Corporate Disclosure

On Tuesday 6 June 2017, ESMA will hold a workshop on the European Single Electronic Format.  This workshop is organised in the context of Eurofiling XBRL week and is open to the interested public, free of charge.

The European Securities and Markets Authority (ESMA) is drafting a regulatory technical standard (RTS) specifying an European Single Electronic Format (ESEF) in which annual financial reports have to be prepared. ESMA published in December 2016 a Feedback Statement on its consultation that sets out the general approach and is currently working on the detailed technical specifications.

In this context, the objective of the workshop is to inform participants about the current considerations regarding the detailed technical specifications as well as to provide them with an opportunity to comment on the working draft of the regulatory extension taxonomy and the filing rules.

Target audience

This workshop is addressed to financial reporting and IT experts from filers, regulators, consulting and software firms. Considering the technical nature of the content, participants should have knowledge in XBRL/Inline XBRL.

Registration and further information

Eurofiling XBRL week is taking place in the ECB headquarters in Frankfurt. Full details are available in the Invitation, and interested parties can register at Registration is open until 26 May, however please note that the capacity of the meeting room is limited and ESMA therefore cannot guarantee participation.

The European Securities and Markets Authority (ESMA) has published its annual report on the enforcement and regulatory activities of accounting enforcers within the European Union (EU) in 2016.

ESMA, in 2016, continued strengthening supervisory convergence in the area of financial reporting, to improve the consistency and quality across the EU. ESMA achieves this through coordinating the national enforcers’ decisions, publishing annual enforcement priorities and publishing statements on areas of focus such as the implementation of the new standards IFRS 9 and IFRS 15.

The assessment of compliance with the 2015 European Common Enforcement Priorities was based on the examinations of the financial statements of 206 listed issuers. The examination resulted in enforcement actions against 43 (21%) issuers with shortcomings related to the:

  • disclosure of the assumptions and judgements made by management in relation to the potential risk exposure of the issuer due to the impact of financial market conditions; and
  • correct classification in the statement of cash flows and the need to include all relevant information.

Steven Maijoor, Chair, said:

“Following the implementation of ESMA’s Guidelines on Enforcement of Financial Information we have seen a significant alignment of supervisory procedures. ESMA is also currently carrying out a peer review to identify how supervisory convergence of European accounting enforcement can be further strengthened.

“The 2016 enforcement priorities include disclosures of the expected impact of new reporting standards that are not yet applicable. ESMA urges issuers to provide sufficient information on the consequences that the application of the new IFRS 9 and IFRS 15 standards will have on the financial position and performance of the entity.”

Overall, national enforcers reviewed the interim or annual financial statements of 1,258 issuers, representing approximately 21% of issuers of securities listed on EU regulated markets, which led to actions against 311 (25%) of those issuers examined. This constitutes an increase of about 10% compared to the year before. The areas where most infringements were identified by European enforcers related to:

  • presentation of financial statements;
  • accounting for financial instruments; and
  • impairment of non-financial assets.

These three areas represent more than 40% of all the issues addressed by enforcement actions taken by European enforcers in 2016.

Next steps

In 2017 accounting enforcers will review issuers’ compliance with IFRS in line with the common enforcement priorities for 2016, focusing on the presentation of financial performance, the distinction between equity instruments and financial liabilities and disclosures of the impact of the new standards issues by the IASB. ESMA also urges issuers to provide disclosures on their exposure to risks arising from the UK’s decision to leave the EU.

Enforcement and Regulatory Activities of Accounting Enforcers in 2016

The report provides an overview of the activities of the European Securities and Markets Authority (ESMA) and the accounting enforcers in the European Economic Area (EEA), hereafter ‘European enforcers’, when examining compliance of financial information provided by issuers with IFRS in 2016. It also provides an overview of the main activities performed at European level, quantitative information on enforcement activities in Europe as well as ESMA’s contribution to the development of the single rulebook in the area of financial reporting.

The European Securities and Markets Authority (ESMA) has published a Practical Guide to national rules across the European Economic Area (EEA) on major holdings notifications under the Transparency Directive to help market participants navigate the different requirements.

The Transparency Directive requires investors to notify issuers when they acquire or dispose of shares admitted to trading on regulated markets, resulting in their total voting rights crossing certain set thresholds. As a minimum harmonisation directive, the Transparency Directive allows EEA countries some discretion as to how they transpose the rules into national law. Therefore, ESMA has prepared this Practical Guide, in close cooperation with national regulators, to help market participants identify their notification obligations under national law in accordance with the Transparency Directive.

The first part of the Practical Guide contains a fact sheet for each EEA country (with the exception of Lichtenstein) setting out the national requirements in relation to notification of major holdings along with links to the relevant websites. The second part presents information on rules and practices in a series of tables, enabling market participants to compare rules across different jurisdictions.

ESMA has created the Practical Guide based on information provided by national regulators and market participants should address any queries regarding specific content directly to the relevant regulator of the country concerned.

ESMA will update the Practical Guide on an ad hoc basis, based on changes to national rules and practices.