Appendix No. 45

to the Order of the Ministry of Finance of the Russian Federation of January 9, 2019 No. 2n

The international standard of the tasks providing confidence 3410 "The tasks providing confidence concerning the reporting on emissions of greenhouse gases"

The International Standard of the Tasks Providing Confidence (ISTPC) 3410 "The tasks providing confidence concerning the reporting on emissions of greenhouse gases" should be considered together with the Preface to the Collection of International standards of quality control, audit and survey checks, the other tasks providing confidence, and tasks on rendering the accompanying services.

Introduction

1. In view of dependence between emissions of greenhouse gases and climate change many organizations carry out quantitative assessment of the emissions of greenhouse gases for the managerial purposes, and many also constitute the report on emissions of greenhouse gases:

(a) within disclosure of information according to normative requirements;

(b) within system of trade in quotas for emissions;

(c) for the purpose of informing investors and other persons on voluntary basis. For example, voluntarily disclosed information can be published as the separate document, is included in structure of more complete sustainability report or annual statement of the organization or provided as reasons for inclusion in "the carbon register".

Scope of this standard

2. This The International Standard of the Tasks Providing Confidence (ISTPC) regulates accomplishment of such tasks concerning the report of the organization on emissions of greenhouse gases.

3. Conclusion of the practicing specialist concerning the task providing confidence can extend to information in addition to the report on emissions of greenhouse gases, for example, when the practicing specialist is involved to verification of the sustainability report which part the report on emissions of greenhouse gases is. In such cases (see the Items A1 - A 2):

(a) this standard is applied to the procedures providing confidence which are performed concerning the report on emissions of greenhouse gases, except cases when the report on emissions of greenhouse gases constitutes rather small part of general information concerning which confidence is provided;

(b) MSZOU 3000 (reviewed) <1> (or other MSZOU regulating a certain estimated task subject) is applied to the procedures providing confidence, which are carried out concerning other information to which conclusion of the practicing specialist extends.

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<1> MSZOU 3000 (reviewed) "The tasks providing confidence other than audit and survey check of financial information of last periods".

4. This standard does not regulate and does not contain the specific instructions for task performance providing confidence in the relation:

(a) reports on the emissions different from emissions of greenhouse gases, for example nitrogen oxides (NOx) and sulfur dioxide (SO2). Nevertheless this standard may contain instructions concerning such tasks; <2>

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<2> NOx nitrogen oxides (that is NO nitrogen oxide and NO2, nitrogen dioxide which differ from the oxide diazothat N2O which is part of greenhouse gases) and SO2 sulfur dioxide are associated with "acid rains", but not with climate change.

(b) other information connected with greenhouse gases, for example about influence of product lifecycle on the environment on the hypothetical basic size and key performance indicators based on data on emissions (see Item A 3);

(c) tools, processes or mechanisms, such as projects on the compensation quotas which are taken up by other organizations for receipt of deductions for emissions. However, if the report on emissions of greenhouse gases of the organization includes deductions on emissions concerning which confidence shall be provided, requirements of this standard are in accordance with the established procedure applied to such deductions (see Item 76(f)).

Tasks on confirmation and tasks by direct assessment

5. In the International concept of the tasks providing confidence (The concept of the tasks providing confidence) it is noted that the tasks providing confidence can represent tasks on confirmation or tasks by direct assessment. This standard is applied only to tasks on confirmation <3>.

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<3> MSZOU 3000 (reviewed) Item 12(a) (ii).

Procedures of task performance, providing reasonable confidence, and the tasks providing limited confidence

6. In MSZOU 3000 (reviewed) it is noted that the task providing confidence can represent the task providing reasonable confidence, or the task providing limited confidence <4>. This standard is applied as to the tasks providing reasonable confidence and to the tasks providing limited confidence.

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<4> MSZOU 3000 (reviewed) Item 12(a)(i)(b).

7. As in case of the tasks providing reasonable confidence and in case of the tasks providing limited confidence concerning the report on emissions of greenhouse gases, the practicing specialist chooses combination of the procedures providing confidence which can include inspection, observation, confirmation, recalculation, repeated application, analytical procedures and the direction of requests. Determination of the procedures providing confidence which need to be executed within specific task is subject of professional judgment. As reports on emissions of greenhouse gases cover wide range of questions, nature, terms and amount of procedures, most likely, will differ considerably depending on tasks.

