Are you purchasing carbon credits voluntarily?

Polluting company

A polluting company may voluntarily purchase carbon credits that typically represent a reduction or removal of emissions (e.g. CO2 or other greenhouse gas) through a certified offsetting project – e.g. the planting of trees. Credits are often registered with a registry authority and a company may be able to trade or sell them to a third party (see the life cycle of a carbon credit below). However, the arrangements vary significantly and a company needs to carefully consider the specific facts and circumstances to determine the appropriate accounting treatment.

Isg emission

This page references specific IFRS® Accounting Standards – see our glossary for the full list of standards.