ACCA PM Chapter 4 - Environmental Management Accounting

1. The focus is to on the efficient use of resources and the disposal of waste and effluent.

2. Three ways of impact in environmental costs.

• Cost on excessive resources and cleaning-up.
• Reputation pf the company.
• Fines and penalties.

3. Typical environmental cost, other than waste.

• Raw Materials: Use recyclable material to save costs.
• Transport Costs: Find alternatives.
• Water and Energy consumption: Identify inefficiencies and wasteful practice to save costs.

4. The Accounting method for environmental costs.

• Inflow / Outflow analysis
• All waste in Raw materials as well as energy and water.
• Flow Cost Accounting
• Material (Not Raw)
• System
• Delivery and disposal
• Lifecycle costing
• Design-out the cost before the product launched.
• Environmental Activity-Based Costing
• Environment-related cost (E.g., Sewage plant)

Source: https://opentuition.com/acca/pm/acca-performance-management-pm-lectures/