FCA proposed, via the consultation paper CP20/12, to postpone by one year the mandatory European Single Electronic Format (ESEF) requirements for annual financial reporting under the Transparency Directive. FCA issued this proposal in response to the COVID-19 crisis. The ESEF initiative aims to enhance the transparency of financial data disclosed by issuers whose transferable securities are admitted to trading on EU regulated markets. FCA is requesting comments until August 28, 2020.
The consultation includes the following proposals:
- The requirement for all issuers to publish their annual financial reports in XHTML web browser format, replacing the current PDF format, would be pushed back to financial years starting on or after January 01, 2021, for publication from January 01, 2022.
- The requirement for issuers that prepare consolidated annual financial statements in accordance with IFRS to tag basic financial information would be pushed back to financial years starting on or after January 01, 2021, for publication from January 01, 2022.
- The requirement for issuers that prepare IFRS consolidated annual financial statements to tag notes to the financial statements would be pushed back to financial years starting on or after January 01, 2023, for publication from January 01, 2024.
The rules implementing the ESEF requirements are already in place. Issuers must publish their annual financial reports in the ESEF format from the start of 2021 for financial years beginning on or after January 01, 2020. To meet these requirements, issuers will need to devote potentially significant management and operational time, especially in the second half of this year. Due to the impact of COVID-19 crisis on issuers, and in line with the other recent actions of FCA to relieve burdens on issuers, the proposed changes to the ESEF application timetable will allow issuers to focus on their more immediate and significant priorities. Issuers will, however, be able to publish and file their annual financial reports voluntarily in the new ESEF if they choose to do so.
Comment Due Date: August 28, 2020
Keywords: Europe, UK, Banking, Securities, Reporting, ESEF, IFRS, COVID-19, CP20/12, FCA
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