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

Delmar Logistics reports a metric of tonnes of CO2e per delivery vehicle, calculated using management's internal methodology that departs from the widely used GHG Protocol without disclosure. The assurance practitioner is assessing whether the criteria are suitable. Which action best reflects the requirements for evaluating the suitability of criteria?

The practitioner must evaluate whether the criteria are suitable, meaning relevant, complete, reliable, neutral and understandable, and whether they are available to intended users. Management designing the methodology does not make it suitable, and an undisclosed departure from a recognised framework is a particular concern for availability and understandability.

  1. AEvaluate whether the criteria are relevant, complete, reliable, neutral and understandable, and consider whether they are available to intended usersCorrect
  2. BAccept the criteria because management designed them and is responsible for the report
  3. CAccept the criteria only if the entity's auditor of the financial statements approved them earlier
  4. DTreat suitability as a matter for users, not the practitioner, and proceed to evidence gathering

Explanation

Suitable criteria have characteristics such as relevance, completeness, reliability, neutrality and understandability, and must be available to users. Undisclosed departures from a recognised framework raise concerns about availability and understandability. Management's authorship does not make criteria suitable, and the practitioner cannot delegate this judgement.

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