APRA FAR does not require you to have perfect AI governance. It requires you to have evidence you took reasonable steps. Those are different documents. An issued, independent record of how a company governs its AI is one form that evidence takes; this page sets out where AI enters the regime and what the evidence looks like.
01 · What the FAR requires
The Financial Accountability Regime imposes a strengthened responsibility and accountability framework on APRA-regulated entities, their directors and their most senior executives. It is established by the Financial Accountability Regime Act 2023, replaces the Banking Executive Accountability Regime, and is jointly administered by APRA and ASIC. The Regulators publish the primary guidance at Financial Accountability Regime: information for accountable entities.
The regime's four core obligation sets cover accountability, key personnel, deferred remuneration and notification. The accountability obligations are where reasonable steps lives: an accountable person must conduct their responsibilities with honesty, integrity, and due skill, care and diligence, and must take reasonable steps to prevent matters arising that would adversely affect the entity's prudential standing or prudential reputation, or that would result in a material contravention of specified laws. Accountable entities owe parallel obligations, including taking reasonable steps to ensure each of their accountable persons meets theirs.
| Applies to | From |
|---|---|
| Authorised deposit-taking institutions and their authorised non-operating holding companies | 15 March 2024 |
| Insurers, their licensed non-operating holding companies, and superannuation trustees | 15 March 2025 |
02 · Where AI enters
The FAR names no technology. It requires that accountable persons' responsibilities collectively cover all areas of the entity's operations, and it attaches the reasonable-steps obligations to the conduct of those responsibilities. Where AI systems operate inside an accountable person's area, the obligations extend to how those systems are governed, because the regime attaches to the responsibility, not to the tool.
The regime's own register architecture points the same way. The Regulator rules prescribe key functions for the FAR register, and the prescribed ADI key functions include technology management, covering technology strategy, lifecycle management and information security, as well as data management and operational risk management. AI systems in production sit inside exactly these functions. Reading AI into the FAR through them is kn0w's reading of the regime's structure, not a statement by the Regulators.
The Regulators' supervisory attention on AI under the existing framework is a matter of record. APRA's letter to industry of 30 April 2026 sets out its observations and minimum expectations on AI risk. The letter is not a FAR instrument and does not reference the regime; what it demonstrates is that AI risk sits inside the supervision entities already answer to. What the letter expects is set out at What does APRA's AI letter to industry expect?.
03 · The evidence layer
Reasonable steps is judged after the fact, on the record that exists. A privacy policy names a disclosure; an org chart names a person; neither shows what AI is running, who is accountable for it, what oversight applies, or what was spent and measured. That record is a separate document, and it is the document an accountable person will want on file before anyone asks for it.
An AI Accountability Audit produces that record independently of the company. It examines what AI is in production across each function, who is accountable, what governance and oversight applies, what is invested and what is tracked, and issues the result as a signed Statement benchmarked against a peer cohort. The full methodology is published at kn0w.co/methodology.
04 · Two different statements
The FAR requires accountable entities subject to enhanced notification obligations to prepare accountability statements for accountable persons and provide them to the Regulators. That instrument shares a word with the Statement kn0w issues. They are different documents.
| FAR accountability statement | Issued kn0w Statement | |
|---|---|---|
| Prepared by | The accountable entity, with the accountable person closely involved | kn0w, as independent Issuer |
| Describes | The parts of the entity's operations for which an accountable person is accountable, and their responsibilities | How the company adopts and governs AI, across six dimensions |
| Required of | Enhanced entities only, above asset thresholds set in the Minister rules | No one. It is commissioned |
| Signed or authenticated by | The accountable person, declaring the content accurate | The kn0w hallmark, timestamp and four-part identifier |
| Provided to | The Regulators, under the FAR | The company, which may submit it to a board, a regulator or a counterparty |
A company subject to the FAR may hold both. One is a filing the regime requires; the other is evidence the entity chooses to hold. A sample of the issued Statement is available at kn0w.co/sample-statement.
05 · Frequently asked questions
No. The regime is technology-neutral. Its obligations attach to accountable persons' areas of responsibility, whatever operates inside them.
Authorised deposit-taking institutions and their authorised non-operating holding companies from 15 March 2024, and insurers, their licensed non-operating holding companies and superannuation trustees from 15 March 2025. The regime is jointly administered by APRA and ASIC.
No. APRA's 30 April 2026 letter to industry sets out expectations on AI risk under the existing prudential framework, and is not a FAR instrument. No new prudential standard has been introduced.
No. It requires accountable persons to take reasonable steps, and reasonable steps is demonstrated by evidence. An independent audit is one way an entity produces that evidence before it is asked for. A first read of where a company stands is available at the AI Accountability Gap.
The Regulators' joint information paper and supporting materials are published at Financial Accountability Regime: information for accountable entities.
Published 24 August 2026. Verified against the Regulators' joint FAR information paper on 24 August 2026.