XBRL: The Future of Financial Reporting
Submitted by: Alexandra Styczynski 1
Contents XBRL: The Future of Financial Reporting .......................................................................................................................1 Introduction ...................................................................................................................................................................3 Development of XBRL ....................................................................................................................................................3 Opportunities of XBRL Reporting...................................................................................................................................4 Analysis of Research Findings ........................................................................................................................................5 Voluntary SEC Project ................................................................................................................................................5 Mandatory SEC Project ..............................................................................................................................................7 Other Issues ...............................................................................................................................................................9 Assurance Issues ............................................................................................................................................................9 Conclusion ...................................................................................................................................................................10 Appendicies .................................................................................................................... Error! Bookmark not defined.
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Introduction The fundamental objective of financial reporting is to provide users with the timely delivery of useful information. However, the current reporting environment is sustained by a multitude of data formats including the popularly used Portable Document Reader (PDF) and Hypertext Markup Language (HTML). Financial information stored in flat file formats such as these, is not designed to electronically streamline user analysis; and human processing activities are subject to error and misinterpretation of data. Thus, the central problem of the current reporting environment is the fact that users must manually compile and analyze data, thereby inhibiting the usefulness of the information.
A solution to this problem, known as eXtensible Business Reporting Language (XBRL), has been developed in an attempt to globally standardize financial reporting. XBRL is a computer language that provides a means for tagging financial data in order to provide context and facilitate electronic analysis. Currently XBRL implementation projects purposes are in effect around the world including Germany, 1
Japan, Korea, Netherlands and New Zealand. Most notably, the United States are in the midst of a tiered approach, based on the size of a company‟s public float, to mandate the adoption of XBRL filings for 2
financial statements and the related footnotes. Also, in Canada a voluntary XBRL filing program is in effect, having commenced in May 2007.
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Conceptually, the benefits of XBRL are vast; however, research has identified many issues that must be overcome before these promised benefits can be truly realized. The purpose of this paper is to compile the key problems in XBRL implementation, as identified by researchers. Firstly, this paper provides background information on XBRL, followed by a discussion of its opportunities, an analysis of issues identified in recent research regarding implementation projects, and finally, the impact XBRL has on assurance.
Development of XBRL XBRL is a developing, open standard format for online communication of business information. Theoretically based on eXtensible Markup Language (XML), XBRL is a variation specifically for business 1
"XBRL in Action." XBRL International. Web. 1 July 2010. . Aguilar, Melissa K. "Another Round of XBRL Guidance from SEC." Compliance Week 7.76 (2010): 66+. ABI/INFORM. Web. 2 June 2010. < http://proquest.umi.com.proxy.lib.uwaterloo.ca/pqdweb?did=2036561111&sid=2&Fmt=3&clientId=16746&RQT= 309&VName=PQD>. 3 "XBRL Filing Program and Request for Volunteers." Ontario Securities Commission. 19 Jan. 2007. Web. 1 July 2010. . 2
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reporting. XML was originally developed to improve upon the inherent limitations of HTML by including 4
tags on data elements to electronically communicate context. The organization responsible for the development of XBRL, XBRL International, provides a technical description in the XBRL Specification document. The document is publically available for software developers seeking to build XBRL supported applications. The XBRL Specification identifies six types of attributes, called “linkbases” that can be 5
attached to an item of information. A depiction and description of the linkbases is attached in Appendix I. The contextual information provided by the linkbases includes the item label, the presentation of that label, relevant references, formulas to comply with, source calculations, and other contextual information such as date and currency. While the XBRL Specification describes the underlying structure of any data item, XBRL taxonomies are standardized lists of specific data elements. However, it is important to note that standard XBRL taxonomies can be extended by individual companies to accommodate unique disclosure needs.
The underlying vision behind XBRL was to create a standard method of communicating all types of business information, not only financial statements. However, during this time of transition, it is less overwhelming to implement XBRL reporting on a step by step basis. There are two basic concepts for XBRL reporting: XBRL for financial reporting (XBRL-FR) and XBRL Standardized Global Ledger (XBRLGL). XBRL-FR is the initial step in the process of full XBRL implementation. Appendix II pictorially demonstrates how data can be mapped to XBRL taxonomies to create instance documents, which can then be distributed to users. Expansion of XBRL-FR led to the development of XBRL-GL. As depicted in Appendix III, XBRL-GL facilitates regular updates to instance documents on a transaction level. A key concept of the diagram is the flow of XBRL-GL transaction data to create XBRL-FR instance documents. Opportunities exist in the establishment of an automated flow of transactional information to create financial statements in real-time.
