The European Securities and Markets Authority (ESMA) has published an overview of its activities as well as the activities of accounting enforcers in the European Economic Area when examining compliance of financial information provided by issuers listed on regulated markets in FY15.
The report found that ESMA and European enforcers have strengthened supervisory convergence in the area of enforcement of financial information. For example, the number of accounting issues discussed by the enforcers before taking enforcement decisions increased significantly: 65 emerging issues in 2015 again 47 in 2014. This contributed to enhancing supervisory convergence as enforcers should take into account the outcome of these discussions when taking decisions, according to ESMA’s report.
Overall, enforcement actions have been taken against a quarter of the issuers included in the sample of 189 issuers. In many cases, enforcement actions cover several areas of the same set of IFRS financial statements. In relation to the application of the new consolidation package, ESMA and the European enforcers acknowledge the good quality of application of IFRS requirements in the 2014 financial statements. ESMA believes that there is still room for improvement in the application of the IAS 12 requirements related to recognition, measurement and disclosures of deferred tax assets arising from tax losses.
Related link:
ESMA Report on Enforcement and Regulatory Activities of Accounting Enforcers in 2015
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