ACCA Strategic Professional · Advanced Audit and Assurance (International) · Developments in sustainability assurance

Brightwater Utilities has a significant sustainability report. The assurance firm is considering whether to accept an engagement. It has no sustainability specialist, and the report includes complex climate scenario analysis and estimates of future emissions. The partner proposes accepting the work and relying on the audit team's general knowledge. Which course of action best complies with quality management and ethical requirements?

The firm should accept only if it can obtain the required competence and resources, such as training or a sustainability expert, and evaluate that expert's competence and objectivity. Lack of expertise cannot be cured by disclosure, and firms are not prohibited from performing sustainability assurance.

AAccept, because any competent auditor of financial statements is automatically competent in sustainability assurance
BAccept, and disclose the lack of expertise in the assurance report instead of obtaining it
CAccept only if the firm can obtain the necessary competence and capabilities, for example by training staff or using an expert, and evaluate the expert's objectivity and competenceCorrect
DDecline all sustainability engagements because firms are prohibited from performing them

Explanation

Acceptance requires that the firm has the competence, capabilities and resources to perform the engagement, consistent with the professional competence principle. These can be obtained through training or using an expert whose competence and objectivity are evaluated. Disclosing a lack of expertise does not cure it, and no prohibition exists.

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