The European Securities and Markets Authority (ESMA) has issued a statement concerning the accounting treatment in relation with sovereign debt exposures in connection with current market developments. Special consideration is given to the accounting treatment of Greek sovereign debt. Recommendations are intended to ensure consistent application of IFRS requirement across Europe

The statement published today is divided into two sections:
– Section 1 is directed toward annual financial statments for reporting periods ending 31 December 2011. It contains elements that should be considered by issuers and their auditors in relation to sovereign debt exposures;
– Section two details the findings from the study conducted by ESMA on the accounting treatment of Greek sovereign debt in the half-year financial statements for reporting periods ending 30 June 2011 of financial institutions listed in regulated European markets and ESMA’s assessment of them (ESMA Opinion “Accounting for Exposure to Greek Sovereign Debt – Considerations with respect to IFRS Interim Financial Statements for Accounting Periods ended on 30 June 2011”). It also lists elements that should have been considered by issuers and their auditors in relation to sovereign debt exposures in those statements. Depending on future economic developments, these should be considered when preparing or auditing the upcoming year-end financial statements.

Please find the document herewith attached.