The International Public Sector Accounting Standards Board (IPSASB), with support from the World Bank, is developing a climate-related disclosures standard for the public sector.

The IPSASB, developer of international reporting standards for use by governments and other public sector entities around the world, announced in June 2023 it would begin developing a Climate-related Disclosures standard, a first for the public sector. This standard will be the IPSASB’s inaugural Sustainability Reporting Standard (IPSASB SRS™). By increasing transparency, it will enable governments and other public sector entities to make more informed decisions about their contributions towards addressing the climate emergency, hold them accountable for their interventions, and foster trust in their efforts.

The World Bank, an institution dedicated to providing financing, policy advice, and technical assistance to governments of developing countries, has put their support behind this critical initiative to develop the IPSASB's first SRS on Climate-related Disclosures. An initial draft standard will be released for feedback in Q4 2024.

Alongside this announcement, the IPSASB has also published a Stakeholder Engagement Plan outlining how people can provide feedback about the project, through mechanisms that are already a central part of the IPSASB’s due process.

“Equipping governments with the quality standards necessary to report on their critical contributions to addressing the climate emergency together with other sustainability issues requires global support,” said Ian Carruthers, IPSASB Chair. “The World Bank’s contribution provides welcome support for our initiative to develop urgently-needed public sector specific sustainability reporting standards, beginning with a Climate-related Disclosures standard.”

“The standard will take climate reporting to a new level and will complement the reporting requirements of the Paris Agreement which come into effect this year,” said Arturo Herrera, World Bank Global Director for Governance. “Many countries lack a way to track and assess progress against their climate-related commitments, and to identify and disclose risks and impacts. This is especially true for developing countries, many of which are among the most at-risk from climate change. At the same time, SRS disclosure can help attract new investment from the private sector. Some of the world’s biggest investors look at ESG performance in deciding where to invest. The new standard will provide that information.”

Global community engagement is essential to developing sustainability reporting standards for the public sector. The IPSASB continues to seek support for its sustainability reporting standards development program and requires additional resources to scale up its efforts and move with pace. To contribute financial or other support to the IPSASB for the development of IPSASB SRS, please email Ross Smith, IPSASB Program and Technical Director (rosssmith@ipsasb.org).

About the IPSASB 

The International Public Sector Accounting Standards Board (IPSASB) works to strengthen public financial management globally through developing and maintaining accrual-based International Public Sector Accounting Standards® (IPSAS®) and other high-quality financial reporting guidance for use by governments and other public sector entities. It also raises awareness of IPSAS and the benefits of accrual adoption. The Board receives support from the Asian Development Bank, the Chartered Professional Accountants of Canada, the New Zealand External Reporting Board, the government of Canada, and the World Bank. The structures and processes that support the operations of the IPSASB are facilitated by the International Federation of Accountants (IFAC). For copyright, trademark, and permissions information, please go to permissions or contact permissions@ifac.org.  

About the World Bank

The World Bank is an international organization that provides financing, advice, and research to developing nations to help advance their economies. It is one of the world’s largest sources of funding and knowledge for developing countries. The World Bank is headquartered in Washington, D.C. and is affiliated with the United Nations. It is made up of five institutions with one common mission: to end extreme poverty and boost shared prosperity on a livable planet.

Funding for the project is through the World Bank’s Financial Management Umbrella Program. The Program is supported by the Australian Department of Foreign Affairs and Trade, the Government of Austria, the Bill & Melinda Gates Foundation, the European Union, the Swedish International Development Cooperation Agency, Switzerland’s State Secretariat for Economic Affairs, the United Kingdom’s Foreign, Commonwealth and Development Office, and the United States Agency for International Development.

Unleashing the Potential of Islamic Finance: Global Perspectives on Achieving the SDGs with Islamic Finance Tools & Concepts, a new report from the International Federation of Accountants, Malaysian Institute of Accountants (MIA) and the World Bank Group Inclusive Growth and Sustainable Finance Hub in Malaysia (World Bank) looks at the opportunities presented by Islamic finance, practical examples of its usage from Malaysia, and future pathways towards addressing challenges and unlocking the full potential of Islamic finance to support the SDGs.

The report was released today at Innovation in Sustainable Development: Islamic Finance Paving the Way hosted by MIA in Kuala Lumpur featuring a keynote address from IFAC President Asmâa Resmouki.

In recent years, addressing the Sustainable Development Goals (SDGs) has become increasingly challenging. The worldwide economic downturn resulting from the COVID-19 pandemic has worsened the already significant USD4.2 trillion funding gap to achieve the SDGs. As countries worldwide strive to finance the ambitious scope and scale of the SDGs, they also face the complex task of serving financially underserved communities. Advancing Islamic finance has the potential not only to serve usually underbanked Muslim communities but has broader application considering its synergies with the SDGs.

