The Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investments Commission (ASIC) proposed on June 16, 2026, trimming three categories of reporting obligations under the Financial Accountability Regime (FAR). The changes would affect every accountable entity in the system and approximately 4,500 accountable persons, with the regime’s core accountability framework remaining in place.
The proposals were released under the federal government’s Better Regulation reforms, announced in the 2026-27 Budget as part of a broader effort to reduce compliance obligations across the financial services sector. The most operationally consequential of the three changes concerns accountability maps. Under the proposal, entities would no longer need to include details about the direct reports of accountable persons in those maps. APRA and ASIC said this change alone would cut by at least half the number of map updates that entities are currently required to lodge. Institutions that manage frequent personnel changes among their accountable persons would see the largest reduction in update frequency.
The two remaining changes would remove key functions requirements from FAR regulator rules and raise the materiality threshold at which entities must notify regulators of changes to accountability arrangements. APRA member Therese McCarthy Hockey said the proposals preserve the intent of the regime. “The changes announced today get the balance right, ensuring the benefits of clarified accountabilities are retained in a proportionate way while allowing entities to get on with running their businesses," McCarthy Hockey said.
For insurers and other financial services firms that hold Australian financial services licences, ASIC will separately reduce what FAR entities must submit to demonstrate responsible manager competence. From October 2026, the requirement to provide evidence of competence will be reduced. ASIC said approximately 2,000 current AFS licensees would be affected by the change. Under current arrangements, responsible managers at AFS licensees – including those at APRA-regulated insurers – must submit documentation establishing their competence to ASIC. The October 2026 change would scale back that submission requirement for entities already captured by FAR. ASIC commissioner Kate O’Rourke tied the move to a longer-running effort within the regulator. “Through our simplification work, we are focused on reducing regulatory burden while maintaining consumer protections, and that is what these reforms achieve,” O’Rourke said.
The proposed regulatory changes sit alongside planned legislative amendments to the FAR itself. Under the government’s Better Regulation agenda, the legislation would be revised so that entities supply accountability statements and maps on request rather than upfront. Entities would also receive more time to register their accountable persons, easing pressure on compliance teams managing turnover or internal restructures.
The FAR measures also form part of a wider coordination effort through the Council of Financial Regulators (CFR) – the body that brings together Australia’s main financial regulators to coordinate policy and reduce duplication across the regulatory system. The council has assembled a broader package of actions to reduce compliance obligations and improve how regulators collect, share, and use data, of which the FAR changes form one part. Both APRA and ASIC said consultation on the proposed FAR changes would proceed with a view to finalising them before the end of 2026.
On the same date, APRA released an updated draft of Prudential Standard CPS 510 Governance for consultation, the final step in a governance review across banking, superannuation, and insurance that the regulator first opened in March 2025. One of the central proposals under the revised CPS 510 is the removal of routine fit and proper reporting that has become redundant now that FAR reporting is in place. If adopted, approximately 6,000 individuals would no longer be subject to those form submission obligations – a change that, combined with the FAR measures, would represent a reduction in the volume of individual-level reporting that regulated entities must manage.
General insurers, life insurers, and private health insurers regulated by APRA fall within the FAR and are also subject to CPS 510, meaning both workstreams carry direct compliance implications for the sector. The August 2026 deadline for submitting feedback on the draft CPS 510 is the next immediate milestone for insurers, followed by a final standard expected in late 2026 and new requirements scheduled to take effect from early 2028.
