THE ROLE OF FINANCIAL ACCOUNTING IN WASTE MANAGEMENT
THE ROLE OF FINANCIAL ACCOUNTING IN WASTE MANAGEMENT

Summary/Abstract: Waste management is often framed as a technical or logis-tical problem, yet it is also a financial-information problem: what is not mea-sured, classified and disclosed is difficult to control, finance and govern. Fi-nancial accounting provides the disciplined measurement system that recordswaste-related transactions, recognises waste-related obligations and enablescomparability across periods and organisations. Drawing on the uploaded lit-erature in waste management, sustainability accounting and IFRS-based fi-nancial accounting, this article explains how financial accounting strengthenswaste management through (1) transparency and comparability of waste-re-lated costs and revenues, (2) compliance and accountability through recogni-tion and disclosure of waste-related liabilities and provisions, and (3) decisionusefulness by enabling investment appraisal, relevant-cost analysis, risk gov-ernance and performance measurement. It then proposes a practical waste-fo-cused chart of accounts that captures information by waste stream (general/mixed, recyclables, organics, hazardous, e-waste, construction and demoli-tion) and by treatment route (prevention, recycling, composting/AD, energyrecovery, landfill, incineration), and shows how these accounts can be recon-ciled to physical quantities using tools such as material flow cost accounting(MFCA) and life-cycle costing. Finally, it demonstrates how the resulting ac-counting information supports managerial decisions, investor assessment andresearch, and provides illustrative journal entries for common waste-relatedtransactions.

• Details
• Contents