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Beginning with the financial year of 2020, all companies listed on EU regulated markets are required to prepare their annual financial reports in ESEF. The European Securities and Markets Authority commonly referred to as ESMA, has put forth a list of ESEF reporting requirements which each report must live up to in order to be compliant.
In 2013 the Transparency Directive was amended to include the requirement that issuers prepare their annual financial reports in one electronic reporting format. ESMA was tasked with developing the regulatory technical standards (RTS) specifying the format. What they came up with was ESEF, or the European Single Electronic Format, which is an iXBRL format. You can learn more about ESEF reporting here.
The detailed provisions of the European Single Electronic Format (ESEF) are contained within the Reporting Technical Standards (RTS) on ESEF which are included in the Final Report on the RTS on ESEF.
Preparers of the files need to mark-up disclosures using the taxonomy element with the accounting meaning closest to the marked up disclosure. If the closest taxonomy element misrepresents the meaning, the issuer needs to create a taxonomy element titled an "extension" and anchor the extension to the core taxonomy element.
ESMA has created the ESEF Reporting Manual to present companies with guidance on how to adhere to the ESEF requirements as well as outline common issues related to creating iXBRL documents.
The manual was originally published in December 2017, but it has since been updated in July 2019 and July 2020.
It is expected that ESMA will further update the ESEF Reporting Manual as they have stated that they will continually monitor developments in the market and gather feedback from key stakeholders, so they can provide further guidance.
ESEF Reporting is reporting carried out in the European Single Electronic Format.
ESEF is the reporting format which public listed companies on EU regulated markets are required to use when filing their annual financial reports.
The format has been mandated by the European Securities and Markets Authority (ESMA) as part of the Transparency Directive. This means that issuers are required to produce their annual financial report in a way that makes it both human- and machine-readable.
Contrary to what many people believe, an ESEF report is not one single file. An annual financial report in ESEF contains the xHTML report along with a taxonomy package specifying the technical information on the mathematical relationships and extensions. Because of this, an ESEF report is delivered as a .zip package rather than a single file.
When you receive your converted annual financial report from us, we also include an HTML version of your report within the ESEF package. The reason we include this file, is that the file includes an ESEF viewer, which lets you view the tagged iXBRL file directly in your web browser.
When you open the HTML file, a window in the right side of your browser will allow you to alter the display options, so you can highlight entries and then use the left/right arrows on your keyboard to scroll through the XBRL tags embedded in the file.
The viewer file is not part of your ESEF compliance, and it should not be submitted to your OAM (Officially Appointed Mechanism), but it is ideal for hosting on your website. That way your visitors can access it without advanced software able to consume ESEF reports.
An ESEF report consists of two layers, a visual and a technical layer, which are combined into a single report. At ParsePort we can do this with a range of different file types. We commonly see users submit an Excel file containing the financial statement of your annual financial report combined with a PDF containing the glossy version of that same annual report.
The ParsePort XBRL Converter supports several formats. The specific files you use may vary, but the process remains the same. You need to upload a technical part and a visual part to our portal. The most popular choice we see among issuers is the combination of a PDF and an Excel sheet.
When you want to convert your files all you need to do is:
The ParsePort XBRL Converter lets you convert your annual financial report exactly when you need to, without delays, and you can do so as many times as you want.
Using our XBRL Converter for your ESEF conversion, will have very little impact on your current workflows. The only thing you have to prepare earlier than usual is the Excel sheet with the consolidation of the figures for your annual financial report.
XBRL, or eXtensible Business Reporting Language, is the international standard for digital business reporting. XBRL is used in more than 50 countries and millions of documents are created in XBRL every year. In short, XBRL is a language in which reporting terms can be used to uniquely represent the contents of financial statements or other compliance or business reports.
iXBRL, or Inline eXtensible Business Reporting Language, is a standard that enables a file to be both structured and human-readable as well as contain machine-readable data. iXBRL is the format which the new ESEF (European Single Electronic Format) is based on.
iXBRL files can be opened by any standard browser while the embedded tags provide a structure of information which can be read by a computer. The format does not change what you are reporting but rather how you are reporting it.
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