Opportunities of XBRL Reporting XBRL has great potential for both users and auditors of financial information. Users of financial information can enjoy “universal information reuse,” since XBRL reports can be easily transported across 6
any supporting application software. Thus, users are not bound by the constraints of data that is only supported by a single piece of application software; the flexibility of the data provides simple transfer of 4
Boritz, J. Efrim, and Won G. No. "Business Reporting with XML: XBRL (Extensible Business Reporting Language)." Encyclopedia of the Internet 3 (2004): 863-85. XBRL-XARL Research Program. University of Waterloo Centre for Information Systems Assurance. Web. 2 June 2010. 5 Eccles, Robert G., Liv Watson, and Mike Willis. "Chapter 25: How XBRL Will Dramatically Improve Reporting and Control Processes." Governance, Risk, and Compliance Handbook: Technology, Finance, Environmental, and International Guidance and Best Practices. Ed. Anthony Tarantino. Hoboken, N.J.: John Wiley & Sons, 2008. 353-65. Print. 6 Ibid. 4
data to a variety of applications based on the required purpose of the user. As shown in Appendix IV, the business reporting supply chain involves a variety of users at different points during the processing of information. Each of these users, including management accountants, regulators, investors and banks, has different purposes for the information, and therefore it is necessary for information to be accessed from varying applications. Another key benefit lies in the “universal and transparent analytical rules and 7
formulas,” which essentially offers consistency and comparability for user analysis. Additionally, users benefit from “transparent validation and business rules” as the approach for specifying attributes of the data that they require can be electronically streamlined, thereby significantly reducing the need for 8
manual analysis. Basically, users can achieve easier access to the information they require.
Also included in Appendix IV, external auditors are a specific party to the business reporting supply chain. Auditors also stand to benefit from XBRL reporting, as there is an opportunity for “enhanced 9
audit trails.” Integration of XBRL-GL with XBRL-FR would generate automated audit trails, for which the underlying transactional data of a balance could be captured. When combined with the capabilities for an improved IT control environment, auditors are provided “a sound foundation upon which enhanced audit capabilities can be constructed.”
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The automated flow of transactional data to XBRL-FR instance
documents may also lead to the “accelerated implementation of continuous auditing” by way of auditing the process. And as the flow of data is enhanced, auditors have access to current and well documented information, thus facilitating a “better risk assessment” that is based on current information.
Analysis of Research Findings Before these benefits can be enjoyed, research has identified several issues that have arisen with current implementation projects. In Canada, the XBRL implementation program made in effect by the Canadian Securities Administrators (CSA) has not progressed from the initial stage of a voluntary XBRL implementation program. Accordingly, minimal research efforts have addressed the Canadian XBRL program to date; therefore the following analysis is performed on the findings of the US program being undertaken by the Securities and Exchange Commission (SEC). Voluntary SEC Project The SEC commenced the voluntary XBRL filing project by encouraging companies to furnish their
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Ibid. Ibid. 9 Bizarro, Pascal A., and Andy Garcia. "XBRL - Beyond the Basics." The CPA Journal 80.5 (2010): 62-71. ABI/INFORM. Web. 2 June 2010. < http://proquest.umi.com.proxy.lib.uwaterloo.ca/pqdweb?did=2039342811&sid=1&Fmt=2&clientId=16746&RQT= 309&VName=PQD >. 10 Ibid. 8
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regular quarterly and annual filings with XBRL instance documents and company specific extension taxonomies from March 2005 through December 31, 2007. Since the documents are only exhibits to official filings, no audits of XBRL documents were required and the SEC implicitly believed “companies [would] produce XBRL documents of satisfactory quality without such assurance or that the SEC itself would monitor and provide quality assurance on XBRL related documents.”
