European Financial Reporting Advisory Group publishes 2025 annual review highlighting ESRS simplification and IFRS standard setting work

The European Financial Reporting Advisory Group has published its Annual Review 2025, a retrospective update on its main activities over the past year across financial and sustainability reporting. The review highlights EFRAG’s technical work on major International Financial Reporting Standards projects, alongside efforts to simplify the European Sustainability Reporting Standards and expand practical support for the Voluntary Standard for non-listed SMEs. On the financial reporting side, the review points to contributions on IFRS 3 Business Combinations, IAS 36 Impairment of Assets, IFRS 18 Presentation and Disclosure in Financial Statements, IFRS 19 Subsidiaries without Public Accountability, IFRS 20 Regulatory Assets and Regulatory Liabilities, and the Statement of Cash Flows. It also notes work on risk mitigation accounting and stronger co-operation with international standard setters. On the sustainability side, EFRAG says its Draft Simplified ESRS would introduce a more proportionate, principles-based approach under the Corporate Sustainability Reporting Directive, aimed at reducing complexity, reporting costs and implementation challenges while maintaining transparency. The review also cites support for SMEs through the VSME Forum and Ecosystem, the VSME Digital Template, an XBRL Converter, and the EFRAG Knowledge Hub, as well as international engagement to improve interoperability.