The assurance practitioner shall not represent compliance with this ASAE unless the assurance practitioner has complied with the requirements of both this ASAE and ASAE 3000.  (Ref: Para. A5–A6, A17, A21–A22, A37, A127)

Skills, Knowledge and Experience

The lead assurance practitioner shall:

1. Have competence in assurance skills and techniques developed through extensive training and practical application, and sufficient competence in the quantification and reporting of emissions, to accept responsibility for the assurance conclusion; and
2. Be satisfied that those persons who are to perform the engagement collectively have the appropriate competence and capabilities, including in the quantification and reporting of emissions and in assurance, to perform the assurance engagement in accordance with this ASAE. (Ref: Para. A18–A19)

Preconditions for the Engagement

In order to establish whether the preconditions for the engagement are present:

1. The lead assurance practitioner shall determine that both the GHG statement and the engagement have sufficient scope to be useful to intended users, considering, in particular: (Ref: Para. A20)
   1. If the GHG statement is to exclude significant emissions that have been, or could readily be, quantified, whether such exclusions are reasonable in the circumstances;
   2. If the engagement is to exclude assurance with respect to significant emissions that are reported by the entity, whether such exclusions are reasonable in the circumstances; and
   3. If the engagement is to include assurance with respect to emissions deductions, whether the nature of the assurance the assurance practitioner will obtain with respect to the deductions and the intended content of the assurance report with respect to them are clear, reasonable in the circumstances, and understood by the engaging party. (Ref: Para. A11-A12)
2. When determining the suitability of the applicable criteria, as required by ASAE 3000,^[10] the assurance practitioner shall determine whether the criteria encompass at a minimum: (Ref: Para. A23–A26)
   1. The method for determining the entity’s organisational boundary; (Ref: Para. A27–A28)
   2. The GHGs to be accounted for;
   3. Acceptable quantification methods, including methods for making adjustments to the base year (if applicable); and
   4. Adequate disclosures such that intended users can understand the significant judgements made in preparing the GHG statement. (Ref: Para. A29–A34)
3. The assurance practitioner shall obtain the agreement of the entity that it acknowledges and understands its responsibility:
   1. For designing, implementing and maintaining such internal control as the entity determines is necessary to enable the preparation of a GHG statement that is free from material misstatement, whether due to fraud or error;
   2. For the preparation of its GHG statement in accordance with the applicable criteria; and (Ref: Para. A35)
   3. For referring to or describing in its GHG statement the applicable criteria it has used and, when it is not readily apparent from the engagement circumstances, who developed them. (Ref: Para. A36)

Agreement on the Terms of the Engagement

The terms of the engagement required to be agreed by ASAE 3000^[11] shall include: (Ref: Para. A37)

1. The objective and scope of the engagement;
2. The responsibilities of the assurance practitioner;
3. The responsibilities of the entity, including those described in paragraph 17(c);
4. Identification of the applicable criteria for the preparation of the GHG statement;
5. Reference to the expected form and content of any reports to be issued by the assurance practitioner and a statement that there may be circumstances in which a report may differ from its expected form and content; and
6. An acknowledgement that the entity agrees to provide written representations at the conclusion of the engagement.

When planning the engagement as required by ASAE 3000,^[12] the assurance practitioner shall: (Ref: Para. A38–A41)

1. Identify the characteristics of the engagement that define its scope;
2. Ascertain the reporting objectives of the engagement to plan the timing of the engagement and the nature of the communications required;
3. Consider the factors that, in the assurance practitioner’s professional judgement, are significant in directing the engagement team’s efforts;
4. Consider the results of engagement acceptance or continuance procedures and, where applicable, whether knowledge gained on other engagements performed by the lead assurance practitioner for the entity is relevant;
5. Ascertain the nature, timing and extent of resources necessary to perform the engagement, including the involvement of experts and of other assurance practitioners; and (Ref: Para. A42– A43)
6. Determine the impact of the entity’s internal audit function, if any, on the engagement.

Determining Materiality and Performance Materiality When Planning the Engagement

When establishing the overall engagement strategy, the assurance practitioner shall determine materiality for the GHG statement.  (Ref: Para. A44–A50)

The assurance practitioner shall determine performance materiality for purposes of assessing the risks of material misstatement and determining the nature, timing and extent of further procedures.  

