Environmental policy is developed for helping in corporate sustainability. It is aimed to prevent environmental degradation. Statutory policy and standards should be mandated to ensure the company is compliance within standards and preserving the environment. At the operational levels, they avoid violations, emission, discharges of pollutants by monitoring and controlling via financial accounting and management accounting. The companies will then can redeploy resource more effective pg2. The implementation of environmental policy is not only more cost-effective but it also opens new business avenues. From new avenues, cost savings are achieved through energy conservation and waste minimization, which increase profitability, reducing impacts on the environment. Hence, company's competitive advantage is improved (Dorweiler and Yakhou, 2002)pg69. There will be a need of disclosing environmental impacts from company to identify who is the responsible party ultimately bears the environment cost [Richard and Karen, 2006 (Quoted: EPA, 2002)]pg5p2. A proactive environmental policy connotes a management team with a long-term vision and an appreciation for the complexities of accurate product costing. Substantial economic benefits can accrue to firms. Effective environmental awareness and reporting can also contribute to reputation building (Richard and Karen, 2006)pg8p4. Organisations should internalize environmental costs in order to trace cost of the organization's activities on the environment. They would be compelled to minimize the potentially harmful effects once they made these costs be accountable (S.K.Lodhia, 2002)pg2(718)p2.
Accountants and environmental experts could pool their skills to form a multi-disciplinary team to address environmental issues of significance to the organization and recommend appropriate remedial actions (S.K. Lodhia, 2003)pg2r2p3.Environmental accounting generating environmental information to help make management decisions in internal use. For external use, which is at the financial accounting field, it disclosing of interest to the public and to the financial community [Dorweiler and Yakhou, 2003 (Quoted: Bartolomeo et al., 2000)]pg1p1> s.k.lodhia. Environmental accounting translates into how environmental management practice adapts to beneficial impact on the environment (Dorweiler and Yakhou, 2003)pg76r2p3. The potential for accountants to make a significant contribution towards environmental consciousness in organizations has been envisioned through their managerial, auditing and reporting skills (S.K.Lodhia, 2003)pg2r2p1. Richard and Karen, 2006 describes green accounting is to induce corporations to participate proactively in cleaning and sustaining the environment>s.k.lodhia and, moreover, to describe fully and forthrightly their environmental activities in either their annual reports or in stand-alone environmental disclosures pg4r2p1. Public and managerial accountants have a role to play in educating corporate management with regard to environmental responsibility. Accountants are in a position to help develop information necessary for managers to make environmentally informed decisions---ma (Richard and Karen, 2006) pg4p1.
Environmental accounting could be used to make a significant contributions towards increasing environmental sensitivity in organizations and to promote sustainable business practices>R and Karen(S.K.Lodhia, 2003). It extends accountability to stakeholders through its external reporting and auditing process >D and Y, 2002, which enables them to make economically useful decisions.>D and Y Thus, accounting establishes an organizational culture and has a profound impact on business success (S.K.Lodhia, 2003). The fundamental premise behind environmental accounting is that organizations should internalize environmental costs to forecast the potential environmental impact of their activities and accordingly estimate contingent liabilities and create provisions for environmental risk.> [Richard and Karen, 2006 (Quoted: Medley, 1997, p.599)] It is also expected that investment appraisal decisions should be carefully considered to limit adverse impacts on the environment risk (S.K.Lodhia, 2003)pg2r2p2. There is the audit requirement to assure compliance with environmental regulation and appropriate reporting by environmental accounting[Dorweiler and Yakhou, 2003 (Quoted: Grinnell and Hunt,2000)]p3p.last.environmental accounting having beneficial impacts on the environment within business activity (Dorweiler and Yakhou, 2003)pg71p2. A broad view of environmental accounting, and the EMS, includes application of techniques and performance measurement, recognition and reporting of liabilities and contingencies, capital market reactions to accounting disclosures and taxes. Taxes implications include specific environmental taxes, appropriate treatment of environmental expenditures, pollution allowances as tradable permits and general federal income tax issues [Dorweiler and Yakhou, 2003 (Quoted: Bebbington, 1997)]. More environmentally aware public accountants will come to influence the managers of client firms to accept responsibility for a greater participation in a worldwide clean up(Richard and Karen,2006)pg9r2p2.5. Environmental costs are then transferred to what might be called an environmental income statement where they are compared to the estimated annual benefits of expanded environmental action('eco-efficiency'). In addition to more traditional roles of gathering environmental data and preparing reports, accountants have the opportunity to move ER forward by lobbying for the articulation{making of speech sounds} of reporting standards(Richard and Karen, 2006)p4p.last.
