ASTM_E_3123_-_18.pdf

Designation:E312318Standard Guide forRecognition and Derecognition of Environmental Liabilities1This standard is issued under the fixed designation E3123;the number immediately following the designation indicates the year oforiginal adoption or,in the case of revision,the year of last revision.A number in parentheses indicates the year of last reapproval.Asuperscript epsilon()indicates an editorial change since the last revision or reapproval.1.Scope1.1 PurposeThe purpose of this guide is to provide aseries of options or instructions consistent with good commer-cial and customary practice for recognition and derecognitionof environmental liabilities.This guide is consistent withGenerally Accepted Accounting Principles(GAAP).Recogni-tion of environmental liabilities is essential to determining thecurrent book value of an entity.An entity may have futurespending to extinguish risk and liabilities triggered in the past.Serious consequences,ranging from failed audits and poorcapital stewardship to financial fraud and bankruptcy,exist forentities omitting material information from financial state-ments.1.2 ObjectiveThis guide enables users to reliably deter-mine if a given type of environmental liability exists andsubsequently has been settled,consistent with the accountingdefinitions in place.1.3 This international standard was developed in accor-dance with internationally recognized principles on standard-ization established in the Decision on Principles for theDevelopment of International Standards,Guides and Recom-mendations issued by the World Trade Organization TechnicalBarriers to Trade(TBT)Committee.2.Referenced Documents2.1 ASTM Standards:2E2137 Guide for Estimating Monetary Costs and Liabilitiesfor Environmental MattersE2173 Guide for Disclosure of Environmental LiabilitiesE3033 Guide for Beneficial Use of Landfills and ChemicallyImpacted SitesGenerally Accepted Accounting Principles:2.2 FASB Financial Accounting Standards Board3Statement ofAccounting Concepts No.6 Elements of Finan-cial StatementsStatement ofAccounting Concepts No.8 Conceptual Frame-work for Financial ReportingASC Topic 410-20 asset retirement obligationsASC Topic 410-30 other environmental obligationsASC Topic 420 exit/disposal costsASC Topic 440 commitmentsASC Topic 450 contingenciesASC Topic 460 guaranteesASC Topic 805 business combinationsASC Topic 820 fair value measurement2.3 GASB Government Accounting Standards Board:4Statement 10 accounting and financial reporting for riskfinancing and related insurance issuesStatement 18 landfill closure and postclosure care costsStatement 49 pollution remediation obligationsStatement 69 government combinations and disposals ofgovernment operationsStatement 70 nonexchange financial guaranteesStatement 72 fair value measurement and applicationStatement 83 certain asset retirement obligations2.4 IASBInternational Accounting Standards Board:5IAS 37 provisions,contingent liabilities and contingentassetsIFRS 3 business combinationsIFRS 13 fair value measurement3.Terminology3.1 Definitions:(italicization identifies defined terms.)3.1.1 acceptable usean environmental professionals de-scription of a proposed beneficial use,characterized by thenature and duration of activities involved,for a property that isevaluated and determined to be protective of human health,public safety,and welfare with,if necessary,specified engi-neering and institutional controls and established signage.1This test method is under the jurisdiction of ASTM Committee E50 onEnvironmental Assessment,Risk Management and Corrective Action and is thedirect responsibility of Subcommittee E50.05 on Environmental Risk Management.Current edition approved Feb.1,2018.Published March 2018.Originallyapproved in 2017.last previous edition approved in 2017 as E312317.DOI:10.1520/E3123-182For referenced ASTM standards,visit the ASTM website,www.astm.org,orcontact ASTM Customer Service at serviceastm.org.For Annual Book of ASTMStandards volume information,refer to the standards Document Summary page onthe ASTM website.3Available from Financial Accounting Standards Board 401 Merritt 7 P.O.Box5116 Norwalk,Connecticut 06856-5116,http:/www.fasb.org4Available from Governmental Accounting Standards Board,401 Merritt 7 P.O.Box 5116 Norwalk,Connecticut 06856-5116 http:/www.gasb.org/5Available from International Accounting Standards Board,30 Cannon StreetLondon,EC4M 6XH United Kingdom http:/www.ifrs.orgCopyright ASTM International,100 Barr Harbor Drive,PO Box C700,West Conshohocken,PA 19428-2959.United StatesThis international standard was developed in accordance with internationally recognized principles on standardization established in the Decision on Principles for theDevelopment of International Standards,Guides and Recommendations issued by the World Trade Organization Technical Barriers to Trade(TBT)Committee.1 3.1.2 accounting frameworkthe accounting standards andprinciples relevant to an entitys function.As many issuers ofaccounting standards a