The standard itself, AASB S2, has one effective date. It applies to annual reporting periods beginning on or after 1 January 2025. But the Corporations Act, as amended by the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024, applies that standard to three different classes of entity at three different dates. The result is a three-wave rollout of mandatory climate-related financial disclosure across Australian reporters over three years.
This three-wave structure is one of the modifications Australia made when it adopted the underlying international standard. The rest of this piece answers four questions: which group is my company in, when is my first AASB S2 disclosure due, what’s transitional in Year 1, and what should I be doing right now.
| Group | Captures | First applies (FY beginning on or after) | Revenue | Assets | Employees |
|---|---|---|---|---|---|
| Group 1 | Largest entities + NGER reporters above 50 kt CO2-e | 1 January 2025 | ≥ AU$500M | ≥ AU$1B | ≥ 500 |
| Group 2 | Mid-size entities + super trustees ≥ AU$5B AUM | 1 July 2026 | ≥ AU$200M | ≥ AU$500M | ≥ 250 |
| Group 3 | Smaller large entities + certain not-for-profits | 1 July 2027 | ≥ AU$50M | ≥ AU$25M | ≥ 100 |
Year 1 reliefs (all groups): no comparative information (paragraph C3), continued use of a non-GHG-Protocol measurement method (paragraph C4(a)), and Scope 3 deferral including financed emissions (paragraph C4(b)).
§1. Which group is my company in?
The Corporations Act, as amended in 2024, sets three categories. The size thresholds for each category are set in the amending Act itself. The dates each category first applies AASB S2 are what we map out below.
Group 1: largest entities, first wave
Group 1 captures large for-profit entities that meet at least two of three Group 1 size thresholds set by the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024: consolidated revenue of AU$500 million or more, consolidated gross assets of AU$1 billion or more, or 500 or more employees. It also captures registered NGER reporters above the 50 kt CO₂-e emissions threshold, even if those reporters do not otherwise meet the size criteria. NGER is the National Greenhouse and Energy Reporting scheme, Australia’s emissions-measurement framework for large industrial emitters. The NGER inclusion is an Australian-specific mechanism that pulls high-emitting entities into the first wave on emissions grounds rather than size grounds.
The first financial year in which a Group 1 entity must apply AASB S2 is the first financial year that begins on or after 1 January 2025.
Group 2: mid-size entities, second wave
Group 2 captures entities that meet at least two of three Group 2 size thresholds, set in the same amending Act and smaller than Group 1: consolidated revenue of AU$200 million or more, consolidated gross assets of AU$500 million or more, or 250 or more employees. Superannuation trustees with AU$5 billion or more in assets under management also fall into Group 2. The first financial year in which a Group 2 entity must apply AASB S2 is the first financial year that begins on or after 1 July 2026.
Group 3: smaller large entities and certain not-for-profits, third wave
Group 3 captures smaller large entities that meet at least two of three Group 3 size thresholds: consolidated revenue of AU$50 million or more, consolidated gross assets of AU$25 million or more, or 100 or more employees. It also captures certain not-for-profit entities. The first financial year in which a Group 3 entity must apply AASB S2 is the first financial year that begins on or after 1 July 2027.
Out of scope (for now)
Entities that fall below all three sets of size thresholds and are not required to lodge financial reports under the Corporations Act are not currently in scope for mandatory AASB S2 disclosure. About 10,000 Australian entities are expected to fall within scope across the three groups under the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024. The Australian Government will revisit the Group 3 framework in a review scheduled for 2028 to 2029 (covered in §5).
§2. When is my first AASB S2 disclosure due?
The primary source for the three application dates is paragraph BC88 of the AASB Basis for Conclusions:
“The financial period in which an entity is first required to apply AASB S2 is specified in the Corporations Act as amended by the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024. It specifies three application dates (financial years beginning on or after 1 January 2025, 1 July 2026 and 1 July 2027) for the various classes of entity, based on entity size or, for NGER reporters, on level of emissions.”
Source: AASB S2 Basis for Conclusions, paragraph BC88.
The standard’s own effective date appears at paragraph AusC1.1 of the standard:
“An entity shall apply this Standard for annual reporting periods beginning on or after 1 January 2025. Earlier application is permitted. If an entity applies this Standard earlier, it shall disclose that fact.”
Source: AASB S2, paragraph AusC1.1.
