XBRL + human readability = iXBRL

Posted by Pooja on March 13, 2012 1 comments

The eXtensible business reporting language (XBRL) is being leveraged world-over by regulators and filers for reporting business and financial information. ‘XBRLization’ of financial data has become mandatory in many countries.

However, XBRL can be interpreted only by machines. XBRL instance document is composed of XBRL and XLink file and requires a rendering engine or an XBRL instance viewer to interpret and present the data in a human-readable format.  The rendering of XBRL instance document is regulated mainly by presentation linkbase that determines the relationships and display order of elements.

The Inline XBRL (iXBRL) specification on the other hand has been made human-readable. iXBRL has XBRL data embedded in well-formatted HTML or XHTML file. So though being an XBRL document, it is human-readable as the HTML tags are embedded. The basic idea of developing iXBRL is to allow preparers to retain the original view or representation or formatting of the source document, while creating an XBRL document.  XHTML representation of the information is what causes the document to be human readable. Inline document being an XHTML file can be viewed in a browser (preferably, Mozilla Firefox Version3.5 or above). It is also machine-readable, as the document is embedded with XBRL tags.

Moreover, we can also generate an XBRL instance document from an inline document using a processor. iXBRL also minimizes the use of company specific presentation linkbase extensions as the XBRL tags are effectively embedded in the HTML/XHTML formatting of the source document.

iXBRL was originally developed by XBRL International (XII) to meet the requirements of HMRC, the regulatory authority for tax collections in the UK. It was built to retain the formatting of the documents being submitted to HMRC to obtain machine-readable XBRL data bundled with the original human-readable formatting. One of the key requirements for the tax inspectors was the ability to see the submission in its original format

A major shortcoming of an iXBRL document is that untagged information, though being visible is unavailable in machine-readable format. However, some information which is not part of source document can still be tagged and be stored as “hidden information” in iXBRL document.

The table below lists the differences between XBRL and iXBRL based on some key considerations:

# Key differentiators XBRL Inline XBRL Stakeholder Impacted
1. Preparer’s source document presentation format Can be made to retain company format with extension taxonomy Retains company format with minimum need for extension taxonomy Preparers & Reviewers (if required)
2. Need for building an extension taxonomy High Low Preparers, Regulators
3. Need for building viewing tools for the filing document High Moderately High Regulators, Consumers
4. Inbuilt viewing capabilities Not Available Available with limitations Consumers
5. Preparation tool transformation dependency Low High Regulators, Software vendors
6. Complete leverage on calculation linkbase (provided in the base taxonomy by regulators) for validations Yes Cannot be completely leveraged Regulators, Consumers
7. Stability of technology Relatively Mature Evolving All the major stakeholders
8. Automating generation of filing document Relatively easier Relatively difficult Preparers, Software vendors
9. ‘Time to Market’ for software vendors Low High Software vendors

-  Pooja  Patel

XBRL filing is on!

Posted by subra on November 28, 2011 None comments

XBRL filing – is up and running!

Iris Business Services Limited was the first company to file it – they filed
it at about 2.30am Saturday! Many companies are trying to file – and I believe
many are failing.

Clearly it is not an easy thing to do. You need software to do it – and
reasonable working knowledge of xbrl and a good level of accounting knowledge.
Should the person be a Chartered Accountant or a Cost Accountant to do it? No.
Not really.

Could be a smart Bcom graduate with about 4-5 years experience will be able
to do it, but it is not easy. I have seen the forms, and enough automation is
not possible. Lot of details like directors PAN number, DIN number, SRN of the
filing of the form 23B, all have to be MANUALLY entered. I am sure mistakes in
all these fields are not really verifiable, and the rendering could happen with
some errors…..but a query could arise later on. Also the certification by a
practicing accountant is still mandatory…And is a painful part of the whole
process!

Since the people who are attempting it are all qualified accountants,
company secretaries and the like – I am assuming that the basic care will be
taken. Last heard of many companies had failed – and proves once again that it
is not easy…and requires some care.

