Which of the following are key characteristics of an internal control for assurance purposes? Select all that apply.

2023/2772, various EFRAG guidance documents, and reports related to CSRD, ESRS, stakeholder

engagement, double materiality, external assurance, and digital reporting Study guide Reference at

the end of each question

Under the ESRS framework, effective internal controls for assurance purposes must meet key

characteristics to ensure reliability, traceability, and auditability.

Correct Options Explained:

(A) Documentation & Implementation: Internal controls must be formally documented,

implemented as per the designated schedule, and consistently applied​.

(C) Testability by External Assurance Providers: Assurance providers must be able to verify the

controls, test their effectiveness, and ensure compliance with CSRD assurance requirements​.

Incorrect Options Explained:

(B) Same Staff Performing & Assuring the Control: A fundamental principle of internal control is the

separation of duties to avoid conflicts of interest. The control must be performed by one team and

assured independently​.

(D) No Need for Documentation: Proper documentation is mandatory for internal controls to enable

traceability, testing, and regulatory compliance​.

ESRS Reference:

Commission Delegated Regulation (EU) 2023/2772, GOV-5: Risk management and internal controls

over sustainability reporting, highlighting the necessity of internal control mechanisms​.

EFRAG Assurance Guidelines: Stipulating that documented controls must be verifiable and tested for

external assurance​.