Internal environmental accounting mechanisms such as life cycle costing or even full costing accounting attempt to trace costs of the organization's activities on the environment Environmental management systems are expected to be developed in conjunction with accounting information systems, so that environmental issues are addressed by conventional accounting practices (S.K.Lodhia, 2003)pg2p2. EMA integrates corporate environmental and business policies, and thereby provides guidance on building a sustainable business. (Dorweiler and Yakhou, 2003). EMA analyzes environmentally related financial costs and benefits, contributing to recognition of the high and increasing levels of capital and operating expenses, for pollution control equipment, and environmental taxes. Also, possible environmental initiatives [Dorweiler and Yakhou, 2003 (Quoted: Fryxell and Vryza, 1999)]pg68p3. Environmental cost accounting directly places a cost on every environmental design and environmental management. It producing environmental costs in 2 ways [Dorweiler and Yakhou, 2003 (Quoted: Grinnell and Hunt, 2000)]: -one is the A-B-C framework, looking for 'cost drivers' at organizational levels -the other is a cost-of quality framework, which defines environmental costs in prevention, appraisal and internal and external failure. This cost-of-quality approach supports pollution prevention as an appropriate management strategy. ECA is a tool, part of process for treating the environment as integrated with (i) business strategy and (ii) decision making[Dorweiler and Yakhou, 2003 (Quoted: Lally, 1998)]. -to reduce or minimize damage to the environment over life-cycle of products and processes, to continually improve environmental performance in the above areas [Dorweiler and Yakhou, 2003 (Quoted: Bebbington, 1997)]. For the management accountant, the vision is a full understanding of all the environmental costs and benefits. This would allow rational decisions to be made about the way that the organization should develop in the future. Management accountants can provide a great service to their companies if the are able to influence upper management to embrace environmentalism. This latter cost category is itself divided into costs that the company will have to bear and costs that are passed on to society [Richard and Karen, 2006 (Quoted: Hansen and Mowen(2003)) pg 9 p.last. This document would communicate a number of vital messages to upper management. It should recognize that environmental costs are so substantial that they are factored into product pricing. For those with greater diversity of products, activity-based costing with its greater variety of cost drivers would better differentiate the product lines with respect to their environmental impacts. Kaplan and Norton (1992) articulated the concept of the 'balanced scorecard', wherein a company's performance is to be measured across four parameters. More recently, they have introduced environmentalism as a fifth category within the new managerial philosophy known popularly as 'total quality management'.
Currently, very few countries worldwide have any substantial ER requirements. Furthermore, there are no standardized formats of environmental information (Richard and Karen, 2006)pg4p.last. Further, without standards, verification of ER is problematic. The development of standards at an international level tends to be a slow process(Richard and Karen, 2006)pg7r2p3. The profession has failed to maximize its potential for leadership-sufficient expertise to participate in environmental partnerships remains undeveloped: the attestation to environmental reports is still not regarded solely as an accountant's function: and official standards with respect to most ER issues and/or verification engagements continue to be lacking [Richard and Karen, 2006 (Quoted: Beets & Souther, 1999)]pg8r2p1. At this point in time, even the largest firms do not have sufficient expertise on staff to respond to a substantial increase in demand either for assurance services in the environmental area or for advising clients as to the information systems required to collect ER data pg8r2p4. It is believed that accountants are largely unaware of how their skills could be utilized in creating a heightened awareness of environmental sensitivity in organizations(S.K.Lodhia, 2002)pg719p1. In the case study in Fiji, while support was provided for both internalizing environmental costs and recording contingent environmental liabilities, a majority raised the issue of the difficulty associated with quantification of these subjective estimates(S.K.Lodhia, 2002)pg725p5. Reporting style was not consistent across firms because there are no guidelines to assist disclosure of environmental information(S.K.Lodhia, 2002)pg726p3. Therefore, the necessity for harmonizing international accounting standards arise pg731p1. The efforts of accountancy institutes and increasing legislative requirements in other countries should lead to an improvement pg732p1. Company's ignorance of the impact of environmental issues on their accounting practice. Involvement of accountants in environmental sensitivity is limited. Consideration of wider social and political factors does not seem to be compatible with their traditional skills and qualifications (S.K.Lodhia)pg728p.last2. Corporate accountants are highly ignorant of their involvement in the environmental management accounting and reporting strategies. Their managerial, auditing and reporting skills are not utilized in encouraging sustainable business practices by their organization pg730p.last. Corporate accountants are of the view that in the absence of environmental legislation and mandatory accounting standards, they do not have a role in environmental management accounting or environmental reporting(S.K.Lodhia, 2002)pg729p3. In Fiji, the EMA practices of local companies are not transformed into consistent and useful environmental disclosures. This has been largely attributed to the lack of enforcement mechanisms for protection of the environment pg729p2. Concerns have been raised in regard to their competence in environmental matters (S.K.Lodhia, 2002)pg730r2p1. Present status quo will remain as long as the practice is voluntary pg730p1. Areas of conflict are identified as accountants' concern over their own costs to the detriment{harming} of needs in measuring performance (Yakhou and Dorweiler, 2003). There is issue of shortcoming in accounting education related to environmental accounting [Dorweiler and Yakhou, 2003 (Quoted: Gibson, 1997)]pg76p.last2. Yakhou and Dorweiler, 2003 say that it is to raise awareness of environmental issues.
EA The need for integration of integration of an environmental policy with business policy, and for a multidisciplinary team, is given from a business perspective:-the role of accounting in supporting both corporate environmental strategy and corporate business strategy and- the several accounting sub-disciplines related to environmental issues. Emphasis on the multi-discipline team is to support a top-level strategy and to achieve the benefits from directing a company in an environmentally sound manner.
Fiji Lack of action in promoting engagement of accountants in environmental issues. The status quo of the present environmental accounting practice in Fiji is unsatisfactory, largely due to its voluntary nature and inability to provide sufficient guidance to accountants. It also has policy implications, suggesting an urgent need for improved environmental legislation and regulatory intervention in developing nations such as Fiji.
Green Acct'g More environmentally aware public accountants will come to influence the managers of client firms to accept responsibility for greater participation in a worldwide clean up. ER might be viewed as sufficiently important to the public interest and/or society's definition of corporate accountability that the public will demand action. Negatively, the wide expansion of accounting services mandated by Sarbanes-Oxley may leave those firms with SEC clients stretched thin in terms of personnel that expansion into ER assurance is unrealistic, at least in the short run.
