IAASB: Proposed International Standard on Sustainability Assurance (ISSA) 5000, General Requirements for Sustainability Assurance Engagements [ED]
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The IAASB expects to issue the final standard before the end of 2024. Over the next few months, the AASB will ensure that the feedback received on its exposure draft is considered by the IAASB as it finalized its standard. The anticipated approval date for the final CSSA 5000 is December 2024. |
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Last updated: |
March 2024 |
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Overview
Once finalized, ISSA 5000 will serve as a comprehensive, stand-alone standard suitable for limited and reasonable sustainability assurance engagements. It will apply to sustainability information reported across any sustainability topic and prepared under multiple frameworks. Moreover, the standard will be profession-agnostic, enabling its use by professional accountants and other professionals performing sustainability assurance engagements.
On August 3, 2023, the IAASB issued a proposed International Standard on Sustainability Assurance (ISSA) 5000 “General Requirements for Sustainability Assurance Engagements”.
On September 21, 2023, the AASB released its own Exposure Draft, Proposed CSSA 5000, General Requirements for Sustainability Assurance Engagements that included Canadian amendment and potential additional Canadian amendments questions.
The AASB started to review feedback received and noted that it is generally consistent with the feedback themes heard in response to the international standard’s consultation.
Respondents indicated that more guidance and clarification was required around the following concepts:
- "at least as demanding" with respect to relevant ethical requirements and quality management.
- applicability of ISAE 3410, Assurance Engagements on Greenhouse Gas Statements
- practitioner’s evaluation or assessment of the “materiality process” – with a focus on completeness.
- evidence to be obtained for estimates, forward-looking information, and information from the value chain.
- group sustainability assurance engagements; and
- first-time implementation.
Areas where feedback gathered in Canada differed from that heard during the international consultation process include:
- Canadian respondents noted that the proposed standard sufficiently addresses the concept of greenwashing and other types of washing (e.g., social washing), by focusing on the susceptibility of the sustainability information to material misstatement, whether due to fraud or error whereas international responses included views on how the practitioner’s work on fraud and error addresses these concepts; and
- Canadian respondents noted that requirements relating to using the work of a practitioner’s external expert or another practitioner are clear and capable of consistent implementation, whereas international respondents call for a clearer approach to the use of experts and other practitioners.
The AASB continues to review the feedback received on its Exposure Draft. The AASB plans, subject to comments received, to adopt the proposed ISSA 5000 and the proposed conforming and consequential amendments. The result would be a new Canadian Standard on Sustainability Assurance (CSSA).
For more information and updates on this project see the AASB’s project page and the IAASB's project page.
Other Developments
March 2024
On March 6, 2024, the Securities and Exchange Commission (SEC) passed their final rules on “The Enhancement and Standardization of Climate-Related Disclosures for Investors” (the SEC rule) that will require registrants to provide certain climate-related information in their registration statements and annual reports. Out of the various items laid out in the SEC rule, it can be noted that it permits four attestation standards (American Institute of Certified Public Accountants, Public Company Accounting Oversight Board, IAASB and International Organization for Standardization (ISO)) that can be used for the Greenhouse Gas (GHG) emissions attestation. It also recognizes that two of these standards, the IAASB and ISO standards are not restricted to CPAs and the non-CPA professional firms could provide new Scope 1 and Scope 2 assurance on GHG emissions data if they are applying one of those two standards.
January 2024
After the window for providing feedback on the Exposure Draft ended in December 2023, the AASB is considering the feedback provided – including what possible revisions might be required for Canada’s adoption of this international standard. The AASB noted that the feedback provided in Canada is generally consistent with the feedback themes heard in response to the international standard’s consultation and there were some areas where the feedback were contradictory.
Over the next few months, the AASB will be working to ensure Canadian feedback is considered by the IAASB as the final standard is developed. The anticipated approval date for the final CSSA 5000 is December 2024.
September 2023
On September 21, 2023, the AASB issued the Exposure Draft, “CSSA 5000, General Requirements for Sustainability Assurance Engagements”. General feedback on the Exposure Draft are requested by November 6, 2023, and feedback on the Canadian amendment and potential additional Canadian amendments questions are requested by December 31, 2023.
August 2023
On August 3, 2023, the IAASB issued a proposed International Standard on Sustainability Assurance (ISSA) 5000 “General Requirements for Sustainability Assurance Engagements”.
June 2023
On June 28, 2023, the IAASB announced that it has approved by unanimous vote the draft International Standard on Sustainability Assurance (ISSA) 5000, General Requirements for Sustainability Assurance Engagements, for public consultation. The consultation will be open by early August until early December 2023.
April 2023
On April 24, 2023, the International Auditing and Assurance Standards Board (IAASB) announced that, at its April 2023 meeting, it had confirmed its intention to advance the consultation on its proposed new standard for sustainability assurance. Subject to the expected IAASB approval of the Exposure Draft in June 2023, stakeholders can now expect the public consultation on the proposed standard to open in the latter part of July or early August 2023 and extend into December 2023.
September 2022
At its meeting on September 12-16, 2022, the IAASB approved the project proposal for the development of an overarching standard for assurance on sustainability reporting.
