Environmental Accounting Challenges of Selected Manufacturing Enterprises in Bangladesh

Considering the importance as well as potential problems of environment issues, it needs more analysis of relevant factors for future course of actions. Environmental Accounting is called green accounting. This paper made on Challenges of Environmental Accounting Practices in Bangladesh on most polluted 16 selected enterprises in Chittagong during the period 2018. The main objective of the study is to specify the environmental accounting challenges in selected manufacturing enterprises in Bangladesh. The study is based on primary data. Primary data were collected by questionnaire and ex-pert opinion. Questionnaires were prepared based on study objectives. Collected data were processed manually and with help of the Computer software. The study highlights some critical challenges to implement environmental accounting in manufacturing enterprises in Bangladesh. The perception of respondents about the Challenges are: cost involvement, lack of skilled manpower, lack of set rules about environmental accounting, inadequate environmental accounting standard, low adoption of environmental accounting, no specific principles of environmental accounting etc. The average mean score of challenges is 2.47 in the scale of 3. The study also tries to forward some recommendations to overcome the challenges. It is to be recognized that the accountants have a key role in environmental accounting and reporting.

vironmental and social performance. Development of environmental accounting is comparatively slow in Bangladesh while comparing with other countries. In the case of corporate sectors, accounting for the financial aspects of an organization's performance is a statutory requirement but accounting for environmental aspects is voluntary activity in Bangladesh. Some of the studies conducted on EA reveal a number of flaws in EA in Bangladesh. After independence, a good number of industrial units were established in different areas of Bangladesh without considering environmental issues. Further it is revealed from the study of Rahman [1] that many people are being affected due to industrial pollution. Further, Reazuddin [2] states that large, medium and small scale manufacturing companies have created huge environmental problems in Bangladesh. According to the United Nations, Economic and Social Commission Report [3] unsustainable industrialization and non-compliance with environmental regulations are mainly responsible for the environmental degradation in developing countries.
EA refers to the incorporation of environmental costs and information in to a variety of accounting practice. At macroeconomics level, EA is used to account for cost associated with a region's stocks and flows of natural resources. EA accounts for the flow and renewable and non-renewable resources through a region (natural resources accounting) or the flow of goods and services through an economy (national income accounting) in such a level. In case of financial accounting, an enterprise records and reports its economic activities to an external audience where there is requirement for disclosure of environmental liabilities and certain environmental costs. In case of management accounting, EA is the way to gather and report in a predesigned way the material use and environmental costs there of in their operations. In fact, environmental accounts provide data which highlight both the cost and action as to environmental protection taken by enterprises, the contribution of natural resources to economic well-beings and the cost imposed by pollution or resources degradation of the environment which is a precious gift of nature. The factory workers and inhabitants of the immediate surroundings of the industrial concerns of the third world countries often face exposure to harmful chemicals which are more prone to health hazards caused by industrials pollutions Hammer. Hence a study on the Challenges of Environmental Accounting Practices is highly warranted issue in Bangladesh. But the crux of the problem is that in most of the sectors of Bangladesh, the use of environmental accounting practices is not mandatory. As a developing country, the potential of Environmental data generation and analysis is very significant because different types of pollution are being caused by different corporate sectors such as air pollution, water pollution, sound pollution, deforestation etc. The measures taken to overcome or minimized such pollution along with cost and the like need evaluation for assessing status of EA leading to furtherment of the situation. The study has investigated the status and use of Environmental Accounting in sample enterprises and has also evaluated the  [5]. It is noted that, Hecht [6], in a paper stated that the challenges of national income accounting and Environmental Accounting.
However, Environmental awareness, current disclosure practices and problems associated with Environmental Accounting and reporting of twenty large and medium sized companies from industrial sector in Bahrain [7]. Notably, Chauhan [8] a standard system of environmental accounting is not yet evolving in India [9] the authors are of the view that Environmental Accounting can face challenges of large & small, industrial, manufacturing and service sectors. Companies also face some methods problems such as water costs, activity based management, total quality management and process reengineering.
Although, Ramesh [10] the author is found in this paper to deal with insufficient elements of Environmental cost. Electricity, fuel, gas, lubricant oil, conventional and non-conventional energy cost and also considers cost and benefit.
Dijk et al. [11] the authors in a paper pointed out that Australia's law and concentrated population density and the short history since European settlement contribute to the lack of environmental data. Moreover, Tsui has made a study of financial regulation and reporting. In adequate publicity of Environmental management accounting, insufficient agreement between accountants and environmental management departments were major barriers of EMA adoption.
Similarly, Shill and Iqbal [12] in their study states that Environmental Ac-  [13]. The author in fact made a preliminary overview of environmental accounting. Islam & Das [14] in the context of EA the authors evaluated Green banking in Bangladesh. They asserted that Green banking is a new way of conducting the banking business through considering the hygienic environmental issue as well as corporate social responsibility. Ullah et al. [15] in another study the authors found that 31% of the sample companies addressed on environmental issues in their annual reports. Textile industries disclosed very poor information regarding environmental aspects where variation of disclosure among the industries is considerably high.
On the other hand, Ahsanuddin & Saifuddin [16] in a study finds that on an average the selected companies disclosed 50.34% requirements while the standard deviations is very high (about 17.60%) indicating companies are inconsistent in disclosing requirement. The authors opine that companies in Bangladesh are disclosing very inadequate narrative reporting information in their annual reports which are published source of information to stakeholders. Hossain [17] in a study about disclosure of Environmental information found that only 9.97 Pharmaceuticals and Chemicals Companies disclose more information in the annual report. Only two companies disclosed maximum 18 environmental factors in their annual report out of 74 factors. EA has been used increasingly day by day in the developed and developing countries and now-a-days, a good number of companies are putting their concern regarding EA and they are disclosing different environmental information in their annual reports. Though start is slow yet it seems that it will expand greatly in near future. Based on the above literature review we find that most of the studies were made on the disclosure practices of environmental information in the annual reports. There is a very scanty of research about the future Challenges in the environmental accounting practices in developing economy like Bangladesh.

