Do we have to report Scope 3 in year one?

No. AASB S2 gives first-time reporters relief from disclosing Scope 3 greenhouse gas emissions in their first annual reporting period, and Scope 3 is required from the second year. Taking the relief in year one is normal, but the supplier data work needs to start in year one anyway.

Do we need comparatives in our first report?

No. AASB S2 relieves first-time reporters from disclosing comparative information in their first annual reporting period, and comparatives are required from year two. That means your year-one numbers and working papers will be looked at again, so build the year-one file as if it will be re-examined.

We are Group 2. When is our first report actually due?

Group 2 obligations start with your first financial year commencing on or after 1 July 2026, not on 1 July 2026 itself. With a 30 June balance date that is the year ending 30 June 2027. It is lodged by 30 September 2027 if you are a disclosing entity, registered scheme or RSE, otherwise 31 October 2027.

Glossary›AASB S2 disclosure requirements / AASB S2 mechanics›Transitional relief / scaling relief

Glossary term

Cluster C · C20

Tier 1 · differentiator

Transitional relief / scaling relief

Definition

Transitional relief is the set of concessions in AASB S2 Appendix C that reduce what an entity must disclose in its first annual reporting period applying the standard. Comparative information is not required. A non-GHG-Protocol measurement method used in the preceding period may continue. Scope 3 emissions may be omitted. Two of the three then taper rather than simply expiring.

AASB S2

· Appendix C paragraphs C2 to C5, with C1A, C1B and C6 ·

Transitioning

On this page

In practice
What the assurer does with it
Commonly confused with
Timing and relief
Sources
Related terms
Related questions

Cluster

C · AASB S2 disclosure requirements / AASB S2 mechanics, 25 terms

In practice

The reliefs are entitlements, not applications. Nothing needs to be requested and nobody needs to approve them. Paragraph C2 fixes the reference point: the date of initial application is the beginning of the annual reporting period in which the entity first applies AASB S2. Every relief in paragraphs C3 to C5 runs from that date, which is the entity’s own first year, not a calendar year. A Group 3 entity first applying the standard for the year commencing 1 July 2027 gets exactly the same reliefs Group 1 got in 2025.

The three first-year reliefs:

C3: comparatives. The entity is not required to provide the disclosures specified in the standard for any period before the date of initial application, and accordingly is not required to disclose comparative information in its first annual reporting period. This is the cleanest of the three and it applies to everything in the standard, not just emissions.

C4(a): measurement method. If in the annual reporting period immediately preceding the date of initial application the entity used a method for measuring greenhouse gas emissions other than the GHG Protocol Corporate Standard (2004), it is permitted to continue using that other method. Note the condition: the method must have been in use in the immediately preceding period. An entity that measured nothing before its first report has nothing to continue and cannot pick an alternative method under C4(a).

C4(b): Scope 3. The entity is not required to disclose its Scope 3 emissions under paragraph 29(a), including, for an entity participating in asset management, commercial banking or insurance activities, the additional financed-emissions information under paragraph 29(a)(vi)(2) and Appendix B paragraphs B58 to B63A.

The point almost everyone gets wrong is paragraph C5. The reliefs do not simply switch off at the end of year one. Paragraph C5 provides that an entity that used the C4(a) or C4(b) relief is permitted to continue to use that relief for the purposes of presenting that information as comparative information in subsequent reporting periods. In plain terms: an entity that omitted Scope 3 in year one discloses current-year Scope 3 in year two, but is not forced to go back and reconstruct the year-one Scope 3 figure to present as a comparative. The same applies to a non-GHG-Protocol measurement method for the relieved period. The reliefs taper into the comparative column rather than expiring, and the effect is that a first-year decision does not create a retrospective data-reconstruction project in year two. Note the asymmetry: C5 names C4(a) and C4(b) only. It does not extend the C3 comparatives relief, which does its work once, in the first year, and is not needed afterwards.

