This publication discusses the alternative treatments for allocated free permits, the flow-on impact on the measurement of emission liabilities and the corresponding impact on income statements. It also addresses cash assistance and the accounting considerations by a direct emitter.
- No authoritative accounting guidance explicitly dealing with transactions involving carbon permits.
- Entities receiving free carbon permits under the Clean Energy Act have several accounting issues to consider when the Carbon Pricing Mechanism commences on 1 July 2012.
- Consult with your advisers prior to the commencement of the Carbon Pricing Mechanism on the appropriate accounting policy for free carbon permits.