Auditing Social and Environmental Matters 41 / 41

Social and environmental issues

..affect the statutory audit at:

  1. The planning stage (Inherent risk)

    Any environmental regulations? Any key social issues? 

    Review the results of any environmental audits undertaken by the company.

  2. While doing substantive procedures (impairment/provisions)

    Provisions (for example, for site restoration, fines/compensation payments)

    Contingent liabilities (for example, in relation to pending legal action)

    Asset values (issues may impact on impairment or purchased goodwill/products)

    Capital/revenue expenditure (costs of clean-up or meeting legal standards)

    Development costs (new products)

  3. Review stage (going concern).