Guidance for accountants advising SMEs (small and medium-sized enterprises) about establishing and operating carbon accounting, and the associated tax advantages, is published today by ACCA (the Association of Chartered Certified Accountants).
The Technical Factsheet number 190 includes details on carbon accounting – or greenhouse gas accounting – which measures the environmental performance of a business so that targets can be set and reductions achieved for environmental impacts.
David York, technical expert at ACCA, says: 'This briefing can be used by accountants who advise SMEs, or those employed in small businesses or charities who want to adopt aspects of sustainability reporting. But it is also a good read for those SMEs looking to adopt such practices as it explains the technicalities in an accessible way.'
The factsheet focuses on a simple form of carbon accounting that is suited to entities with turnovers up to £7 million; this includes companies of all types, charities, partnerships and sole traders.
David York says: 'This form of carbon accounting has been chosen because it is potentially accessible to all, so that businesses are not deterred by either the amount of time it will take to complete the carbon accounts, or the complexity of the process. This increases the likelihood that carbon accounts will be prepared and used as a way to assist in reducing carbon emissions.'
Mr York explains further: 'There are many ways in which small businesses and other organisations can improve their environmental performance. By taking simple and consistent reporting measures, setting targets and reducing impacts small entities can 'go green' without attracting the tag of 'green wash'. Smaller businesses considering the environment will benefit themselves, their stakeholders and the wider environment: a real win-win.'
Concluding, David York says: 'But SMEs may well ask ‘why should they do this?’ when it is not mandatory. There are four clear reasons - protecting our environment, business growth, cost savings and ultimately happy stakeholders. Hopefully this practical factsheet, developed in conjunction with Green Accountancy, will help owners, managers and adviser of SMEs to understand these reasons for carbon accounting.'
The factsheet offers nine steps for SMEs when considering green accounting:
- Set the relevant business objectives.
- Determine whether the whole business or just parts of it will be included.
- Identify the business activities that are responsible for greenhouse gas emissions and (after preliminary investigation) those to be accounted for.
- Decide on the start and periodicity of data acquisition.
- Set up appropriate systems for data capture, processing and reporting.
- Collect primary data for the base period and convert it to its carbon dioxide equivalents.
- Evaluate the outcome and decide future emissions reduction targets.
- Take steps to achieve the targets.
- Monitor progress by evaluating later outcomes against the base period.
- ends -
For further information, please contact:
Alana Sinnen, ACCA Newsroom
tel: + 44 (0) 207 059 5807
mob: +44 (0) 7715 812120
Notes to Editors
- This factsheet is issued as 'interim guidance' and will be updated over the next two years to take account of feedback from users. Please refer to Appendix 7 Feedback on interim guidance where this process is explained and questions are provided to facilitate comment.
- It has been published by ‘Green Accountancy' who are uniquely qualified in both accountancy (Chartered Certified Accountants) and environmental conservation (Diploma from Oxford University). We encourage and help small businesses, charities and social enterprises reduce their environmental impacts. Our primary services are top quality accountancy and taxation services all provided with consideration of the environment and ethical issues.’
- ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants. We aim to offer business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management.
- We support our 170,000 members and 436,000 students in 180 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. We work through a network of 91 offices and centres and more than 8,500 Approved Employers worldwide, who provide high standards of employee learning and development. Through our public interest remit, we promote appropriate regulation of accounting and conduct relevant research to ensure accountancy continues to grow in reputation and influence.
- Founded in 1904, ACCA has consistently held unique core values: opportunity, diversity, innovation, integrity and accountability. We believe that accountants bring value to economies in all stages of development and seek to develop capacity in the profession and encourage the adoption of global standards. Our values are aligned to the needs of employers in all sectors and we ensure that through our qualifications, we prepare accountants for business. We seek to open up the profession to people of all backgrounds and remove artificial barriers, innovating our qualifications and delivery to meet the diverse needs of trainee professionals and their employers.