Developing an International Assurance Standard on Greenhouse Gas Statements

TLDR

Global concern over climate change and the need to curb GHG emissions has driven governments to pursue stricter environmental regulations and standards. The paper proposes that creating an international assurance standard for GHG disclosures is a suitable response by auditors to address these challenges. The IAASB approved a project to develop a standard that would enhance trust in GHG emissions disclosures, and the authors evaluate which disclosures can be assured and identify key issues for the standard. Insights from four international roundtables across Asia‑Pacific, North America, and Europe, plus a December 2008 IAASB meeting, are synthesized to inform the proposed assurance standard.

Abstract

SYNOPSIS: Worldwide public concern over climate change and the need to limit greenhouse gas (hereafter, GHG) emissions has increasingly motivated public officials to consider more stringent environmental regulation and standards. The authors argue that the development of a new international assurance standard on GHG disclosures is an appropriate response by the auditing and assurance profession to meet these challenges. At its December 2007 meeting, the International Auditing and Assurance Standards Board (hereafter, IAASB) approved a project to consider the development of such a standard aimed at promoting trust and confidence in disclosures of GHG emissions, including disclosures required under emissions trading schemes. The authors assess the types of disclosures that can be assured, and outline the issues involved in developing an international assurance standard on GHG emissions disclosures. The discussion synthesizes the insights gained from four international roundtables on the proposed IAASB assurance standard held in Asia-Pacific, North America, and Europe during 2008, and an IAASB meeting addressing this topic in December 2008.