The period from December 2025 to January 2026 has seen several important developments across Australia’s accounting, taxation, and audit landscape. Regulatory updates, enhanced reporting standards, and a stronger focus on transparency continue to shape how firms operate and how businesses meet their compliance obligations.
The following summary highlights key regulatory, taxation, and audit-related changes that accounting professionals and firms should be aware of as they plan for the year ahead.
Key Developments in Australia’s Accounting, Taxation, and Audit Industry (Dec 2025 – Jan 2026)
1. Accounting & Corporate Reporting
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Sustainability Reporting: The International Sustainability Standards Board (ISSB) finalized amendments to IFRS S2 greenhouse gas emissions disclosures in December 2025. Australian firms preparing their first sustainability reports are encouraged to adopt these early, as they directly impact climate-related financial disclosures.
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ASIC Oversight: ASIC reaffirmed its financial reporting and audit focus areas for FY 2025–26, emphasizing revenue recognition, asset valuation, and provision estimates. These areas require significant judgment and remain under close surveillance to ensure integrity in reporting.
2. Taxation Updates
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Corporate Tax: Collective investment vehicles will now be required to complete annual Reportable Tax Position (RTP) schedules, tightening compliance obligations.
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Legislative Changes: Andersen Australia reported the Treasury Laws Amendment (Strengthening Financial Systems and Other Measures) Bill 2025, which introduced reforms aimed at bolstering financial resilience and transparency.
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Holiday Home Deductions: The ATO released new draft rules targeting owners of holiday homes who claim deductions despite primarily using properties for personal holidays. This move is expected to reduce misuse of tax benefits.
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End-of-Year Benefits: Guidance was issued on FBT and tax considerations for parties and gifts, reminding firms to balance employee appreciation with compliance.
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Red Tape Reduction: The Tax Institute continued its push to simplify tax processes, aiming to reduce administrative burdens for practitioners and clients.
3. Audit Industry Developments
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ANAO Initiatives: The Australian National Audit Office (ANAO) announced that from January 2026, it will trial shorter performance audit reports to deliver findings to Parliament more quickly. This is part of a broader effort to modernize audit practices.
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Performance Statements Audits: Work is underway to refine audits of performance statements across 21 government entities, signaling a stronger emphasis on accountability in the public sector.
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ASIC’s Audit Focus: ASIC reiterated its surveillance programs, stressing the importance of accurate, complete, and informative audits. This aligns with global trends toward transparency and investor confidence.
4. Industry Impact & Outlook
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For Firms: These changes mean accountants and auditors must adapt quickly to sustainability reporting standards and ensure compliance with evolving tax rules.
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For Clients: Businesses will face stricter scrutiny on deductions and reporting accuracy, but benefit from clearer guidance and potentially reduced red tape.
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For Regulators: The period marks a shift toward faster, more transparent audits and stronger oversight of financial reporting, aligning Australia with international best practices.
Together, these developments reflect a continued shift toward greater transparency, accountability, and efficiency across Australia’s accounting, taxation, and audit ecosystem. As sustainability reporting becomes more prominent and regulatory oversight intensifies, firms that stay informed and proactive will be better positioned to manage compliance, support clients effectively, and adapt to ongoing industry change.
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Soundera Pandian Selvaraj, One Business Services Team
