Frameworks · AASB S2

In Australia, climate disclosure is not a standard you adopt. It is a report you lodge.

AASB S2 was made under section 336A of the Corporations Act 2001 and commenced as a legislative instrument on 31 December 2024. That single fact changes the character of the exercise. Elsewhere a preparer asks whether the organisation is ready to adopt a standard. In Australia the question is whether a statutory report, carrying a directors' declaration, will withstand an auditor who is required by another instrument to look at it.

This page covers what is specifically Australian: who is caught and when, how the standard departs from the ISSB text, and the assurance timetable. For the anatomy of the disclosure requirements themselves, which AASB S2 carries over almost unchanged, see our paragraph map of IFRS S2.

Who reports

Three cohorts, and three separate ways into each.

The cohorts are commonly described by size alone, which understates the reach. Section 292A creates three independent gateways, and an entity is caught if it passes any one of them: a corporate size test, an emissions test tied to registration under the NGER Act, and an asset-value test that applies to registered schemes, superannuation entities and retail CCIVs. A mid-sized company with modest revenue can be pulled into Group 2 purely by being an NGER registered corporation.

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CohortFirst year beginsSize test (any two) Other ways in
Group 11 Jan 2025
to 30 Jun 2026		 Revenue $500m+
Gross assets $1bn+
500+ employees		 NGER registered corporations in a group meeting the section 13(1)(a) NGER threshold.
Group 21 Jul 2026
to 30 Jun 2027		 Revenue $200m+
Gross assets $500m+
250+ employees		 Any NGER registered corporation, or one required to apply for registration. Plus registered schemes, superannuation entities and retail CCIVs holding $5bn or more in assets.
Group 31 Jul 2027
onwards		 Revenue $50m+
Gross assets $25m+
100+ employees		 The size test now reaches registered schemes, superannuation entities and retail CCIVs as well.

Thresholds as set out in ASIC Regulatory Guide 280, Table 2, which reflects section 1707B. Note that the $5bn asset test sits in Group 2, not Group 1 — several widely circulated summaries place it a year early.

The test is applied at the end of the year, not the start

ASIC's guidance is explicit that reporting status crystallises at year end. An acquisition, a restructure or simply a good year can move an entity across a threshold it did not meet in July. The regulator's expectation is that you have a means of noticing that before the year closes, rather than discovering in August that a report was due.

The structural difference

AASB S2 stands alone. IFRS S2 cannot.

The ISSB wrote S2 to be applied with S1 alongside it, and S1 carries the conceptual foundations, the location and timing rules and the materiality machinery. Australia made a different choice: AASB S1 is voluntary, so the parts of it that climate reporting cannot do without were lifted into Appendix D of AASB S2 itself.

The practical consequence is that AASB S2 is a complete instrument. Compliance is a statement made against it alone, and an entity that never opens AASB S1 can still comply in full. Appendix D keeps the S1 paragraph numbering, so anyone who has worked with the international standards will recognise the provisions, but the cross-references inside AASB S2 point at Appendix D rather than at another document.

This is also why the two standards start in different years. IFRS S2 has applied to periods beginning on or after 1 January 2024; AASB S2 applies from 1 January 2025.

Aus7.1
Aus26.1
Clarify that the avoid-duplication provisions bite mainly when an entity has volunteered to report beyond climate.
Aus20.1
Reporting entity. The disclosures follow the financial statements unless the law permits otherwise — and section 292A(2) does permit otherwise.
Aus37.1
Replaces the deleted industry-metric provision with a pointer back to the cross-industry categories.
Aus37.2
Commencement of the instrument: 31 December 2024.
AusC1.1
Effective date. Periods beginning on or after 1 January 2025, early application permitted, and you must say if you applied it early.
Appendix D
The S1 content that makes the standard self-contained.

What else the AASB changed

Five departures worth knowing before you draft.

The AASB kept the IFRS S2 paragraph numbering, which makes the departures easy to miss. Each of these will change what a preparer produces.

departures from IFRS S2as stated by the AASB
12, 23, 28(b)
32, 37, B65(d), B67 Industry-based metrics are not required The single largest reduction in scope. An entity applying AASB S2 need not disclose industry metrics or work through the SASB-derived disclosure topics, and the definition of a disclosure topic was removed with them less to produce than under IFRS S2
s292A(2) The reporting entity can be the parent alone Under the ISSB standards the disclosures follow the financial statements, so a group reports for the group. The Corporations Act lets a parent choose between the consolidated entity and the parent entity, and AASB S2 was modified to accommodate that choice
Appendix A Not-for-profit entities read two terms differently General purpose financial reports and primary users are taken from the Framework rather than from the standard's own defined terms
GICS and the
climate agreement Referenced versions are pinned Australian law requires a legislative instrument to identify the exact version of any document it incorporates, so where IFRS S2 points at the latest version, AASB S2 names one
Dec 2025 The greenhouse gas amendments were mirrored The AASB's compiled standard incorporates amendments made to 15 December 2025 and applies to annual periods beginning on or after 1 January 2027, with early application permitted. The substance matches the ISSB's changes, which we cover in the amendment write-up

Assurance

The auditor's scope is set by law, and it widens on a schedule you do not control.

