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ACCA Strategic Professional · Advanced Audit and Assurance (International) · Reporting on other assignments

An assurance practitioner is planning an ISAE 3000 engagement on a bank's sustainability KPIs. The bank's management proposes to measure the KPIs using its own undisclosed internal calculation methods, which are not available to the users of the report. Which criteria characteristic is most clearly lacking?

Availability is the characteristic lacking. Suitable criteria must be made available to intended users so they understand how the subject matter was measured or evaluated. Undisclosed internal methods prevent that, so users cannot interpret the conclusion. Criteria need not come from an independent body or match competitors.

  1. AAvailability, since the criteria must be available to the intended usersCorrect
  2. BNeutrality, since criteria must be set by an independent body
  3. CCompleteness, since criteria must cover all the entity's operations
  4. DComparability, since criteria must match those of every competitor

Explanation

Suitable criteria are relevant, complete, reliable, neutral and understandable, and they must be available to the intended users. Undisclosed methods mean users cannot understand how the subject matter was measured. Criteria need not be set by an independent body, and they need not match every competitor's.

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