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Research conducted by
Boritz and No in March 2008 describes the problems identified in the implementation of the voluntary filing project in an attempt to convey the need for assurance over XBRL related documents. A summary of their findings is attached in Appendix V and further discussed below.
One of the fundamental features of XBRL is the ability for companies to extend standardized taxonomies to accommodate the unique reporting needs of the company. However, there is potential for companies to abuse extension capabilities by adding new items without need, where appropriate items were already established within the taxonomy. The research found that all 304 XBRL filings from the voluntary program used extended taxonomies, and specifically, in 2007 it was found that 55.4% of all XBRL items represented company specific extensions.
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Moreover, the research found that extensions
were not justified in the filings, and thus, the reasonableness of extensions could not be ascertained.
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These problems undermine one of the main benefits of the usefulness of XBRL filings as they reduce consistency and comparability of information.
As the SEC required that all company specific extensions were compliant with the most recent version of the XBRL Specification document, the research also incorporated validation tests on all filings to conclude on the level of compliance with that rule. Although it was found that only 34.2% of the filings were compliant, Boritz and No noted varying degrees of non-compliance.
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The XBRL Specification
document contains mandatory requirements as well as recommendations. While not all errors from the validations tests were related to mandatory requirements, an example of a critical error observed in the research was General Electric‟s extension of company specific “Accounts Payable” item when they should have used the standardized taxonomy.
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Seemingly, this finding indicates the company‟s abuse of
the ability to extend official taxonomies. A possible reason for errors such as this may lie in the fact that companies are motivated to extend the official taxonomies in order to reduce transparency.
Moreover, the authors suggest that error messages due to non-compliance with the XBRL Specification‟s recommendations will require user investigation of the issue, impairing efficiency and 11
Boritz, Efrim, and Won G. No. "SEC's XBRL Voluntary Program on EDGAR: The Case for Quality Assurance." (19 Pages). XBRL-XARL Research Program. University of Waterloo Centre for Information Systems Assurance, Mar. 2008. Web. 10 June 2010. . 12 Ibid. 13 Ibid. 14 Ibid. 15 Ibid. 6
leading them to lose faith in the reliability, and hence, usefulness of the data.
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It is important that XBRL-
related documents be viewed as reliable in order for users to obtain value from their use; otherwise there is no practical value in the efforts of preparing these documents in the first place.
Several other issues also reduced the level of consistency observed in the XBRL related documents. It was found, in some cases, that dates of the XBRL related documents did not match the dates of the corresponding official filings.
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From period to period, the research also found that the context
linkbase of XBRL items was not consistently defined.
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Inconsistencies in XBRL related documents
reduce usefulness of the information as users may experience difficulties in performing their analyses on incomparable data.
In addition to the above noted issues with regards to voluntary filing program, various other deficiencies were noted in the filings. Multiple versions of taxonomies were joined to form a company`s base taxonomy, where the authors determined that “a single comprehensive taxonomy [would] ensure better inter-period consistency and reliability.”
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Also, it was noted that the majority of companies do not
file XBRL-related documents on the notes to the financial statements and on the management discussion and analysis.
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As these both contain a significant amount of information, there is opportunity for future
development.
Based on the results of the research, it appears that significant quality control issues arose during the SEC‟s voluntary XBRL filing program. In order for the technology to become an effective means of communicating business information, XBRL-related documents must be reliable. The authors of this study suggest that the SEC implement a quality assurance program by improving official taxonomies, and by providing guidance on the preparation of XBRL documents, among other suggestions.
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Mandatory SEC Project The SEC‟s mandatory XBRL filing project became effective in 2009. The SEC is in the midst of employing a tiered approach to the full implementation of XBRL reporting, whereby the first round of companies was determined based on the size of their public float. In a research study conducted by Debreceny, Farewell, Piechocki, Felden, and Graning in 2010, the first round of filings was examined for
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Ibid. Ibid. 18 Ibid. 19 Ibid. 20 Ibid. 21 Ibid. 17
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the purpose of identifying avoidable computational errors.
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These computational errors were identified by
comparing “values of reported monetary facts (e.g. „Current Assets‟) with the sum of related facts (e.g. „Cash and Cash Equivalents,‟ „Inventory,‟ etc.) as defined by the expressed mathematical structure”
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in
the calculation linkbase. The authors of the study analyzed the errors in an attempt to understand the causes of error and to determine potential solutions.
