As discussed under Section 2.2, IAS 38 accounting principles apply when the carbon offsets held do not fall within the scope of another standard. It might make sense to classify fungible carbon offsets that could be used either for production of carbon-neutral products or the achievement of overall voluntary emission targets as intangible assets at the time of purchase. This is because, at the time of purchase, the entity cannot reliably conclude that the carbon offsets will be used in the production of goods. Depending on their usage, entities could include their costs in the cost of the carbon-neutral products (see FAQ 3.2.1 above) or expense their costs in profit and loss when the offsets are retired to achieve overall voluntary emission targets.

However, if the group designates separate pools for its fungible carbon offsets with different purposes and have appropriate controls in place, it might also be considered acceptable to determine the classification separately for each pool of carbon offsets.