The Australian Securities and Investments Commission has published a reporting and audit update that brings together early observations on the first sustainability reports prepared under Chapter 2M of the Corporations Act 2001, its 2026-27 supervisory priorities, recent enforcement, and revised relief and guidance. Reviewing initial reports against the Corporations Act and AASB S2 Climate-related Disclosures, ASIC found improved quantity, quality and consistency of climate-related financial information compared with earlier voluntary disclosures. It also identified areas for improvement ahead of the 30 June 2026 reporting season, including avoiding disclaimers that conflict with the statutory framework, using all reasonable and supportable information on climate risks, clearly disclosing judgements and measurement uncertainty, preventing material information from being obscured, meeting cross-reference requirements, and treating legally required targets such as Safeguard Mechanism emissions targets as climate-related targets. For 2026-27, ASIC will focus financial reporting reviews on significant judgement areas across listed and unlisted companies, registrable superannuation entities and managed investment schemes, including decommissioning and site-restoration provisions. It plans to review 25 audit files, continue surveillance of non-lodgement of financial reports and auditors' annual statements, and concentrate on Group 1 sustainability reports and large audit firms' assurance methodologies. Recent action included 21 infringement notices worth more than AUD 4 million for alleged FY24 financial reporting breaches, including late-lodgement notices paid by four Canva group companies and three Mecca group companies. Surveillance reviews also led Viva Energy Group Limited to change its impairment testing approach, contributing AUD 25 million of a AUD 558.8 million impairment charge, and Pure Foods Tasmania Limited to reverse AUD 4.5 million of deferred tax assets. ASIC also extended relief so certain related registered schemes can present sustainability disclosures in a single report where specified conditions are met, updated FAQs on audit and assurance requirements for sustainability reports, reissued Regulatory Guide 43, and remade three sunsetting relief instruments covering rounding, electronic lodgement and technical relief. Alongside the Australian Accounting Standards Board, it is running introductory sustainability reporting webinars on 16, 25 and 30 June, and said final observations from its review of the 31 December 2025 sustainability reports will be published in the second half of 2026.
Australian Securities & Investments Commission2026-05-29
Australian Securities and Investments Commission publishes reporting and audit update with early sustainability reporting observations and 2026-27 focus areas
The Australian Securities and Investments Commission issued a reporting and audit update on early findings from the first sustainability reports under Chapter 2M of the Corporations Act 2001, its 2026-27 supervisory priorities, enforcement, and revised relief and guidance. ASIC reported improved climate-related financial disclosures against AASB S2 Climate-related Disclosures but highlighted deficiencies in disclaimers, use of reasonable and supportable climate risk information, disclosure of judgements and measurement uncertainty, presentation of material information, cross-referencing, and treatment of legally required emissions targets. It will prioritise reviews of significant judgement areas, Group 1 sustainability reports and large audit firms’ assurance methodologies, and has extended and remade selected relief and updated sustainability reporting guidance.