As part of the “Better Regulation” agenda, the EC has launched a call for feedback (http://ec.europa.eu/info/law/better-regulation/initiatives/ares-2018-744988_en) until 8 March on the fitness check on public reporting by companies (Accounting Directive, Transparency Directive, Non-financial reporting Directive, Bank Accounts Directive, Insurance Accounts Directive and IAS Regulation).
In particular, participants will be asked for their views on the following:
- Whether the current financial reporting framework meets its objectives and will continue to do so in the digital economy, whether the level of harmonisation and simplification meets the needs of respectively the large cross border groups and the SMEs, the role of IFRS for non-listed and listed companies including governance aspects to ensure these are not detrimental to long term and sustainable investments, and the coherence of sectoral accounting legislation for banks and insurance companies with other EU reporting and prudential legislations;
- Whether the financial and non-financial disclosures in the area of Environmental, Social and Governance (ESG) reporting by companies are fit for purpose, including as regards sustainability disclosures;
- Whether to encourage experimentation with integrated reporting as a way to make the EU reporting framework more effective and efficient and if yes how;
- Whether public corporate reporting does take enough consideration of – and at least is not a hindrance to – technological progress and how to make the best use of these new tools to do more with less.
The fitness check will incorporate evidence and data mainly, but not exclusively, from the following sources:
- A public consultation;
- A conference to be held in the spring of 2018;
- Studies commissioned to external contractors, including ongoing studies concerning the reporting of payments to governments by extractive industries and the accounting requirements for smaller (micro) companies;
- Conclusions drawn up from work currently being carried out by the High Level Group of Experts on Sustainable Finance, which was set up in 2016 by the Commission;
- Relevant items, if any, of the Fitness check of supervisory reporting requirements. It addresses the regulatory reporting of the financial sector and is therefore of a different nature;
- The evaluation of the IAS Regulation (COM(2015) 301 final);
- The results of the Commission’s assessment of the national transposition measures for the Transparency Directive and the Accounting Directive, as announced in the Call for Evidence Communication of 23 November 2016 (COM(2016) 855 final).
The quantification costs and benefits will be drawn from all above-mentioned sources as well as estimates provided in previous impact assessments (the review of the Accounting Directive including the non-financial reporting and the reporting of payments to governments by extractive industries, the review of the Transparency Directive).
The open public consultation would be launched in 1st quarter of 2018 and would last for a period of 12 weeks.
The evaluation and fitness check roadmap is available here http://ec.europa.eu/info/law/better-regulation/initiative/170149/attachment/090166e5b8688e9c_en