Accounting for Emissions Trading: How Allowances Appear on the Financial Statements Could Influence the Effectiveness of Programs to Curb Pollution

30 Pages Posted: 20 Sep 2011

Date Written: September 20, 2011

Abstract

Cap-and-trade programs to curb carbon emissions frequently rely on the use of tradeable emissions credits known as "allowances." To date, companies' presentations of their usage of these allowances on their financial statements has not been uniform. Cap-and-trade programs will be most effective when presentation of allowances on financial statements is standardized, since all companies will be forced to be transparent about their methods of compliance with carbon emissions trading systems. Therefore, the FASB and the IASB should implement standards for the presentation of allowances on the financial statements.

Suggested Citation

Souchik, Laura, Accounting for Emissions Trading: How Allowances Appear on the Financial Statements Could Influence the Effectiveness of Programs to Curb Pollution (September 20, 2011). Boston College Environmental Affairs Law Review, Vol. 39, No. 2, 2012, Available at SSRN: https://ssrn.com/abstract=1931035

Laura Souchik (Contact Author)

Boston College Law Review ( email )

885 Centre Street
Newton, MA 02459-1163
United States

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