8. If there are no instructions about other, each requirement of this standard is applied as to the tasks providing reasonable confidence and to the tasks providing limited confidence. As the confidence level received within the task providing limited confidence, below than in case of the task providing reasonable confidence, the procedures performed by the practicing specialist within the task providing limited confidence will differ on nature and lines, and also will be less on amount, than in case of task performance, providing reasonable confidence. <5> Requirements which are applied only to this or that type of tasks are provided in format of two columns with addition of letters "O" (limited confidence) or "Р" (reasonable confidence) after number of Item. Though some procedures are required to be performed only within the tasks providing reasonable confidence they, nevertheless, can be applicable in case of some tasks providing limited confidence (see also Item A 90, in which the main distinctions between the supplementary procedures performed by the practicing specialist within the task providing reasonable confidence and the task providing limited confidence concerning the report on emissions of greenhouse gases are specified) (see Items A 4, A 90).

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<5> MSZOU 3000 (reviewed) Item 12(a) (iii).

Interrelation between this standard and MSZOU 3000, other professional standards and other requirements

9. The practicing specialist shall observe requirements of MSZOU 3000 (reviewed) and this standard in case of task performance, providing confidence, concerning the report on emissions of greenhouse gases. This standard supplements, but does not replace understanding of how MSZOU 3000 (reviewed) shall be applied to the task providing confidence to the report of the organization on emissions of greenhouse gases (see Item A 17).

10. Observance of requirements of MSZOU 3000 (reviewed) requirements of parts A and B Code of ethics of professional accountants issued by Council for international standards of ethics for accountants (the Code of SMSEB), is at least either other professional requirements, or the requirements of the law or regulation relating to the tasks providing confidence strict than established by the Code of SMSEB <6>. Besides, it is required that the head of task was member of the auditing organization applying MCKK 1 <7>, either other professional requirements, or the requirements established by the law or the regulation, at least strict than MCKK 1 (see the Items A5 - A 6).

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<6> MSZOU 3000 (reviewed) Items 3(a), 20 and 34.

<7> MSZOU 3000 (reviewed) Items 3(b) and 31(a). The International Standard of Quality Control (ISQC) 1 "Quality control in the auditing organizations booking audit and survey verifications of the financial reporting, and also performing the other tasks providing confidence, and tasks on rendering the accompanying services".

11. When the task is performed according to the local laws, regulations or provisions of the scheme of trade in quotas for emissions, this standard does not cancel operation of such law, regulation or provision. If the local laws, regulations or provisions of system of trade in quotas for emissions differ from requirements of this standard, the task performed according to the local laws, regulations or provisions of certain system of trade will not conform automatically to requirements of this standard. The practicing specialist has the right to declare compliance to this standard in addition to observance of the local law, regulation or provision of system of trade in quotas for emissions only if it fulfilled all applicable requirements of this standard (see Item A 7).

The effective date

12. This standard becomes effective for reports on the tasks providing confidence for the periods which are coming to an end on September 30, 2013 or after the specified date.

Purposes

13. The practicing specialist is faced by the following purposes:

(a) in accordance with the established procedure to receive either reasonable confidence or limited confidence in the relation of whether the report on emissions of greenhouse gases contains essential misstatements owing to unfair actions or mistakes that will allow the practicing specialist to create the conclusion expressing reasonable confidence or limited confidence;

(b) provide the conclusion or the report according to the results received by the practicing specialist in which the following is specified:

(i) in case of the task providing reasonable confidence - whether the report on emissions of greenhouse gases in all essential relations according to applicable criteria is prepared;

(ii) in case of the task providing limited confidence - whether the facts which can form the basis in order that he believed, proceeding from the performed procedures and the obtained evidence that the report on emissions of greenhouse gases is not prepared in all essential relations according to applicable criteria were elicited by the practicing specialist;

(c) inform proper persons if it is provided by this standard, according to the results received by the practicing specialist.

Determinations

14. For the purposes of this standard the following terms are used in the values <8> provided below:

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<8> The determinations used in MSZOU 3000 (reviewed) also are applied to this standard.

(a) Applicable criteria - the criteria used by the organization for determination of number of emissions of greenhouse gases and preparation of the report on emissions of greenhouse gases.

(b) Premises - the statements of the organization made in explicit or other form which are included in the report on emissions of greenhouse gases and are used by the practicing specialist for consideration of different types of potentially possible misstatements.

(c) Basis year - specific year or average value for several years concerning which comparison of emissions of the organization in dynamics for time is carried out.

