eXtensible Business Reporting Language (XBRL) (D. Naseem)

UNIVERSITY OF WATERLOO

ACC626 Term Paper eXtensible Business Reporting Language (XBRL)

David Naseem

7/1/2011

This is a report on eXtensible Business Reporting Language to satisfy the paper requirement for ACC626 course at the University of Waterloo. The report generally covers: (1) The need for XBRL and its importance in the current reporting environment; (2) How XBRL works; (3) Top management and practitioner concerns with XBRL; (4) Opportunities for the introduction of new services and (5) Assurance Issues and Implications of XBRL. The report concludes with recommendations for CA practitioners to get ahead in the race for XBRL adoption and predictions for future developments in this area.

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Table of Contents 1.0 Introduction .................................................................................................................................2

2.0 The Problem with Current Financial Reporting on the Web ................................................................ 3

2.1 A Brief History of XBRL ........................................................................................................................... 4

2.2 XBRL and How it works .......................................................................................................................... 5

3.0 Impact of XBRL on the Profession ......................................................................................................... 6

3.1 Top management concerns about XBRL ................................................................................................ 8

3.2 Practitioner and Industry Concerns about XBRL ................................................................................... 8

3.4 Opportunities for Introduction of New Services ................................................................................... 9

3.5 Assurance Issues and XBRL .................................................................................................................. 11

3.6 Recommendations for Practice Professionals ..................................................................................... 12

4.0 Conclusions ........................................................................................................................................... 13

Appendix 1 .................................................................................................................................................. 14

Annotated bibliography ................................................................................................................... 15

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1.0 Introduction

It is often said that Accounting is the language of business but there is a new language that has the

potential to change the way accountants communicate information forever, it is called eXtensible

Business Reporting Language (XBRL). Since the dawn of the internet, sharing information has become

increasingly easier, within minutes one can share pictures, videos and documents with others. The

technology has advanced so much so that businesses are looking to become entirely “paperless” by

removing paper from its workflows. This move is the next step forward for business in the 21st century,

business that is increasingly reliant on technology, especially the internet, to cut costs and increase

efficiencies while maintaining effectiveness of the enterprise. Financial reports are an integral part of the

business and generally have followed this trend. In the past, if one wanted access to the annual report

they would need to order it from the organization or if they were a shareholder obtain it at the annual

meetings; and this was not that long ago at all. Presently, most financial reports are available free of

charge on company websites for public companies and also filed with financial databases such as

SEDAR (Canada) and EDGAR (America).

For the better part of the last century all financial analysis was done on paper, it took a lot of labour to

extract, manipulate, model and interpret the data to make it useful. Modern personal computers have

given consumers the power to analyze data on a level that was impossible before this age, coupled with

the advances in technology this should make financial analysis a snap, but this is not the case. Willis

(2003) echoes many such problems that exist with paper financial reports, citing that the needs of

investors and other users are real-time in nature and paper reporting cannot keep up. Specifically he

states that, “paper-based reporting is opaque, linear, and unable to meet real-time information needs.”1

This is the problem that XBRL aims to solve, to make managing and manipulating information a lot easier.

At its heart XBRL is a tagging mechanism that allows companies and individuals the ability to ‘tag’ data

inside financial reports.2 The point is to tag financial data with universal tags to facilitate data extraction

and manipulation. These tags will be based on universal taxonomies (a bit like dictionaries) for all

financial statements; examples of a tag may be ‘Cash’, ‘Receivables’ etc. XBRL is a game changer in the

financial reporting world because it will become the new format for financial reports all over the world. It is

currently a requirement in countries like China, Japan, Korea, Singapore and Spain.3 Canada is set to

1 Willis, Mike. "Corporate Reporting Enters the Information Age." Regulation, Summer 2003: 56-60.

http://proquest.umi.com.proxy.lib.uwaterloo.ca/pqdweb?did=441379991&sid=1&Fmt=3&clientId=16746&RQT=309&VName=PQD

2 Saeedi, Ali, Barry Smith, and Jim Richards. "An Introduction to XBRL." Academic Paper, 2006: 1-19.

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1007570 3 Dzinkowski, Ramona. "Do you speak XBRL?" CA Magazine, December 2008.

http://www.camagazine.com/archives/print-edition/2008/dec/features/camagazine4118.aspx



http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1007570


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adopt XBRL, it currently has a voluntary XBRL filing program in place and will require mandatory XBRL

tagged documents starting in 2012.4

The purpose of this report is to educate and inform a practice professional about the topic of XBRL. This

remainder of this report is laid out as follows. First, the problems with the current financial reporting

paradigm are examined. Next, the report gives a brief account of the history of XBRL and how it was

developed. Finally, details of how XBRL works will be examined. The analysis in the report will focus on

the impact of XBRL on the CA profession, the risks associated with XBRL, top management and

practitioner concerns about XBRL. The report ends with opportunities for the introduction of new services

with recommendations on how CAs can better equip themselves for success in a post-XBRL world.

