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EU consultation on ESAs includes section on financial reporting

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24 Mar 2017

The European Commission has launched a public consultation on the operation of the European Supervisory Authorities (ESAs) one of which is the European Securities and Markets Authority (ESMA). The consultation suggests that the review of the ESAs' operation might also be used to "streamline" the endorsement process in the EU by giving ESMA an "advisory role".

The section on financial reporting first describes ESMA's role as an enforcer of accounting and auditing standards and outlines the efforts that have been undertaken to harmonise accounting and auditing practices in the EU. It then notes several possibilities for strengthening ESMA's position in this respect as supervisory and enforcement convergence has remained somewhat limited to date.

The last paragraph of the section is used to make an additional suggestion:

Finally, there may also be scope to streamline the adoption process of international accounting standards. One possible avenue, which was already considered in the Maystadt report published in October 2013, would be to give ESMA an advisory role in the endorsement process, subject to appropriate safeguards to ensure that the European public interest is fully considered as part of the endorsement process.

The questions asked at the end of the section then seem to connect the topics of improvements to the operations of the ESAs and changes to the endorsement process by asking (a) what improvements to the current organisation and operation of the various bodies could be made and (b) how the current endorsement process could be made more effective and efficient.

Please click to access the consultation documents on the European Commission's website.

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