THE AUDITING OF SOCIAL ACCOUNTS SOME GENERAL CONSIDERATIONS - - PDF document

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THE AUDITING OF SOCIAL ACCOUNTS

SOME GENERAL CONSIDERATIONS

INDEPENDENT AUDITING (with certification) OF SOCIAL ACCOUNTS

• A DEBATE (CONSIDERING IN THIS CASE ONLY

ITALY):

• A) ONLY VOLUNTARY
• B) COMPULSORY BY LAW

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ONLY VOLUNTARY1

• 1) TO AVOID BUSINESS OF CERTIFICATION

AND “LABEL”’S COMPANIES

• 2) NOT TO CURB COMPANIES’WORK IN AN

ALREADY STAGNANT ECONOMY

• 3) BETTER TO LEAVE TO THE MARKET THE

VALUATION

ONLY VOLUNTARY2

• 4) RISK TO CONFUSE THE SOCIAL ACCOUNT’S

AUDITOR WITH AN “ETHICAL AUDITOR”: RISK OF INSTRUMENTALISM

• 5) MULTIDIMENSIONALITY OF DATA AND

INFORMATION MAKE MORE DIFFICULT THE AUDITING PROCESS THAN IN FINANCIAL ACCOUNTING

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COMPULSORY BY LAW1

• 1) TO GUARANTEE STAKEHOLDERS THAT

SOCIAL ACCOUNTS ARE RELIABLE

• 2) THE DISCOVER OF UNRELIABLE SELF-

REFERENTIAL DOCUMENTS WOULD DIFFUSE A GENERAL MISTRUST ON EVERY SOCIAL ACCOUNT

COMPULSORY BY LAW2

• 3) ASYMMETRIC INFORMATIONS CAN

REDUCE A LOT THE ABILITY OF THE MARKET TO SELECT “GOOD” SOCIAL ACCOUNTS

• 4) THE ABSENCE OF INDEPENDENTLY

ASSURED DOCUMENTS COULD FAVOUR “RUMORS” AND UNJUSTIFIED VOICES AGAINST COMPANIES

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COMPULSORY BY LAW3

• 5) A COMPLETE FREEDOM AND

VOLUNTARINESS BOTH IN DECIDING TO BE AUDITED AND IN CHOOSING AUDITORS CAN DIFFUSE A VERY IMPERFECT (AND PROBABLY NOT MUCH RELIABLE) MARKET OF ASSURANCE

SOME CONCLUSION ISSUES

• AN “AUTHORITY” INSTEAD OF AN AUDITOR? CAN

THIS AUTORITY CONTROL EFFECTIVELY ALL? WHY DOES NOT EXIST AN AUTHORITY (BUT CERTIFICATION) IN FINANCIAL STATEMENT? WHAT ABOUT MULTIDIMENSIONALITY?

• WHY DOES NOT EXIST MARKET SELECTION WITH

FINANCIAL ACCOUNTS?

• THERE ARE AUDITING PROBLEMS ALSO FOR

FINANCIAL ACCOUNTS

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FINALITY OF AUDITING PROCESS

(according to GBS and the author of these slides)

• THE AUDITOR’S AIM IS NOT TO CERTIFY THE “GOODNESS” OF A COMPANY, BUT

ONLY TO GUARANTEE THE STAKEHOLDERS THAT:

• 1) THE COMPANY IS RESPECTING THE

DECLARED STANDARD (GRI, GBS, AA1000,…)

• 2) DATA AND INFORMATION ARE

CONSISTENT WITH DECLARED PRINCIPLES

• 3) THE DOCUMENT IS CONSISTENT WITH

AVALIABLE DATA AND INFORMATION

• 4) FINANCIAL STATEMENT IS RELIABLE

AA1000S

• AA1000S IS ESSENTIALLY AIMED TO “CLOSING THE

CREDIBILITY GAP” BETWEEN DECLARATIONS AND FINALITIES OF PRACTISING STAKEHOLDER ENGAGEMENT AND ITS REAL CREDIBILITY

• EVERY AUDITING AND ASSURANCE PROCESS HAS

THE AIM OF INCREASING CREDIBILITY OF A DOCUMENT (ALSO IN THE FINANCIAL STATEMENT)

• VERY DIFFUSED

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AA1000S

• FUNDAMENTAL PRINCIPLE OF AA1000S IS
• INCLUSIVITY
• THAT IS IN GENERAL BASIC PRINCIPLE FOR

ALL AA1000 DOCUMENTS

AA1000S ASSURANCE JUDGEMENT1

• IT MUST HOLD AT LEAST:
• 1) DECLARATION OF USING AA1000S

ASSURANCE STANDARD

• 2) BASIC DESCRIPTION, PARTICULARLY

ABOUT ASSURANCE LEVEL PURSUED

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AA1000S ASSURANCE JUDGEMENT2

• 3) ASSURANCE JUDGEMENT IN

THE DOCUMENT

• 4) ADDED COMMENTS