ASRS assurance & audit: what report preparers need to know
The Australian Sustainability Reporting Standards (ASRS) are raising the bar on climate disclosures. Under the new regime, emissions data no longer sits in the sustainability corner as a "non-financial" metric. It’s now a formal financial disclosure, governed by AASB S2 and subject to assurance, with the expectation of reasonable assurance by 2030.
For CFOs and sustainability leaders, this has real implications. The transition from voluntary reporting to auditable statements demands stronger systems, clearer governance, and tighter integration between sustainability and finance.
Here’s what you need to know to be ready.
What limited and reasonable assurance mean
ASRS outlines a phased approach to assurance. Initially, emissions and climate disclosures will require limited assurance, progressing to reasonable assurance over time. These terms aren’t interchangeable. They reflect very different levels of scrutiny.
Limited assurance
Limited assurance is a lower level of engagement. It typically involves inquiry and analytical review to confirm that nothing has come to the auditor’s attention that suggests the information is materially misstated. It's lighter touch, based on plausibility checks and high-level analysis.
For organisations early in their sustainability journey, limited assurance may not feel too disruptive. But it still requires clear documentation, traceable data, and some form of internal review process.
Reasonable assurance
Reasonable assurance is a higher standard. This level mirrors what’s expected in a financial audit. It requires the assurance provider to obtain sufficient and appropriate evidence to conclude whether the data is free from material misstatement.
This involves testing internal controls, verifying source data, evaluating methodologies, and assessing management’s assumptions. If your reporting processes are informal, undocumented, or dependent on manual calculations, achieving reasonable assurance will be a serious challenge.
Why you need internal controls now
Sustainability reporting can no longer operate in parallel to financial reporting. It needs to be integrated into the same governance and control frameworks that support your financial statements.
One of the first things to get right is data ownership. Finance and sustainability teams must jointly agree who is responsible for what. This includes who collects data, who reviews and signs off on it, and how changes are tracked.
Proving the completeness of Scope 1-3 data is an often overlooked but essential task for a successful audit. You may think you’ve sourced your electricity bills to calculate Scope 2, but how do you know you have sourced all of them without reconciling them against your audited financials? How can you verify that the excel file with your fuel spend from your fuel card supplier actually includes all the fuel they’ve sold you?
Equally important is data traceability. You must be able to explain where the numbers came from, especially when dealing with Scope 3. If you're relying on spend-based estimates, supplier inputs or extrapolated data, all assumptions and emission factors need to be documented and justifiable.
Controls around spreadsheets also need a rethink. Are calculations protected against tampering? Are version histories maintained? Do you have review points built into your reporting cycle? These questions matter now — not just during assurance, but in building confidence across your leadership team.
Embedding sustainability into your existing financial risk and control environment is the logical next step. It ensures consistency, auditability, and ultimately, credibility.
How technology and experts support audit readiness
Preparing for assurance means shifting from ad hoc processes to structured, repeatable systems. That’s where technology becomes essential.
Carbon accounting platforms like Avarni offer the audit trail, permissions control, and data transparency that spreadsheets can’t deliver. These tools track how every number is calculated, which emission factors were used, when data was updated, and by whom. That’s exactly the type of evidence assurance providers will ask for.
Technology can also streamline data collection, reduce manual handling, and flag outliers — all of which reduce the risk of misstatement.
But audit readiness isn’t just about having the right platform. It’s also about having robust methodologies in place, especially when dealing with estimates or incomplete data. Consultants and assurance specialists can help bridge this gap, providing independent reviews, stress-testing assumptions, and documenting your approach in line with ASRS requirements.
Waiting until assurance is mandatory means you’ll be playing catch-up under pressure. Getting support now gives you time to build defensible processes and avoid costly rework later.
Why this is a CFO issue
ASRS and AASB S2 make one thing clear: emissions and climate disclosures are now financial disclosures. That means the CFO, not just the sustainability team, needs to be across the numbers.
This isn’t just about compliance. It’s about risk. Investors, boards, and regulators will be relying on these disclosures to assess exposure to climate-related financial risks. Inaccurate data or weak controls could lead to reputational damage, regulatory breaches, or even liability.
The CFO is already the natural owner of governance, assurance, and financial reporting. Bringing sustainability into that fold is the next logical and necessary step.
Summary
- ASRS introduces limited assurance now, progressing to reasonable assurance by 2030, increasing scrutiny of climate disclosures
- Limited assurance is a lighter review; reasonable assurance involves evidence gathering, testing, and audit-style verification
- Strong internal controls, data traceability, and defined ownership are essential for defensible reporting
- Carbon accounting platforms and consultants support audit readiness with traceability, automation, and expert guidance
- Emissions data under ASRS is a financial disclosure, requiring CFO oversight and integration into financial governance systems
