Analysis Of Enterprise’s Carbon Emission Rights Accounting

With the development of the national carbon market,the financial impact of the trading behavior and trading volume on enterprises has attracted great attention from the political,business and academic circles.Hence,the Ministry of Finance has issued drafts for consultation and interim regulations.To identify existing problems in the accounting treatment of enterprises and promote improvement of accounting standard,this paper analyzed the 2019 enterprises’ carbon emissions trading accounting treatment questionnaire.Our analysis found that the practice of enterprise accounting treatment is diversified and simplified,and inconsistent with the practice of the consultation draft: while purchased allowances held for compliance are mainly recognized as intangible assets(45.45%)and inventory(18.18%),purchased allowances held for trading are mainly recognized as intangible assets(27.27%),inventory(18.18%)and financial assets(18.18%);no presentation(50%)or presenting within existing accounts(45.45%),and also no disclosure(59.09%).In the absence of compulsory accounting standards,the above-mentioned characteristics of enterprises have led to two problems: the incomparable financial information,and the hidden of carbon emissions behaviors.The complex definition of emission allowances,the lack of attention paid to carbon emission trading accounting by enterprises,and the difficulty in obtaining fair value are the main reasons for the above problems.We believe that it is necessary to formulate mandatory carbon emissions trading accounting standards,and the key of the standards is to balance between the comprehensiveness and feasibility of accounting treatment.Based on this,this article affirms the contribution of the interim regulations and puts forward three suggestions: to confirm the current year’s emission costs,to standardize the order of use of allowances,and to confirm different profit and loss accounts based on holding intentions.The findings will both enrich carbon accounting and allow accounting standards setters,government regulators,companies,investors,and the public to understand the accounting treatment of enterprises hence making better decisions.