In March, the Institute completed the due process and published its first sustainability assurance standard – HKSSA 5000 General Requirements for Sustainability Assurance Engagements. This milestone aligns with the Hong Kong government’s Roadmap on Sustainability Disclosure in Hong Kong(HK Roadmap) released in December 2024.
What is HKSSA 5000?
HKSSA 5000 is fully aligned with ISSA 5000 and deals with assurance engagements on sustainability information. HKSSA 5000 is applicable to assurance engagements on sustainability information reported under a suitable framework or criteria. Examples of suitable framework or criteria used to measure or evaluate sustainability matters are HKFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information, HKFRS S2 Climate-related Disclosures and Appendix C2 Environmental, Social and Governance Reporting Code issued by The Hong Kong Stock Exchange.
Why does it matter?
HKSSA 5000 provides a robust framework for practitioners conducting assurance engagements on sustainability information. It supports the consistent performance of high-quality sustainability assurance engagements and aims to enhance the reliability and transparency of disclosed sustainability information. In turn, this strengthens the confidence and trust of intended users in the sustainability information provided.
Who can use it?
HKSSA 5000 is intended for use by both professional accountant assurance practitioners and non-professional accountant assurance practitioners, provided they meet the required quality management and ethical requirements. HKSSA 5000 requires practitioners to apply HKSQM 1 Quality Management for Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or Related Services Engagements, and the Code of Ethics for Professional Accountants issued by the Institute, or professional requirements, or requirements in law or regulation, that an appropriate authority has determined to be at least as demanding as HKSQM 1 and the provisions of the Code related to sustainability assurance engagements.
Which standard shall be applied?
HKSSA 5000 is an overarching standard that includes requirements and application material for all aspects of a sustainability assurance engagement. Once it becomes effective, practitioners are not required to apply HKSAE 3000 (Revised) Assurance Engagements Other than Audits or Reviews of Historical Financial Information or HKSAE 3410 Assurance Engagements on Greenhouse Gas Statements when performing sustainability assurance engagements including greenhouse gas statements.
What level of assurance does it address?
HKSSA 5000 addresses both limited and reasonable assurance engagements. The difference between limited and reasonable assurance is primarily in the degree to which it enhances the confidence of the intended users regarding the sustainability information. The level of assurance obtained in a limited assurance engagement is substantially lower than in a reasonable assurance engagement. The procedures conducted in a limited assurance engagement differ in nature, timing, and extent from those in a reasonable assurance engagement. HKSSA 5000 delineates specific requirements and application material specific for each type of assurance. HKSSA 5000 also applies to combined assurance engagements where limited assurance is obtained on selected information and reasonable assurance on other information and the conclusions are presented in the same assurance report.
When will it be effective?
HKSSA 5000 will be effective for assurance engagements on sustainability information reported for periods beginning on or after 15 December 2026, or as at a specific date on or after 15 December 2026. Earlier application is permitted, as long as practitioners comply with the relevant quality management standards and ethical requirements, including any consequential amendments as a result of the publication of HKSSA 5000.
How will practitioners be supported in implementation?
The Institute has a holistic capacity building (CB) programme that covers sustainability reporting, sustainability assurance and sustainability ethics, to assist practitioners in building awareness and enhancing their skills to effectively navigate the evolving sustainability landscape. The sustainability programme is an ongoing initiative that began a few years ago. The sustainability assurance CB programme will commence in June with webinar and workshops planned for the second half of 2025.
Is assurance on sustainability information mandatory in Hong Kong?
As at the time of writing this article, obtaining assurance on sustainability information remains voluntary in Hong Kong. The HK Roadmap outlines Hong Kong’s blueprint for developing a comprehensive ecosystem to support sustainability disclosures, encompassing sustainability assurance, data and technology, as well as skills and competencies. Moving forward, the Accounting and Financial Reporting Council will release a proposed local regulatory framework for sustainability assurance for public consultation in 2025. This framework will address various aspects, including the registration of assurance providers, the implementation of assurance and ethics standards, and the establishment of the related regulatory regime.
This article was contributed by Cherry Yau, Associate Director of the Institute’s Standard Setting Department.