Based on the findings, the researchers identified seven classes of errors. The first two classes of errors were the improper “exclusion [and inclusion] of a value from a calculation hierarchy.”
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These two
errors are related because it is assumed that when a value is mistakenly included in a given calculation, it is implicitly excluded from the correct calculation, and vice versa. The third class of errors is simply the assignment of an erroneous value to an XBRL item.
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The fourth class of errors stems from the wrong
interpretation of positive and negative values, thus resulting in reversals of debit and credit balances.
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The fifth class of errors are differences due to rounding and the sixth class are due to incorrect calculations in the original filings.
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The last class captures all other errors not previously defined.
The research findings are summarized in Appendix VI. Based on these results, it appears that 26% of the total number of tested filings contained errors, and of these erroneous filings, the maximum number of errors found in an individual file was 32.
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It was also found that an overwhelming 43% of
errors were identified as class four, debit and credit reversal mistakes.
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The authors hold several factors
responsible for this problem. They first recognize the fact that no software has the ability to recognize traditional calculation relationships between items regardless of whether the values are keyed as positive or negative.
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It is also noted that different pieces of software used to prepare XBRL-related documents
use different methods for notifying users of calculation errors, and that the SEC does not test for calculation errors.
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Also, the authors found that the preparers would change the value of an item, by
adding a negative sign for the purpose of performing a calculation, where pre-assigned positive and negative weights are already included for common calculations.
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Debreceny, Roger, Stephanie Farewell, Maciej Piechocki, Carsten Felden, and Andre Graning. "Does It Add Up? Early Evidence on the Data Quality of XBRL Filings to the SEC." Journal of Accounting and Public Policy 29.3 (2010): 296-306. ABI/INFORM. Web. 10 July 2010. . 23 Ibid. 24 Ibid. 25 Ibid. 26 Ibid. 27 Ibid. 28 Ibid. 29 Ibid. 30 Ibid. 31 Ibid. 32 Ibid. 8
Similar to the findings of the research performed on the SEC‟s voluntary filing program, the quality of XBRL filings is inadequate. By building automated calculation validation techniques into XBRL document preparation software, the authors suggest that the majority of errors would be avoided.
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Other Issues Other issues that inhibit the usefulness of XBRL filings include the fact that there is limited training available for both preparers and users to learn how to properly employ the technology.
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This
problem is due to the fact that the technology is still developing; therefore standardized software has not been established. A related problem lies in the fact that it is difficult for people to teach themselves how to use XBRL data as it is not user-friendly. A sample of piece of an XBRL-related document is attached in Appendix VII to emphasize this point. From the appendix, it is clear that these documents are intended for machine processing as opposed to human analysis.
Assurance Issues Given the fact that research on the SEC‟s XBRL filing programs highlighted widespread quality deficiencies over XBRL-related documents, assurance over these documents appears necessary. While the temporary solution for providing assurance on XBRL filings is to map balances back to the original filing, this solution will not continue to suffice as the technology continues to develop and mature over time. The reason for this is that the long-term vision for XBRL includes the communication of all business information, including the integration of transactional data with all filings, as previously discussed. Seeing that it would not be practical to continue providing assurance by mapping balances, some efforts have been made to address the matters which must be overcome in order to design effective models for providing assurance. For example, earlier work performed by Boritz and No, in 2004, led to the development of another XML based language called eXtensible Assurance Reporting Language (XARL). XARL helps provide assurance over XBRL-related documents and links assurance elements, such as the identity of the auditor and date the assurance was provided, to the audited data.
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More recently, Plumlee and Plumlee questioned the traditional usefulness of the traditional audit approach in terms of XBRL filings when they considered how “the paradigm shift from a paper-centric to a 33
Ibid. Bizarro, Pascal A., and Andy Garcia. "XBRL - Beyond the Basics." The CPA Journal 80.5 (2010): 62-71. ABI/INFORM. Web. 2 June 2010. < http://proquest.umi.com.proxy.lib.uwaterloo.ca/pqdweb?did=2039342811&sid=1&Fmt=2&clientId=16746&RQT= 309&VName=PQD > 35 Boritz, J Efrim, and Won G. No. "Assurance Reporting for XML-Based Information Services: XARL." Canadian Accounting Perspectives 3.2 (2004): 207-33. ABI/INFORM. Web. 2 June 2010. . 34
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data-centric focus raises questions about the effectiveness or utility of the current audit guidance.”
