Explore the major policy developments impacting the global profession that we are currently engaging on at a European level, working closely with ICAEW Faculties as well as through our membership of European associations, including Accountancy Europe and CFE Tax Advisers Europe.
A Green Recovery is at the centre of the EU’s efforts to build more resilient, sustainable and fairer economies and societies after COVID-19. This includes a commitment to the Green Deal, which seeks to pave the way to climate neutrality by 2050. As part of The Prince’s Accounting for Sustainability Project (A4S) Accounting Bodies Network, collectively representing over 2.5 million accountants worldwide, ICAEW is committed to helping the profession put sustainability and the fight against climate change at the forefront of its work. This includes our work to support some of the specific objectives of the European Green Deal and associated policy measures, including the EU’s renewed sustainable finance strategy.
Natural Capital Coalition
ICAEW is a founding member of The Natural Capital Coalition, a global, multi-stakeholder open source platform for supporting the development of methods for natural and social capital valuation in business. Amongst other projects, The Coalition has produced a Natural Capital Protocol which acts as a framework to support better business decisions by integrating natural capital.
Corporate reporting is evolving. As a leading actor in the international regulatory and standard setting community, EU corporate reporting developments can have a broader global impact. ICAEW continues to closely follow and influence discussions relating to financial and non-financial reporting.
Listed companies in Europe must prepare their consolidated financial statements in accordance with International Financial Reporting Standards (IFRSs), as endorsed and adopted by the EU. In light of the coronavirus impact, we are also closely following developments related to specific standards, particularly IFRS9 Financial Instruments.
ICAEW is closely following the review of the EU Non-financial reporting directive. We believe that improvements can be made to non-financial reporting, to ensure better disclosures on key matters relevant to businesses, including climate change issues. High quality, non-financial information and user-driven assurance on that information are key to improving investor confidence and highly relevant to the future role of auditors. EU legislative change will provide an important point of reference for international businesses, investors and stakeholders – including when it comes to developments around setting non-financial reporting standards.
European Single Electronic Format (ESEF)
Since the start of 2020, the rules introducing the new European Single Electronic Format (ESEF) are now in force and annual reports of EU listed companies should be prepared under the new regime. ICAEW continues to support members on the implementation of ESEF while also seeking clarity over the level of auditor involvement.
In recent years, the audit profession has been under increased political and public scrutiny, with the profession and regulators across the globe debating all aspects of audit. We work to ensure that members remain informed of key EU policy developments, while sharing insights with policy-makers and regulators across Europe. We also engage closely with other professional accountancy organisations and stakeholders, including through our Accountancy Profession Strategic Forum, to help improve audit quality.
As part of ICAEW’s strategy to support a world of stronger economies, we track tax reform efforts in the EU, sharing guidance with policymakers and other external stakeholders. Particular focus is on EU steps to future-proof tax systems post-pandemic while countering aggressive tax planning, issues that we are also addressing through our membership of CFE Tax Advisers Europe.
Read more on the CFE Tax Advisors Europe paper on Professional Judgement in Tax Planning.
Digital transformation will play a central and priority role in re-launching and modernising European economies and societies. With new technology and technologically driven change impacting everyone, including the profession, we follow EU developments in this area while sharing expertise, knowledge and insight.