The comment letter is dated 23 October 2012, but was only made available by ESMA now.

In the comment letter, the ESMA believes that the due process objectives and how to achieve these objectives should be more clearly stated in the Due Process Handbook and related to the objectives of the IFRS Foundation (ie to develop, in the public interest, a single set of high quality, understandable, enforceable and globally accepted financial reporting standards based upon clearly articulated principles).

In addition, the ESMA states:

As a result of the importance ESMA attaches to the independence of the IASB, and while fully agreeing that all stakeholders should be consulted, we believe that, as a general rule, the IASB should drive its own agenda and perform its own activities. We acknowledge that in some instances the Board may feel the need to work jointly with other standard-setters.  In those cases we believe that the Board should always ensure that the output of these projects meet the objectives and high quality standards that the Board has set for its own projects.

The ESMA also believes the role of the Due Process Oversight Committee (DPOC) should be focused on substance and not only on the process. The DPOC should also consider whether the Due Process Handbook objectives are met.

Please click for:

• ESMA comment letter (link to ESMA website)
• Our previous story on the IFRS Foundation Due Process Handbook.