Objectives of the Study
The main objective of the study is to specify challenges of environmental ac-

Research Methodology
The study is based on primary data. For the purpose of the study, an attempt was Open Journal of Business and Management made to select purposive samples from most polluted eight manufacturing industries taking two from each i.e. 16 enterprises in Chittagong. The primary data were collected by questionnaire. The primary data was used for the purpose of the study.
Mainly, the formal interview has been conducted to gather primary data and opinions of respondents as to perceptions relevant to different aspects of EA.
Notably, the author visited each sample enterprises more than twice for data col- Here it is to be mentioned that the Accountant was a common respondent of each sample enterprises. However, not all 80 respondents did respond adequately. As such in the final evaluation, actual respondents came to 61 ( Table 1).
The data collected were tabulated both manually and by use of computer as per need. Different statistical tools such as frequency distribution, mean, and standard deviation were used to analyse the data. Data was coded and analyses by SPSS. Summary of the information in relevant case has been shown in tables where necessary through ranking.

Scope of the Study
Environmental Accounting is a new branch as well as a concept of accounting.
In the present day context, everybody's concerns over environment has created a pressure on management to ensure environmental disclosure in their annual report, But most of organization reportedly is not concerned about environmental

General Problems
Environmental Accounting needs to be managed properly and adequately. This necessity has given rise to Environmental Management Accounting. Environmental management accounting (EMA) is a part of environmental accounting which is the "accounting systems and techniques that provide decision-makers and management with financial and non-financial information about the firm or organization and its environment." [18] In this case, further, EMA is not likely to be successful if its promotion is inadequate. It is find out from Japanese companies, EMA information was incomplete and eco-efficiency information was underutilized due to insufficient public promotion [19].
EMA requires collaboration and actions of different functions, such as financial management and environmental management. But no logical relationship has yet been established between them. Setthasakko [20] found that accountants in Thailand did not have sufficient environmental knowledge and experience.
Environmental issues are restricted to the existing accounting practices. He pointed out that Accountants in Thailand did not practice in creating EMA.
It is to be mentioned here that the application of IFAC/ UNDSD, EMA guidelines was not mandatory and companies use own definitions of environmental costs. Companies had their own definitions of environmental costs which made firms found collecting, identifying and evaluating environmental cost data difficult. Setthasakko [20]. Finally, managers were unwilling to adopt EMA as they were not willing to be held responsible for significant environmental costs. Gale [21] reported that after looking at the "true environmental costs", the managers of a paper mill in Canada who participated in the research project questioned the validity of EMA methodology and the managers decided not use EMA.

General Challenges of EMA
The above brief discussion indicates that the general problem of EA and EMA is less definition of Environmental cost, lack of willingness of managers to adopt EMA, lack of co-ordination among functional areas, lack of legal framework, inadequacy of guidelines and compulsion to adopt guidelines, etc. It is recognized that "the majority of management and cost accounting systems that are in Research on environmental costs revealed that environmental costs are generally higher than considered because costs are hidden in other accounts [22]. The total environmental costs were found to be at least twice as high according to EMA methodology as compared to conventional accounting.
"According to IFAC [23], the following challenges exist in most organizations management accounting systems: 1) Inadequate links between accounting and other departments; 2) Unintentional hiding of environmental-related costs information in overhead accounts; 3) Inadequate tracking of information on material use, flows, and costs; 4) Lack of some environmental-related information in the accounting records; and 5) Investment decisions made on the basis of incomplete environmental-related information.
The largest part of environmental cost lies in the purchase value of non-product output [24]. Wrongly allocating costs in particular costing categories can also result in "hidden" costs in the costs in the accounting system [22]."