2.0 The Problem with Current Financial Reporting on the Web

There are numerous problems with current financial reporting that give rise to the need for XBRL. First,

the problem is one of usability. It is generally regarded that electronic forms of financial statements are

not as user friendly to use as paper copies as it takes more time and energy to extract data from them.

Willis (2003) finds that people are generally reluctant to use financial information in electronic form

because, “too complicated, too unwieldy, and perhaps not worth the time…”5 The main culprit here is the

problem of having too many formats, a company can show financial information in HTML, Excel, Word or

PDF.6 Trying to deal with these different files, it is sometimes better to use paper copies. Further, there

could be a problem with the format of the statements themselves, i.e. some organizations may show

details in the notes while others may place them on the financial statements themselves. XBRL solves

both of these issues because: (1) it is an open standard for financial reporting and once it is made

mandatory all financial reports will be XBRL tagged and; (2) all numerical information will be tagged using

standard taxonomies which will make the actual format of the financial statements irrelevant.7 However,

this is not to say that the format of the financial statements is not important; XBRL tagged documents can

be combined with a ‘style sheet’ to produce statements similar to their hard-copy versions.8

Next, search engines are inept at finding specific accurate information quickly. This is less of a problem

now because major regulators now have their own filing systems for financial information such as SEDAR

and EDGAR. But finding a document quickly does not necessarily mean that a user will be able to find

4 Dzinkowski, Ramona. "Do you speak XBRL?" CA Magazine, December 2008.

http://www.camagazine.com/archives/print-edition/2008/dec/features/camagazine4118.aspx 5 Willis, Mike. "Corporate Reporting Enters the Information Age." Regulation, Summer 2003: 56-60.



http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1007570 7 Ibid.

8 Plumlee, David, and Marlene Plumlee. "Assurance on XBRL for Financial Reporting." Academic Paper, 2008: 1-27. http://ssrn.com/abstract=1104245





http://ssrn.com/abstract=1104245

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required information quickly within the document. Traditional search methods simply cannot cope with

information needs, because to index financial information across a plethora of formats (as mentioned

earlier) one would need to rely on a full-text indexed search engine, these search engines are known for

their low accuracy.9 Further the problem is compounded by the financial statement themselves; although

a search engine may find the required information, the user will be unaware of the disclosures or other

notes regarding that item unless they review the full report and thereby defeating the purpose of the

search engine.10

Finally, another problem is that after financial statements are prepared they must be modified for different

parties. For example, a company might need to file a different set of information for banks, regulators etc.

In the past this was a major undertaking, recently with advanced software packages, it has become

easier. With XBRL this will not be a concern because it is an open platform there is no need to

specialized software or infrastructure to use XBRL.11

Therefore, once information has been tagged it can

be manipulated by external parties and companies can embed details for external parties eliminating the

need for different reports altogether.

2.1 A Brief History of XBRL

The history of XBRL goes back to a CPA practicing in Washington, Charles Hoffman.12

He saw the

problems that were inherent with managing the different file formats and began experimenting with XML

as a way to solve them.13

He approached the AICPA with his idea and this eventually led to the

development of the XBRL International consortium that is charged with the further development of the

platform. 14

The consortium has been very successful persuading many countries and major stock

exchanges to adopt XBRL.15

Originally the framework was known as XFRML or eXtensible Financial

Reporting Markup Language, but the consortium realized early that this language would be very versatile

so they went with XBRL.16

Although the language has been in the spotlight recently, the fact of the matter

is that there were taxonomies as early as 2000.17

From the above discussion it is clear that XBRL is a


http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1007570 10

Ibid. 11

Malhotra, Rashmi, and Francis Garritt. "Extensible Business Reporting Language: The Future of E-Commerce- Driven Accounting." International Journal of Business 9, no. 1 (2004): 1-24. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=490444

12 Ibid.

13 Ibid.


http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1007570 15

Boritz, J. Efrim, and Won Gyun No. "Auditing XBRL-Related Documents: The Case of United Technologies Corporation." SSRN Working Paper Series, 2008: 1-46. http://ssrn.com/abstract=1288376

16 Malhotra, Rashmi, and Francis Garritt. "Extensible Business Reporting Language: The Future of E-Commerce-

Driven Accounting." International Journal of Business 9, no. 1 (2004): 1-24. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=490444

17 Ibid.






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language with distinct business applications that has the potential to become the medium of choice for all

formal financial business communication.

