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AICPA comments on proposed standard for sustainability assurance
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As the International Auditing and Assurance Standards Board (IAASB) works to finalize a new global standard for assurance of sustainability reporting, the AICPA is working to provide important feedback to ensure the final standard works for CPAs in the United States.
The AICPA recently submitted a comment letter in response to the exposure draft of International Standard on Sustainability Assurance (ISSA) 5000, General Requirements for Sustainability Assurance Engagements.
“We have been carefully analyzing the proposed ISSA 5000, and it was very important for us to submit a comment letter,” said Jennifer Burns, CPA, the AICPA’s chief auditor. “We want to help shape the final IAASB standard so that its main tenets are workable in the U.S.”
The AICPA showed support for the IAASB’s efforts to create a new standard designed specifically for sustainability assurance, to be used instead of ISAE 3000 (Revised). According to an annual study co-authored by the AICPA, 99% of the world’s largest audit firms used ISAE 3000 (Revised) or corresponding national standards in 2021 as the framework for providing assurance of sustainability disclosures.
At the same time, the comment letter proposed revisions “to enable a final standard that can be consistently interpreted and applied” and commented that “it is unclear how users of assurance reports issued under proposed ISSA 5000 can be confident that non-accountant assurance practitioners are adhering to these high standards.” The most recent State of Play study showed that just 38% of sustainability-related engagements performed by other service providers in 2021 used ISAE 3000 (Revised).
According to the IAASB, the final standard will be issued before the end of 2024. Burns said the AICPA Auditing Standards Board (ASB) is considering changes to the AICPA attestation standards to address current practice issues and for the purposes of global consistency. The ASB is targeting the end of 2024 for an ED, timed purposely to come after the IAASB finalizes its standard.
The ASB ED is expected to propose a new sustainability section in the attestation standards as well as changes to the current baseline attestation standards.
— To comment on this article or to suggest an idea for another article, contact Bryan Strickland at Bryan.Strickland@aicpa-cima.com.