A major tenet of Islamic finance is the protection of people, planet, and prosperity, and its underpinnings can contribute to fresh thinking on sustainable development paradigms, interpretations, and approaches. The SDGs create opportunities for Islamic finance growth, just as Islamic finance can drive greater sustainable development.

Malaysia has become a pioneer of Islamic finance, attributed in part to its strong governance, supportive regulatory ecosystem, and the pivotal role of a local professional accountancy organization, MIA, in education and stakeholder outreach. Though every jurisdiction’s use of Islamic finance would work differently, Malaysia and MIA can serve as examples to learn from.

“Professional accountancy organizations are playing a key role in advancing sustainable financing, and given the profession’s commitment to support the SDGs, principles of Islamic finance should be considered a viable approach,” said Asmâa Resmouki, IFAC President. “We encourage all IFAC members to look towards best practices such as those cultivated in Malaysia, and seize opportunities presented in their own jurisdictions.”

Learn more about Islamic finance and download the report. 

About IFAC

IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 180 members and associates in more than 135 jurisdictions, representing millions of professional accountants in public practice, education, government service, industry, and commerce.

The International Ethics Standards Board for Accountants (IESBA) today released its 2023 Annual Report, Respecting the Past, Planning for the Future.

This interactive review of 2023 features comprehensive accounts of the Board’s projects and insights from its leaders, illustrating a period of significant achievement. The achievements include the approval and subsequent launches of the Exposure Draft on International Ethics Standards for Sustainability Assurance (including International Independence Standards) (IESSA) and ethics standards for sustainability reporting and the final Ethics Standards for Tax Planning and Related Services.

2023 also saw the board approve an Exposure Draft on Using the Work of an External Expert and the IESBA’s Strategy and Work Plan for 2024-2027, all aimed at strengthening the IESBA’s International Code of Ethics for Professional Accountants (including International Independence Standards) (the Code).

"2023 has been a transformative year for the IESBA, marked by our continued commitment to strengthening global ethics standards and putting ethics at the heart of corporate decision-making," said IESBA Chair Gabriela Figueiredo Dias. "Our efforts in areas such as sustainability reporting and assurance and tax planning are prime examples of how we are addressing the evolving challenges and opportunities to enhance public trust and integrity in corporate reporting and in the work of professional accountants and assurance providers."

The 2023 IESBA Report also includes an interactive map showcasing the 140+ countries where the IESBA Code is in use and an overview of the Board’s extensive stakeholder outreach efforts and initiatives to promote global adoption and effective implementation of the Code.

Throughout 2023, the IESBA has responded vigorously to the challenges of ethics in the accountancy profession and beyond. The 2024 agenda will focus on final approvals of sustainability-related standards, new workstreams addressing accountancy firm culture and governance, and independence considerations for audits of collective investment vehicles, pension fund arrangements, and investment company complexes.

The full report can be accessed here.

About IESBA

The International Ethics Standards Board for Accountants serves the public interest by setting high-quality ethics standards, including independence requirements, as a cornerstone to ethical behavior in business and organizations, and to public trust in financial and non-financial information that is fundamental to the proper functioning and sustainability of organizations, financial markets and economies worldwide.

Along with the International Auditing and Assurance Standards Board (“IAASB”), the IESBA is part of the International Foundation for Ethics and Audit (“IFEA”). The Public Interest Oversight Board (“PIOB”) oversees IESBA and IAASB activities and the public interest responsiveness of the standards.

On behalf of the global accountancy profession, IFAC welcomes the opportunity to provide input to the IESSA ED. The global business community and the accountancy profession are at the start of significant transformation with respect to evolving sustainability disclosures. IESBA has an important role, like other standard setters, in this transformation.

We appreciate the significant resources and effort the Board has devoted to this important project. However, the actions of standard setters, regulators and policy makers must be undertaken and calibrated with the priority of being an effective influence on the transformation and by “bringing along relevant stakeholders” in the business community, including the accountancy profession, on this journey. It is important for the IESBA to be a positive influence in this transformation through the creation of practical, easily understandable, and sufficiently flexible standards.

Below are three key matters we urge IESBA to reconsider to enhance the practicality of implementation:

• Reducing complexity and calling for transparency from practitioners with respect to relevant, jurisdiction-specific sustainability assurance oversight and enforcement where they conduct engagements.
• Ensuring barriers to financial statement auditors providing sustainability assurance to the same client are removed.
• Addressing matters of practicality related to value chain considerations—i.e., through revision or removal of proposed requirements.

Click here to read the comment letter.

New evidence came today of the global momentum toward sustainability disclosure. The International Sustainability Standard Board (ISSB) released a new guide to help jurisdictions adopt its sustainability reporting standards, S1 and S2, and announced that more than 20 jurisdictions have indicated plans to incorporate these standards into their legal or regulatory frameworks. These jurisdictions collectively represent nearly 55% of global GDP and more than 30% of global market capitalization.

Commenting on the release of the guide and the new data, Tom Seidenstein and Gabriela Figueiredo Dias, IAASB and IESBA Chairs, respectively, said, “On behalf of our Boards, we congratulate the ISSB on the release of its new adoption guide, which will help jurisdictions navigate the adoption journey and promote necessary consistency and quality for sustainability disclosure. As the IAASB and IESBA continue to progress our proposed standards on sustainability assurance and an ethics framework for sustainability reporting and assurance, we welcome all initiatives aiming at building the necessary capacity and understanding to achieve a consistent application of sustainability related standards, including assurance and ethics standards. Our collective goal is to strengthen stakeholders’ trust and confidence in disclosures.”

New evidence came today of the global momentum toward sustainability disclosure. The International Sustainability Standard Board (ISSB) released a new guide to help jurisdictions adopt its sustainability reporting standards, S1 and S2, and announced that more than 20 jurisdictions have indicated plans to incorporate these standards into their legal or regulatory frameworks. These jurisdictions collectively represent nearly 55% of global GDP and more than 30% of global market capitalization.

Commenting on the release of the guide and the new data, Tom Seidenstein and Gabriela Figueiredo Dias, IAASB and IESBA Chairs, respectively, said, “On behalf of our Boards, we congratulate the ISSB on the release of its new adoption guide, which will help jurisdictions navigate the adoption journey and promote necessary consistency and quality for sustainability disclosure. As the IAASB and IESBA continue to progress our proposed standards on sustainability assurance and an ethics framework for sustainability reporting and assurance, we welcome all initiatives aiming at building the necessary capacity and understanding to achieve a consistent application of sustainability related standards, including assurance and ethics standards. Our collective goal is to strengthen stakeholders’ trust and confidence in disclosures.”

International Accountancy Profession Commits to Empower Sustainability Transformation

ATHENS, Greece -- The International Federation of Accountants (IFAC) congratulates the IFRS Foundation and the ISSB on their announcement today that more than twenty jurisdictions, representing over half the global economy by GDP, have already decided to use, or are taking steps to introduce, ISSB Standards in their legal or regulatory frameworks.

IFAC also welcomes the IFRS Foundation’s Inaugural Jurisdictional Guide for the adoption or other use of ISSB Standards (the Guide), which was developed to help jurisdictions design and plan their journeys to the adoption or other use of ISSB Standards.

IFAC Chief Executive Officer Lee White, speaking from the 49^th IOSCO Annual Meeting in Athens, said, “IFAC was an early advocate for a harmonized, global system for the disclosure of sustainability-related information, and we continue to actively support and contribute to coordinated efforts to develop and deliver such a system. Today’s announcement by the IFRS Foundation confirms strong global momentum for the ISSB Standards and is particularly powerful given it comes less than a year after IOSCO’s endorsement of ISSB Standards IFRS S1 and IFRS S2. I wish to recognize the leadership of the IFRS Foundation and ISSB on the milestone they’ve achieved.”

IFAC is a collaborating partner with the IFRS Foundation on its Regulatory Implementation Programme, a component of the Guide, which includes the development of tools, educational materials and other initiatives to advance capacity building in support of ISSB Standards.

As part of the global ecosystem working to support consistent and comparable sustainability-related information, IFAC also recently convened leaders from across the Asia-Pacific region and Latin America in two separate events held in Singapore and Bogota, Colombia, respectively. The objective of these assemblies was to discuss and advance the transformation occurring both within businesses and the accountancy profession related to sustainability disclosure. A program of regional assemblies through to 2026, including one in the Middle East later this year, is currently being finalized.

IFAC’s work over the last several years to benchmark the  State of Play: Sustainability Disclosure and Assurance provides key data on global developments and a roadmap for the future. 

Mr. White said, “The global business community has commenced its sustainability reporting and assurance journey, and the global accountancy profession -- which is undertaking critical roles using the ISSB Standards, the IAASB’s forthcoming International Standard on Sustainability Assurance, and the IESBA’s proposed standards for ethical considerations in sustainability reporting and assurance -- is central to the transformation of sustainability reporting, and to empowering this change.”

