Marking a significant step forward in supporting assurance for non-financial reporting, the International Auditing and Assurance Standards Board (IAASB) today published Non-Authoritative Guidance on Applying ISAE 3000 (Revised) to Extended External Reporting (EER) Assurance Engagements.
The Guidance responds to ten key stakeholder-identified challenges commonly encountered in applying International Standard on Assurance Engagements 3000 (Revised), Assurance Engagements Other than Audits or Reviews of Historical Financial Information. The guidance promotes consistent high-quality application of ISAE 3000 (Revised) in extended external reporting assurance engagements to:
- strengthen the influence of such engagements on the quality of extended external reporting;
- enhance trust in the resulting assurance reports; and
- increase the credibility of extended external reports so that they can be trusted and relied upon by their intended users.
“The IAASB is not a newcomer to assurance of what is commonly referred to as non-financial information reporting. For years, we have been active in this area as the landscape has continued to evolve,” according to IAASB Chair Tom Seidenstein. “Together with ISAE 3000 (Revised) and ISAE 3410, Assurance Engagements on Greenhouse Gas Statements, this guidance forms a strong package that will help enhance confidence in assurance reports and improve their reliability, including enabling practitioners to respond to new reporting regimes. We will continue to closely monitor current global developments to establish a coherent set of sustainability reporting standards, and are prepared to act to enhance our standards, frameworks and guidance to support progress.”
The Guidance addresses a number of overarching matters, including applying appropriate competence and capabilities, exercising professional skepticism and professional judgement, and the preconditions for an assurance engagement, as well as more specific technical matters. The Guidance also provides further explanation and examples to better understand the distinction between limited assurance and reasonable assurance engagements.
The IAASB expresses its sincere appreciation for the collaboration and funding provided by the World Business Council for Sustainable Development and the Gordon and Betty Moore Foundation.
Extended External Reporting
Extended external reporting encapsulates many different forms of reporting, including but not limited to, sustainability or environmental, social and governance (ESG) reporting, integrated reporting, reporting on corporate social responsibility, greenhouse gas statements, and service performance reporting in the public sector. These kinds of extended reporting are growing in frequency and importance, and address matters that are becoming increasingly critical to decision-making by investors and other users.
Additional Support Material
Two additional items of non-authoritative support material have also been published. These are not integral to the Guidance—the Guidance can be used without the need to refer to these materials but they are available as additional resources should practitioners wish to refer to them: (1) Credibility and Trust Model Relating to EER Reporting, and (2) Illustrative Examples of Selected Aspects of EER Assurance Engagements. The latter includes examples that cover a broad range of reporting frameworks.
About the IAASB
The International Auditing and Assurance Standards Board develops auditing and assurance standards and guidance for use by all professional accountants under a shared standard-setting process involving the Public Interest Oversight Board, which oversees the activities of the IAASB, and the IAASB Consultative Advisory Group, which provides public interest input into the development of the standards and guidance. The structures and processes that support the operations of the IAASB are facilitated by the International Federation of Accountants (IFAC). For copyright, trademark, and permissions information, please go to permissions or contact permissions@ifac.org.