So if you are a company who has to file the ANNUAL RETURNS in xbrl format,
wake up, and file it.

xbrl mca conversion: last date is 30 November 2011!

Posted by subra on October 24, 2011 1 comments

Many companies are taking the view that the last date for filing their
Annual Return with the MCA is 30th Nov, 2011. Then they back calculate and say
it will take 15 days for the vendor to create an xbrl document. They think they
can get up on 12th November, and be compliant!

I wish to demolish the myth that they need to wake up on 15th November!

Let us see the whole process:                                                          No. of days

You call the vendor, he quotes a figure for converting -                                2

Your board asks for 2-3 comparative quotes -                                              2

Your company accepts one vendor -                                                            1

Client asks for pdf and other details -                                                           2

You send all the details -                                                                             2

Vendor starts and completes work -                                                             14

Auditor does a review -                                                                                4

Vendor does some regrouping -                                                                    2

Auditor certifies -                                                                                         1

the whole process ASSUMING no snags takes about 30 days. Can we assume that
the MCA website will be overloaded from 15th November onwards?

Sure.

What happens if the Validator does NOT ACCEPT the filing?

Well, you go back to the vendor and say …please do it again.

What happens if he CANNOT?

Well you look for a NEW vendor.

Is this a real threat?

Well a vendor who has never got his work validated by a 3rd party will not
know the significance of a validation process…so yes the risk is real.

Will a responsible vendor accept work WITH A DEADLINE after 1st of November?

I doubt it. He would be hard-pressed to do his own work – either he will
refuse work or charge you double the fees.

Will you be able to file it without paying a fine?

No.

So you will end up paying a fine.

Is the fine too high?

Well it is not the amount, but the fact that in many companies the BOARD
insists that all fines and penalties be brought to the attention of the Board.
I remember putting a statement in my Internal Audit report of a manufacturing
company a statement saying ‘The company has not paid any extra fee or penalty
for any kind of non compliance or delay’. Obviously the Board was seeing that
statement in every MONTHLY board meeting.

So do you want to wake up on 15th September or 15th November is your call.
Do what works for you!

 

XBRL – the new e-biz lingo

Posted by rajeev on October 14, 2011 None comments

“Need is the mother of invention.”
History of mankind testifies this quotation,
Likewise a need was for an innovation,
To report business and financial information,
And this brought about a revolution,
Which culminated into XBRL evolution.

It all began in the US,
When a few accountants with their prowess,
Investigated the use of XML ‘might’,
To convert  financial data into electronic byte.
Subsequently the prototypes got approved.
And XBRL standard was introduced.

XBRL stands for eXtensible Business Reporting Language,
Which may be traced to the XML lineage,
A taxonomy and an instance document,
Forms the basis of an XBRL document,
While Taxonomy defines the business concepts,
Instance document encodes them with precepts.
Schema, linkbases make the taxonomy meaningful,
Facts, figures make the instance document fruitful.

Accuracy, reliability, timeliness to name a few,
Are some of the many advantages to review,
Impressed by which the regulators world over,
Adopted this new standard for a greater order.

So with XBRL being the order of the day,
Learn to file in XBRL the right away,
And with the filing date not far away,
It may be best to file it the ‘IRIS’ way.

XBRL TRAINING AT A PLACE NEAR YOU…

Posted by subra on September 29, 2011 1 comments

With the MCA mandate on XBRL filing, huge class of professionals and corporate entities are drawn towards the training avenues in XBRL. Training is imperative to at least know the buzzword, let alone understanding, to identify the strategy for XBRL Implementation this year and onwards.

To facilitate this, IRIS has been frequently organizing workshops and seminars across the nation, as an initiative towards spreading the word on XBRL .It has been conducting these workshops for statutory bodies vis-a -vis ICAI, ICSI and ICWAI and bodies like MCA,CII etc and a lot of corporate clients. Apart from this, it has also conducted sessions for individual requests through our training partners like CEMA, Princeton Academy and ConsultIFRS.com etc.

