Views on improving the integrity of global capital markets
06 January 2020

An Electronic Access Point for the European Single Electronic Format Is Much Needed

Posted In: Financial Reporting

CFA Institute has supported the European Securities and Markets Authority’s (ESMA) efforts to establish a European Single Electronic Format (ESEF).  The ESEF is the single electronic reporting format in which issuers in EU-regulated markets will have to prepare their annual financial reports beginning on 1 January 2020. As a result, EU issuers will produce annual financial reports that are machine-readable, which brings EU capital markets into the digital information age. We believe the ESEF will improve democratization of information.  

The transparency directive also required ESMA, and the national competent authorities (NCAs) from each EU member state, to work together to create a single, centralized point of entry for the public to access statutory information of listed companies. The European electronic access point (EEAP) will be a web portal for the provision of easy and fast access to regulated information stored by all Officially Appointed Mechanisms (OAMs). The ESMA board of supervisors, however, paused work on the project in January 2018.

Currently, every EU member state has its own OAM, which typically works as a storage facility that publishes statutory information related to its listed companies. Hence, any investor who wants to compare and contrast companies across different member states has to access a different OAM for each company. Furthermore, member states have different national mechanisms for storing information about companies, which all work in slightly different ways, and the information they provide varies in terms of scope and quality. This is not efficient for investors. The EEAP is essential to facilitate accessibility, analysis, and comparability of annual financial reports by users.

The Issue

Public companies are readying themselves to prepare ESEF filings, NCAs and OAMs are getting ready to accept these filings, and investors and other users are waiting to access and analyze them. Without an EEAP, investors and other users will not be able to access ESEF filings without great cost and effort. The development of the EEAP is integral to improving the transparency of information provided by listed companies within the EU. Please read our article in 

Image Credit: ©alengo

About the Author(s)
Mohini Singh, ACA

Mohini Singh was director of financial reporting policy at CFA Institute. She represented membership interests regarding financial reporting and disclosure proposals issued by the FASB, the IASB, and others. Singh holds the Associate Chartered Accountant (ACA) designation.

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