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Carbon credits

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Presentation on the current issue of Carbon Credits, what it is, how is the accounting done, what are its benefits and various other issues.

Text of Carbon credits

  • 1. By: DIVINE KAUR CARBON CREDIT

2. Birth of Carbon Credit Concept of Carbon Credit Growth of Carbon Credit & Indias Position Concern for Chartered Accountants 3. The Major Concern

  • GLOBAL WARMING

4. Green house gases leading toGlobal Warming

  • CO 2
  • Methane
  • Nitrous Oxide
  • Hydroflourocarbon
  • Sulphur Hexaflouride
  • Perflourocarbon

CO 2 t-e one tonne of CO 2equivalent 5. Birth of UNFCCC In 1992, Rio Brazil Objective Green House Gases should be stabilized within a time frame. 6. TheKYOTOPROTOCOL An agreement signed in December 1997 in Kyoto, Japan 7. KYOTO PROTOCOL Annexure 1Non Annexure 1 Developed Developing Under developed 8. The Kyoto Protocol Objective Reduction of Green House Gases emission by developed countries in the The First Commitment Period (2008-2012) 9. DID YOU KNOW???? WHY 10. Birth ofCarbon Credit Concept of Carbon Credit Growth of Carbon Credit & Indias Position Concern for Chartered Accountants 11. What isCarbon Creditunder theKYOTOProtocol A credit for reducing 1 ton of CO 2 (Green House Gases)from the atmosphere 12. How to generateCarbon Credits??? CARBON CREDITS 13. METHANE CO 2 METHANE CO 2 EARN CARBON CREDIT METHANE 14. USE OFCARBON CREDITS IN EMISSION REDUCTION 15. REDUCTION NATIONAL MEASURES ADDITIONAL MEASURES THE FLEXIBILITY MECHANISM 16. FLEXIBILITY MECHANISM Clean development Mechanism Joint implementation Emission trading Project based 17. Emission Trading Developed country A (needs CC) Developed country B Sell these carbon credits Payment for CC Earns carbon creditscalledAssigned Amount Units 18. Joint Implementation Developed country A (needs CC) Developed country B Sets a project Sell carbon credits Earns carbon credits calledEmission Reduction Units 19. Clean Development Mechanism (CDM) Developed country(needs CC) DevelopingCountry Sells carbon creditsSets a project Earns carbon credits called Certified Emission Reduction 20. Concept of VERs VER Countries not committed to the protocol Voluntary Emission Reduction OR Verified Emission reduction 21. What should be the price ofcarbon???? At present, price of 1 carbon creditis 10 Euro to 15 Euro 22. Birth ofCarbon Credit Growth of Carbon Credit & Indias Position Concern for Chartered Accountants Concept of Carbon Credit 23. Market for Carbon TradingCurrently there are 5 Environmental Exchanges, trading in Carbon Credits POWER NEXT EUROPEAN CLIMATEEXCHANGE 24. Indias Stance in Carbon Credits 25. India along with China, lead countries in earningCarbon Credit 26.

  • India pocketedRs 1,500croresin the year 2005just by selling carboncredits to developed- countryclients.
  • India has generated30 million
  • Carbon credits &140 million
  • are in pipeline

27. Some of the Leading companies of India using & selling Carbon Credits GUJARAT FLOUROCARBONS Ltd. 28. SRF . The major beneficiary of reducing GHG gases 29. Birth ofCarbon Credit Growth of Carbon Credit & Indias Position Concern for Chartered Accountants Concept of Carbon Credit 30. Concern forThe Chartered Accountants . 31. ACCOUNTING TREATMENT 32. Present Accountingtreatment.. Treatment under IFRS Treatment under US GAAPS Treatment under AS IAS 20 (Government grants) currently no guidance note available currently no accounting standard available 33. Tax Treatments

  • Will there be any tax on
  • Carbon Credits??????

If there is income there will be tax 34. OR CER Transaction Tax TAX TREATMENT INDIRECT TAX DIRECT TAX Income from CERs Other Income Business Income Goods Services VAT, etc Service tax 35. However, NO set Accounting or Tax Treatment has yet been decided 36. Scope forChartered Accountants 37. Other opportunities.. As an auditor.In audit of Carbon Trading As a Carbon Trading Consultant Carbon Trading Broker 38. Birth ofCarbon Credit Growth of Carbon Credit & Indias Position Concern for Chartered Accountants Concept of Carbon Credit 39. What after 2012 End of Commitment Period??? NOT SUCCESSFUL THE COPENHAGEN CONFERENCE 40. Thank You