Methodology for entities’ non-financial reporting quality assessment

Abstract

Introduction. Currently, the task of harmonizing domestic legislation in the field of accounting and reporting with the directive requirements of the EU has arisen, in particular in terms of conceptual and terminological differences, the mechanism for collecting and processing data from non-financial reports of enterprises and the lack of a proper system for ensuring their quality. Problem Statement. The existence of a wide variety of approaches to the preparation of non-financial reporting by enterprises ,on the one hand , and the lack of regulation in domestic legislation of approaches to disclosure of information on sustainable development by business entities lead to a decrease in the quality of reporting data (comparability, transparency, reliability), on the other hand. The purpose is to scientifically substantiate the methodological tools for assessing the quality of non-financial reporting of enterprises. Methods: bibliographic analysis, graphical method as well as analysis and synthesis methods were used. Results. In the context of the development of the concept of quality of non-financial reporting and its reflection in regulatory documents of various levels, it has been identified that, despite the global level of its distribution, there is currently no clear understanding of the definition of quality of non-financial reporting as the basis for building a system for its assessment. The authors have developed the conceptual and categorical apparatus in the studied area by formulating a definition of the concept of “quality of non-financial reporting”. Conclusions. The paper proposes a draft Methodology for entities’ non-financial reporting quality assessment with regard to disclosure of information to justify the provision of state support to overcome the consequences of the pandemic of particularly dangerous infectious diseases (draft Methodology) is an attempt to solve it. The document is based on internationally recognised standards for corporate sustainability disclosures: IFRS S1 “General Requirements for Disclosure of Sustainability-related Financial Information”; IFRS S2 “Climate-related Disclosures”; European Sustainability Reporting Standards (ESRS 1 “General Principles”). The draft Methodology proposed in this paper includes three sections: General provisions; Procedure for assessing the quality of non-financial reporting; Organisation of the quality assessment of non-financial reporting at the enterprise.