The European Commission is planning a fresh crackdown on the accounting that led to the downfalls of Enron and Parmalat, forcing companies to disclose off-balance-sheet arrangements.

The plans, set to be adopted by Brussels this month, come as part of a broader drive by the Commission to improve the rights of shareholders, increase corporate transparency and limit the risk of boardroom excesses and financial scandals.

In recent weeks, the Commission has already issued recommendations on boardroom pay and the independence of non-executive directors, as well as plans to increase the rights of cross-border shareholders.

These moves followed earlier plans that seek to loosen the ties between companies and their auditors - another area identified as crucial by the Commission in the fight to prevent a replay of the scandals that hit companies on both sides of the Atlantic.

Brussels' latest plans would force companies to shed more light on the use of special-purpose vehicles, offshore activities and other arrangements that can be kept away from the balance sheet. Both Enron and Parmalat made extensive use of such arrangements to hide the extent of their losses.

Any arrangement that did not show up in the balance sheet would have to be disclosed in the notes to the company accounts "insofar as the information is material and of assistance in assessing the financial position of the company".