Report on the application of IFRS 10, IFRS 11 and IFRS 12 in the EU

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31 Mar 2021

The European Securities and Markets Authority (ESMA) has published a report that analyses the application of the requirements of IFRS 10 'Consolidated Financial Statements', IFRS 11 'Joint Arrangements' and IFRS 12 'Disclosure of Interests in Other Entities' by European issuers.

The analysis builds on a review of the 2017, 2018 and 2019 annual reports of a sample of European issuers and on the evidence from supervision and enforcement activities undertaken by European enforcers on financial statements relating to financial years between 2014 and 2020.

The report was submitted to the IASB as part of the ESMA response to the post-implementation review of the three standards that the IASB is currently conducting.

Overall, the results show that the requirements of the standards have generally been well applied in the financial statements of the issuers in the sample. However, ESMA believes there is room for improvement in the level of compliance, comparability and transparency in the application of the requirements. In addition, ESMA notes that some aspect of the IFRSs can be improved to bring more clarity in areas where uncertainty in practice still exists.

Please click to access the full report on the ESMA website.

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