Accounting for Carbon Essay

Accounting for Carbon Essay

Length: 1966 words (5.6 double-spaced pages)

Rating: Term Papers

Open Document

Essay Preview

Introduction
This paper examines the implications of using different approaches when it comes to accounting for carbon emissions. This essay provides a brief background on the Kyoto protocol. Then it goes into the issues surrounding accounting for carbon. The starting place that needed to be addressed was how to account for carbon credits and the free allowances, next was the obligation. The paper subsequently examines the current practices for accounting for carbon, such as the IFRIC 3 approach, the net liability approach, and the recognition of government grants approach, followed by that there was some other issues that had to be alluded to that are important for when accounting for carbon.. Finally this paper attempts to formulate an ideal structure for how to report carbon in accounts.
Brief Background
Accounting for carbon has become more of an issue as time has passed. With the introduction of the Kyoto Protocol, markets have been developed for the trading of carbon over a wide series of industries. The Kyoto Protocol was a treaty brought into place to ensure the reduction of greenhouse gas emissions. The European Union Emissions Trading Scheme (henceforth known as EU ETS) is a mechanism used to reduce greenhouse gases. The EU ETS is a cap-and trade scheme, under which companies are told how much CO2 they can emit (the cap), and if they emit less than the cap, they have surplus left for sale. If they emit more that the se cap they can buy credits from other businesses that come in under their cap (the trade) (Ratnatunga and Balachandran, 2009)
Issues
What kind of asset is a carbon credit?
A carbon credit can be accounted for in many different ways. The top two approaches that have been used by companies as found by Lovell,...


... middle of paper ...


...ounting, Organizations and Society, 34 (3), 499--534.

Lovell, H., Bebbington, J., Larrinaga, C. and Sales De Aguiar, T. 2013. Putting carbon markets into practice: a case study of financial accounting in Europe. Environment and Planning C, 31, 741--757.

MacKenzie, D. (2009). Making things the same: Gases, emission rights and the politics of carbon markets. Accounting, Organizations and Society, 34 (3), 440--455.

Pricewaterhousecoopers/ Internantional Emissions Trading Assosiation (PWC/IETA) (2007), Trouble- Entry Accounting- Revisited, London.

Ratnatunga, J., Balach & Ran, K. (2009). Carbon business accounting: the impact of global warming on the cost and management accounting profession. Journal of Accounting, Auditing \& Finance, 24 (2), 333--355.

Smith, R. (2007). Development of the SEEA 2003 and its implementation. Ecological Economics, 61 (4), 592--599.




Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

Carbon Sequestration at St. Lawrence University Essay

- Forests are a critical player when it comes to the carbon cycle. Every year, forests store more than 1.0 x 1015 metric tons of carbon in biomass, detritus, and soils (Dixon et al.). The storing of this carbon dioxide is very important to our planet and threshold that allows humans to thrive. Climate change is occurring, but would be accelerating much faster without carbon sinks like our forests that store the carbon dioxide humans have emitted. Carbon sequestration is defined as “the prevention of greenhouse gas build-up in the earth's atmosphere by methods such as planting trees to absorb carbon dioxide or pumping carbon dioxide into underground reservoirs” (Collins English Dictionary)....   [tags: Forests, Carbon Cycle, Bio,ass, Detritus, Soil]

Term Papers
1272 words (3.6 pages)

History of Accounting Essay

- History of Accounting The history of accounting I feel is important in the learning, understanding, and developing of my foundation for my accounting career. In this report you will learn about the development of accounting. You will learn about the people who influenced accounting the most throughout the years. You will learn how accounting came about and how it was used in the ancient times. You will learn about the invention of the double-entry bookkeeping processes. You will learn how things were done before the birth of the double-entry bookkeeping process....   [tags: Accounting Employment Bookkeeping Essays]

Term Papers
3105 words (8.9 pages)

