> For the complete documentation index, see [llms.txt](https://kb.bravegen.com/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://kb.bravegen.com/carbon/system-overview.md).

# System Overview

This document defines the **canonical behaviour of the system** for transforming climate activity data into greenhouse gas inventory outcomes.

It covers how the platform:

* Handles physical and monetary activity data
* Applies GHG Protocol concepts (Scope, categories, TTW, WTT, T\&D, FLAG, LUC)
* Creates inventory items from sources
* Preserves inventory integrity while maximising automation

***

## Core System Objects <a href="#core-system-objects" id="core-system-objects"></a>

### [Activity Source](/carbon/core-concepts/activity-sources.md) <a href="#id-1.-source" id="id-1.-source"></a>

A **Source** represents a single stream of **activity and cost data only**.

Examples:

* Litres of diesel consumed at an entity
* kWh of electricity used for a single meter
* $ spent on a particular Good or Service

A Source:

* Has a **Source Type**
* Has an **ingested Unit of Measure (UoM)**
* May originate from Collect process
* **Is not an inventory item**

{% hint style="info" %}
Activity data on its own has no scope, no emission factor, and no reporting category.
{% endhint %}

***

### [Inventory Rule](/carbon/core-concepts/inventory-items/inventory-rules.md) <a href="#id-2.-rule" id="id-2.-rule"></a>

Each Source can be associated with **an Inventory Rule** during the task review step.

A Rule:

* Determines which emissions boundaries are represented
* Applies one or more **Inventory Templates** &#x20;
* Does **not** represent emissions itself

Rules are configured under Settings > Rules

{% hint style="info" %}

### Default Spend Rule <a href="#explicit-exception-currency-based-activity-general-ledger" id="explicit-exception-currency-based-activity-general-ledger"></a>

The default spend rule is a special case which bypasses the inventory template feature. This rule is only available for currency-based activity sources. This is applicable because:

* There is no physical emissions boundary to decompose
* Emissions are calculated using **spend-based EEIO or supplier-specific factors**
* The system can automatically:
  * Identify the supplier
  * Infer supplier industry
  * Infer goods/services procured
  * Select the appropriate emission factor and Scope 3 category

In this case, we directly assign inventory items via the 'default spend' rule to avoid creating hundreds of single use templates.
{% endhint %}

***

### [Inventory Template ](/carbon/core-concepts/inventory-items/inventory-templates.md) <a href="#id-3.-inventory-template-standard-path" id="id-3.-inventory-template-standard-path"></a>

An **Inventory Template determines the properties of the Inventory Item created at the reporting entity**.

Examples of emissions boundaries:

* Tank-to-Wheel (TTW) combustion
* Well-to-Tank (WTT) upstream emissions
* Electricity transmission & distribution (T\&D) losses
* Biogenic CO₂
* Land Use Change (LUC)

Each Inventory Template:

* Performs calculations (including UoM conversion and calculations)
* Specifies an **Emission Factor via a Emission Factor Group**&#x20;
* Assigns **Scope** and **GHG Protocol sub-category**

{% content-ref url="/pages/NZVdVFzKnuO1QZhMlttq" %}
[Inventory Templates](/carbon/core-concepts/inventory-items/inventory-templates.md)
{% endcontent-ref %}

***

### [Inventory Item](/carbon/core-concepts/inventory-items.md) <a href="#id-4.-inventory-item" id="id-4.-inventory-item"></a>

An **Inventory Item** is the final emissions record used for reporting, aggregation, and disclosure.

Inventory items live within a reporting entity, and are created through the assignment of an **Inventory** **Rule** to an activity source, during the task review process.&#x20;

{% content-ref url="/pages/43pnlsRt9IoyfllBNci9" %}
[Inventory Items](/carbon/core-concepts/inventory-items.md)
{% endcontent-ref %}

***

## Final Assurance Statement <a href="#final-assurance-statement" id="final-assurance-statement"></a>

The platform does not create inventory items representing raw activity data. All inventory items are created exclusively via emissions-boundary logic (Inventory Templates) or via a tightly-bounded currency-based system rule where no such boundaries exist. This design ensures Scope integrity, prevents double counting, and supports regulator-grade assurance under ASRS and NZ CRD.