Assurance on sustainability indicators

In this lesson

1. 0:00 Assurance engagements for sustainability indicators
2. 0:40 Planning the engagement: resources and expertise
3. 1:02 Evidence quality and complexity considerations
4. 2:01 Ethical threats in sustainability assurance
5. 3:01 Collecting sufficient and appropriate evidence
6. 4:38 Reconciling KPIs with financial statements
7. 5:04 Identifying supporting documentation and third-party reports
8. 7:00 Professional scepticism and management bias
9. 8:34 Challenges in assessing sustainability indicators
10. 9:47 Reporting and manipulation risks
11. 10:25 Structuring the assurance report

About this lesson

This lesson covers the key considerations when planning and performing these engagements, including assurance levels (limited or reasonable), evidence collection techniques, and how to apply your audit skills to sustainability reporting. You'll discover how to identify management bias, assess KPI quality, and navigate the unique risks of sustainability assurance, including ethical threats and the challenge of working with undefined or subjective terms. The video walks you through the practical steps of gathering evidence for sustainability assurance. You'll explore how to use inquiries, testing of systems and controls, analytical procedures, and third-party confirmations to build a robust assurance opinion. The lesson emphasises the importance of professional scepticism when evaluating management explanations and highlights how to spot inconsistencies between KPIs and financial data—such as cost movements that don't align with reported sustainability changes. You'll also learn how to assess the competence and independence of experts you might rely on, just as you would in a financial audit. A key focus is recognising the specific risks in sustainability assurance. These include management bias (particularly when lenders impose emission targets or when there's pressure to appear "greener"), undefined terminology that lacks objective measurement, and the potential for KPI manipulation. The lesson prepares you to challenge vague claims like "environmentally friendly" and to understand who relies on the assurance report and how the information might be misused. By the end, you'll have a clear framework for scoping these engagements, determining whether you have the right expertise and resources, and delivering a credible assurance conclusion that reflects the actual quality of the client's sustainability reporting.

Duration: 11m