ASIC has released revised guidance on climate change-related financial disclosures made in both offer documents and Annual Report Operating & Financial Reviews:
ASIC has updated its guidance to, amongst other things:
The updated ASIC RG’s follow recent joint guidance published by the Australian Accounting Standards Board and Auditing & Assurance Standards Board on the incorporation of climate-related financial risk assumptions into accounting estimate materiality assessments. That guide specifically calls out the need for report preparers and auditors to consider the materiality of climate risk assumptions on balance sheet items such as asset valuation, impairments and provisions.
Taken together, there is no doubt that mainstream investor, activist and regulatory focus will be on the adequacy of climate-related financial risk disclosures in FY20.
Our guide, Our guide, 'Are your finance and governance teams ready? Heightened expectations on climate risk governance and disclosure', analyses these, and other, developments in the climate risk governance, risk management and disclosure space, including: