ESEF: Europe’s roadmap to transparency in reporting
Since 2020, EU issuers have been required to prepare and disclose their annual financial reports in the European Single Electronic Format. This digital format enables financial information to be processed by machines and meets the capital markets’ higher transparency requirements.
The technical and accounting requirements of ESEF present challenges for affected companies. IFRS consolidated financial statements must include tags for monetary and narrative disclosures in accordance with the ESEF Regulation. Preparing ESEF documents requires XBRL-enabled software. With the European Commission’s initiatives on the European Single Access Point (ESAP) and the digitalisation of sustainability reporting, ESEF continues to grow in importance—even as artificial intelligence becomes more widespread. ESEF provides reliable information prepared by reporting companies and audited by independent auditors.
Every detail matters in ESEF reporting
Apply the taxonomy correctly
Selecting the right tag depends on the meaning of the information in the IFRS financial statements—including narrative disclosures.
Keep track of changes
New transactions and annual updates to the ESEF taxonomy can affect existing tags.
Align preparation and audit
The software, reporting process and audit need to work together so that ESEF files can be prepared transparently and audited on time.
From initial design to publication in ESEF format
We support you throughout the process—with expertise, a holistic approach, flexibility and reliability.
We assess whether ESEF formatting and disclosure requirements apply to your company, including in complex situations—for example, where the company’s registered office and the market on which it is listed are in different countries.
We develop the technical mapping, tag the disclosures and prepare audit-ready ESEF files. We take into account the audit requirements set out in IDW PS 410. We have experience working with a range of auditors and understand their areas of focus.
We act as your sounding board throughout the annual ESEF preparation process and keep you informed of regulatory, technical and content-related developments. We are familiar with established ESEF software solutions and develop scalable training programmes for your in-house experts. This helps you retain control of your processes and reduces the coordination effort compared with a fully outsourced solution.
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Frequently asked questions about ESEF
Under Section 328(1) of the German Commercial Code (HGB), domestic issuers must disclose their accounting documents in ESEF format in accordance with Article 3 of the ESEF Regulation, as set out in the seventh version of Delegated Regulation (EU) 2026/283.
ESEF documents are based on XHTML and make information available in a machine-readable format. IFRS consolidated financial statements also include machine-readable facts using iXBRL (inline eXtensible Business Reporting Language). All monetary amounts in the primary financial statements must be tagged, as well as around 250 narrative disclosures listed in Annex II of the ESEF Regulation, where they are included in the notes.
A thorough understanding of IFRS is helpful when assessing the meaning and scope of individual elements in the ESEF taxonomy. A sound working knowledge of both the IFRS and ESEF taxonomies is essential.
ESEF documents must be prepared using ESEF-enabled software. Solutions are generally classified as built-in or bolt-on.
With a built-in solution, reports are created, stored and processed directly in the tagging environment. Changes to the report content are reflected immediately in the tags. With a bolt-on solution, an input document in a compatible format—such as Word or PDF—is first uploaded to the software. The tagging is then based on that version of the document.
Financial statements are updated continuously. In addition to new figures, companies therefore need to assess new developments and their impact on tagging. Common examples include business combinations, impairment losses, changes to share-based payment arrangements, and amendments to accounting policies or presentation.
The ESEF Regulation has also been updated annually to date. Updates mainly cover the applicable technical standards, the scope of tagging—particularly for narrative disclosures—and the ESEF taxonomy, which is a modified IFRS taxonomy. Companies should therefore assess whether any changes affect their existing tags.
The European Single Access Point (ESAP) is a European initiative to provide central access to publicly available information. Under the ESAP Regulation, ESMA is to provide a suitable platform from July 2027. ESEF documents are also expected to be made available there, significantly improving the limited data availability to date. The submission process has two steps: companies first submit their documents to the relevant national collection bodies, which then forward them to ESAP.
As part of the management report, sustainability reports are also subject to ESEF formatting requirements. At present, they only need to be provided in untagged XHTML format. However, the CSRD also provides for the digitalisation of sustainability reporting. To this end, ESMA has consulted on tagging sustainability reports using the ESRS taxonomy. EFRAG is expected to finalise the revised ESRS taxonomy by the end of 2026. Its application will be governed by an updated ESEF Regulation.
ESMA must first submit a draft regulatory technical standard (RTS), which is still pending. Under the phased approach set out in the consultation paper, tagging could become mandatory for the first time for reporting periods beginning on or after 1 January 2027 or 2028.