Considerations of ESG-related matters in an audit of financial statements

Environmental, social, and governance (ESG) has become an area of increasing focus. The demand by investors, regulators, and other users (stakeholders) for information about the effects of ESG-related matters on entities and their financial reporting has grown dramatically. Although ESG can encompass a wide range of matters that may have the potential to affect an entity’s financial statements, Chapter 1 of Consideration of ESG-Related Matters in an Audit of Financial Statements focuses on the effects of climate-related matters.