DRAFT FUTUREPAST WORK PRODUCT FOR NSF-ISR GHG PROGRAM

GHG Verifier Initial Training Final Exam

March7, 2006

Name:

Date:

Final Grade:

The pass mark for this examination is 70% (40 out of 57 possible points).

Anyone who scores between 50% and 69% (29 – 39 points) will have an additional opportunity to take the exam.

Please answer all questions of the test. All answers are to be written on the examination paper in the space provided.

You may reference any of the materials reviewed during the training. You may not discuss the questions out loud.

Examination length:About 1 Hour

Point Value for Examination Questions

Multiple choice=2 pts. each(5 questions, 10 points)

True/False=1 pt. each(3 questions, 3 points)

Short answer=4 pts. each(11 questions, 44 points)

Description of Examination Sections

Section I: General(12 points)

Section II: ISO 14064-3(22 points)

Section III: NSF-ISR Verification Procedures(23 points)

Section I: General

1.Select what you believe is the most important reason why companies in the electric utility and chemical sectors might be interested in establishing a greenhouse gas inventory.

A.End-user consumer demand

B.Opportunity for favorable media coverage

C.Ready availability of technological options for reducing GHG emissions

D.Relatively high degree of carbon-intense operations, and therefore exposure to present or potential regulation

E.Industry peer pressure

2.Describe the difference between GHG validation and GHG verification.

Validation is the prospective (ex ante) determination that a GHG project will deliver the GHG emission reductions or removal enhancements described in the GHG project documentation. It is conducted prior to project approval and implementation.

Verification is an examination after-the-fact (ex post) of either the accuracy of a GHG inventory or of the interim or final results of a GHG project.

3.Describe the difference between verification and management system conformity assessment

Verification seeks to determine the accuracy of reported GHG information. Management system conformity assessment assesses whether organizations have implemented systems that meet defined requirements.

4.TRUE/FALSE: As of January 2006, both BEAC and RABQSA offered certified GHG verifier credentials. T F

5.TRUE/FALSE: ISO 14064-3 (Greenhouse gases: Specification with guidance for the validation and verification of greenhouse gas assertions) can be used by organizations (first-party) or independent bodies (third-party) to validate or verify GHG assertions. T F

Section II: ISO 14064-3

1.Which of the following activities does NOT take place during an on-site verification visit?

  1. Agreement with client on level of assurance, objectives, scope and criteria
  2. Assessment of the GHG information system controls
  3. Assessment of the GHG data and information
  4. Assessment against the criteria
  5. Evaluation of the GHG assertion

2.The extent of the validation or verification activities depend upon all of the following EXCEPT:

  1. The level of assurance required
  2. The needs of the intended user
  3. Objectives of the validation or verification activities
  4. The responsible party’s budget for verification
  5. The validation or verification criteria

3.Which of the following is NOT included as a Kyoto Protocol GHG gas:

  1. CO2
  2. N2O
  3. PFCs
  4. CFCs
  5. CH4

4.List four examples of risk that could be identified prior to making the first on-site visit:

_Risk that not all sources of GHGs had been identified______

_Complexity of the organization’s operations______

_Existence of complex organizational boundary issues related to joint ventures or production-sharing agreements______

_Significant merger and acquisition activity______

5.Explain the concept of “residual risk,” and the uses the verification auditor makes of this information.

_Residual risk is the risk of material discrepancy that remains after taking into account management’s identification of risk and application of management controls to mitigate that risk.__

______

______

6.Describe four auditing techniques that can be used during the testing of procedures and operations.

__Vouching______

__Recomputation______

__Retracing data______

__Confirmation______

7.A.Describe the difference between a “reasonable” level of assurance and a “limited” level of assurance.

A reasonable level of assurance informs the intended user that the GHG assertion has been verified by an independent third-party and can be relied upon for making decisions. The verification statement is cast in a “positive” form using words such as “The information presented in the GHG assertion is fairly stated.” The limited level of assurance informs the intended user that the GHG assertion has been verified by an independent third-party and that no problems in the GHG assertion have been found. The limited level of assurance statement uses a double negative, i.e. “The information presented in the GHG assertion has been examined and no evidence has been found to indicate that it is not, in all material respects, fairly stated.” This level of assurance does not provide an intended user with as much assurance as the reasonable one.

B.Write a sample assurance statement (one sentence) that reflects the “reasonable” level of assurance:

“We have examined the information contained in the GHG assertion and have found that it is, in all material respects, fairly stated.”

C.Write a sample assurance statement (one sentence) that reflects the “limited” level of assurance:

“We have examined the information presented in the GHG assertion and have found no evidence to indicate that it is not, in all material respects, fairly stated.”

Section III: NSF-ISR Verification Procedures

1.Describe the relevance of the “control environment” to a GHG verification audit, and why it must be assessed.

__The control environment comprises the Direction and guidance derived from general commitment, responsibility, awareness and actions of directors and management regarding the internal control system and its importance in reporting the GHG data (3.12) and supporting the GHG assertion. Deficiencies in the control environment can limit the effectiveness of management controls designed to reduce the risk of material misstatement in the GHG assertion.

______

2.Describe what might be included in a sampling plan, citing specific examples of record types that might be reviewed.

___GHG sources: specific points that emit GHG through combustion, processes, or leakage ___GHG sinks: e.g. forests, soils

___GHG reservoirs: geologic formations that contain GHGs

___GHG types: six gases or categories of gas recognized by the UN Framework Commission on Climate Change, e.g. CO2, CH4, N2O, HFCs, PFCs, and SF6

___Organizations, facilities, sites: ______

3.Discuss the role of “nonconformities” found during a GHG verification audit and the reasons why they must be closed prior to writing a GHG statement.

______

______

______

______

4.Describe the circumstances under which the lead verifier might recommend an increase in audit time for a verification audit.

______

______

______

______

5.Relevant criteria for a GHG inventory verification may include:

A.The organization’s policies and procedures

B.Applicable international standards (e.g. ISO 14064–1) or technical specifications (e.g. WBCSD/WRI GHG Protocol)

C.Applicable industry guidance documents (e.g. API or IPIECA for the oil and gas industry)

D.Applicable GHG “program” requirements (e.g. 1605b, California Climate Action Registry, etc.)

E.All of the above.

7.Provide three reasons why a lead verifier’s draft GHG statement might be rejected upon review, and discuss what steps may need to follow in order to remedy the deficiencies.

___The statement does not include all required elements______

___The statement does not match agreement with client on objectives, scope or criteria______

___Working papers submitted do not provide evidence sufficient to support the stated level of assurance

______

8.TRUE/FALSE: Once a verification statement has been issued, there are no circumstances under which it might be revised. T F

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