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October 2023

From Published Accounts

By Himanshu Kishnadwala, Chartered Accountant
Reading Time 22 mins

COMPILERS’ NOTE

Reporting on the impact of climate change and steps taken to mitigate the same and become ‘carbon neutral’ is today increasingly gaining importance. Auditors are also increasingly required to consider these impacts on the financial statements (in many jurisdictions, regulations also mandate auditors to do so) and modify the audit plan and reporting accordingly.

Given below is an instance of such reporting by auditors and corresponding disclosure in Notes to the financial statements.

A similar extract was given in this column on page 75 of BCAJ December, 2020. If a comparison is to be made, the level of disclosures and reporting has significantly increased since then.

BP P.L.C (UK)

From Independent Auditor's Report on Consolidated Financial Statements for the year 31st December, 2022.

KEY AUDIT MATTER

The potential impact of climate change and the energy transition (impacting PP&E, goodwill, intangible assets, investments in joint ventures and provisions).

Climate change impacts BP’s business in several ways as set out in the strategic report on pages

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