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ACCA Strategic Professional · Advanced Audit and Assurance (International) · The assurance of sustainability

Maris plc asks its auditor to provide assurance on its sustainability report. The auditor notes that the board decided which topics to include after applying a materiality assessment under the GRI Standards that considers significant impacts of the entity. How does this differ from the assessment of material topics under IFRS S1?

Under IFRS S1, information is material if omitting or obscuring it could reasonably be expected to influence primary users' decisions about providing resources to the entity. This is investor-focused, unlike GRI's impact-based approach, and IFRS S1 sets no fixed profit percentage.

  1. AIFRS S1 treats information as material if omitting or obscuring it could reasonably be expected to influence decisions of primary users of general purpose financial reports about providing resources to the entityCorrect
  2. BIFRS S1 treats information as material only if it significantly impacts the environment, regardless of investor decisions
  3. CIFRS S1 requires materiality to be set as a fixed percentage of profit before tax
  4. DIFRS S1 has no materiality concept because all sustainability information must be disclosed

Explanation

IFRS S1 uses an investor-focused definition aligned with IFRS Accounting Standards: information is material if its omission or obscuring could reasonably influence primary users' resource-provision decisions. GRI instead looks at significance of impacts. IFRS S1 does not prescribe a fixed percentage.

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