International Greenhouse Gas Assurance Standard Proposed

BY MATTHEW G. LAMOREAUX

The International Auditing and Assurance Standards Board (IAASB) on Tuesday released a proposed standard to provide assurance on companies’ reporting of greenhouse gas emissions, a key component in sustainability reporting.

 

The IAASB says the proposed International Standard on Assurance Engagements (ISAE) 3410, Assurance Engagements on Greenhouse Gas Statements , addresses the practitioner’s responsibilities in identifying, assessing and responding to risks of material misstatement and contains illustrative assurance reports on greenhouse gas statements. Comments on the ED are due June 10.

 

“In the United States, Statement of Position (SOP) 03-2, Attest Engagements on Greenhouse Gas Emissions Information, provides guidance on the application of the AICPA Attestation Standards for an examination of GHG emissions information,” said Chuck Landes, AICPA vice president–Professional Standards and Services. “This proposed IAASB standard fills a gap in the international standards literature by providing specific guidance for GHG emissions engagements. It also covers limited assurance engagements in addition to reasonable assurance engagements.”

 

“The monetary value of carbon trading transactions around the world is in the billions and continuing to increase exponentially. This has led to a strong and growing need for mechanisms to enhance the reliability of the underlying information used in these transactions—and this proposed standard is an important part of fulfilling that need,” said IAASB Chairman Arnold Schilder in a press release. “Disclosure of emissions information is also increasingly being required by regulation or presented on a voluntary basis to inform investors, consumers and others.”

 

“Most large companies already report voluntarily on their greenhouse gas emissions,” said Ken Witt, an AICPA technical manager leading the Institute’s sustainability initiative. “As the focus on environmental performance increases, we expect that the demand for assurance engagements on greenhouse gas emissions information and all reported sustainability information will also increase.”

 

The IAASB is an independent standard-setting board operated by the International Federation of Accountants, of which the AICPA is a member. IAASB standards must be adopted by the AICPA or the PCAOB to be authoritative in the U.S.

 

—Matthew G. Lamoreaux ( mlamoreaux@aicpa.org ) is a JofA senior editor.

 

More from the JofA:

 

 Find us on Facebook      Follow us on Twitter

 

SPONSORED REPORT

Click-through nexus: Pushing the boundaries of sales tax compliance

Sales and use tax compliance has been complicated by nexus expansion. In this report, we provide an overview of this issue and include a handy state-by-state summary of click-through nexus or notification requirements.

QUIZ

News quiz: Making allowances for the kids and the economy

Recent news gives CPAs insight into Americans’ attitudes about children and money and gauges outlook on the economy. See how much you know about recent news and reports with this quiz.

CHECKLIST

Auditing risks in culture

Cultural flaws can seriously damage an organization. Here’s how internal auditors can reduce risks by embedding culture audits into existing audit programs.