ThinkTWENTY20

By Gundi Jeffrey, Managing Editor

Although Canada’s accounting firms have been focusing on increasing their efforts to deliver quality audits, the Canadian Public Accounting Board (CPAB) still believes there is more work to be done. The recent inspection findings in its 2018 Annual Inspection Results – which more than doubled from the year before – indicate that “sustainable audit quality is still a challenge across the firms. We believe that the strength of a firm’s audit quality management systems will be critical to accelerating improvements in the sustainability of high-quality public company audits.”

By Gerald Trites, FCPA, FCA, CISA

Artificial Intelligence has been entering the world of accountants and other financial professionals for some time – usually at a basic level, such as selecting accounts to post, helping with data searches, and offering suggestions for problem-solving purposes. But, now, we are on the verge of a new wave of AI, with new technologies that have not been used before.

Climate related catastrophies, including fires, floods and hurricanes, are having a massive impact on businesses and communities. It stands to reason that banks will be affected as well.  Regulators around the world who are increasingly concerned about the impact of climate change on financial institutions recently published a guide to help banks build resilience to climate-related risk. 

The Hong Kong Monetary Authority’s white paper on green and sustainable banking explains a rationale for introducing measures in this area.

In terms of disclosures and data, the paper notes that financial institutions should take the Task Force on Climate-Related Financial Disclosures (TCFD) recommendations into account while developing an ‘appropriate’ approach to disclosing climate-related risk that enhances transparency. 

It’s good to see Hong Kong looking to the TCFD recommendations while developing climate-change risk disclosures. A logical next step would be to incorporate structured, XBRL data into mandatory non-financial disclosures, ensuring the climate-risk exposures of Hong Kong’s financial institutions can be easily analysed and compared world-wide. For more, see the XBRL International Website.