environmental accounting design - Covenant University Repository

We are however, cautioned on use of terminologies. Since terminologies are not
standardized, the broad term Environmental Accounting might differ among organizations and
nations. Environmental Accounting (EA) is variously called Environmental Cost Accounting
(ECA), Environmental Management Accounting (EMA), Full Cost Accounting (FCA) and
Total Cost Assessment (TCA) among others. IFAC (1998) Management Accounting Concepts
and IFAC (2005:19) International Guidance Document on Environmental Management
Accounting have proffered definitions as:
Environmental Management Accounting (EMA) which is defined as:
the management of environmental and economic performance through the
development and implementation of appropriate environmental-related
accounting systems and practices. While this may include reporting and auditing
in some companies, environmental management accounting typically involves
life-cycle costing, full-cost accounting, benefits assessment, and strategic
planning for environmental management. IFAC (1998; 2005:19)
Also, a complementary definition given by the United Nations Expert Working Group
(representing 30 nations plus) on EMA and the United Nations Division for Sustainable
Development (2001) which highlights both the physical and monetary side of EMA, broadly
defines EMA as the ‘identification, collection, analysis and use of two types of information for
internal decision making, namely: physical information on the use, flows and destinies of
energy, water and materials (including wastes) and monetary information on environmental-
related costs, earnings and savings.’
The types of information essentially relevant in EMA are basically two, physical
information and monetary information. To correctly assess costs in an organization, physical
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