Companies generating carbon credits under voluntary green schemes face a number of financial reporting considerations – especially given the absence of requirements under IFRS® Accounting Standards that apply specifically to these schemes.
In this podcast – the latest in our series on the impact of the transition towards net zero – Allison McManus and Irina Ipatova provide some pointers for companies seeking a framework to help them make financial reporting decisions around voluntary green schemes.
Understanding all the terms of these schemes is important. Companies also need to understand how they will use carbon credits because both will be critical to determine the impact on financial reporting.
To approach your analysis of carbon credits in a structured way, you need to think about the initial recognition, subsequent measurement and disposal. And of course, don't forget about the meaningful disclosures of information that may be relevant to your users.
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