Revision as the Engagement Progresses

The assurance practitioner shall revise materiality for the GHG statement in the event of becoming aware of information during the engagement that would have caused the assurance practitioner to have determined a different amount initially.  (Ref: Para. A51)

Obtaining an Understanding of the Entity and Its Environment

The assurance practitioner shall obtain an understanding of the following: (Ref: Para. A52–A53)

1. Relevant industry, regulatory, and other external factors including the applicable criteria.
2. The nature of the entity, including:
   1. The nature of the operations included in the entity’s organisational boundary, including: (Ref: Para. A27–A28)
      1. The sources and completeness of emissions and, if any, sinks and emissions deductions;
      2. The contribution of each to the entity’s overall emissions; and
      3. The uncertainties associated with the quantities reported in the GHG statement. (Ref: Para. A54–A59)
   2. Changes from the prior period in the nature or extent of operations, including whether there have been any mergers, acquisitions, or sales of emissions sources, or outsourcing of functions with significant emissions; and
   3. The frequency and nature of interruptions to operations. (Ref: Para. A60)
3. The entity’s selection and application of quantification methods and reporting policies, including the reasons for changes thereto and the potential for double-counting of emissions in the GHG statement.
4. The requirements of the applicable criteria relevant to estimates, including related disclosures.
5. The entity’s climate change objective and strategy, if any, and associated economic, regulatory, physical and reputational risks. (Ref: Para. A61)
6. The oversight of, and responsibility for, emissions information within the entity.
7. Whether the entity has an internal audit function and, if so, its activities and main findings with respect to emissions.

Procedures to Obtain an Understanding and to Identify and Assess Risks of Material Misstatement

The procedures to obtain an understanding of the entity and its environment and to identify and assess risks of material misstatement shall include the following: (Ref: Para. A52–A53, A62)

1. Enquiries of those within the entity who, in the assurance practitioner’s judgement, have information that is likely to assist in identifying and assessing risks of material misstatement due to fraud or error.
2. Analytical procedures. (Ref: Para. A63–A65)
3. Observation and inspection. (Ref: Para. A66–A68)

Obtaining an Understanding of the Entity’s Internal Control

Other Procedures to Obtain an Understanding and to Identify and Assess Risks of Material Misstatement

If the lead assurance practitioner has performed other engagements for the entity, the lead assurance practitioner shall consider whether information obtained is relevant to identifying and assessing risks of material misstatement.  (Ref: Para. A73)

The assurance practitioner shall make enquiries of management, and others within the entity as appropriate, to determine whether they have knowledge of any actual, suspected or alleged fraud or non-compliance with law or regulation affecting the GHG statement. (Ref: Para. A84–A86)

The lead assurance practitioner and other key members of the engagement team, and any key assurance practitioner’s external experts, shall discuss the susceptibility of the entity’s GHG statement to material misstatement whether due to fraud or error, and the application of the applicable criteria to the entity’s facts and circumstances.  The lead assurance practitioner shall determine which matters are to be communicated to members of the engagement team, and to any assurance practitioner’s external experts not involved in the discussion.

The assurance practitioner shall evaluate whether the entity’s quantification methods and reporting policies, including the determination of the entity’s organisational boundary, are appropriate for its operations, and are consistent with the applicable criteria and quantification and reporting policies used in the relevant industry and in prior periods.

Performing Procedures on Location at the Entity’s Facilities

The assurance practitioner shall determine whether it is necessary in the circumstances of the engagement to perform procedures on location at significant facilities.  (Ref: Para. A15–A16, A74–A77)

Internal Audit

Where the entity has an internal audit function that is relevant to the engagement, the assurance practitioner shall: (Ref: Para. A78)

1. Determine whether, and to what extent, to use specific work of the internal audit function; and
2. If using the specific work of the internal audit function, determine whether that work is adequate for the purposes of the engagement.