The phrase “financial years beginning on or after [date]” trips most readers on first encounter. It does not mean the first AASB S2 disclosure is filed on that date. It means the first financial year that begins on or after that date is the first year the entity applies the standard. The first disclosure is filed after that financial year ends.
Most Australian companies use a 31 December year-end or a 30 June year-end. A handful use 31 March or 30 September. The table below maps year-end conventions to first disclosure dates for Group 1.
Group 1: first AASB S2 disclosure by year-end
| Year-end | First financial year beginning on or after 1 Jan 2025 | First mandatory disclosure for year ended | Typical filing window |
|---|---|---|---|
| 31 December | 1 Jan 2025 to 31 Dec 2025 | 31 December 2025 | February to April 2026 |
| 30 June | 1 Jul 2025 to 30 Jun 2026 | 30 June 2026 | August to October 2026 |
| 31 March | 1 Apr 2025 to 31 Mar 2026 | 31 March 2026 | May to July 2026 |
| 30 September | 1 Oct 2025 to 30 Sep 2026 | 30 September 2026 | November 2026 to January 2027 |
Worked examples (cohort categories, not specific reporters): the 31 December year-end Group 1 cohort (the calendar-year cohort) has already filed the first mandatory AASB S2 disclosure. The 30 June year-end Group 1 cohort (the largest Australian cohort by count) files the first mandatory AASB S2 disclosure later this year. Some early-application reporters chose to publish preparatory FY25 disclosures before they were strictly required to; AusC1.1 explicitly permits this.
Group 2 (first financial year beginning on or after 1 July 2026): 30 June year-ends file for year ended 30 June 2027 (August to October 2027 filing window); 31 December year-ends file for year ended 31 December 2027 (February to April 2028).
Group 3 (first financial year beginning on or after 1 July 2027): 30 June year-ends file for year ended 30 June 2028 (August to October 2028); 31 December year-ends file for year ended 31 December 2028 (February to April 2029).
Once you know your year-end and your Group, the date your first AASB S2 disclosure is due is a mechanical lookup.
§3. What’s transitional in Year 1: Appendix C reliefs
AASB S2 has three transitional reliefs that apply in the first reporting year for any entity, regardless of which Group the entity falls into. These reliefs are issued by the AASB itself and live in Appendix C of the standard. They are separate from the modified-liability protection in the Corporations Act amendments, which is covered in §4.
Para C3: no comparative information required in Year 1
“An entity is not required to provide the disclosures specified in this Standard for any period before the date of initial application. Accordingly, an entity is not required to disclose comparative information in the first annual reporting period in which it applies this Standard.”
Source: AASB S2, paragraph C3.
In plain English: in the first year an entity applies AASB S2, it does not need to restate prior-period figures as comparative information. This applies to every disclosure in the standard, including the physical-risk asset disclosure under paragraph 29(c) (the requirement to disclose the amount and percentage of assets vulnerable to climate-related physical risks), scenario analysis under paragraph 22, and anticipated financial effects under paragraph 25.
Para C4(a): carry-forward of a non-GHG-Protocol measurement method
“if, in the annual reporting period immediately preceding the date of initial application of this Standard, the entity used a method for measuring its greenhouse gas emissions other than the Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (2004), the entity is permitted to continue using that other method”
Source: AASB S2, paragraph C4(a).
In plain English: an entity that was already measuring emissions under the NGER scheme can continue using that method in its first AASB S2 year without dual-track preparation. The NGER and GHG Protocol methods differ on some technical points.
Para C4(b): Scope 3 (and financed emissions) deferral
“an entity is not required to disclose its Scope 3 greenhouse gas emissions (see paragraph 29(a)) which includes, if the entity participates in asset management, commercial banking or insurance activities, the additional information about its financed emissions (see paragraph 29(a)(vi)(2) and paragraphs B58–AusB63.1).”
Source: AASB S2, paragraph C4(b).
In plain English: full Scope 3 disclosure (emissions across the entity’s value chain) is deferred to Year 2 for every reporter. For asset managers, commercial banks, and insurers, the relief also defers the financed-emissions disclosure (the Category 15 calculation), which is the single biggest Scope 3 build for financial institutions. Year 2 requires both.
Para C5: carry-forward as comparative information
“If an entity uses the relief in paragraph C4(a) or paragraph C4(b), the entity is permitted to continue to use that relief for the purposes of presenting that information as comparative information in subsequent reporting periods.”