(d) System of restrictions and trade in quotas - the system providing establishment of general restrictions for emissions and distribution of permissions (quotas) for emissions between participants and allowing them to trade quotas and the credits for the permitted carbon emissions.

(e) Comparative information - numerical indicators and disclosure information provided in the report on emissions of greenhouse gases for one or several last periods.

(f) Emissions - greenhouse gases which during the corresponding period were released into the atmosphere or would be released into the atmosphere if they were not caught and sent to absorber. Emissions can be subdivided into the following categories:

- direct emissions (also known as emissions of category 1) which represent emissions from the sources belonging to the organization or being under its control (see Item A 8);

- indirect emissions which represent the emissions which are consequence of organization activity, but sources of which belong or are under control of other organization. Indirect emissions can be subdivided into the following categories in turn:

- - emissions of category 2, which represent the emissions connected with energy which is received and consumed by the organization (see Item A 9);

- - emissions of category 3, to which concern all other indirect emissions (see Item A 10).

(g) Deduction on emissions - any Article included in the report on emissions of greenhouse gases of the organization which is subtracted from the total amount of the emissions reflected in the report, but is not absorption; usually the acquired compensation quotas belong to it, but also other tools or mechanisms (such as credits and quotas for achievement of indicators) which are recognized system of regulation or other system in which the organization (see the Items A11 - A 12) participates can belong.

(h) Coefficient of calculation of emissions - mathematical coefficient or the standard rate for transfer of units of measure of activities (for example, liters of the consumed fuel, the actual distance in kilometers, number of animals in livestock production or tons of the made products) in quantitative expression of the greenhouse gases connected with these activities.

(i) System of trade in quotas for emissions - the market-based approach used for control of greenhouse gases by means of provision of economic incentives for emission reduction of such gases.

(j) The organization - the legal entity, the economic actor, or identifiable part of the legal entity or the economic actor (for example, one plant or other site, such as landfill), or several legal entities or other organizations, or parts of these organizations (for example, joint business) to which the emissions reflected in the report on emissions of greenhouse gases belong.

(k) Unfair actions - intentional actions of one or several persons from among management, persons who are responsible for corporate management, employees or the third parties made by means of deception for receipt of illegal or illegal benefits.

(l) Supplementary procedures - the procedures performed in response to the estimated risks of essential misstatement, including tests of control facilities (if such are available), detailed tests and analytical procedures.

(m) The report on emissions of greenhouse gases - the report in which components and quantitative parameters of emissions of greenhouse gases of the organization for the period are specified (sometimes called by "emissions inventory") and, when applicable, comparative information and explanatory notes, including the basic principles of quantitative assessment and policy of creation of the reporting. The report on emissions of greenhouse gases of the organization can also include the categorized list of absorbtion or deductions on emissions. If the task does not cover all report on emissions of greenhouse gases, the term "report on emissions of greenhouse gases" means that its part which is covered by task. The report on emissions of greenhouse gases represents information on subject of task <9>.

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<9> MSZOU 3000 (reviewed) Item 12 (x).

(n) Greenhouse gases - carbon dioxide (CO2) and any other gases which, according to applicable criteria, shall be included in the report on emissions of greenhouse gases, such as: methane, oxide diazothat, sulfur hexafluoride, hydrofluorocarbons, perfluorocarbons and chlorofluorocarbons. Gases other than carbon dioxide are often designated as carbon dioxide equivalents (CO2-e).

(o) Organizational borders - the borders determining what activities are subject to inclusion in the report on emissions of greenhouse gases constituted by the organization.

(p) Materiality for accomplishment of audit procedures - the size or sizes established by the practicing specialist at the level below materiality threshold for the report on emissions of greenhouse gases to reduce to it is acceptable low level probability that the cumulative size of uncorrected and undetected misstatements will exceed materiality for the report on emissions of greenhouse gases. In appropriate cases materiality for performing procedures also belongs to the size or sizes established by the practicing specialist at the level below threshold or thresholds of materiality for certain types of emissions or disclosure of information.

(q) The purchased compensation quota - deduction on emissions in case of which the organization pays decrease in emissions of other organization (reduction of emissions) or increase in absorption of other organization (increase in absorption) of rather hypothetical basic size (see Item A 13).

(r) Quantitative assessment - process of determination of amount of greenhouse gases which directly or indirectly belong to the organization for implementation measure (or absorption) emissions by certain sources (or absorbers).

