AcSB's performance measures framework: Can it help auditors with a new assurance role?

The Accounting Standards Board (AcSB) developed a draft Framework on Reporting Performance Measures. Could this be a first step towards criteria that enable auditors to provide assurance over performance measures?

Responding to concerns raised by investors and others, the AcSB developed a draft Framework on Reporting Performance Measures that it hopes is a first step towards enhancing the relevance of financial information outside financial statements.

In her Chair's message, Linda Mezon stated, "We want to help entities that choose to report financial and non-financial performance measures outside financial statements improve the quality of this supplemental information." The framework is designed to help entities select, determine and report performance measures, and implement and maintain controls and governance practices. Mezon hopes that investors, contributors, lenders and other resource providers will set expectations and seek compliance with the framework.

Perhaps this is where auditors can play a greater role. CPA Canada and the Audit and Assurance Standards Board (AASB) are working on a multi-stakeholder research project to examine:

  • what performance measures investors use to make decisions, and their understanding of what assurance auditors currently provide on such measures
  • how and why management reports the performance measures they do, and whether the framework assists them with their reporting process
  • how audit committees oversee management's reporting process for performance measures, and their views on whether there is a role for the auditors
  • whether auditors believe they can provide the assurance that investors and audit committees may need, including whether they can use the framework and existing assurance standards for this purpose

This multi-stakeholder research encourages auditors to help shape the future of assurance – to innovate and experiment with new ways of providing assurance over information outside the financial statements. The results of this research may inform:

  • the AcSB about the benefits and challenges of using the framework in practice
  • the AASB about where there might be a need for assurance standards
  • CPA Canada about expectation gaps that continue to exist, as well as further guidance, tools or other communications that might help support enhanced assurance over performance measures

Get involved

CPA Canada and AASB staff are organizing a roundtable to obtain feedback on the auditability of the AcSB's framework. Help move this important initiative forward by providing comments on the draft framework, and contribute to its development from an audit perspective.

Keep the conversation going

Canada is taking a leadership role in strengthening the relevance of financial information outside financial statements. What do you think of this initiative? What might be needed after the framework is finalized? Do you agree that auditors have a role to play in this space? Post a comment below or email me directly.

Conversations about Audit Quality is designed to create an exchange of ideas on global audit quality developments and issues and their impact in Canada.


The views and opinions expressed in this article are those of the author and do not necessarily reflect that of CPA Canada.

About the Author

Eric Turner, CPA, CA

Director, Auditing and Assurance Standards, CPA Canada