The assurance timetable runs the same way, which is the other half of the story. ASSA 5010 paragraph 11(a) provides that where comparative information was not required to be, and was not, subject to assurance for a publicly available report for the previous financial year, that comparative information is not required to be subject to assurance in the current year. Paragraph 11(b) provides that where the comparative information was subject to limited assurance last year, it is not required to be subject to reasonable assurance this year. So the relief carries through to the assurance scope, and a figure does not get pulled up to a higher assurance level just because it has become a comparative. The pattern is identical to AASB S2 Appendix C paragraph C5, and recognising that the two standards taper in parallel is what lets an entity plan the cost of years two, three and four properly.

A separate transition is coming. AASB S2025-1 Amendments to Greenhouse Gas Emissions Disclosures, issued December 2025, amended paragraphs 29(a)(ii), 29(a)(vi)(2), Appendix B paragraphs B21 to B22, B24, B28, B37, B59, B62(a) and B63(a), and paragraph C4(b); added paragraphs 29A to 29C, Appendix B paragraphs B62A and B63A, and paragraphs C1B and C6; and deleted AusB63.1. Paragraph C1B makes the amendments effective for annual reporting periods beginning on or after 1 January 2027, with early application permitted if disclosed. Paragraph C6 carries their own transition: an entity that previously applied AASB S2 must, unless impracticable, adjust comparative information for the preceding period for changes in measurement method, for Category 15 and financed-emissions presentation, and for the industry-classification system used in disaggregated financed-emissions disclosure. For a private operating business reporting Scope 1, 2 and a screened Scope 3, C6 will usually require nothing, because the provisions it adjusts are financed-emissions and measurement-method provisions.

Two planning points a CFO should take from this entry. Taking C4(b) in year one is cheap and sensible, but it does not defer the underlying work, because year two requires current-year Scope 3 and the data collection has to start during year one to produce it. And the entity’s basis of preparation must name which reliefs were taken, because the reader cannot otherwise tell the difference between a Scope 3 figure that is zero and one that was relieved.

What the assurer does with it

Reliefs change the scope of the engagement, so the assurer establishes which were taken before planning fieldwork. They ask for the entity’s date of initial application, the group determination supporting it, and a written statement of which Appendix C reliefs are being relied on.

For C4(a) they test the precondition specifically: evidence that the alternative measurement method was actually in use in the annual reporting period immediately preceding the date of initial application. An entity that claims C4(a) having previously measured nothing fails that test. For C4(b) they confirm the omission is disclosed rather than presented as a nil or complete figure, because an undisclosed omission is a misstatement rather than a relief. For C3 they confirm the absence of comparatives is stated.

Where paragraph C5 is relied on in year two or later, they check that the relieved prior-period figure is labelled as relieved and not silently presented as though it had been measured on the current basis, and they apply ASSA 5010 paragraph 11 to confirm the comparative is outside the current year’s assurance scope. They accept a basis of preparation naming each relief with its paragraph reference, dated before the report was finalised. They reject a relief claimed after the fact, a relief claimed for a year that is not the entity’s first annual reporting period applying the standard, a C4(a) claim with no evidence of the preceding method, and a Scope 3 omission with no disclosure that it was omitted. The recurring finding is not an invalid relief but an undisclosed one.

Commonly confused with

A reporting exemption, which means no sustainability report at all. A relief means a sustainability report with less in it, and the entity is fully captured. Also confused with the impracticable relief, which must be argued and evidenced; Appendix C reliefs are automatic entitlements requiring no argument. And confused with the ASSA 5010 assurance phasing, which is a separate timetable governing how much of the report is assured and at what level, not what has to be in it. The two interact, per paragraph 11, but they are different instruments.

Timing and relief

C3, C4(a) and C4(b) apply in the entity’s own first annual reporting period applying AASB S2: financial years commencing on or after 1 January 2025 for Group 1, 1 July 2026 for Group 2, 1 July 2027 for Group 3. C5 extends the C4(a) and C4(b) reliefs into the comparative column of later periods for as long as the relieved period is presented as a comparative. The AASB S2025-1 amendments and their C6 transition apply for annual reporting periods beginning on or after 1 January 2027 under paragraph C1B, with early application permitted if disclosed. On the assurance side, ASSA 5010 paragraph 11(a) and 11(b) keep unassured and limited-assured comparatives out of a higher assurance scope in the following year.