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The
authors first make the point that audit guidance must address the definition of an error in an XBRL document by pointing out that current validation techniques do not uncover mistagged pieces of data. Although it is recommended that auditors perform testing on the correctness of tags, the authors point out the lack of guidance as to how this testing could be performed. They identify that the key problem with sampling these tags is that, unlike traditional audit sampling, auditors would not be able to base the sample on tolerable error and desired reliability since the correctness of tags is a qualitative feature.
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Another key issue identified was the concept of materiality as “ultimately, the risk of material mistagging is unrelated to the size of the item.”
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These basic concepts are well established and accepted when applied
to a traditional audit, but when they are used in the context of an audit of an XBRL-related document, it is unclear how auditors should apply them.
While it is apparent that the need for updated assurance guidance is necessary for XBRL filings, research in this area is limited as there is no conclusive guidance regarding the steps auditors should take in order to provide such assurance. Nevertheless as XBRL technology develops, auditors must take action to determine the appropriate procedures by participating in XBRL training and research initiatives.
Conclusion XBRL has the potential to enhance the usefulness of financial information by encouraging consistency of reporting through the use of XBRL taxonomies, and by supporting increased efficiency for users through its electronic analysis capabilities. Accordingly, “regulators and government agencies in many countries are increasingly implementing XBRL for regulatory filings.”
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However, in order for the
information to be useful, users must be able to rely on the fact that the filings are of high quality. In the early stages of the implementation of XBRL, research has demonstrated a multitude of problems with the quality of the filings. The poor quality of these filings is the direct result of a lack of knowledge and experience with XBRL, and the conflict of interest where XBRL filers do not want the increased transparency that regulators seek to achieve. If the technology is to become successfully established as the primary means for communication of business information, assurance must be provided on XBRL related documents. Although there are some unresolved assurance issues with regards to the
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Plumlee, R David, and Marlene A. Plumlee. "Assurance on XBRL for Financial Reporting." Accounting Horizons 22.3 (2008): 353 (11 Pages). ABI/INFORM. Web. 2 June 2010. . 37 Ibid. 38 Ibid. 39 Boritz, Efrim, and Won G. No. "SEC's XBRL Voluntary Program on EDGAR: The Case for Quality Assurance." (19 Pages). XBRL-XARL Research Program. University of Waterloo Centre for Information Systems Assurance, Mar. 2008. Web. 10 June 2010. . 10
technology, these can be overcome through experience and the establishment of proper tools and guidance. Once assurance practices for XBRL-related documents are established and generally accepted, the quality of XBRL filings will be enhanced, and users could rely on the technology to provide the timely delivery of useful information.
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Appendices Appendix I – Linkbases
Source: Eccles, Robert G., Liv Watson, and Mike Willis. "Chapter 25: How XBRL Will Dramatically Improve Reporting and Control Processes." Governance, Risk, and Compliance Handbook: Technology, Finance, Environmental, and International Guidance and Best Practices. Ed. Anthony Tarantino. Hoboken, N.J.: John Wiley & Sons, 2008. 353-65. Print.
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Appendix II – XBRL for Financial Reporting
Source: Bizarro, Pascal A., and Andy Garcia. "XBRL - Beyond the Basics." The CPA Journal 80.5 (2010): 62-
71. ABI/INFORM. Web. 2 June 2010. < http://proquest.umi.com.proxy.lib.uwaterloo.ca/pqdweb?did=2039342811&sid=1&Fmt=2&clientId=167 46&RQT=309&VName=PQD >
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Appendix III – XBRL Standardized Global Ledger
Source: Bizarro, Pascal A., and Andy Garcia. "XBRL - Beyond the Basics." The CPA Journal 80.5 (2010): 62-
71. ABI/INFORM. Web. 2 June 2010. < http://proquest.umi.com.proxy.lib.uwaterloo.ca/pqdweb?did=2039342811&sid=1&Fmt=2&clientId=167 46&RQT=309&VName=PQD >
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Appendix IV – Financial Reporting Cycle
Source: Eccles, Robert G., Liv Watson, and Mike Willis. "Chapter 25: How XBRL Will Dramatically Improve Reporting and Control Processes." Governance, Risk, and Compliance Handbook: Technology, Finance, Environmental, and International Guidance and Best Practices. Ed. Anthony Tarantino. Hoboken, N.J.: John Wiley & Sons, 2008. 353-65. Print.
