Companies must be aware of the financial impact of climate-related risk, says ACCA

Date

03 Jul 2017

Sections

Euro & Finance

Press release

ACCA (the Association of Chartered Certified Accountants) has welcomed the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD) as an important step towards the better allocation of capital, by incorporating the effect of climate change in investment decisions.

Yen-pei Chen, subject manager – corporate reporting at ACCA said:

‘The four thematic areas of the TCFD’s recommendations – governance, strategy, risk management and metrics and targets – provide a useful framework for disclosure.

‘The detailed implementation guidance in the annex will be particularly helpful for companies preparing to report under the EU’s Directive on the disclosure of non-financial and diversity information.

‘Climate-related disclosures, in our view, will be best integrated into the reporting of the impact of other material factors within the four thematic areas.’

ACCA also welcomed the inclusion of references to the financial impact of climate-related risk, and the ensuing recommendation that this be reflected in companies’ financial statements.

‘In particular, climate-related risks could affect the carrying value of assets and goodwill, and in some cases the going concern status of the business,’ added Ms Chen.

‘Accounting standard setters such as the IASB should be giving greater priority to closing the long-standing gap that exists in reporting the effect of pollutant pricing or emissions trading systems.’

Professional accountants play an important role in helping companies to manage and report climate-related risks more effectively. This is particularly clear in light of this week’s EU adoption of non-binding guidelines for non-financial information reporting, which is another example of the global momentum towards better-informed capital markets and companies fit for the challenges of today’s world.

ACCA is committed to educating the professional accountants of the future, giving them the skills they need to respond to this wider set of challenges, and contribute to a more sustainable future for businesses and our planet.

- ends –

 

For media enquiries, contact:

Adele Gilbert, ACCA Newsroom
T: +44 (0)20 7059 5077
M: +44 (0)7753 242 464
E: adele.gilbert@accaglobal.com
Twitter@ACCANews

About ACCA

ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants. It offers business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management.

ACCA supports its 188,000 members and 480,000 students in 178 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. ACCA works through a network of 100 offices and centres and more than 7,110 Approved Employers worldwide, who provide high standards of employee learning and development. Through its public interest remit, ACCA promotes appropriate regulation of accounting and conducts relevant research to ensure accountancy continues to grow in reputation and influence.

Founded in 1904, ACCA has consistently held unique core values: opportunity, diversity, innovation, integrity and accountability. It believes that accountants bring value to economies in all stages of development and seek to develop capacity in the profession and encourage the adoption of global standards. ACCA’s core values are aligned to the needs of employers in all sectors and it ensures that through its range of qualifications, it prepares accountants for business. ACCA seeks to open up the profession to people of all backgrounds and remove artificial barriers, innovating its qualifications and delivery to meet the diverse needs of trainee professionals and their employers. More information is here: www.accaglobal.com

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