(s) Absorption - greenhouse gases which during the corresponding period were absorbed from the atmosphere or would be released into the atmosphere if they were not withheld and directed to absorber (see Item A 14).

(t) The considerable site - the site which in itself is considerable owing to the amount of its emissions of rather cumulative emissions included in the report on emissions of greenhouse gases or owing to its special nature or circumstances in connection with which there are certain risks of essential misstatement (see the Items A15 - A 16).

(u) Absorber - physical object which absorbs greenhouse gases from the atmosphere, or process from which such absorption results.

(v) Source - physical object which releases greenhouse gases into the atmosphere, or process from which such emission results.

(w) Type of emissions - classification of emissions, for example, on emission source, gas type, the region or the site.

Requirements

MSZOU 3000 (reviewed)

15. The practicing specialist shall not declare observance of this standard if he does not fulfill all requirements of this standard and MSZOU 3000 (reviewed) (see the Items A5 - A 6, A 17, A21 - A 22, A 37, A 127).

Acceptance and task performance

Skills, knowledge and experience

16. The head of task shall:

(a) have competence in skills and methods of ensuring the confidence received by intensive training and practical application and sufficient competence in quantitative assessment and creation of reports on emissions to take the responsibility for provision of conclusion on the task providing confidence;

(b) to be confident that all persons performing the task providing confidence have necessary competence and opportunities, including in the field of quantitative assessment and creation of reports on emissions, and also in sphere of activity on ensuring confidence, for the task performance providing confidence according to this standard (see the Items A18 - A 19).

Precedent conditions of task performance

17. To establish whether precedent conditions for task performance are available:

(a) the head of task shall determine that the report on emissions of greenhouse gases and task provide sufficient amount of information useful to expected users, taking into account, in particular, following (see Item A 20):

(i) if the report on emissions of greenhouse gases excludes considerable emissions which were or easily can be estimated quantitatively whether such exceptions are reasonable in specific circumstances;

(ii) if the task excludes ensuring confidence in the relation of considerable emissions which are reflected in the report of the organization whether such exceptions are reasonable in specific circumstances;

(iii) if the task includes ensuring confidence in the relation of deductions on emissions whether are nature of confidence which the practicing specialist will receive concerning deductions, and expected contents of the conclusion or report on the task providing confidence, concerning these emissions, accurate, proved in specific circumstances and clear for the party which involved the specialist to task performance (see the Items A11 - A 12);

(b) in case of determination of proper nature of applicable criteria according to requirements of MSZOU 3000 (reviewed) <10> practicing specialist shall determine whether include criteria at least the following (see the Items A23 - A 26):

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<10> MSZOU 3000 (reviewed), Items 24(b) (ii) and 41.

(i) method of determination of organizational borders (see the Items A27 - A 28);

(ii) the considered greenhouse gases;

(iii) acceptable methods of quantitative assessment, including methods of entering of adjustments into basis year (when applicable);

(iv) disclosure of sufficient information that expected users could understand the significant judgments used by preparation of the report on emissions of greenhouse gases (see the Items A29 - A 34);

(c) the practicing specialist shall receive the consent of the organization as regards it realizes and confirms the responsibility:

(i) for the organization, implementation and providing internal control system which the organization considers necessary for preparation of the report on emissions of greenhouse gases which is not containing essential misstatements owing to unfair actions or mistakes;

(ii) for preparation of the report on emissions of greenhouse gases according to applicable criteria (see Item A 35);

(iii) for inclusion in the report on emissions of greenhouse gases of the reference to applicable criteria which the organization used, or their description, and also if from circumstances of the performed task it is not clear, instructions on the one who developed them (see Item A 36).

Approval of conditions of task performance

18. Task conditions which approval is necessary according to MSZOU 3000 (reviewed) <11> shall include the following (see Item A 37):

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<11> MSZOU 3000 (reviewed) Item 27.

(a) the purpose and amount of works on task;

(b) responsibility of the practicing specialist;

(c) responsibility of the organization, including the obligations specified in Item 17 (c);

(d) determination of the criteria applicable to preparation of the report on emissions of greenhouse gases;

(e) the reference to expected form and content of the conclusion or the report which will be issued by the practicing specialist, and the statement that there can be circumstances under which the provided conclusion or the report can differ from assumed on form and content;

(f) confirmation of the fact that the organization agrees to provide written applications in case of the conclusion of the agreement on task performance.

Planning

19. When planning task performance according to requirements of MSZOU 3000 (reviewed) <12> practicing specialist shall (see the Items A38 - A 41):

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