EuropeanIssuers responded to CESR’s Consultation on development of pan-European access to financial information disclosed by listed companies dated July 2010.
CESR has published a Consultation Paper (CP) on measures for developing a pan-European access to financial information disclosed by listed companies. This can be achieved in two ways.
In the first option, CESR proposes to organise national information depositories that would be accessible through one European search engine. The second option consists of developing a single European storage mechanism, where issuers of all securities admitted to trading on an EEA regulated market would need to file regulated information with the European OAM.
At the same time CESR issued a press release informing that it also intends to analyse costs and benefits of the possible use of eXtensible Business Reporting Language (XBRL) for financial reporting of listed companies in Europe. A detailed analysis identifying the needs of users of financial information, the impact on reporting entities, the quality of the XBRL Taxonomy and possible interactions with other regulatory bodies and requirements will precede the issuing of a Consultation Paper on this issue.
EuropeanIssuers believe that both issues are interconnected as the options given in the CP already envisage the need of using a mandatory standardised language, possibly XBRL.
EuropeanIssuers agree that more transparency and standardisation of reporting can be good where appropriate, however standardisation can only be achieved for part of the information. It is impossible to standardise some information, e.g. narrative information or information based on standards that are subject to continuous changes.
Costs, liability for and quality of the information should be carefully examined before deciding whether reporting can be further improved and standardised, namely if through XBRL.
EuropeanIssuers agree with the use of XBRL as a final conversion tool for standardised data but not with its use in a company’s internal (data processing) systems.
EuropeanIssuers disagree with the mandatory use of XBRL for the time being: an impact assessment or a relevant study should be done to show the market exactly what are the advantages and disadvantages of its use. Namely, research should be made on the (in)efficiency of the use of XBRL where it has been already put in practice.
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