IFRS and environmental accounting

Abstract

Purpose – The purpose of this paper is to examine whether International Financial Reporting Standards (IFRS) can be used for monitoring environmental degradation. A comprehensive review of academic and professional literature indicates that the IFRS regime provides useful conceptual and practical frameworks for monitoring firms that are operating in environmentally sensitive industries.Design/methodology/approach – Using qualitative and case study research methods, the financial statements of three environmentally sensitive companies were studied.Findings – The sustainability reports produced by the companies contained both information and propaganda. The credibility of published sustainability reports is unclear. The size and adequacy of the contributions of the companies towards sharing the costs of decommissioning, rehabilitation and restoration of the environment are not disclosed. A new statement is proposed.Practical implications – Policy implications at national and international level are many.Soc...