March Towards ESEF – What you need to know?
What is ESEF?
The European Securities and Markets Authority (ESMA) based European Single Electronic Format (ESEF) reports are required this year and with the requirement has come a demand for software solutions. Currently the 2021 ESEF regulation was submitted in by ESMA in May 2021 and adopted by the European Commission late last year on November 29, 2021. This regulation is anticipated to enter into force in March 2022. The requirement states that all annual financial reports need to be in xHTML (inline XBRL, iXBRL) and marked-up based on the IFRS consolidated statements via XBRL tags using the iXBRL technology.
The IFRS foundation prepared and updated the 2021 IFRS Taxonomy that the 2021 ESEF taxonomy is based off of. All version information, comparisons and explanations about the taxonomy package can be found on the IFRS Foundation’s website. Updates in the ESEF taxonomy include labels in all EU languages.
Originally this regulation was intended for the 2020 financial year, however it was delayed a year to allow software vendors and issuers time to better understand and adapt to the new regulation.
Why is ESEF being enforced?
In order to create a comparable, secure, transparent way to evaluate companies listed on any EU regulated marketplace. By using XBRL this is achievable regardless of the reported language since all the data is machine readable and can be translated based on the ESMA provided taxonomy.
Who does this effect?
This ESEF Regulation will apply to all companies with securities listed on any EU regulated market. Using the 2021 ESEF taxonomy and software solutions companies will be able to comply with ESMA’s requirements for the annual financial reports beginning on or after January 1st, 2021. This is why we created SemansysNext to easily complete your ESEF requirements.
Stay tuned next week for the second article about “How do you complete the ESEF report?” in our ‘March Towards ESEF’ 3 part mini-series as we approach our ESEF webinar on March 17th, 2022.
For more information please contact us at info@semansys.com. We would be happy to schedule a demo or provide more detail about any of our capabilities.