The workshops have been done at all the major cities of the country, like Bangalore, Mumbai, Delhi, Chennai etc to name a few, training more than 3000 professionals on XBRL so far. Below is a graphical representation of various trainings conducted by IRIS so far.

The upcoming trainings for the month are regularly updated in the training calendar posted on the website. Below is the Schedule of our training program in near future.

Till November, we are planning to conduct many more sessions at Tier2 and Tier 3 cities like Baroda, Surat, Jaipur, Lucknow, Cochin, Chandigarh, Ahmedabad, Indore and Kanpur. Please reach us on suchita.goyal@irisindia.net for further details. We also look forward to have affiliates for these cities.

Training on XBRL

Posted by subra on September 12, 2011 1 comments

XBRL reporting is now mandatory, and for corporate India learning XBRL is vital! This means XBRL training is a very happening event! Even though this is a company secretary’s responsibility, but the work will have to be done by an accountant. In fact to too many accountants this looks like a tech person’s job like all kind of ‘computer work’. However XBRL is the place where Finance meets Technology! It is obvious that one has to learn about XBRL, so you should look for some training. Without undergoing any training, or reading any book, or having no knowledge of XBRL, you will not be able to file your return. Like any skill XBRL has to be learnt and you need some experience before you can appreciate the whole XBRL process. Buying the software is essentially the first step. Akin to using a car – buying a car does not mean anything till you get a driving license!

Hence, to understand MCA Mandate on XBRL filing of annual reports, IRIS offers various training programmes across the country. We have done training with the Institute of Chartered Accountants of India, the ICWAI and the ICSI. Obviously all the 3 institutes are eager to equip their members with the basic working knowledge of XBRL so that they can help their clients meet the MCA mandate.

Programs available: Iris does short programs of 2-3 hours as an introduction to XBRL as well as full 2 day programs which include hands on training for the participants. The 1 day program basically covers XBRL Basics with case studies and Exercises on MCA Taxonomy and Demonstration of Products available to meet the MCA mandate.

The 2 day program, along with the above mentioned structure, also includes hands-on practical training on IRIS Proton which is an XBRL authoring tool for Creating Instance Document.

Below is the Schedule of our training program. For further details on XBRL training kindly reach us on training@irisindia.net

 

 

Date

Day

 Venue City Duration  

17-10-2011

Monday

Sundaram Clayton Ltd

Chennai

1 day

  

18-10-2011

Tuesday

The Lalit Intercontinental

Delhi

1 day

  

20-10-2011

Thursday

JW Marriott

Mumbai

1 day

  

22-10-2011

Saturday

Courtyard Marriott

Chennai

1 day

  

21-10-2011

Friday

ICAI,Bangalore

Bangalore

1.5 day

  

22-10-2011

Saturday

  

24-10-2011

Monday

ICSI

Cochin

1 day

  

15-11-2011

Tuesday

NISM,Vashi

Navi Mumbai

2 day

  

16-11-2011

Wednesday

  

15-12-2011

Thursday

JW Marriott

Mumbai

1 day

  

 

Why use xbrl?

Posted by subra on August 31, 2011 None comments

Good and a valid question.

Actually in the Indian context we do not know how much the regulators will talk to each other! For example if RBI, SEBI, MCA, IRDA …etc at all spoke to each other you may not have to file the same document with each of the authorities. If MCA, for e.g. regularly checks its quantitative information with Chambers of Commerce, Income tax authorities, Excise, etc. surely inconsistencies can be found.

Even internally (within the organization) the word sales can mean a different number to the salesman and a different number to the accountant. Gross sales could include excise duty, but for the calculation of commission it will have to be just the sales figure without the statutory levies.

This is even likely to become a great opportunity for software vendors and accountants – checking for internal consistency – after all the business rules will have to be created, is it not?!!

In the United States for example – financial information filed with the SEC is shared with various organisations. The submission made by banks (to Federal Financial Institutions Examination Council) is shared by them with Federal Deposit Insurance Corporation (FDIC), Federal Reserve System (FRS), and the Office of the Comptroller of the Currency.