Essay about Carbon Monoxide

- Imagine a killer perfect enough to travel through the corridors of your home completely undetectable to the eye of its prey. It can’t be heard, can’t be smelled, and before you or anyone in your household realizes that something is wrong, it could already be too late. Over ten thousand people fall victim to carbon monoxide poisoning and over one thousand five hundred die per year of this gas so deadly, it is referred to as the “silent killer”(“What Is Carbon Monoxide?”). Carbon monoxide, or CO for short, is a flammable, colorless, odorless, tasteless gas that is produced during incomplete combustion of fuel and it’s ability to do harm resides within the lack of knowledge and understanding o...   [tags: essays research papers fc]

Term Papers
1503 words (4.3 pages)

Essay about Alternatives to Concrete

- Concrete today is considered by many modern engineers and architects as a more efficient and effective alternative to steel n regards to the creation of buildings, ranging from low-story apartments to neck-breaking skyscrapers. Through the rapid growth and development of the world's major metropolises and growing cities, concrete today has become one of the most important building materials to date. According to the World Business Counsel for Sustainable Development (WBCSD), “it has become the most consumed substance on earth, only superseded by water, with three tons for each person used annually” (World)....   [tags: Recycled Waste, Carbon Emissions]

Term Papers
949 words (2.7 pages)

Financial Accounting Essay

- The accounting system we use today started in Venice in renaissance period over 520 years ago. The trade business increased hugely during this time and all the financial recordings had to be written down to help people see how their business is doing. During that time in 1494 the first book about was published in accounting by Luca Paciolli and was called “The Collected Knowledge of Arithmetic, Geometry, Proportion and Proportionality”. He was called “The father of Accounting” and most of his described principles have been used up until this day....   [tags: Accounting]

Term Papers
1499 words (4.3 pages)

Essay on Business Accounting

- Introduction Financial statements What carries out the accounting and financial forecasting of any type of company is financial statement. As for financial statement, it is a financial report or record compiled usually on a quarterly and annual basis which quantitatively provides the indication of an individual’s, an organization’s, or business’s financial status. There are, according to belief of most experts, generally three financial statements such as: an income statement (Pro Forma Profit and Loss), a balance sheet and a cash flow statement....   [tags: Accounting]

Term Papers
1627 words (4.6 pages)

Essay on Accounting

- The Financial Accounting Standards Board is board of seven independent members who are accounting professionals that was developed in 1973. This seven member group is responsible for communicating the standards that are in place for financial accounting and reporting that takes place in the United States. Generally accepted accounting principles (GAAP) are the standards that are used by the FASB to govern the way in which corporations prepare their financial reports. This process of utilizing these standards to maintain and report accounting files is the only method that the US Securities and Exchange Commission will accept....   [tags: Business Accounting Finance]

Term Papers
1116 words (3.2 pages)

Accounting Essay

- Accounting On September 28, 1998, Chairman of the U.S. Securities and Exchange Commission Arthur Levitt sounded the call to arms in the financial community. Levitt asked for, "immediate and coordinated action… to assure credibility and transparency" of financial reporting. Levitt’s speech emphasized the importance of clear financial reporting to those gathered at New York University. Reporting which has bowed to the pressures and tricks of earnings management. Levitt specifically addresses five of the most popular tricks used by firms to smooth earnings....   [tags: Accounting Finances Money Essays]

Free Essays
2347 words (6.7 pages)

Essay about Accounting

- Accounting Introduction The financial information is a very important matter in a company success. Allow them to see if they have been successful in the past, in the present and help them to predict a future performance of you company. The form, the use and the people involve with the financial and accounting information in a company is going to be developed in this report. Accounting Knowing the status of your company in every single area will allow you to improve your performance and developed strategies with a solid background for a successful operation....   [tags: Business Accounting Finance]

Term Papers
1235 words (3.5 pages)

Essay about Accounting

- According to the Generally Accepted Accounting Principles, T-Shirts by Tommy can account for the accident is to record an extraordinary item. Using the definition from our Intermediate Accounting textbook, extraordinary events are defined as, "…events and transactions that are distinguished by their unusual nature and by the infrequency of their occurrence" (Keiso). Because of the nature of the plane crash, and the fact that these types of accidents happen very rarely, it can definitely be categorized as extraordinary....   [tags: Business Analysis Accounting Finance]

Free Essays
1607 words (4.6 pages)