Source: AASB S2, paragraph C5.
In plain English: a reporter that deferred Scope 3 disclosure in Year 1 can present “not applicable in the comparative period” in Year 2’s comparative columns. The Year 1 deferral does not compound into a Year 2 disadvantage requiring back-calculation.
These three reliefs are universal. They apply to every Group, every entity, the first year that entity applies AASB S2.
§4. Modified-liability protection: a separate Year 1 shield
The Corporations Act amendments include a separate transitional protection for forward-looking climate-related statements. This is commonly called modified-liability protection. It is different from the Appendix C reliefs in §3.
Section 296D(2B) of the Corporations Act (as amended) sets out the framework. The specific clause text sits in the Corporations Act itself rather than in AASB S2, so this piece cites Section 296D(2B) by number only.
What it does. Modified liability protects certain forward-looking climate-related statements (scenario analysis outputs under paragraph 22, anticipated financial effects under paragraph 25) from certain civil enforcement actions during the first three reporting years for each Group cohort.
What it does not do. It does not extend to historical-fact statements. It does not displace director duties or general continuous-disclosure obligations. The protection narrows after the first three reporting years for each cohort.
Practical implication: scenario analysis under paragraph 22 carries the strongest litigation shield in Years 1 to 3. Factual current-period statements like the paragraph 29(c) physical-risk asset disclosure have narrower shield coverage.
The 2028 to 2029 Treasury review will revisit the liability framework alongside the Group 3 coverage settings. This is covered in §5.
§5. What changes in Year 2 and beyond
The Year 1 transitional period ends after the first reporting year. Several things change in Year 2.
- The comparative information requirement begins. The prior year’s disclosures become the comparative columns in Year 2.
- Scope 3 disclosure becomes mandatory for any reporter that deferred under paragraph C4(b).
- Financed-emissions disclosure becomes mandatory for asset managers, commercial banks, and insurers.
- Paragraph C5 carry-forward means the deferred Year 1 items can be presented as “not applicable in the comparative period” without back-calculation.
The modified-liability shield narrows after the first three reporting years for each Group. Year 4 onwards, reporters face fuller civil enforcement exposure on forward-looking climate-related statements.
The 2028 to 2029 Treasury review is the headline forward-look. Paragraph BC87 of the AASB Basis for Conclusions sets out the review’s remit:
“Furthermore, the AASB notes that the Australian Government will conduct a review of climate disclosure requirements in 2028–29. The Treasury Policy Position Statement Mandatory climate-related financial disclosures (January 2024) states that the Australian Government will conduct a review of climate disclosure requirements in 2028–29. The review will be led by Treasury, working with the Council of Financial Regulators. At a minimum, the review will examine the effectiveness of coverage settings (particularly the approach to Group 3 entities), appropriateness of the liability framework and whether there are any other barriers that may be affecting a company’s ability to make quality disclosures, including data availability, and supporting materials.”
Source: AASB S2 Basis for Conclusions, paragraph BC87.
AASB S2 in its first cycle is not the steady-state version of AASB S2. The next three years reveal what the steady-state version looks like.
§6. What to do right now, by group
Group 1
- If you have filed already (31 December year-end cohort): start the Year 2 Scope 3 inventory build and the financed-emissions calculation if it applies to your sector.
- If you are filing this year (30 June year-end and other non-calendar year-ends): complete the paragraph 29(c) physical-risk asset register and finalise the paragraph 22 scenario-analysis outputs. Platforms like Continuuiti provide the physical-risk data layer for the AASB S2 paragraphs that need quantitative inputs: 12-hazard assessment under SSP scenarios for the paragraph 22 scenario-analysis requirement, with asset-level damage estimates for the paragraph 29(c) percentage-vulnerable disclosure.
- Document modified-liability-shielded statements with internal sign-off chains.
- Agree the ASSA 5000 limited-assurance scope with the assurance provider. ASSA 5000 is the AUASB sustainability assurance standard in force for first-wave reporters.
- Document your sector context for future industry-based metrics application. AASB-developed Australian industry-based metrics are expected from 2030; in the interim, no equivalent disclosure is required under AASB S2.
Group 2 (FY27 first disclosure, around 13 months away for 30 June year-ends)
- Form the climate-risk governance committee at board level if not yet done.