Most jurisdictions leave assurance to the market or phase it in loosely. Australia legislated it. The Corporations Act requires sustainability reports for years beginning on or after 1 July 2030 to be audited outright, and instructs the AUASB to specify what must be assured in the years before that. It did so in ASSA 5010, a standard with no international counterpart, operative for years beginning between 1 January 2025 and 30 June 2030.

Two vocabulary points, because the legislation and the profession use different words for the same things. What the Act calls a review is a limited assurance engagement. What the Act calls an audit is a reasonable assurance engagement. When a director asks whether the climate statements are audited, the answer in the first three years is no, and the distinction matters more than it sounds: we have written on what actually changes for the preparer between the two.

The trap in the schedule is that it escalates on the entity's own reporting clock rather than on a calendar shared by everyone. Your fourth year of reporting is when your evidence has to support reasonable assurance, and for a Group 1 entity that is a year beginning as early as 1 July 2028. The work needed to get there does not start in year four.

A quirk that catches Group 1 calendar-year reporters

The first year of reporting for Group 1 is any year beginning between 1 January 2025 and 30 June 2026. An entity with a 1 January year end therefore sits in year one twice, for 2025 and again for 2026. The relief is narrower than it looks: Scope 3 reporting is required for Group 1 years beginning on or after 1 January 2026, so the second pass through year one is not a repeat of the first.

ASSA 5010

What has to be assured, and when.

In the first year the auditor's review covers four things only: governance, the identification of climate risks and opportunities, Scope 1 and Scope 2 emissions, and any statement that the entity has no material climate risks. Everything else is outside the engagement. From the second year the review covers the whole report, and from the fourth it becomes an audit.

Read the first column carefully if you are preparing now. A narrow year-one scope is not a licence to prepare the rest loosely, because year two arrives with the whole report in scope and year two's comparatives are year one's numbers.

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What is assuredYr 1Yr 2Yr 3Yr 4 Yr 5Yr 6
Group 1 year beginning1 Jan 251 Jul 261 Jul 27 1 Jul 281 Jul 291 Jul 30
Group 2 year beginning1 Jul 261 Jul 271 Jul 28 1 Jul 291 Jul 301 Jul 31
Group 3 year beginning1 Jul 271 Jul 281 Jul 29 1 Jul 301 Jul 311 Jul 32
Governancelimitedlimitedlimitedreasonablereasonablereasonable
Which climate risks and opportunities the entity has identifiedlimitedlimitedlimitedreasonablereasonablereasonable
Scope 1 and Scope 2 emissionslimitedlimitedlimitedreasonablereasonablereasonable
A statement that there are no material climate riskslimitedlimitedlimitedreasonablereasonablereasonable
The rest of the strategy pillarnonelimitedlimitedreasonablereasonablereasonable
Climate resilience and scenario analysisnonelimitedlimitedreasonablereasonablereasonable
Transition plansnonelimitedlimitedreasonablereasonablereasonable
Risk managementnonelimitedlimitedreasonablereasonablereasonable
Scope 3 emissionsn/alimitedlimitedreasonablereasonablereasonable
All other metrics and targetsnonelimitedlimitedreasonablereasonablereasonable

Derived from the phasing appendix to ASSA 5010 (compiled version, incorporating amendments to 17 December 2025). Row labels are ours. Scope 3 shows as not applicable in year one because the standard's own first-year relief removes it. An auditor may always assure more than the minimum, and some will.

Comparatives do not get pulled up a level

ASSA 5010 settles a question that would otherwise cause real difficulty in year four. Comparative information that was not assured last year does not need assurance this year, and comparatives that carried limited assurance last year do not have to be brought up to reasonable assurance because the current year has moved. Without that, the first audit year would have dragged the prior year's figures up with it.

Now
Confirm the cohort, and confirm it against all three gateways rather than revenue alone.
Before year end
Fix the emissions boundary and write down why it is drawn there. It becomes the comparative.
Year 1
Governance, risk identification and Scope 1 and 2 will be looked at by an assurance provider. Those need support now, not narrative.
Year 2
Everything else enters scope, including scenario analysis and any transition plan.
Year 4
Reasonable assurance. Controls get tested rather than enquired about.

What to do about it

The schedule is generous about scope and strict about dates.

The staged approach was designed to be manageable, and it is. The risk it creates is a false sense of room: the year-one scope is narrow enough that an entity can pass through it on effort alone, without the records that year two and year four will require. Every extension in this timetable is an extension of what gets tested, not of when you need to have started.

If you want to know which cohort you are in and what your first mandatory period is, the deadline checker will tell you in a couple of clicks. If you want to know whether your evidence would survive the year-two review, the readiness diagnostic is the more useful of the two.

Find your cohort and first period →

No signup. Or take the readiness diagnostic for a scored view, or read how other markets are sequencing the same transition.