Identifying and Assessing Risks of Material Misstatement

Causes of Risks of Material Misstatement

When performing the procedures required by paragraphs 33L or 33R of this ASAE, the assurance practitioner shall consider at least the following factors: (Ref: Para. A84–A89)

1. The likelihood of intentional misstatement in the GHG statement; (Ref: Para. A84–A86)
2. The likelihood of non-compliance with the provisions of those laws and regulations generally recognised to have a direct effect on the content of the GHG statement; (Ref: Para. A87)
3. The likelihood of omission of a potentially significant emission; (Ref: Para. A88(a))
4. Significant economic or regulatory changes; (Ref: Para. A88(b))
5. The nature of operations; (Ref: Para. A88(c))
6. The nature of quantification methods; (Ref: Para. A88(d))
7. The degree of complexity in determining the organisational boundary and whether related parties are involved; (Ref: Para. A27–A28)
8. Whether there are significant emissions that are outside the normal course of business for the entity, or that otherwise appear to be unusual; (Ref: Para. A88(e))
9. The degree of subjectivity in the quantification of emissions; (Ref: Para. A88(e))
10. Whether Scope 3 emissions are included in the GHG statement; and (Ref: Para. A88(f))
11. How the entity makes significant estimates and the data on which they are based. (Ref: Para. A88(g))

The assurance practitioner shall design and implement overall responses to address the assessed risks of material misstatement at the GHG statement level.  (Ref: Para. A90–A93)

The assurance practitioner shall design and perform further procedures whose nature, timing and extent are responsive to the assessed risks of material misstatement, having regard to the level of assurance, reasonable or limited, as appropriate.  (Ref: Para. A90)

Sampling

If sampling is used, the assurance practitioner shall, when designing the sample, consider the purpose of the procedure and the characteristics of the population from which the sample will be drawn.  (Ref: Para. A90(b), A105)

Fraud, Law and Regulation

The assurance practitioner shall respond appropriately to fraud or suspected fraud and non‑compliance or suspected non‑compliance with law or regulation identified during the engagement.  (Ref: Para. A106–A107)

Accumulation of Identified Misstatements

The assurance practitioner shall accumulate misstatements identified during the engagement, other than those that are clearly trivial.  (Ref: Para. A112)

Consideration of Identified Misstatements as the Engagement Progresses

The assurance practitioner shall determine whether the overall engagement strategy and engagement plan need to be revised if:

1. The nature of identified misstatements and the circumstances of their occurrence indicate that other misstatements may exist that, when aggregated with misstatements accumulated during the engagement, could be material; or
2.  The aggregate of misstatements accumulated during the engagement approaches materiality determined in accordance with paragraphs 20–22 of this ASAE.

If, at the assurance practitioner’s request, the entity has examined a type of emission or disclosure and corrected misstatements that were detected, the assurance practitioner shall perform procedures with respect to the work performed by the entity to determine whether material misstatements remain.

Communication and Correction of Misstatements

The assurance practitioner shall communicate on a timely basis all misstatements accumulated during the engagement with the appropriate level within the entity and shall request the entity to correct those misstatements.

If the entity refuses to correct some or all of the misstatements communicated by the assurance practitioner, the assurance practitioner shall obtain an understanding of the entity’s reasons for not making the corrections and shall take that understanding into account when forming the assurance practitioner’s conclusion.

Evaluating the Effect of Uncorrected Misstatements

Prior to evaluating the effect of uncorrected misstatements, the assurance practitioner shall reassess materiality determined in accordance with paragraphs 20–22 of this ASAE to confirm whether it remains appropriate in the context of the entity’s actual emissions. 

The assurance practitioner shall determine whether uncorrected misstatements are material, individually or in the aggregate.  In making this determination, the assurance practitioner shall consider the size and nature of the misstatements, and the particular circumstances of their occurrence, in relation to particular types of emissions or disclosures and the GHG statement.  (See paragraph 72).

When the assurance practitioner intends to use the work of another assurance practitioner, the assurance practitioner shall:

1. Communicate clearly with the other assurance practitioner about the scope and timing of the work and findings of the other assurance practitioner; and (Ref: Para. A113–A114)
2. Evaluate the sufficiency and appropriateness of evidence obtained and the process for including related information in the GHG statement. (Ref: Para. A115)

The assurance practitioner shall request written representations from a person(s) within the entity with appropriate responsibilities for, and knowledge of, the matters concerned: (Ref: Para. A116)

