The Interpretation recommends that the emission rights are accounted for in either of two methods:
- Using the gross method
Allowances are intangible assets, whether issued by government or purchased. Allowances that are issued for less than fair value shall be measured initially at their fair value. When allowances are issued for less than fair value, the difference between the amount paid and fair value is other operating income, which shall initially be recognized as deferred income in the balance sheet, and subsequently recognized as income on a systematic basis over the compliance period for which the allowances were issued. As emissions are made, a liability is recognized for the obligation to deliver allowances equal to emissions that have been made. It shall be measured at the value of the allowances received and at fair value for the portion exceeding the allowances received.
- Using the net method
According to this method, only a liability is recognized for the portion exceeding the emission rights granted. It is measured at fair value.
You can retrieve 179-1 CBN interpretation here in
French or in
Dutch.