Your base year is the year you compare later years against. Set a recalculation policy at the same time. Then a change to your group or your method does not show up as a false increase or reduction.
Do you need a base year?
Under the GHG Protocol Corporate Standard (2004, chapter 5), a company that tracks emissions over time chooses a base year, reports it, and gives the reason for the choice.
AASB S2 does not require a base year unless you disclose targets. You disclose the targets you set. You also disclose any target that a law or regulation requires you to meet, such as a Safeguard Mechanism baseline (AASB S2 paragraph 33). Each target needs the base period it is measured from. For a target set by law, use the base period that the law sets.
Your AASB S2 comparative is the prior year as reported, and it moves every year (Appendix D paragraph 70). Your base year stays fixed. FY26 is Bluegum's second AASB S2 year. FY25, its first, is both its comparative and its base year. The two figures can still differ, as shown below.
How do you choose a base year?
Choose the earliest year for which you have reliable, verifiable data. State why you chose it.
Check that the year is complete. A base year that is missing a category makes every later comparison wrong.
Check that the year is representative, with no shutdown or other unusual event.
One base year for all scopes is simplest. The GHG Protocol allows a later base year for Scope 3 if you explain why.
Bluegum's base year is FY25 (1 July 2024 to 30 June 2025) for all three scopes. Total: 19,800 tCO2e.
FY25 was Bluegum's first AASB S2 year. Bluegum used the C4(b) relief and did not disclose FY25 Scope 3. It still measured Scope 3 for its own records, so FY25 Scope 3 was never assured. A base year that was not assured must still stand up to review once you disclose a target against it. If Bluegum discloses a target against FY25, expect its auditor to review the FY25 Scope 3 data.
What goes in a recalculation policy?
The Corporate Standard requires a recalculation policy. Each company sets its own significance threshold. The Corporate Standard makes no specific recommendation.
We recommend a threshold of 5% of base year emissions, measured cumulatively. The reason: at 5%, an acquisition or disposal cannot hide or invent more than about one year of reduction progress, and small changes do not force a recalculation every year.
"Cumulatively" means you add up the changes since you set the base year. If Trailhead had emitted 600 tCO2e (3.0% of 19,800), Bluegum would not recalculate in FY26. A later acquisition of 450 tCO2e would take the total to 1,050 tCO2e (5.3%), and Bluegum would then recalculate for both.
Apply the policy to increases and decreases alike.
When do you recalculate?
Change | Recalculate? |
Acquisition, disposal or merger of an operation that existed in the base year | Yes, if above the threshold |
Outsourcing or insourcing of an emitting activity | Yes, if above the threshold and it moves emissions between scopes that you track against separate base years, or into a scope you do not report |
Change of calculation method, or better data or a better emission factor | Yes, if above the threshold |
A corrected emission factor | Yes, if above the threshold. A correction is a change of method. |
A significant error, or several errors that together are significant | Yes |
Organic growth or decline, including opening or closing your own sites | No |
Acquiring or selling an operation that did not exist in the base year | No |
The annual update of an emission factor that reflects a real change, such as a cleaner grid | No |
The Victorian grid factor fell between FY25 and FY26 because the grid uses more renewable energy. That is a real change, so Bluegum does not recalculate. If Bluegum finds that FY25 used the wrong state's grid factor for Summit Packs, that is an error. Bluegum corrects it and tests it against the threshold.
Does the Trailhead acquisition trigger a recalculation?
Bluegum acquired Trailhead Rentals on 1 March 2026. Trailhead existed in FY25, so this is a structural change. Test Trailhead's full-year FY25 emissions against the base year.
tCO2e | Scope 1 | Scope 2 | Scope 3 | Total |
Bluegum FY25 base year, as first measured | 1,600 | 2,200 | 16,000 | 19,800 |
Trailhead, full year FY25 | 260 | 90 | 800 | 1,150 |
Bluegum FY25 base year, recalculated | 1,860 | 2,290 | 16,800 | 20,950 |
The test: 1,150 / 19,800 = 5.8%. With no earlier changes, the cumulative total is also 5.8%. That is above 5%, so Bluegum recalculates.
Recalculate for the whole year, not only for the months after the acquisition. The base year includes Trailhead's full 12 months of FY25.
What does the recalculation show?
Bluegum's reported FY26 inventory counts Trailhead from 1 March 2026 only. See Buying, selling or closing part of the business. To compare with the recalculated base year, the Corporate Standard says to use the full year in the current year as well.
Comparison | FY25 | FY26 | Change |
Without recalculation: reported FY26 (Trailhead for 4 months) against the original base year | 19,800 | 19,780 | Down 0.1% |
Like for like: FY26 with Trailhead for 12 months (19,400 + 1,130) against the recalculated base year | 20,950 | 20,530 | Down 2.0% |
Without the recalculation, the acquisition hides a 2.0% reduction.
The like-for-like figure is not an AASB S2 amount. If you publish it, label it as your own metric, explain how you built it, and keep it apart from your AASB S2 totals (Appendix D paragraphs 50 and 53).
If you cannot get the acquired business's base year data in the year of the change, recalculate in the following year.
Is a recalculated base year a restated comparative?
No. They are separate figures with separate rules. The base year comes from the GHG Protocol. The comparative comes from AASB S2.
AASB S2 comparative | GHG Protocol base year | |
What it is | Last year's figures as reported (Appendix D paragraph 70) | A fixed year that you track progress and targets against |
In your first AASB S2 year | Not required (C3) | Needed under AASB S2 only if you disclose a target |
Scope 3 after the C4(b) relief | Not required in your second year (C5) | Include Scope 3 if a target covers it |
Acquisition or disposal | No change. It stays as reported | Recalculate if the change is above your threshold |
Material error | Restate, unless impracticable (Appendix D paragraph 83) | Recalculate if the error is significant |
First use of the AASB S2025-1 relief | Adjust it if your measurement changes, unless impracticable (C6) | Test it as a change of method |
Bluegum's FY26 report shows FY25 Scope 1 and 2 as reported: 3,800 tCO2e (1,600 + 2,200). It does not show an FY25 Scope 3 comparative, because Bluegum used C4(b) in FY25 (C5). Bluegum shows the recalculated FY25 base year of 20,950 tCO2e separately, and labels it as recalculated.
What do you disclose?
The base year and why you chose it.
Your recalculation policy and threshold.
For each recalculation: what changed, why, and the effect on the base year.
The base year as first measured and as recalculated. Bluegum shows its FY25 base year at 19,800 tCO2e as first measured and at 20,950 tCO2e recalculated.
Your AASB S2 comparative as reported, apart from the base year.
Any target set by law, with the base period that the law sets.
What this means in Avarni
Set your base year under Forecasting as the Baseline Year. Enter the start date. The year runs twelve months from there. For Bluegum, the start date is 1 July 2024.
Avarni calculates the baseline total from the data in your Baseline Year each time it draws the chart. If you change base year data, your target trajectory moves with it. See Set a reduction target.
Trailhead's FY25 emissions are not in Bluegum's FY25 data in Avarni. The baseline in Forecasting stays at the original figure. Keep the recalculated base year and its workings in your boundary document. See What goes in your boundary document.
Avarni picks each emission factor by the activity date on the row. An annual factor update applies to the new year only, so your base year does not move. See Load historical and prior-year data.