Tough Financial Disclosures Await Firms – ICPAK

The Institute of Certified Public Accountants of Kenya (ICPAK) has released the first sustainability standards, IFRS S1 and S2, which indicate tougher financial reporting for businesses.

The International Sustainability Standards Board (ISSB) developed these standards in order to increase transparency and reliability of sustainability-related information and climate change disclosures for entities in Kenya.

The implementation is expected to bring in a new era of sustainability-related disclosures, particularly among Nairobi Security Exchange (NSE) corporations.

The International Financial Reporting Standards (IFRS) S1 and S2 are intended to increase the alignment and interoperability of global environmental, social, and corporate governance (ESG) standards.

According to ICPAK, the guidelines establish a uniform vocabulary for communicating the impact of climate-related risks and opportunities on a company’s prospects.

“These new standards are broadening the horizons of financial statements. The broadening is in scope by going into the entire value chains of companies because this is where most of the sustainability risks and opportunities are found,” said ICPAK CEO Grace Kamau.

To monitor implementation, the organization has collaborated with the Pan-African Federation of Accountants (PAFA), the International Accounting Standards Board (IASB), the Financial Sector Deepening (FSD), and the United Nations Conference on Trade and Development (UNCTAD).

ISSB Chair Emmanuel Faber will officially unveil the Standards on June 26, 2023, at the IFRS Foundation’s annual conference and through a week of events organized by stock exchanges throughout the world.