Issuers subject to the Transparency Directive must prepare the annual financial reports they make available to the Dutch Authority for the Financial Markets (AFM) and other interested parties in ESEF format. The ESEF applies to financial years beginning on or after 1 January 2021. In practical terms, this means annual accounts prepared in 2022 for the 2021 financial year.
ESEF standard format for annual financial reports For Issuers of securities
From 1 January 2021, issuers whose securities are admitted to trading in the European Union must file and publish their annual reports digitally. This must be done in accordance with the European Single Electronic Format (ESEF). The ESEF will make issuers' reports more accessible and facilitate analysis and comparability of annual financial reports.
Format mandatory for financial years beginning on or after 1 January 2020
Need to know how to prepare your financial reports in the ESEF format?
You must prepare your annual financial reports in XHTML format. If your financial reports contain IFRS consolidated annual accounts, your primary financial statements must be marked up with XBRL tags in a process known as tagging and using the ESEF taxonomy. The other parts of the financial report should be included in the XHTML document. For financial years beginning on or after 1 January 2022, you must also mark up the notes to the IFRS consolidated annual accounts with XBRL tags, using what are known as block tags.
What role does my auditor play in annual accounts in ESEF?
Your external auditor must audit the annual accounts prepared using the ESEF. As the European Commission has stated (see question 2), these activities are part of the statutory duty of the accountant and therefore part of the statutory audit. This means that if you are required to tag the primary financial statements, the external auditor must also verify compliance with the ESEF requirements, including tagging as part of the statutory audit. Please see the appended CEAOB guidelines on auditors' involvement on financial statements in ESEF for more information about the work to be performed by auditors for annual accounts in ESEF.
Filing your financial reports
You must deliver your annual financial reporting in ESEF to the officially appointed mechanism (OAM), simultaneously with making it publicly available. In the Netherlands, this is the AFM. You can find more information about the submission procedure here. In addition, the European Commission has stated that the XHTML annual accounts are subject to a statutory audit and must therefore be accompanied by an audit opinion. The audit opinion must be filed with the OAM at the same time as your annual financial reporting in ESEF.
Companies and auditors from outside the EU
Companies from outside of the EU/EEA that are admitted to trading on a regulated market in the Netherlands are also required to prepare their annual financial information in ESEF. Tagging is mandatory when a consolidated annual report is drafted using IFRS is used to prepare the financial reporting, but not when using other financial reporting frameworks. The auditor shall need to perform procedures to assess compliance with the RTS, and shall report thereon in the auditor’s report.