25 January 2021

European Single Electronic Format (ESEF) – collected guidance Reporting & assurance

This page gathers key publications and guidance available for ESEF reporting and assurance, and tracks the implementation by EU Member States. We will update this regularly reflecting new developments (latest update : 26 February 2021).

Stay posted on our updates by signing up to our audit & assurance news. For more information, or if you want to alert us to another source, contact Harun Saki at [email protected]

Update: Member State option for delaying ESEF implementation

According to the Article 4 of the Transparency Directive, issuers of the European Union (EU) regulated markets shall make their 2020 annual financial reports public before 30 April 2021. 2020 would have been the first-year implementation of the ESEF requirements. This was implemented to make reporting easier for issuers and to facilitate accessibility, analysis and comparability of the financial information.

Requests for a one-year delay to the implementation of ESEF have emerged, especially after the development of the global Covid-19 pandemic. On 11 December 2020, the European Parliament (EP) and Council agreed to an amendment of the Transparency Directive granting EU member states (MS) an option to delay by one year the application of the ESEF requirements.

The amendment was published in the EU Official Journal on 16 February 2021. It approves the Recovery Prospectus compromise and the delay of ESEF. The Article 2 declares that “Member State may allow issuers to apply [ESEF] for financial years beginning on or after 1 January 2021, provided that Member State notifies the Commission of its intention to allow such a delay by 19 March 2021, and that its intention is duly justified.”

As of today, the following MS have already notified the EC of their intention to postpone ESEF by one year:

  • Belgium
  • Bulgaria
  • Croatia
  • Cyprus
  • Denmark
  • France
  • Greece
  • Hungary
  • Ireland
  • Lithuania
  • Luxembourg
  • Malta
  • Netherlands
  • Portugal
  • Romania
  • Slovakia
  • Spain

In addition, the following countries declared their intention to delay ESEF and are expected to notify the EC shortly. In all member states, companies willing to prepare their 2020 AFR in compliance with ESEF will be able to do so.

Finally, based on information we received, Austria and Germany will most likely not delay the implementation of ESEF.

We are glad to observe that national authorities are taking transitional measures to clarify the situation for issuers while waiting for a formal and definitive decision. Those measures greatly help issuers in their preparation of 2020 annual financial reports.

What is the European Single Electronic Format (ESEF)?

The Transparency Directive was amended in 2013 in order to make reporting easier for issuers and to facilitate accessibility, analysis and comparability of the financial information. The Directive sets rules on harmonisation of transparency requirements for listed companies in European Union (EU) regulated markets. The amendment included, amongst others, a new requirement for issuers to prepare their annual financial reports (AFRs) in a single electronic reporting format starting from 2020 AFRs.

The European Securities Markets Authority (ESMA) was assigned the responsibility to develop the technical standards for European Single Electronic Format (ESEF) and the eXtensible Business Reporting Language (XBRL) tags and inline XBRL (iXBRL) technology were chosen as the basis. This technology has already been used for various reporting purposes in many countries such as Denmark, India, Japan, the  Netherlands, South Africa, the UK and the US. With ESEF, consolidated financial statements included in AFRs will be both human- and machine-readable.

In February 2019, Accountancy Europe published the factsheet ESEF – Digitalising EU listed companies’ financial information that provides an overview of the ESEF requirements, including practical advice for preparers of financial information.

As noted by Alain Deckers from the European Commission (EC) DG FISMA in this Accountancy Europe podcast:  The European Commission’s take on ESEFESEF should be considered as part of a broader strategy towards digitisation of capital markets information in the EU.

ESEF Reporting

In 2019, ESMA developed ESEF Regulatory Technical Standards (RTS) that include the ESEF taxonomy (based on the IFRS taxonomy) and related requirements for the issuers. To promote a harmonised and consistent ESEF implementation, ESMA published on its website other useful material, including:

In addition, ESMA regularly updates the ESEF taxonomy to align with the latest available version of the IFRS Taxonomy. ESMA released the 2020 taxonomy files in December 2020.

XBRL Europe has also a dedicated ESEF Hub that includes educational materials and tools for preparing and reading ESEF reports.

ESEF Assurance

As intended users will make decisions based on digital financial information provided in ESEF-compliant AFRs, the EC considered the need for assurance on their reliability.

In May 2019, EC DG FISMA issued a Q&A document on ESEF which clearly stated that ESEF RTS provisions shall be considered as “statutory requirements” within the meaning of Article 28(2)(c)(ii) of the Audit Directive. Accordingly, the statutory auditors shall opine on whether the digitised consolidated financial statements are prepared in accordance with ESEF RTS.

The EC asked the Committee of European Auditing Oversight Bodies (CEAOB) to explore how this could be done in practice with a view to possibly provide guidance to the market. In November 2019, the CEAOB issued the guidelines on auditor’s involvement.

Accountancy Europe and the European Contact Group (ECG) released their publication on ESEF Assurance in December 2019 as a contribution to ESEF implementation efforts at EU member state level. This paper sets out specific considerations along with practical implications that may assist auditors providing ESEF assurance.

Implementation status in the EU member states

On 12 October 2020, Accountancy Europe hosted a webinar on ESEF. The scope of the debate covered the opportunities, challenges and practical considerations about ESEF reporting and assurance. Our objective was to support national efforts and contribute to an efficient and effective ESEF implementation.

There continue to be some uncertainties about ESEF implementation at national level and the EC issued an Interpretative Communication on ESEF in November 2020 to provide clarifications on:
audit opinion on compliance with ESEF

  • use of e-signature by issuers and statutory auditors
  • issuers’ responsibility for drawing-up and disclosing the ESEF-compliant AFRs
  • other EU Obligations for limited liability companies laid down in the Accounting Directive
  • requirement for officially appointed mechanisms (OAMs) to disseminate the ESEF-compliant AFRs

Partly due to these uncertainties and largely to the coronavirus’ implications, some companies could not get ready for reporting in ESEF. There was a call to EU authorities for delaying the ESEF requirements for one year.

In November 2020, the Council of the EU adopted its position and noted that EU member states should be allowed to postpone the application of ESEF requirements by one year. On 11 December 2020, The European Parliament and the Council agreed to an amendment of the Transparency Directive allowing EU member states to delay by one year the application of the ESEF requirements. Member states shall notify the Commission of their intention to do so along with their sufficiently justified reasons. Companies who wish to publish their 2020 AFRs in ESEF will still be able to do so.

We will be monitoring ESEF implementation at EU member states and regularly updating this page to reflect the implementation status.

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