Practical application of green accounting: the case of Lithuanian companies

ENEuropean Union (EU) directive 2014/95/EU regulates the preparation of social responsibility report and one part of this report relates to environmental aspects. The required environmental information could be collected and accounted for by applying green accounting practices. Unfortunately, green accounting has no clear practical applicability and accounting standards do not regulate this. Therefore, the aim of the research is to assess whether companies apply green accounting and whether there is a link between the preparation of a social responsibility report and green accounting. To achieve the aim of the research, i.e., to reveal the concept of green accounting and to assess the possibilities of adapting traditional accounting to green accounting, scientific literature analysis, synthesis, systematisation, and comparison were applied. Based on this, an empirical study was conducted, for which Lithuanian companies were selected as case studies. First, the financial reports of listed companies in NASDAQ Baltic Vilnius were analysed. Second, an additional pilot study was performed using a questionnaire designed to investigate the preparation of social responsibility reports and the application of green accounting in Lithuanian companies.It has been identified that companies do not have a clear strategy on environmental issues and this may be the reason why Lithuanian companies do not apply green accounting. Although the results of the questionnaire have revealed that companies do not apply green accounting, the analysis of the financial reports show that there is a basis for green accounting. The focus was placed on those companies that calculate various environmental indicators separately from the financial accounting system. The conclusion was reached that companies lack information on the application of green accounting in the common accounting system. Keywords: Accounting; Environmental accounting; Green accounting.