A hard hitting report flowing from the first examination of the credit rating market by the regulator found the companies were deficient in seven areas. These included staffing levels, transparency, internal control functions and the length of time dedicated to making ratings decision. The report will come as a major concern to the three agencies. However, it should offer some cheer to national Governments, including Germany, France and Greece, all of whom have criticised ratings agencies over recent decisions. The agencies have also faced criticism in the UK from the Treasury Select Committee (TSC) for failing to spot problems in the months leading up to the financial crisis of 2007 and 2008. The ESMA\'s initial examination of the three agencies found shortcomings in: • The recording of internal meetings. The timing of the distribution of documents ahead of rating committee meeting. • The adequacy of resources, including staffing, devoted to the analytical business • Internal control functions and the organisations\' independent directors. • Disclosure of rating methodologies. • Process for the disclosure of ratings actions. • The IT environment, particularly security concerns on the use of third parties. The regulator said it had not decided whether any of the shortcomings constituted a breach of its rules. However it warned its report was published \"without prejudice to the possibility of further investigations which could lead to enforcement or supervisory actions.\" The ESMA said it would follow up with individual companies in the first half of 2012. Moody\'s said: \"We are fully committed to continuing to enhance our ratings process and internal controls and to maintaining a healthy dialogue with ESMA.\"