Australian Securities & Investments Commission publishes sustainability report assurance FAQs and signals pragmatic enforcement during phase-in

The Australian Securities & Investments Commission has published FAQs clarifying the review and audit obligations that apply to sustainability reports under the Corporations Act 2001 for both auditors and report preparers. It also indicated supervision and enforcement will be pragmatic and proportionate as the assurance requirements are phased in, with enforcement investigations more likely where it sees serious or reckless misconduct. The FAQs address auditors’ obligations when forming an opinion on a sustainability report, what the auditor’s report must contain, and how modified liability settings apply to statements in that auditor’s report, as well as preparers’ responsibilities to obtain a review or audit, requirements around auditor appointment, removal and resignation, and who can perform the engagement. Reporting entities must have sustainability reports reviewed or audited in accordance with the Corporations Act and ASSA 5000 and obtain an auditor’s report; for financial years commencing before 1 July 2030, the required level of review or audit follows AUASB requirements set out in ASSA 5010, and from 1 July 2030 sustainability reports will be required to be audited.