AASB S2 Group 2 mandatory reporting: a 10-step checklist for the period that started 1 July

Group 2 entities, approximately 3,000 Australian companies including large proprietary companies and public interest entities with reporting periods beginning on or after 1 July 2026, are now in their first mandatory AASB S2 climate reporting period. The first reports are not due until next year. But limited assurance applies from Year 1 of this period, which means the data has to be audit ready from 1 July, not reconstructed when someone asks.

For CFOs, finance directors, and sustainability leads who are working through what this means in practice, the challenge is not usually understanding the standard. It is translating the standard into a set of concrete tasks that the finance team can own. This checklist covers the 10 things that need to be in place before the first report is due.

The 10-step checklist

1. Confirm whether your entity is Group 2 in scope Group 2 applies to entities that meet at least two of three thresholds: 250 or more employees, AU$200 million or more in consolidated revenue, or AU$500 million or more in consolidated gross assets. Large proprietary companies and public interest entities above these thresholds are in scope for reporting periods beginning on or after 1 July 2026. If your entity sits close to any of these thresholds, document the assessment and the data used to make it, because the in-scope determination itself may be reviewed.
2. Identify all Scope 1 emission sources Scope 1 covers direct greenhouse gas emissions from sources owned or controlled by your entity. For most Group 2 entities the three categories to work through are stationary combustion (boilers, furnaces, generators), mobile combustion (company vehicles and fleet), and fugitive emissions (refrigerants, gas leaks). Each source type uses a different NGA Factor category expressed in kg CO2-e per unit of fuel or activity. Map every source to its emission factor category before running any calculations.
3. Identify all Scope 2 sources by facility and state Scope 2 covers purchased electricity, steam, heat, and cooling. For electricity, the location-based emission factor varies by state grid and must be applied per facility, not averaged across the entity. A business with operations in both Victoria and New South Wales cannot use a single national factor. List every facility, confirm its state, and assign the correct state-level electricity factor to each one.
4. Source the correct NGA Factors workbook version for your reporting period DCCEEW publishes the National Greenhouse Accounts Factors workbook annually. For a reporting period covering FY2026 data, the 2025 workbook is the applicable source. The location-based Scope 2 electricity factors from that workbook are: NSW 0.64, VIC 0.78, QLD 0.67, SA 0.22, WA 0.61, TAS 0.20, NT 0.56, all expressed in kg CO2-e/kWh. The ACT draws from the NSW grid and uses the NSW factor of 0.64. Scope 1 stationary combustion factors are expressed in kg CO2-e/GJ and vary by fuel type.
5. Apply state-specific electricity factors to each facility The difference between state factors is not cosmetic. The Victorian grid factor (0.78 kg CO2-e/kWh) is nearly four times the South Australian factor (0.22 kg CO2-e/kWh) in the 2025 workbook. Applying the wrong state factor to a high-electricity facility is a material misstatement under AASB S2. Calculate Scope 2 emissions for each facility individually using the correct state factor, then aggregate.
6. Establish version control on your emission factor source Your disclosure and your assurer need to be able to confirm which version of the NGA Factors workbook was used, when it was accessed, and that the same version was applied consistently across all facilities throughout the reporting period. A spreadsheet downloaded once and saved locally is not sufficient to demonstrate this without additional manual records. Document the workbook version, the publication date, and the access date for every use. If you are using an API that returns the workbook version and publication reference in each response, retain those response logs.
7. Document the calculation methodology in a format an external assurer can follow Limited assurance means an external assurer will review your disclosures and look for material misstatements. They will want to trace your emission figures back to a source, follow the calculation steps, and confirm the factors used match the authoritative workbook for the reporting period. Write the methodology down: which sources are included, which factors are applied, how consumption data flows from operational systems into the calculation, and how the final figures are derived. This document does not need to be long, but it needs to exist and it needs to be accurate.
8. Assess whether Scope 3 is material for your entity AASB S2 requires Scope 3 disclosure if it is material to the entity. It is encouraged for Group 2 entities in Year 1 but not mandated unless materiality applies. Conduct a formal materiality assessment across the standard Scope 3 categories (purchased goods and services, business travel, employee commuting, use of sold products, and so on) and document the outcome. If your entity's Scope 3 emissions are immaterial relative to Scope 1 and 2, document why and retain that assessment.
9. Align your disclosures with the TCFD structure AASB S2 is aligned with ISSB IFRS S2 and the TCFD framework. Disclosures are expected to cover four areas: governance (how the board and management oversee climate risks and opportunities), strategy (how climate risks and opportunities affect the entity's business model and planning), risk management (how the entity identifies, assesses, and manages climate risks), and metrics and targets (including Scope 1 and Scope 2 quantitative emissions data). Mapping your draft disclosure to these four pillars before finalising it will identify gaps early.
10. Engage your assurance provider before the period ends, not after Limited assurance is required from Year 1 for Group 2 entities. Engaging an assurance provider before the reporting period closes means they can review your data collection methodology, flag any gaps in the audit trail, and give you time to address them before the report is finalised. Waiting until the report is drafted and then handing it to an assurer under time pressure is the pattern that results in qualified conclusions. The assurance conversation should start now, not when the deadline is visible.

What an API gives you that a spreadsheet does not

A spreadsheet can hold the NGA Factor numbers, but it cannot prove which version it came from, when it was accessed, or whether the same version was applied consistently across all facilities throughout the year. The Tech Compass AU Climate API delivers DCCEEW NGA Factors via a REST endpoint at /v1/au/climate/nga-factors, and every response includes the publication_reference, workbook_version, and a request_id in the data_lineage block. Those fields are exactly what an assurer needs to trace a calculation back to its source without relying on someone's memory of which file they downloaded six months ago. Full schema and response examples are in the Climate API reference.