Precision Mining Accounting
PSAK 64-compliant records, accurate depletion, and audit-ready mining financial reporting
Compliance Warning
This industry is considered high risk and may receive closer attention from tax authorities. Professional tax consultation is strongly recommended.
Common Challenges
Complex Depletion and Depreciation
Coal reserve depletion calculations using the units-of-production method require accurate and consistent reserve estimates.
Asset Retirement Obligation (ARO)
Recognition and measurement of mine decommissioning and restoration obligations that must be estimated from the start of operations.
Stripping Costs and Capitalization
Overburden removal costs must be properly allocated between production expense and capitalization in accordance with IFRIC 20.
Our Solutions
Reserve-Based Depletion Accounting
Developing depletion models based on proven reserves with periodic updates according to geological technical reports.
- Accurate cost per ton
- Fair asset book value
- Optimal tax planning
ARO Estimation and Amortization
Calculating present value of mine restoration obligations and amortizing over mine life with appropriate discount assumptions.
- Complete liability recording
- Consistent amortization expense
- External audit ready
Open-Pit Cost Allocation
Separating stripping costs between production expense and assets according to applicable IFRIC 20/PSAK.
- Fair income statement
- Accurate balance sheet
- Per-pit profitability analysis
Related Tax Regulations
PSAK 64
Mining Activities
Accounting standard for exploration, evaluation, development, and production in mining including depletion and ARO
PSAK 57
Provisions, Contingent Liabilities and Contingent Assets
Recognition of mine decommissioning and restoration obligations (Asset Retirement Obligation)
PSAK 16
Property, Plant and Equipment
Capitalization of development costs and depreciation of mining assets over useful life
Need Help with Coal Mining Accounting?
Consult your bookkeeping and tax needs with our professional team. Free initial consultation.
Free Consultation via WhatsAppCoal Mining Accounting Consulting Services Across Indonesia
We support clients in major Indonesian cities. Find a location-specific service page for your area.
Bali
Banten
Daerah Istimewa Yogyakarta
Jawa Tengah
Jawa Timur
Kalimantan Barat
Kalimantan Selatan
Kalimantan Timur
Kepulauan Riau
Riau
Sulawesi Selatan
Sulawesi Tengah
Sulawesi Tenggara
Sulawesi Utara
Sumatera Utara
Sumatra Selatan
Frequently Asked Questions
How is coal mining depletion calculated?
Depletion is calculated using the units-of-production method: (Asset book value - residual value) × (current year tonnage produced ÷ estimated total proven reserves). Reserve estimates must be periodically updated by geologists to maintain accuracy.
What is ARO and when should it be recognized?
Asset Retirement Obligation (ARO) is the obligation for post-mining decommissioning and land restoration. ARO is recognized when the asset is installed or the environment is disturbed, measured at the present value of estimated future restoration costs, with the debit side capitalized as part of the asset acquisition cost.
Can exploration costs be capitalized?
Exploration and evaluation costs can be capitalized as exploration and evaluation assets in accordance with PSAK 64 if they meet the criteria: the right to explore has been obtained, there are technically and commercially proven reserves, and the expenditure can be reliably measured.
How do accounting services improve operating cost efficiency?
Accurate, timely financial reports help you spot cost leakage, monitor margins by product or service, and make data-based decisions.
Can financial reports be accessed in real time?
Yes. We use cloud accounting systems so you can monitor cash flow, profit and loss, and business performance from anywhere.
How do you ensure reports are ready for external audits or banks?
Reports are prepared by qualified accounting professionals with clear documentation and traceable transaction data.
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