- Articulate the materiality framework before drafting begins. KPMG specifically flagged “develop a materiality framework that drives considerations of material information to users for disclosure” as a key practical consideration for first-time reporters in their FAST 30 cohort review of 30 first-wave Group 1 reporters (March 2026).
- Build the asset-level data inventory.
- Run scenario-analysis rehearsal exercises.
- Scope sector context by GICS classification for future industry-based metrics application. AU equivalents are pending the AASB workplan, expected from 2030.
Group 3 (FY28 first disclosure, around 24 months away for 30 June year-ends)
- Add climate-related financial risk to the board agenda.
- Decide the materiality framework (single-issue or broader sustainability).
- Start the asset register at high level.
- Monitor the 2028 to 2029 Treasury review for any Group 3 framework revision.
- Monitor AASB educational material for not-for-profit entities (on the AASB workplan per BC83 and BC84).
§7. Sources
- AASB S2 (September 2024 compiled), paragraphs AusC1.1, C3, C4, C5.
- AASB S2 Basis for Conclusions (September 2024 compiled), paragraphs BC83, BC84, BC85, BC87, BC88, BC89.
- Corporations Act 2001 (as amended by the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024), section 296D(2B).
- NGER Scheme legislation: National Greenhouse and Energy Reporting Act 2007 and associated Regulations.
- Treasury Policy Position Statement: Mandatory Climate-Related Financial Disclosures (January 2024).
- KPMG FAST 30: AASB S2 First Impressions cohort review (March 2026).
- Related: how AASB S2 differs from the underlying international standard → https://continuuiti.com/blog/aasb-s2-vs-ifrs-s2-physical-risk/
- Related: how AASB S2 relates to AASB S1 → https://continuuiti.com/blog/aasb-s1-vs-s2/
Worked Samples
See an AASB S2 Worked Disclosure
Full sector-level mock disclosure showing how the Group 1 paragraphs land on the page. Includes paragraph 22 scenario analysis, paragraph 29(c) asset vulnerability, and the four-pillar disclosure architecture.
Frequently asked questions
Which group is my company in?
Australia’s Corporations Act, as amended by the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024, sets three categories. Group 1 captures the largest for-profit entities plus registered NGER reporters above the prescribed emissions threshold. Group 2 captures mid-size entities. Group 3 captures smaller large entities plus certain not-for-profit entities. Size thresholds for each group are set in the amending Act itself.
When is my first AASB S2 disclosure due?
Group 1 applies the standard from the first financial year beginning on or after 1 January 2025. Group 2 applies from the first financial year beginning on or after 1 July 2026. Group 3 applies from the first financial year beginning on or after 1 July 2027. The first mandatory disclosure is filed after that financial year ends, typically four to eight months later under the Corporations Act statutory deadline.
Can I use the transitional reliefs in Year 1?
Yes. Three universal reliefs in Appendix C apply to every Group, every entity, in the first year it applies AASB S2. Paragraph C3 removes the comparative information requirement. Paragraph C4(a) lets entities continue using a non-GHG-Protocol measurement method, which matters for NGER reporters. Paragraph C4(b) defers Scope 3 disclosure to Year 2, including financed emissions for asset managers, banks, and insurers.
What is modified-liability protection and how long does it last?
Modified liability is a separate transitional protection in the Corporations Act, set out in Section 296D(2B). It protects certain forward-looking climate statements such as paragraph 22 scenario analysis and paragraph 25 anticipated financial effects from certain civil enforcement actions during the first three reporting years for each Group cohort. From Year 4 onwards, reporters face fuller civil enforcement exposure on forward-looking climate-related statements.
Do I need to restate prior-year figures in my first AASB S2 disclosure?
No. Paragraph C3 of AASB S2 removes the comparative information requirement in the first annual reporting period in which an entity applies the standard. This applies to every disclosure in AASB S2, including the paragraph 29(c) physical-risk asset disclosure, paragraph 22 scenario analysis, and paragraph 25 anticipated financial effects. Comparative information is required from Year 2 onwards.
Is AASB S2 mandatory for all Australian companies?
No. AASB S2 is mandatory only for entities that meet the Group 1, 2, or 3 size thresholds set by the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024, or that are registered NGER reporters above the prescribed emissions threshold. Entities that fall below all three sets of thresholds and are not required to lodge financial reports under the Corporations Act are not currently in scope. The Australian Government will revisit the Group 3 framework in a review scheduled for 2028 to 2029.
