On the Path to an European Single Electronic Format ESMA Consultation for the IFRS Taxonomy of Structured Electronic Reporting

Abstract

Manuscript Type: TheoreticalMain Focus: At European level signs become more obvious that structured electronic reporting using XBRL (eXtensible Business Reporting Language) will be part of a future European single electronic standards for financial reporting (ESEF). This ESEF is planned to be build on the IFRS Taxonomy. The European Securities and Markets Authority (ESMA) has begun to implement rules that were included in the new EU Transparency Directive, 2013. Background of the consultation of ESMA, the amended provisions of the Transparency Directive, according to which with effect from 1 January 2020, all annual financial reports to be created in a common electronic reporting format (European Single Electronic Format (ESEF)). To this end, ESMA should submit to the European Commission not later than 31 December 2016 draft regulatory technical standards to define the electronic loading reporting format, taking into account existing and future technology options. The regulations aimed at facilitating submissions for issuers, and the filed Information for investors and regulators to improve access to and thus also to enable better analysis and peer comparisons. This article analyzes the 110 commentaries to ESMA release paper.Results: The evaluation of the commentaries has shown that the majority of commentators the ESMA proposals support the implementation of the ESEF. A small number reject the proposals completely or is against certain aspects to ESEF. Critics of the proposed ESEF can be summarized in three categories. The first group rejects completely all proposals. Striking on this commentaries is that the text of the comments is semantically completely identical. All of these comments came from one geographical area. From this it can be concluded that the content of the comments has been agreed in advance by the companies, which can be traced back to a pooling of common interests. Although the consultation process represent a transparent proven process to public participation, so this result shows that this kind of consultation process not protected from a political-driven participation of interests. The second group consist essentially of stakeholders: regulators, IT companies, standard-setters and auditors who in general support the proposals. However, a majority of the second Grupen rejects company-specific elements which are also called common practice elements. A third group rejects the majority of proposals, but no identical semantic comments are detectable. Usually, the public consultation process has the task to disclose divergent opinions and interests and to initiate a competition. This that more than half of the commentary contains the exact same comment text, this goal is not reached. This raises the question whether ESMA should assess these commentaries in their final assessment as one comment.