1. That they have fulfilled their responsibility for the preparation of the GHG statement, including comparative information where appropriate, in accordance with the applicable criteria, as set out in the terms of the engagement;
2. That they have provided the assurance practitioner with all relevant information and access as agreed in the terms of the engagement and reflected all relevant matters in the GHG statement;
3. Whether they believe the effects of uncorrected misstatements are immaterial, individually and in the aggregate, to the GHG statement. A summary of such items shall be included in, or attached to, the written representation;
4. Whether they believe that significant assumptions used in making estimates are reasonable;
5. That they have communicated to the assurance practitioner all deficiencies in internal control relevant to the engagement that are not clearly trivial of which they are aware; and
6. Whether they have disclosed to the assurance practitioner their knowledge of actual, suspected or alleged fraud or non-compliance with law or regulation where the fraud or non-compliance could have a material effect on the GHG statement.

The date of the written representations shall be as near as practicable to, but not after, the date of the assurance report.

The assurance practitioner shall disclaim a conclusion on the GHG statement or withdraw from the engagement, where withdrawal is possible under applicable law or regulation, if:

1. The assurance practitioner concludes that there is sufficient doubt about the integrity of the person(s) providing the written representations required by paragraphs 58(a) and (b) of this ASAE that written representations in these regards are not reliable; or
2. The entity does not provide the written representations required by paragraphs 58(a) and (b) of this ASAE.

The assurance practitioner shall: (Ref: Para. A117)

1. Consider whether events occurring between the date of the GHG statement and the date of the assurance report require adjustment of, or disclosure in, the GHG statement, and evaluate the sufficiency and appropriateness of evidence obtained about whether such events are appropriately reflected in that GHG statement in accordance with the applicable criteria; and
2. Respond appropriately to facts that become known to the assurance practitioner after the date of the assurance report, that, had they been known to the assurance practitioner at that date, may have caused the assurance practitioner to amend the assurance report.

When comparative information is presented with the current emissions information and some or all of that comparative information is covered by the assurance practitioner’s conclusion, the assurance practitioner’s procedures with respect to the comparative information shall include evaluating whether: (Ref: Para. A118–A121)

1. The comparative information agrees with the amounts and other disclosures presented in the prior period or, when appropriate, has been properly restated and that restatement has been adequately disclosed; and (Ref Para. A121)
2. The quantification policies reflected in the comparative information are consistent with those applied in the current period or, if there have been changes, whether they have been properly applied and adequately disclosed.

Irrespective of whether the assurance practitioner’s conclusion covers the comparative information, if the assurance practitioner becomes aware that there may be a material misstatement in the comparative information presented the assurance practitioner shall:

1. Discuss the matter with those person(s) within the entity with appropriate responsibilities for, and knowledge of, the matters concerned and perform procedures appropriate in the circumstances; and (Ref: Para. A122–A123)
2. Consider the effect on the assurance report. If the comparative information presented contains a material misstatement, and the comparative information has not been restated:
   1. Where the assurance practitioner’s conclusion covers the comparative information, the assurance practitioner shall express a qualified conclusion or an adverse conclusion in the assurance report; or
   2. Where the assurance practitioner’s conclusion does not cover the comparative information, the assurance practitioner shall include an Other Matter paragraph in the assurance report describing the circumstances affecting the comparative information.

The assurance practitioner shall read other information included in documents containing the GHG statement and the assurance report thereon to identify material inconsistencies, if any, with the GHG statement or the assurance report and, if on reading that other information, the assurance practitioner: (Ref: Para. A139)

1. Identifies a material inconsistency between that other information and the GHG statement or the assurance report; or
2. Becomes aware of a material misstatement of fact in that other information that is unrelated to matters appearing in the GHG statement or the assurance report,

the assurance practitioner shall discuss the matter with the entity and take further action as appropriate. (Ref: Para. A124–A126)

In documenting the nature, timing and extent of procedures performed, the assurance practitioner shall record: (Ref: Para. A127)

1. The identifying characteristics of the specific items or matters tested;
2. Who performed the engagement work and the date such work was completed; and
3. Who reviewed the engagement work performed and the date and extent of such review.

The assurance practitioner shall document discussions of significant matters with the entity and others, including the nature of the significant matters discussed, and when and with whom the discussions took place.  (Ref: Para. A127)

Quality Control

The assurance practitioner shall include in the engagement documentation:

1. Issues identified with respect to compliance with relevant ethical requirements and how they were resolved;
2. Conclusions on compliance with independence requirements that apply to the engagement, and any relevant discussions with the firm that support these conclusions;
3. Conclusions reached regarding the acceptance and continuance of client relationships and assurance engagements; and
4. The nature and scope of, and conclusions resulting from, consultations undertaken during the course of the engagement.

