ESMA issues new enforcement priorities for 2014


The European Securities and Markets Authority (the ESMA) has published its European Common Enforcement Priorities (the Priorities) for 2014. These Priorities identify topics that the ESMA, together with European national enforcers, see as a key focus of their examinations of listed entities’ IFRS financial statements. The aim of the common enforcement priorities is to achieve a high level of harmonisation in enforcement and to contribute to consistency in the application of IFRS across the European Union.

The common enforcement priorities cover the following topics:

  • preparation and presentation of consolidated financial statements and related disclosures;
  • financial reporting by entities that have joint arrangements and related disclosures; and
  • recognition and measurement of deferred tax assets.

These topics have been highlighted as they relate to either:

  • significant changes to accounting practices as a result of new standards, such as IFRS 10, 11 and 12;
  • challenges to issuers as a result of the current economic environment, notably when forecasting future taxable profits in periods of low economic growth (IAS 12).

The ESMA and the national enforcers also expect EU listed banks to provide relevant information on material impacts resulting from the European Central Bank’s Comprehensive Assessment and on any changes in the level of regulatory capital required. The ESMA further considers that findings included in the 2013 ESMA Report on comparability of financial statements of financial   institutions continue to be highly relevant to the 2014 annual reports.

This publication can be consulted on the ESMA’s website by clicking here