Strategic Plan 2025–26

The Financial Reporting Council (FRC) oversees the effectiveness of Australia’s financial reporting framework, standard setting processes for accounting and auditing standards and audit quality. It also supports alignment with international standards and regulatory developments to promote trust and transparency in financial reporting.

This strategic plan is intended to cover the FRC’s priorities for 2025 and 2026, recognising the Government’s intention to combine the FRC, the Australian Accounting Standards Board (AASB) and the Auditing and Assurance Standards Board (AUASB) into one body that it has proposed to be operational on or after 1 July 2026.

Purpose and objectives

The FRC operates under Part 12 of the Australian Securities and Investments Commission Act 2001 (ASIC Act). The FRC’s functions and powers are set out in section 225 of the ASIC Act. Broadly, the FRC is responsible for:

  • Providing oversight of the accounting and auditing standard-setting processes in Australia.
  • Monitoring and promoting audit quality to maintain confidence in financial reporting.
  • Advising the government on matters relating to accounting standards.
  • Advising the government on matters relating to auditing and accounting standards.
  • Supporting the effective implementation of Australian-specific sustainability standards and international alignment.
  • Engaging with stakeholders, including regulators and standard setters, to enhance governance and accountability.
  • Encouraging continuous improvement in financial reporting to meet the need of evolving domestic and international markets, and regulatory expectations.

Environmental analysis

Global Australia
  • There is a focus on mandating sustainability reporting.
  • The adoption of global sustainability standards will play a key role in shaping corporate accountability and investor confidence.
  • The global economy remains influenced by inflationary pressures, geopolitical uncertainties, and evolving investor expectations.
  • Regulatory reforms, including the proposed merger of oversight financial reporting bodies, require careful stakeholder engagement and implementation strategies.
  • Advancements in artificial intelligence (AI), blockchain, and data analytics are transforming financial reporting and auditing practices.
  • Australia is adapting to shifts in regulatory changes and advancements in AI and digital reporting.
  • International standard-setting bodies continue to refine and enhance financial reporting and audit requirements to promote transparency and trust.
  • Australian standard setters must proactively engage in international forums to ensure that global standards reflect domestic needs and regulatory objectives.

Strategic priorities

The FRC’s strategic priorities for 2025–26 focus on strengthening financial reporting, responding to regulatory and market developments, and enhancing international collaboration.

Strategic Priority Key Actions

Accounting, Auditing and Assurance Standards

  • Overseeing the development and implementation of Australian-specific standards:
    • Monitor the AASB and the AUASB to develop guidance and implement educational initiatives designed to enhance robustness and effectiveness in financial and sustainability reporting and assurance frameworks.
  • Encouraging and supporting continuous improvement in financial and sustainability reporting by promoting transparency and accountability:
    • Support the adoption of digital reporting.
  • Promoting alignment with IFRS1, IAASB2, IASB3, ISSB4 and other international standard setters to enhance consistency and comparability across jurisdictions:
    • Influence key international standard setters by demonstrating leadership in Australian financial and sustainability reporting frameworks and enhancing international relationships.

Strengthening Audit Quality
  • Supporting the AUASB to develop and implement guidance to enhance transparency and audit quality.
  • Promoting continuous improvements in audit quality.

Sustainability Standards
  • Supporting the adoption and integration of sustainability reporting standards.
  • Promoting international alignment to ensure comparability and consistency.

Regulatory Developments
  • Assisting in the facilitation of the proposed merger of financial reporting bodies in Australia, ensuring continued stakeholder engagement and a smooth transition to the new body.
  • Monitoring and responding to broader parliamentary inquiries impacting the audit and accounting professions, including evolving expectations on audit and assurance.

Stakeholder Engagement
  • Engaging with stakeholders, including regulators, organisations, and standard setters in Australia to discuss and obtain insights on current challenges, objectives and possible improvements in relation to the financial and sustainability reporting frameworks.
  • Influencing international standards and guidance by enhancing relationships with key international standard setters:  
    • Support the nomination of suitable Australian candidates for key international positions.
    • Encourage alignment between Australian-specific and international financial and sustainability reporting and assurance standards.

The FRC remains committed to upholding trust in financial reporting and audit quality while supporting government policy and responding to emerging challenges in the accounting and auditing professions. The FRC continues to promote confidence and best practices in financial governance in Australia through strategic oversight and proactive engagement with stakeholders. 

1 International Financial Reporting Standards
2 International Accounting and Assurance Standards Board
3 International Accounting Standards Board
4 International Sustainability Standards Board