Connecting internal assurance and governance to support effective oversight of integrated reporting

Posted
2 June, 2022

This announcement was made by IFAC on May 25, 2022.

On the heels of the IFRS Foundation’s announcement about the future of integrated reporting and the International Integrated Reporting <IR> Framework, IFAC announced the publication of a related resource for boards of directors. IFAC worked in partnership with the Institute of Internal Auditors (IIA) to develop Executing the Board’s Governance Responsibility for Integrated Reporting—the second installment in IFAC’s integrated reporting assurance series.

This installment is intended to help boards execute their oversight responsibility for the integrity of the integrated report and the underlying reporting process via coordination of all lines of governance and management with the support of internal auditors. The paper considers how an integrated internal approach to assurance can support board accountability for integrated reports, thereby improving the quality of integrated reports and better preparing organizations for external assurance.

Statement by Kevin Dancey, IFAC CEO:

The IFRS Foundation’s announcement on the future of integrated reporting and the International Integrated Reporting Framework confirms that the International Accounting Standards Board (IASB) and International Sustainability Standards Board (ISSB) will assume responsibility for the Framework from July. Within the IFRS Foundation, the Framework will be further developed to help companies prepare an integrated report and support connectivity between the reporting required by the IASB and the ISSB. This installment of IFAC’s integrated reporting assurance series shows how directors can deliver confidence in integrated reporting through coordinated and connected internal and external assurance activities.

Statement by Anthony Pugliese, CIA, CPA, CGMA, CITP, president and CEO of the IIA:

As an integral component of effective organizational governance, internal audit plays a critical role in instilling trust and confidence in the completeness, accuracy, and reliability of the information that forms the basis of the organization’s integrated report. As noted in the widely accepted Three Lines Model, internal audit provides objective assurance, independent from management, of internal controls critical to achieving organizational objectives, including objectives related to integrated thinking and reporting.