The Australian Department of the Treasury has launched a consultation on reducing the cost and complexity of mandatory climate-related financial disclosures while preserving core reporting requirements and alignment between Australian Accounting Standards Board Standard S2 and International Financial Reporting Standard S2. The proposals are intended to address implementation issues identified after the first reporting cycle without changing Scope 3 emissions requirements or the entities covered by the regime. The consultation considers three alternatives to the scheduled transition from limited to reasonable assurance in 2030: retaining limited assurance indefinitely, delaying reasonable assurance until 2035, or applying reasonable assurance only to mature metrics such as Scope 1 and Scope 2 emissions. It also seeks views on clearer guidance for proportionality mechanisms and statements that an entity has no material climate-related risks or opportunities. Further proposals would set boundaries for value-chain data requests and expand access to domestic emissions factors, particularly to reduce burdens on small and midsize suppliers. Treasury is also examining alignment with National Greenhouse and Energy Reporting periods and whether sustainability assurance work should receive greater recognition under Registered Company Auditor experience requirements. The proposals have not received government approval and will not affect entities reporting for the 2026-27 financial year. Any implementation will be sequenced to minimize disruption, with exposure draft legislation to follow where legislative changes are required.

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