Increasing concern for the environment has led many to pursue a career as an environmental accountant without fully understanding what’s involved. It’s a field that was first introduced in the 1980s and is employed by multiple types of businesses and governments to determine the best way to conduct business, while minimizing the impact on the environment.
There are four types of environmental accounts. They encompass environmental financial accounting, environmental cost accounting, environmental management accounting, and environmental national accounting.
Environmental financial accounting pertains to estimating and public reporting of environmental liabilities, along with financial material environmental costs. They produce reports of exposure and management of the financial and non-financial impacts due to climate change of various entities.
An environmental cost accounting expert is concerned with the use and depletion of natural resources. The professionals calculate the costs of managing natural resources and the operational costs of doing so within multiple types of organizations and businesses.
Environmental management accounting helps companies save money and provide product pricing through optimal use of resources. The information can result in cleaner production practices. The primary benefit is increasing value for shareholders, improving an entity’s reputation, and improving the public’s perception of a company.
The field of environmental national accounting is used to determine a country’s economy and the environment. It takes into consideration a country’s physical and monetary assets and operational costs of natural resources.
The environment plays a vital role in the economy. Environmental accountants provide businesses and nations with important data that’s instrumental in determining criteria ranging from economic health, degradation of natural resources, and the costs of pollution. The professionals provide data on the contribution of the environment to the economy and vice-versa.
Environmental accounting is also known as green accounting. The accounting processes have become invaluable for business and countries in making policies in regard to natural resources in an international marketplace.
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