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Appendix V – Findings from the SEC’s Voluntary XBRL Filing Program
Source: Boritz, Efrim, and Won G. No. "SEC's XBRL Voluntary Program on EDGAR: The Case for Quality
Assurance." (19 Pages). XBRL-XARL Research Program. University of Waterloo Centre for Information Systems Assurance, Mar. 2008. Web. 10 June 2010. . 16
Appendix VI - Findings from the SEC’s Mandatory XBRL Filing Program
Source: Debreceny, Roger, Stephanie Farewell, Maciej Piechocki, Carsten Felden, and Andre Graning. "Does It Add Up? Early Evidence on the Data Quality of XBRL Filings to the SEC." Journal of Accounting and Public Policy 29.3 (2010): 296-306. ABI/INFORM. Web. 10 July 2010. .
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Appendix VII – Sample XBRL-Related Document
Source: Boritz, J. Efrim, and Won G. No. "Business Reporting with XML: XBRL (Extensible Business Reporting Language)." Encyclopedia of the Internet 3 (2004): 863-85. XBRL-XARL Research Program. University of Waterloo Centre for Information Systems Assurance. Web. 2 June 2010.
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Appendix VIII – Annotated Bibliography
Author
Title of Article
Periodical/ website
Vol. / No. / Year Pages Edition published
Aguilar, Melissa K.
Another Round of XBRL Guidance from SEC
Compliance Week
Vol. 7, No. 76 May
2010
Date Location, accessed data base, website, link 66, 78 June 2,
Annotation: The SEC is phasing in the adoption of XBRL financial reporting through a “tiered” approach, whereby different classes of companies are required to begin tagging financial statements in accordance with XBRL rules at different times. Other projects regarding the expansion of XBRL reporting beyond financial statements are also underway including the XBRL US Consortium, who is considering the possibility of tagging mergers, acquisitions, and other corporate actions.
Author
Title of Article
Periodical/ website
Bizarro, Pascal A., and Andy Garcia
XBRL The CPA Beyond the Journal Basics
Vol. / No. / Year Pages Edition published Vol. 80, No. 5 May
2010
62-71
Date Location, accessed data base, website, link June 2, .
Annotation: The XBRL Financial Reporting (XBRL-FR) process is used to produce financial information by: Mapping financial data to the standard reporting framework‟s taxonomy and making any necessary company-specific adjustments; Validating the data; and Providing the information to users. The purpose of XBRL has also been extended to include XBRL Global Ledger (XBRL-GL) which is a way to store transaction-level data. Integration of XBRL-FR with XBRL-GL will benefit auditors as financial statements would be linked to the supporting transactions. However, XBRL implementation problems, including the following, must be overcome: Difficulties in training personnel to use XBRL; Inherent need for improved general and application controls due to automation; and Need for improved network security.
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Author
Title of Article
Boritz, Efrim, SEC‟s and Won XBRL Gyun No Voluntary Program on EDGAR: The Case for Quality Assurance
Periodical/ website
Vol. / No. / Year Pages Edition published
XBRL-XARL n/a Research Program.
March 2008
Date access ed 19 pages June 10, 2010
University of Waterloo Centre for Information Systems Assurance.
Location, data base, website, link
Annotation: As many companies are now beginning to implement XBRL for SEC filing purposes, quality assurance issues have been identified. Some of these issues include: Use of XBRL has been mainly limited to financial statements as opposed to note disclosures and MD&A Many companies employed the use of company-specific, extended taxonomies, thereby making information less comparable with other companies XBRL filings were not always consistent with traditional financial statements The SEC must address these problems by developing an XBRL quality assurance program that ensures correctness of XBRL filings.