Perceptions of Respondents as to Challenges of
Environmental Accounting: Bangladesh Context 1) Environment issue is a burning issue in the present day context due to its damage caused by natural and human activities. Its safeguard and prevention is thus a serious concern to all-society and business. Against this backdrop, Environmental accounting and Environmental Management Accounting have become a research topic globally as well in Bangladesh. This is gaining recognition too. In such a context the present research was undertaken where in study of perceptions of respondent to EA and EMA was also undertaken as an important part of this study.
Study of perceptions of the respondents of sample enterprises Challenges.
Here 13 statements were given to respondents to express their perceptions rele- 2) Perceptions of Respondents as to Challenges of environmental accounting Various types of Challenges may come in the way to introduce and implement Environmental Accounting. It is urgently necessary to find out challenges beforehand so as to minimize the same or overcome the same so that it can be applied properly and help achieve efficiency. To this end efforts were made to know the perceptions of respondents as to Challenges they face or expect to face and the magnitude of such challenges. Following para deals with the same.
i) Cost involvement Environmental Accounting and reporting will require extra manpower and cost. Many enterprises, unless otherwise compelled, may not be willing to incur such costs. Thus incurring additional cost may be considered as problems in introducing EA. To what extent such cost factor is considered as Challenges was thus a matter of investigation. To this end the average score of respondents worked out at 2.47 in the scale of 3. This score lies between highest problem score 3 and moderate problem 2. Thus respondents found to consider it as a significant problem. Table below depicts the status of the responses more explicitly. The 59% (36) respondents reveal high degree of positiveness, 32.8% (20) reveal moderately high, 6.6% (4) respondents somewhat high, one respondent 1.6% high degree of negativeness on cost involvement is an important issue to the enterprise in adopting environmental accounting.
ii) Lack of skilled manpower People's educated, skilled workers are vital for the efficient and effective implementation of EA. In such a context the respondents were requested to express their opinion as to this challenge. It is seen that respondents perceive the existence of skilled human resources must as the average score of the respondent's perceptions worked out positive at 2.54 in the scale of 3. The 67.2% (41) respondents show the high degree of positiveness, 23% (14) respondents moderately high, 8.2% (5) respondents somewhat high and 1.6% (1) respondent's very low degree of negativeness on lack of skilled workforce is an obstacle for the environment. press moderately high, 6.6% (4) respondents express somewhat high, and 1.6% (1) respondents express improper enforcement of planning, and environmental legislation gives rise to the low adoption of environmental accounting.

x) Insufficient information affects recording and presentation
Accounting is an information system. But insufficient information affects re-  (Table 2).

Statistical Data Analysis Showing Perception of Respondents on Challenges of EA
It is evident from the Table 3 Table 4 shows the respondents perception in terms of percentage on different challenge statements. Among all statements Lack of co-ordination with different Open Journal of Business and Management

Implications of the Study
The study reveals that the vast majority of the respondents consider introduction and implementation of Environmental Accounting and Environmental Man-Open Journal of Business and Management agement Accounting is necessary. But the crux of the problem is that the application and use of EA is limited and at initial stage in the sample enterprises. Lack of initiative from enterprise management, lack of skilled process, extra cost involvement are serious handicaps in the way of introduction and use of E.A. Information generated, collected and proper framework to install and operate EA are not adequate and proper. The environmental factors, organizational capacity, provision for maintaining separate sets of accounts staff, information management structure and attitude of management are not favorable to requirements though necessity are well recognized. In such circumstances what is urgently required is the establishment of legal framework, government initiative and instructions urgently required. At the same time proper guidance from accounting professional bodies is also called for. Enterprise initiative than can be expected to follow. Management awareness is not sufficient, what is required is the understanding of its necessity and, drawing up enterprise rules relevant to EA and EMA. For the sake of stability, sustainability and development of industrial growth keeping environmental hazard at minimum, recording and reporting environmental related information is a must for an economy like Bangladesh which is striving hard to grow in sustainable perspective.

Recommendations
It is to be recognized that environmental accounting and reporting have a significant role by an accountants [5]. However, Manufacturing organizations need individual environmental accounting department for recording and reporting.
So that, Government should be taken necessary steps of environmental accounting rules and regulations. International accounting standard should be maintained overcome the environmental accounting challenges. The accountants need keep records up to date.

Conclusion
Challenges of Environmental Accounting need to be managed appropriately and adequately. An attempt has been made to identify relevant problems of EA as well EMA in the context of Bangladesh situation. Perceptions of selected respondents from most polluted manufacturing enterprises have analyzed which demonstrate highly prospects in future. In the same way, some important challenges or future problems have been identified which may draw the attention of the future policy planning for appropriate action.

Conflicts of Interest
The author declares no conflicts of interest regarding the publication of this paper.