Matters Arising after the Date of the Assurance Report

If, in exceptional circumstances, the assurance practitioner performs new or additional procedures or draws new conclusions after the date of the assurance report, the assurance practitioner shall document: (Ref: Para. A128)

1. The circumstances encountered;
2. The new or additional procedures performed, evidence obtained, and conclusions reached, and their effect on the assurance report; and
3. When and by whom the resulting changes to engagement documentation were made and reviewed.

Assembly of the Final Engagement File

The assurance practitioner shall assemble the engagement documentation in an engagement file and complete the administrative process of assembling the final engagement file on a timely basis after the date of the assurance report.  After the assembly of the final engagement file has been completed, the assurance practitioner shall not delete or discard engagement documentation of any nature before the end of its retention period.  (Ref: Para. A129)

In circumstances other than those envisaged in paragraph 68 where the assurance practitioner finds it necessary to modify existing engagement documentation or add new engagement documentation after the assembly of the final engagement file has been completed, the assurance practitioner shall, regardless of the nature of the modifications or additions, document:

1. The specific reasons for making them; and
2. When and by whom they were made and reviewed.

For those engagements, if any, for which a quality control review is required by law or regulation or for which the firm has determined that an engagement quality control review is required, the engagement quality control reviewer shall perform an objective evaluation of the significant judgements made by the engagement team, and the conclusions reached in formulating the assurance report. This evaluation shall involve: (Ref: Para. A130)

1. Discussion of significant matters with the lead assurance practitioner, including the engagement team’s professional competencies with respect to the quantification and reporting of emissions and assurance;
2. Review of the GHG statement and the proposed assurance report;
3. Review of selected engagement documentation relating to the significant judgements the engagement team made and the conclusions it reached; and
4. Evaluation of the conclusions reached in formulating the assurance report and consideration of whether the proposed assurance report is appropriate.

The assurance practitioner shall form a conclusion about whether the assurance practitioner has obtained reasonable or limited assurance, as appropriate, about the GHG statement.  That conclusion shall take into account the requirements of paragraphs 56 and 73–75 of this ASAE.

This evaluation shall include consideration of the qualitative aspects of the entity’s quantification methods and reporting practices, including indicators of possible bias in judgements and decisions in the making of estimates and in preparing the GHG statement,13 and whether, in view of the applicable criteria:

1. The quantification methods and reporting policies selected and applied are consistent with the applicable criteria and are appropriate;
2. Estimates made in preparing the GHG statement are reasonable;
3. The information presented in the GHG statement is relevant, reliable, complete, comparable and understandable;
4. The GHG statement provides adequate disclosure of the applicable criteria, and other matters, including uncertainties, such that intended users can understand the significant judgements made in its preparation; and (Ref: Para. A29, A131–A133)
5. The terminology used in the GHG statement is appropriate.

The evaluation required by paragraph 73 shall also include consideration of:

1. The overall presentation, structure and content of the GHG statement; and
2. When appropriate in the context of the criteria, the wording of the assurance conclusion, or other engagement circumstances, whether the GHG statement represents the underlying emissions in a manner that achieves fair presentation.

The assurance report, at a minimum, shall include the following basic elements: (Ref: Para. A134)

