Featured Product

    ESMA to Assess German Reporting System Post Wirecard Collapse

    July 15, 2020

    ESMA is to launch an assessment of the supervisory response in the financial reporting area by BaFin and the Financial Reporting Enforcement Panel (FREP) to the events leading to the collapse of Wirecard AG. The assessment will be completed by October 30, 2020. The assessment will focus on the application of the Guidelines on the Enforcement of Financial Information (GLEFI) by BaFin and FREP, which are the designated competent authorities for the supervision and enforcement of financial information in Germany under the Transparency Directive. The fast-track assessment will be conducted using GLEFI and the peer review methodology of ESMA, within a compressed timeframe. This announcement follows the June 25 EC letter, which invited ESMA to conduct a fact-finding analysis of the events leading up to the collapse of Wirecard AG.

    ESMA issued the GLEFI in 2014, on its own initiative, to promote consistent application and supervision of IFRS and in 2017. In support of this work, ESMA conducted a peer review with onsite visits in seven member states. The review focused on three GLEFI guidelines: guideline on human and financial resources, guideline on selection methods, and guideline on examination procedures. The review identified significant differences in national approaches, resources allocated, and actions taken in relation to enforcement of financial information. The review included BaFin and FREP and, while the country-specific report highlighted positive aspects of the German enforcement model, it also identified areas for improvement. These included:

    • Procedures in place in both FREP and BaFin
    • Selection and examination of issuers
    • Independence and conflict of interests in FREP
    • Cooperation between the two authorities

    ESMA also invited BaFin and EC, in the country-specific onsite report, to investigate whether the Transparency Directive is correctly transposed in Germany, given BaFin’s self-declared inability to comply with the GLEFI due to a lack of enforcement powers. The peer review tool has been chosen, as the Transparency Directive only contains high-level principles regarding financial reporting and its supervision and the IAS regulation is not included in the list of acts for which ESMA may launch a Breach of Union Law investigation.

     

    Related Links

    Keywords: Europe, EU, Germany, Banking, Securities, Wirecard, Reporting, FREP, GLEFI, Transparency Directive, IFRS, BaFin, ESMA

    Featured Experts
    Related Articles
    News

    EBA Sets Out Work Priorities and Deliverables for 2021

    EBA published its annual work program for 2021. The work program describes the activities and deliverables for the coming year in the context of the six key strategic areas of work.

    September 30, 2020 WebPage Regulatory News
    News

    PRA Proposes to Amend SS11/13 on Internal Ratings-Based Approaches

    PRA is proposing, via the consultation paper CP14/20, to introduce two complementary expectations on the level of mortgage risk-weights in UK for banks applying the internal ratings-based approaches.

    September 30, 2020 WebPage Regulatory News
    News

    ECB Confirms Compliance of €STR with Financial Benchmark Principles

    ECB published its statement of compliance with the IOSCO principles for financial benchmarks developed by IOSCO.

    September 30, 2020 WebPage Regulatory News
    News

    OSFI Updates Timelines for Implementation of IFRS 17

    OSFI updated the timelines for implementation of IFRS 17 on insurance contracts.

    September 30, 2020 WebPage Regulatory News
    News

    IFRS Consults on Global Approach to Sustainability Reporting

    IFRS launched a consultation to assess the demand for global sustainability standards.

    September 30, 2020 WebPage Regulatory News
    News

    EIOPA Sets Out Work Priorities for 2021-2023

    EIOPA has set out the work priorities for 2021-2023, taking into account the current market situation in light of the COVID-19 pandemic.

    September 30, 2020 WebPage Regulatory News
    News

    US Agencies Finalize Three Interim Final Rules Issued Amid Pandemic

    US Agencies (FDIC, FED, and OCC) finalized three interim final rules that were published in March and April this year to ease the impact of disruptions caused by the COVID-19 pandemic.

    September 30, 2020 WebPage Regulatory News
    News

    US Agencies Finalize Interim Final Rules Issued Amid Pandemic

    US Agencies (FDIC, FED, and OCC) finalized two rules, which are either identical or substantially similar to the interim final rules in effect and issued earlier this year.

    September 29, 2020 WebPage Regulatory News
    News

    APRA Proposes to Increase Transparency of Banking Data

    APRA announced that it is resuming consultation on the confidentiality of data submitted to APRA by the authorized deposit-taking institutions.

    September 29, 2020 WebPage Regulatory News
    News

    EIOPA Consults on Use of Risk Mitigation Techniques Under Solvency II

    EIOPA is consulting on a supervisory statement on the use of risk mitigation techniques by insurance and reinsurance undertakings.

    September 29, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5873