Technical update

AML reporting

The National Crime Agency has issued its SARs Annual Report. Nearly 867,000 suspicious transaction reports were made in that period: one for every 80 people in the UK. Of these, 0.7% or around 6,000 reports were from the accountancy profession. The majority of SARS (85.5%) were from the banking sector, and 10.3% from financial services. Ireland, by comparison, had one report for every 73 people (in a slightly earlier period), with the accounting profession making a considerably smaller number of SARs a year, according to information shared with the Joint Practices Group, a consultation group with the Garda and profession.

An accounting practice having never made a SAR is considered by the ACCA anti-money laundering (AML) compliance team a possible indication of a lack of understanding of the  regulations. This may therefore increase a practice’s risk score and, therefore, the frequency of AML monitoring.

Sustainability

The International Sustainability Standards Board (ISSB) has released amendments to greenhouse gas emissions disclosure requirements under its IFRS S2 standard on climate-related disclosures. The changes cover reporting beginning on or after 1 January 2027, and follow ISSB consultation during 2025, delivering reliefs and clarifications. Early use of the changes is permitted, with the ISSB saying it has kept investor information needs in focus, minimising disruption to jurisdictions adopting or using IFRS Sustainability Disclosure Standards. The changes, for example, allow the use of classification systems beyond the MSCI/S&P’s Global Industry Classification Standard to disaggregate information about financed emissions.

The European Commission has issued guidance to help European Union sustainability reporters prepare for incoming simplified disclosure rules when using the EU’s taxonomy for sustainable economic activities. This will take account of the amendments to European Sustainability Reporting Standards (ESRS) following the Omnibus Taxonomy Delegated Act adopted by the EU executive in July 2025.

The European Financial Reporting Action Group has published a basis for conclusions and four related documents to help accountants and sustainability reporters understand its new draft simplified ESRS, released in December 2025.

In addition, companies that a have commercial imperative to report on their sustainability but do not want to adopt the ESRS standards due to their size and complexity are increasingly adopting the greatly simplified Voluntary Sustainability Reporting Standard for non-listed SMEs (VSME), issued by EFRAG. The body has just conducted a survey of VSME use and acceptance by financial institutions, business partners and companies in the value chain. Some of the key takeaways include a growing awareness and use of the standard, with companies reporting improved access to finance and cost optimisation.

Challenges identified include limited training, unclear methodologies and insufficient supporting tools. The respondents to the survey asked for additional guidance, including on specific disclosures and sector-specific topics, as well as awareness-raising initiatives such as examples of completed VSME reports, training sessions and best-practice cases. Read an example VSME report for a credit union, which ACCA was involved in developing.

The European Commission issued an update to the Carbon Border Adjustment Mechanism (CBAM) rules. The Environmental Protection Agency has been appointed as the national competent authority in Ireland and CBAM became fully operational in Ireland on 1 January 2026.

Finally, the Global Reporting Initiative (GRI) has released a review concluding that 73% of 30 academic studies published between 2010 and 2025 showed that the disclosure of sustainability impacts by companies had improved their financial performance, particularly when following globally accepted reporting standards. Six of the papers had mixed or inconclusive results, and only two concluded sustainability reporting harmed business success.

Ethics

The International Ethics Standards Board for Accountants (IESBA) has launched a new policy programme designed to improve the ethical culture of accountancy firms worldwide. The board will discuss new ‘IESBA Viewpoints’ to support ethical leadership, governance or incentives which influence ethical corporate culture and behaviour in accountancy firms. The discussions will take place in the first half of 2026 and inform the development of a global baseline on the topic.

Assurance

The International Auditing and Assurance Standards Board (IAASB) has updated its requirements for using external experts in assurance. The changes amend several standards: ISA 620 on the work of an auditor’s expert, ISRE 2400 on engagements to review historical financial statements, ISAE 3000 on assurance engagements other than audits or reviews of historical financial information, and ISRS 4400 on engagements with agreed-upon procedures.

The IAASB has also developed an approach for updating ISA for LCEs, its audit standard for less complex entities. Future revisions should reflect the typical nature and circumstances of these organisations, while aligning proportionately with the core concepts of international auditing standards. The approach defines IAASB procedures when developing ISA for LCE revisions.

Education standards

The International Federation of Accountants (IFAC) has published its 2026 Handbook of International Education Standards. The document contains the full suite of International Education Standards (IES) 1–8, with a supporting framework and glossary, incorporating all recently revised and updated standards. IES 1–6 address entry requirements to professional accounting education programmes and the professional development of aspiring accountants, IES 7 covers lifelong learning, and IES 8 competences to be held by engagement partners responsible for financial statement audits.

Financial markets

A review by the Basel Committee on Banking Supervision (BCBS) and the International Organization of Securities Commissions (IOSCO) has concluded that the international system for implementing margin requirements for non-centrally cleared derivatives is effective and should be maintained. A BCBS-IOSCO working group on margining requirements recommends that monitoring should be ongoing.