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About IFAC

IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 180 members and associates in more than 135 jurisdictions, representing millions of professional accountants in public practice, education, government service, industry, and commerce.

Barry Melancon, President & CEO of the American Institute of CPAs (AICPA) and CEO of the Association of International Certified Professional Accountants, announced this week that he will retire from his leadership positions at the organizations at the end of the year. Appointed in 1995, Melancon will have served as CEO of AICPA & CIMA for 30 years, the longest serving CEO in the organization’s history.

Lee White, CEO of IFAC, said: "I’ve been fortunate in my career to have had a strong professional collaboration with Barry, and I have always been grateful to receive his counsel and partnership. On behalf of the profession, we thank him for his many contributions and wish him well in his upcoming retirement from AICPA & CIMA, and look forward to working with him as he continues to advocate for the profession."

Over the course of his career, Melancon has been a major supporter of connecting the accounting profession globally through IFAC, and also orchestrated the establishment of the Association of International Certified Professional Accountants in 2017, a joint venture between the AICPA and Chartered Institute of Management Accountants (CIMA). An advocate for embracing digital and sustainability transformations, he has also been a longstanding proponent of integrated reporting. He served as chair of the board of the International Integrated Reporting Council and led its subsequent path into the IFRS Foundation and formation of the International Sustainability Standards Board. Under Melancon's leadership, IFAC and the AICPA collaborated on numerous projects including the annual State of Play, a benchmarking study that captures and analyzes the extent to which companies are reporting and obtaining assurance over their sustainability disclosures. 

About IFAC

IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 180 members and associates in more than 135 jurisdictions, representing millions of professional accountants in public practice, education, government service, industry, and commerce.

The International Public Sector Accounting Standards Board® (IPSASB®) has issued Improvements to IPSAS, 2023. 

Improvements to IPSAS, 2023 includes improvements to IPSAS in order to align with amendments to IFRS® Accounting Standards based on IASB’s Narrow Scope Amendments projects.

The pronouncement was approved by the IPSASB in March 2024.

About the IPSASB
The International Public Sector Accounting Standards Board® (IPSASB®) works to strengthen public financial management globally through developing and maintaining accrual-based International Public Sector Accounting Standards™ (IPSAS®) and other high-quality financial reporting guidance for use by governments and other public sector entities. It also raises awareness of IPSAS and the benefits of accrual adoption. The Board receives support from the Asian Development Bank, the Chartered Professional Accountants of Canada, the New Zealand External Reporting Board, and the government of Canada. The structures and processes that support the operations of the IPSASB are facilitated by the International Federation of Accountants (IFAC). For copyright, trademark, and permissions information, please go to permissions or contact permissions@ifac.org.

About the Public Interest Committee
The governance and standard-setting activities of the IPSASB are overseen by the Public Interest Committee (PIC), to ensure that they follow due process and reflect the public interest. The PIC is comprised of individuals with expertise in public sector or financial reporting, and professional engagement in organizations that have an interest in promoting high-quality and internationally comparable financial information.

The IESBA will hold two interactive global webinars in the coming weeks to present the first global ethics standards on tax planning, released earlier this month.

The standards establish a comprehensive ethical framework to guide professional accountants when providing tax planning and related services. The framework stipulates the expected mindset and behaviors of professional accountants when they recommend or otherwise advise on tax planning arrangements to employing organizations or clients. The standards were developed in response to public interest concerns about tax avoidance and the role played by consultants in light of revelations in recent years such as the Paradise and Pandora Papers.

Moving away from a purely mechanical and legalistic approach and towards a principles-based framework will establish a consistent point of reference for all professional accountants when dealing with tax planning to ensure due consideration of public interest as well as potential reputational, commercial, and wider economic consequences for their employing organizations or clients. Beyond just the accountancy profession, all other tax advisers are strongly encouraged to follow the standards.

The 1.5-hour webinar will feature a high-level overview of the standards and provide an opportunity for stakeholders to participate in a questions-and-answers session with the presenters.

The webinars will be held in English and available on YouTube following the session.

Global Webinar #1

Timing:  May 13, 2024 at 10:30 PM, EDT

Registration link

Presenters:

• Laurie Endsley, IESBA Vice Chair
• Andy Mintzer, IESBA Member
• Channa Wijesinghe, IESBA Member
• Carla Vijian, IESBA Principal

Global Webinar #2

Timing:  May 15, 2024 at 12:00 PM, EDT

Registration link

Presenters:

• Jens Poll, Former IESBA Member and Chair of the Tax Planning and Related Services Task Force
• Laurie Endsley, IESBA Vice Chair
• Sanjiv Chaudhary, Former IESBA Member
• Carla Vijian, IESBA Principal