What should a CA/CS/CWA certify in an instance document?

Posted by Maya on August 23, 2011 None comments

MCA has clarified that the XBRL instance documents will be submitted as attachments to Form 23AC and 23 ACA. While the responsibility of submitting these forms continues to be that of the management of the company, MCA has also clarified that the instance documents need to be certified by any Chartered Accountant (CA), Company Secretary (CS) or Cost and Works Accountant (CWA), who is in whole time practice in India (Circular 57/2011 dt. 28/07/2011).

Now, the question is – What in an instance document should be certified by a CA/CS/CWA?

Following is an Audit Checklist that can be used for auditing/certifying XBRL instance document. Please note that these checks are strictly for a scenario where the taxonomy is fixed and extensions are not allowed:

1. Ensure that all the elements in the annual report (as required by the scope defined by MCA) are included in the XBRL document.

2. Ensure that all the above elements are mapped to the appropriate concepts in the taxonomy.

3. Ensure that the subtotals in the instance document (which may be different from the annual report due to regrouping done using the fixed taxonomy) are correct.

4. Ensure that the XBRL documents are validated and are technically correct i.e. it complies with the rules mentioned in XBRL 2.1, FRIS and FRTA (XBRL 2.1 and FRTA may not be very relevant, as we are using fixed taxonomy for the MCA mandate).

5. Ensure that all the values are correctly captured with the correct contexts, decimals and units.

6. Ensure that there are no calculation errors in the instance document or if exists, are genuine errors.

 

XBRL pricing

Posted by subra on August 19, 2011 None comments

If you have visited the MCA website you will find prices ranging from a few thousands to millions of Rupees! Why should there be such a variance and what are the factors which decide the price?

Well clearly it is a case of how much effort goes into the creation of xbrl document. In case of a company, the factors that decide the cost of converting are as follows:

1. Number of pages: not just the total number pages but the number of pages to be tagged. It is the P&L a/c, Balance sheet, Cash flow, Notes on accounts, etc that are to be tagged. Auditor’s report, Director’s report and Notes on accounts- are tagged as a block.

2. The industry to which it belongs – now normally C&I is the industry in the current year, because the taxonomy is fixed!

3. Is it standalone or a consolidated filing? Obviously if it is consolidated, the effort level increases.

4. How many schedules are there in the annual report of the company?

5. The number of transactions with related parties – it requires a lot of detailed tagging and is therefore time consuming.

6. The number of subsidiaries that a company has

7. The number of associates, the number of branches, the number of JV partnerships.

All the above factors play an important role in the pricing of a XBRL tool.

 

Will XBRL stay?

Posted by subra on August 8, 2011 None comments

After the fate of IFRS in India, people are wondering if XBRL will stay Or will somebody push it to 2015 and beyond?

The answer is really difficult. Let us look at what is happening to XBRL worldwide. The US’s SEC started it slowly – for the top companies – but has now mandated it. BSE started it in 2007; Sebi liked it and implemented it in India. It became compulsory for the top 100 companies (www.Corpfiling.com). However it is so easy to use, that about 1000 companies are using it. This is a fantastic indication of the industry’s acceptance.

XBRL is now implemented in Australia, UK (a variant called ixbrl), Singapore, India, China, Japan, South
Africa, Dubai, Saudi Arabia, and Netherlands….literally around the world. XBRL is now just a part of the reporting world, and is well entrenched.

In a world which is wanting more accountability from the political classes, businessmen, media (ask
Murdoch!), XBRL has gone from ‘Why XBRL’ to ‘When XBRL’ and ‘How xbrl’!!

In fact a couple of big Indian banks are now getting ready to get client information in xbrl – so that they can put it in their format for loan processing. It can dramatically shrink the time taken to process the data, and not have to worry about the accuracy. The advantage of xbrl is that it can be used even in each person’s proprietary software. This dramatically increases its applicability. Many big research companies use their own ‘Proprietary’ research software – this edge will be lost. A lot of independent research people will create free and paid tools for people to use with xbrl data. The sheer number of users will make it far more
popular!