1. A title that clearly indicates the report is an independent assurance report.
2. An addressee.
3. An identification or description of the level of assurance, either reasonable or limited, obtained by the assurance practitioner.
4. Identification of the GHG statement, including the period(s) it covers, and, if any information in that statement is not covered by the assurance practitioner’s conclusion, clear identification of the information subject to assurance as well as the excluded information, together with a statement that the assurance practitioner has not performed any procedures with respect to the excluded information and, therefore, that no conclusion on it is expressed. (Ref: Para. A120, A135)
5. A description of the entity’s responsibilities. (Ref: Para. A35)
6. A statement that GHG quantification is subject to inherent uncertainty. (Ref: Para. A54–A59)
7. If the GHG statement includes emissions deductions that are covered by the assurance practitioner’s conclusion, identification of those emissions deductions, and a statement of the assurance practitioner’s responsibility with respect to them. (Ref: Para. A136–A139)
8.  
   1. Identification of the applicable criteria;
   2. Identification of how those criteria can be accessed;
   3. If those criteria are available only to specific intended users, or are relevant only to a specific purpose, a statement alerting readers to this fact and that, as a result, the GHG statement may not be suitable for another purpose. The statement shall also restrict the use of the assurance report to those intended users or that purpose; and (Ref: Para. A140–A141)
   4. If established criteria need to be supplemented by disclosures in the explanatory notes to the GHG statement for those criteria to be suitable, identification of the relevant note(s). (Ref: Para. A131)
9. [Deleted by the AUASB. Refer Aus 76.1(i).]
10. [Deleted by the AUASB. Refer Aus 76.2(j).]
11. A description of the assurance practitioner’s responsibility, including:
    1. A statement that the engagement was performed in accordance with ASAE 3410 Assurance Engagements on Greenhouse Gas Statements; and
    2. An informative summary of the worked performed as a basis for the assurance practitioner’s conclusion. In the case of a limited assurance engagement, an appreciation of the nature, timing, and extent of procedures performed is essential to understanding the assurance practitioner’s conclusion. In a limited assurance engagement, the summary of the work performed shall state that:
       • The procedures performed in a limited assurance engagement vary in nature and timing from, and are less in extent than for, a reasonable assurance engagement; and
       • Consequently, the level of assurance obtained in a limited assurance engagement is substantially lower than the assurance that would have been obtained had a reasonable assurance engagement been performed. (Ref: Para. A142–A144)
12. The assurance practitioner’s conclusion:
    1. In a reasonable assurance engagement, the conclusion shall be expressed in a positive form; or
    2. In a limited assurance engagement, the conclusion shall be expressed in a form that conveys whether, based on the procedures performed and evidence obtained, a matter(s) has come to the assurance practitioner’s attention to cause the assurance practitioner to believe that the GHG statement is not prepared, in all material respects, in accordance with the applicable criteria.
    3. When the assurance practitioner expresses a modified conclusion, the assurance report shall contain:
       1. A section that provides a description of the matter(s) giving rise to the modification; and
       2. A section that contains the assurance practitioner’s modified conclusion.
13. The assurance practitioner’s signature. (Ref: Para. A145)
14. The date of the assurance report. The assurance report shall be dated no earlier than the date on which the assurance practitioner has obtained the evidence on which the assurance practitioner’s conclusion is based, including evidence that those with the recognised authority have asserted that they have taken responsibility for the GHG statement.
15. The location in the jurisdiction where the assurance practitioner practices.

A statement that the firm of which the assurance practitioner is a member applies ASQC 1.

A statement that the assurance practitioner complies with relevant ethical requirements related to other assurance engagements.^[*]

Emphasis of Matter Paragraphs and Other Matter Paragraphs

If the assurance practitioner considers it necessary to: (Ref: Para. A146–A152)

1. Draw intended users’ attention to a matter presented or disclosed in the GHG statement that, in the assurance practitioner’s judgement, is of such importance that it is fundamental to intended users’ understanding of the GHG statement (an Emphasis of Matter paragraph); or
2. Communicate a matter other than those that are presented or disclosed in the GHG statement that, in the assurance practitioner’s judgement, is relevant to intended users’ understanding of the engagement, the assurance practitioner’s responsibilities or the assurance report (an Other Matter paragraph),

and this is not prohibited by law or regulation, the assurance practitioner shall do so in a paragraph in the assurance report, with an appropriate heading, that clearly indicates the assurance practitioner’s conclusion is not modified in respect of the matter.

The assurance practitioner shall communicate, unless prohibited by law or regulation, with those person(s) with oversight responsibilities for the GHG statement the following matters that come to the assurance practitioner’s attention during the course of the engagement, and shall determine whether there is a responsibility to report them to another party within or outside the entity:

1. Deficiencies in internal control that, in the assurance practitioner’s professional judgement, are of sufficient importance to merit attention;
2. Identified or suspected fraud; and
3. Matters involving identified or suspected non-compliance with laws and regulations, other than when the matters are clearly trivial. (Ref: Para. A87)