making a mistake. I'm glad Ami corrected me. That was all I asked. I learned something new. You, on the other hand, learned nothing. You think ANWR is still the answer and energy independence is still possible if environmentalists just get out of the way.    Fucking daft.

And you know what's really daft?  Accusing folks of things they never claimed or even implied.  Such as ANWR is the end-all be-all answer to reducing oil prices....that energy independence is right at our fingertips if it weren't for enviromental nut jobs.  As it's painfully clear, if you could get past your apparent acute disdain for the "uber rich", and how dare they not spread their wealth more they way you'd see fit, you might not look quite so arrogant & condescending when you make such bold proclaimations of "blatant lie", only to be corrected.....again

[Amianthus]

Or was he saying that profit is reduced by R&D after it goes on paper as profit?

Yes.

[Plane]

Or was he saying that profit is reduced by R&D after it goes on paper as profit?

Yes.

I would never have guessed that.

So the cents on the dollar reported profit is not all availible to shareholders?

[Amianthus]

I would never have guessed that.

So the cents on the dollar reported profit is not all availible to shareholders?

Nope. Exxon, as an example, paid about 27% of it's profits to shareholders. So, the amount that oil company shareholders "raped" the American people for is only about 2.7% of sales. The balance of profit was reinvested into delivering more product in the future.

[sirs]

2.7%??   Those evil bastards

[Amianthus]

2.7%??   Those evil bastards

Evil lying bastards.

After all, we can assume that everything they reported was lies, and the auditors are all just in on it.


 

[sirs]

I sit corrected