You filed your first report. This time Scope 3 emissions reporting is included, the year one exemption is over, and someone independent checks the number.
For the wider year one picture, what Australia’s first reporters learned covers it. Group 2 readers, treat this as your Year Two preview.
Key takeaways
- Scope 3 emissions reporting is required from your second reporting year, and the date depends on your reporting group and financial year start rather than a fixed deadline.
- Year two is when Scope 3 picks up limited assurance, so treat this year’s workings as audit evidence rather than a draft.
- The modified liability regime reduces exposure during the transition. It doesn’t make an undocumented estimate defensible.
What changes in your second ASRS report
Two things, and they happen at the same time.
Under Australia’s mandatory climate-disclosure, in-scope entities receive one year of transitional relief for Scope 3 emissions. Scope 3 disclosure is then required from the entity’s second reporting year, with timing determined by its reporting group and financial-year start date.
The second change is assurance, covered further down. Between them they turn Scope 3 from an optional estimate into a disclosed, tested number.
Your own date depends on when your first reporting period began:
| Reporting group | First reporting period begins | Scope 3 required from | Illustrative year end |
|---|---|---|---|
| Group 1 | 1 Jan 2025 onwards | 1 Jan 2026 onwards | 31 Dec 2026, calendar-year reporter |
| Group 1 | 1 Jul 2025 onwards | 1 Jul 2026 onwards | 30 Jun 2027, June year end |
| Group 2 | 1 Jul 2026 onwards | 1 Jul 2027 onwards | 30 Jun 2028, June year end |
| Group 3 | 1 Jul 2027 onwards | 1 Jul 2028 onwards | 30 Jun 2029, June year end |
Year two means your second annual reporting period rather than a shared calendar year. A Group 1 entity reporting to 31 December already has Scope 3 inside its current period.
What decision-useful Scope 3 disclosure means
More than a carbon total, AASB S2 asks for Scope 3 reporting that connects to your climate risks and opportunities. This means you have to be able to explain your workings, as well as ensure their accuracy.
Your team should be able to set out:
- Which categories you assessed, and which you judged relevant.
- The calculation boundary, data sources, assumptions and emission factors.
- Your consolidation approach, and any change to methodology since year one.
- Where you used supplier data against spend-based or activity-based estimates.
- Material limitations and uncertainty.
- How Scope 3 connects to your targets, transition plan and risk management.
That last point is where most second reports are lacking. A Scope 3 figure sitting on its own page, disconnected from the risks it’s meant to communicate, is the most common gap we see. If you manage a property portfolio, boundary changes between year one and year two are often behind it.
What changes when Scope 3 comes into assurance
Scope 3 picks up limited assurance from your second reporting year, moving to reasonable assurance in your fourth.
Limited assurance is a review-level conclusion rather than a full audit, and that wording leads some teams to treat year two Scope 3 as exploratory. It isn’t, and an assurance provider will test your methodology, source evidence, and whether the disclosure is complete. Limited assurance also covers your governance and strategy disclosures rather than just emissions.
The real change is when you build the evidence. Year one Scope 3 could be reconstructed afterwards. Year two needs the workings documented as you go. Our article on climate and nature assurance explains what a provider looks at.
Where you stand on liability
Statements about Scope 3 sit under a modified liability regime until 31 December 2027. For three years from 1 January 2025, actions relating to Scope 3, scenario analysis and transition plans are generally limited to regulator-only actions.
So there’s a certain level of protection during the transition. It narrows who can bring an action and over what window. It doesn’t reduce your obligation to disclose properly, and it has an end date your second report should already be planning past.
Directors carrying the declaration should read this alongside the broader non-compliance position. Your own exposure depends on your circumstances, so confirm it with your legal team rather than working from a general summary.
Does that protection cover the numbers themselves?
No. The regime affects who can act and for how long. It doesn’t make an undocumented estimate defensible. Method and evidence still carry the weight, which is the same standard your assurance provider will apply.
What to do before your second report closes
Three things, in this order.
- Confirm your own Scope 3 date from your financial year start rather than a headline.
- Check whether your year one boundary and methodology still hold, because a change needs either explaining or reversing.
- Treat every Scope 3 working paper as assurance evidence from the moment you create it.
If year two is your first assured Scope 3 cycle, our climate and nature assurance team can run the readiness work with you. Or if you’d rather start by pinning down exactly when Scope 3 lands for your entity, a free 30-minute consult will settle it.
Frequently Asked Questions
From your entity’s second reporting year, which depends on your reporting group and when your financial year starts. A Group 1 entity reporting to 31 December has Scope 3 required for the year ending 31 December 2026.
You report the categories relevant to your business and explain how you reached that judgement. Screening is part of the disclosure, so the categories you set aside need a stated reason rather than silence.
Yes. Estimation is expected, particularly for categories where supplier-specific data doesn’t exist. What matters is that the method is stated, applied consistently, and supported by evidence a reviewer can follow.
Explain the change. Movements caused by better data or a revised boundary are normal in a second report, and disclosing the reason is far safer than presenting a shifted number without comment.
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