Author
Title of Article
Periodical/ website
Vol. / No. / Year Pages Edition published
Boritz, J. Efrim, and Won G. No
Assurance Canadian Vol. 3, No. Reporting Accounting 2 for XMLPerspectives Based Information Services: XARL
2004
207-233
Date Location, accessed data base, website, link June 2,
Annotation: XARL (Extensible Assurance Reporting Language) is web service that was developed by the authors, Boritz and No, to help provide assurance on XBRL-Related documents. The XARL taxonomy relates assurance elements, such as the type of assurance being provided, the identity of the auditor, and the date the assurance was provided, to the data being audited. XARL can also be extended to provide assurance over other XML-based documents.
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Author
Title of Article
Periodical/ website
Vol. / No. / Year Pages Edition published
Boritz, J. Efrim, and Won G. No
Business Reporting with XML: XBRL
XBRL-XARL n/a Research Program.
2004
University of Waterloo Centre for Information Systems Assurance.
Date Location, accessed data base, website, link 863 - 885 June 10,
Annotation: Article describes the background information of the development of the XML based languages, XBRL and XARL. A discussion of the background of HTML is also included. No recent research issues were identified from this source.
Author
Title of Article
Periodical/ website
Vol. / No. / Year Pages Edition published
Debreceny, Roger, Stephanie Farewell, Maciej Piechocki, Carsten Felden, and Andre Graning
Does It Add Up? Early Evidence on the Data Quality of XBRL Filings to the SEC
Journal of Accounting and Public Policy
Vol. 29 Issue 3
2010
296-306
Date Location, accessed data base, website, link July 10, .
Annotation: This article identifies the calculation errors and potential causes, with respect to the SEC‟s mandatory XBRL filing program including: improper exclusion [and inclusion] of a value from a calculation hierarchy assignment of an erroneous value to an XBRL item wrong interpretation of positive and negative values, thus resulting in reversals of debit and credit balances differences due to rounding incorrect calculations in the original filings
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Author
Title of Article
Periodical/ website
Vol. / No. / Year Pages Edition published
Eccles, Robert G., Liv Watson, and Mike Willis
Chapter 25: How XBRL Will Dramatically Improve Reporting and Control Processes
Governance, Risk, and Compliance Handbook: Technology, Finance, Environment al, and International Guidance and Best Practices.
Ed. Anthony Tarantino. Hoboken, N.J.: John Wiley & Sons
2008
353-365
Date Location, accessed data base, website, link n/a Print
Annotation: The current problems faced by the traditional approach to financial reporting include: Software formats such as “.doc,” “.pdf,” and “.xls” make it difficult for users to process information of the application the file was created in; Controls are application specific; and The use of spreadsheets can create problems with managing large amounts of ever-changing information. XBRL can solve these problems and provide many additional benefits such as: Providing a more flexible means of financial reporting that allows users to process information across different applications; Provides flexibility over the use of controls in separate applications; Giving financial information contextual background; and by Facilitating more controlled and automated audit trail.
Author
Title of Article
Periodical/ website
Plumlee, R. David, and Marlene A. Plumlee
Assurance Accounting on XBRL for Horizons Financial Reporting
Vol. / No. / Year Pages Edition published Vol. 22, No. 3
2008
Date Location, accessed data base, website, link 11 pages June 2, .
Annotation: The PCAOB requires auditors to agree XBRL-Related documents to a copy of the financial statements which they have audited. This method of gaining assurance over XBRL-Related documents is currently sufficient, but as XBRL changes the way financial information is reported this method will no longer be adequate. As users are able to extract the data they need through the XBRL “data-centric” environment, auditors must consider changes to the traditional approach to auditing, including the following issues: Determining how to use sampling to test appropriateness of tags on financial information; and Determining how to re-define materiality since errors in tags could lead to material misstatement regardless of the associated balances.
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Note: The following two sources were referenced in the paper for facts regarding current implementation projects and do not identify issues: "XBRL Filing Program and Request for Volunteers." Ontario Securities Commission. 19 Jan. 2007. Web. 1 July 2010. . "XBRL in Action." XBRL International. Web. 1 July 2010. .
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