b'STAATSOLIE MAATSCHAPPIJ SURINAME N.V.NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2020 (Continued)Restricted Cash is provided to the customer. Initial recognition is Restrictedcashisrequiredforfinancingpurposes basedonhistoricalexperience.TheinitialestimateasthishasbeentherequirementofStaatsolies of warranty related costs is revised annually. financiers.Therestrictedaccountsarethe Decommissioning liabilitycollectionaccounts;DebtPaymentAccount(DPA)andtheDebtPaymentReserveAccount(DSRA). TheGrouprecognizesadecommissioningliabilitywhere it has a present legal or constructive Thecollectionaccountisusedforinternational obligationasaresultofpastevents,anditiscollections from all our international customers toprobablethatanoutflowofresourceswillbedeposittheirpayments.TheDPAaccountcontains requiredtosettletheobligation,andareliablethreemonthsworthofdebtserviceandisfunded estimate of the amount of obligation can be made.monthly.Everythreemonthsinterestandprincipal,ifany,ispaidout. Theobligationgenerallyariseswhentheassetisinstalled,ortheground/environmentisdisturbedTheDSRAcontainsthreemonthsworthofinterest atthefieldlocation.Whentheliabilityisinitiallyfor the lifetime of the loan. After the necessaryrecognized,thepresentvalueoftheestimatedfundinghastakenplace,Staatsoliecanobtainthe costsiscapitalizedbyincreasingthecarryingremaining cash for its operations. amount of the related oil assets to the extent that itwasincurredbythedevelopment/constructions. Cash dividendofthefield.AnydecommissioningobligationsTheGrouprecognizesaliabilitytomakecash that arise through the production of inventory are distributionstoownersofequitywhenthe expensedwhentheinventoryitemisrecognizeddistributionisauthorized,andthedistribution in cost of goods sold. Additional disturbances is no longer at the discretion of the Group. Awhichariseduetofurtherdevelopment/correspondingamountisrecognizeddirectlyin construction at the oil and gas property are equity. recognizedasadditionsorchargestothecorresponding assets and decommissioning t.Provisionsliability when they occur. Costs related to restorationofsitedamage(subsequenttostartGeneral of commercial production) that is created on an ongoing basis during production are provided ProvisionsarerecognizedwhentheGroup forattheirnetpresentvaluesandrecognizedinhas a present obligation (legal or constructive)profitorlossasproductioncontinues.asaresultofapastevent,itisprobablethat Changes in the estimated timing or cost of anoutflowofresourcesembodyingeconomic decommissioning are dealt with prospectively benefitswillberequiredtosettletheobligation byrecordinganadjustmenttotheprovisionand a reliable estimate can be made of theandacorrespondingadjustmenttooilandgasamount of the obligation. properties. Any reduction in the decommissioning Theexpenserelatingtoaprovisionispresented liabilityand,therefore,anydeductionfromintheconsolidatedstatementofprofitorloss theassettowhichitrelates,maynotexceednet of any reimbursement. If the effect of thethecarryingamountofthatasset.Ifitdoes,timevalueofmoneyismaterial,provisionsare any excess over the carrying value is taken discounted using a current pre-tax rate thatimmediately to the consolidated statement of reflects,whenappropriate,therisksspecific profitorloss.totheliability.Whendiscountingisused,the If the change in estimate results in an increase increase in the provision due to the passageinthedecommissioningliabilityand,therefore,oftimeisrecognizedasafinancecostinthe anadditiontothecarryingvalueoftheasset,consolidatedstatementofprofitorloss. the Group considers whether this is an indication Warranty provisions ofimpairmentoftheassetasawhole,andifso,testsforimpairment.If,formaturefields,TheGrouptypicallyprovideswarrantiesfor the estimate for the revised value of oil and guaranteeofquality,providingthecustomera gas assets net of decommissioning provisions timeframeoffifteen(15)daysafterdeliveryto exceedstherecoverablevalue,thatportionoftheraise a claim in regard to shortages and defectincrease is charged directly to expense.inquality/quantityofdeliveredgoods.Provisionsrelated to these assurance-type warranties areOvertime,thediscountedliabilityisincreasedrecognizedwhentheproductissold,ortheservice for the change in present value based on 69'