3/1/2024
Interview with Matthieu Garat, Digital Transformation & ESEF Expert at Labrador Company about ESEF and the partnership with Corporatings.
Listed companies have been required to publish their financial statements in the 'ESEF' format (European Single Electronic Format) since 2021. This format is based on XHTML: it is a web page where additional mechanisms allow the issuer to identify their disclosures. But the format is technically complex. In order to ensure regulatory compliance in the first years, companies have been relying on new service providers. However, as a consequence, accounting departments have been losing the autonomy and control over the content of publications they used to have. Luckily, solutions do exist to regain control over the pre-publication of this essential document.
Financial statements in ESEF: a complex pre-publication
Many companies seem to be coming across issues since the ESEF regulations have applied and the XHTML format has become mandatory. The work of the accounting departments has become tedious. In addition to sending the annual accounts to the auditor for review, companies must now rely on third parties: the software publishers who oversee transforming the reports into the XHTML format, while respecting all technical constraints of the format. Some companies even delegate the whole technical format report creation to external consultants.
Relying on such third parties costs a lot of money and creates huge risks for the company. The creation of their report is often delayed by amounts the company has little control over, and the quality of the resulting reports is often mediocre. But as the accounting department does not have the required technical skill to challenge the software provider or external consultant, it becomes very dependent. If at any point the auditor requests changes on an aspect the company is unable to directly act on, the accounting department gets stuck in a very tedious position where they can just forward messages back-and-forth and hope it somehow gets solved.
This is even more noticeable on new specifications such as block tagging, where companies are expected to identify certain sections of the notes to their financial statements. This 'block tagging' comes with its share of technical requirements that the software publisher claims to handle. In reality, a great share of available software is still unable to produce compliant reports on that aspect.
At the current rate, companies are faced with a high risk of spending a lot of time creating reports whose information will not even be readable. It is therefore important for them to find a solution that helps gain visibility on the XHTML format and its tags and resume control on the content within the financial statements.
PRISM, the ESEF quality control solution that gives power back to companies
Corporatings has the solution for you. PRISM is self-sufficient regarding pre-publication. It helps you ensure your report contains exactly the data you intended to communicate, and it helps you verify that the report is compliant on all aspects before it is sent for audit.
On block tagging, PRISM allow you to review the contents, regardless of the technical constructions such as double tagging, continuations etc.
PRISM improves your compliance and saves you colossal amount of time. In particular, it will greatly decrease the number of exchanges with your auditor and external consultant/software provider. Creating reports can finally be a breeze!
Beyond simple compliance, PRISM's benchmark features allow you to compare the disclosures within your report with the ones from your peer companies. You can make sure that analysts will be able to retrieve the most useful data from your report.
PRISM allows you to verify your report and demand the necessary changes from your software provider. If you rely on an external consultant to create your report, PRISM helps you check very efficiently that the work was done correctly. You can therefore send a report of great quality to your auditor with confidence.
Our software gives control back to accountants so that they can rightfully oversee the production of the most important part of the document for investors. Corporatings is your ally in making your report creation smooth and riskless.