2.2 XBRL and How it works

XBRL is very different from all other reporting mechanisms currently at work and therefore it is helpful to

learn about how it works. Debreceny et al. (2005) found that XBRL is much more versatile than traditional

financial documents because not only is the language platform independent (formats do not need to be

converted across applications) but also that XBRL can support both financial and non-financial data.18

This is something that no other format has been able to support while still maintaining the “efficiency,

reliability and accuracy” of XBRL.19

Although XBRL is supposed to make things simpler for all business people and users of financial

information, like all well-built applications it hides immense complexity under a façade of simplicity. There

are four documents that are key to understanding the XBRL process and how it works, these are: (1) the

XBRL specification; (2) XBRL taxonomies; (3) XBRL instance documents; (4) style sheets.

The current XBRL specification version is 2.1 and according to the XBRL consortium the specification

provides “the fundamental technical definition of how XBRL works.”20

Further it provides documentation

about the framework of XBRL and explains the syntax needed to create instance documents using

taxonomies.21

As alluded to before XBRL taxonomies are a bit like dictionaries since they contain

definitions of data tags, the data tags themselves and the relationships between tagged items.22

For

example a data tags might be financial statement line items like Cash, Investments and Equipment.

However, the tagged items are not simply financial information; taxonomies allow the tagging of non-

financial information as well as financial information such as management discussion and analyses in the

annual reports.23

The definition of the tags depends on which taxonomy is utilized; there are various

18

Debreceny, Roger S, Akhilesh Chandra, John J Cheh, and Denise Guithues-Amrhein. "Financial reporting in XBRL on the SEC's EDGAR system: a critique and Evaluation." Journal of Information Systems 19, no. 2 (2005): 191-210. http://proquest.umi.com.proxy.lib.uwaterloo.ca/pqdweb?index=0&did=938381601&SrchMode=2&sid=1&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1308970465&clientId=16746

19 Yoon, Hyungwook, HangJung Zo, and Andrew P Ciganek. "Does XBRL adoption reduce information asymmetry?" Journal of Business Research 64, no. 1 (2011): 157-163. http://www.sciencedirect.com/science/article/pii/S0148296310000251

20 XBRL Consortium. XBRL Specifications. 2011. http://xbrl.org/frontend.aspx?clk=LK&val=35 (accessed June 25,

2011). 21

CICA ITAC. Audit and Control Implications of XBRL. White paper, Toronto: CICA, 2005. http://www.cica.ca/research-and-guidance/documents/it-advisory-committee/item12054.pdf

22 Ibid.

23 Debreceny, Roger S, Akhilesh Chandra, John J Cheh, and Denise Guithues-Amrhein. "Financial reporting in XBRL

on the SEC's EDGAR system: a critique and Evaluation." Journal of Information Systems 19, no. 2 (2005): 191-210.(URL on next page)

http://proquest.umi.com.proxy.lib.uwaterloo.ca/pqdweb?index=0&did=938381601&SrchMode=2&sid=1&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1308970465&clientId=16746


http://www.sciencedirect.com/science/article/pii/S0148296310000251

http://xbrl.org/frontend.aspx?clk=LK&val=35%20

http://www.cica.ca/research-and-guidance/documents/it-advisory-committee/item12054.pdf

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taxonomies that are currently in existence. These range from GAAP taxonomies used to produce GAAP

financial information as well as regulatory body taxonomies that facilitate the filings of information with

regulators such as the 10K and 10Q filings for the SEC in the US.24

The taxonomies define the tagged

items and relationships between the tagged items, for example, the relationship between cost of goods

sold and the inventory account. The potential of the above is profound, not only will everyone be using the

exact same format to communicate business information; but all investors regardless of their level of

financial sophistication will be able to understand the financial statements in depth because all relevant

relationships in the statements will be explicitly identified.

The instance document is essentially the coming together of the taxonomy and the XBRL specification in

the context of a financial report. For example, say a company has prepared its financial statements for the

year ended December 31, 2011 with the numerical data for each line item and the notes etc. It will then

proceed to tag the relevant data with the XBRL specification and data tags contained in the taxonomy.25

The result of this step is known as the instance document which is just a collection of data and tags that

explain the data. It is important to note that in its current form an instance document cannot be read by

humans but is only machine-readable.26

For XBRL to be a complete solution it needs to be able to

produce information that makes sense to humans and for this reason the XBRL specification contains

style sheets. The purpose of the style sheet is to convert the machine-readable instance document into a

form that is readable by humans.27

Statements prepared using the instance document is comparable to

statements published in other formats such as Word, PDF and HTML.28

Appendix 1 shows the

information as described above in a flowchart format.29

3.0 Impact of XBRL on the Profession

Anyone with a cursory knowledge of accountants and their role in society will attest that their main task is

one of reducing information asymmetry between owners and managers of a corporation. In a study by

Yoon et al. (2011) examining the effects of XBRL and information asymmetry states that even without

XBRL firms that publish information in a high-quality, standard formats are perceived as less risky by the


24 Plumlee, David, and Marlene Plumlee. "Assurance on XBRL for Financial Reporting." Academic Paper, 2008: 1-27.

http://ssrn.com/abstract=1104245 25





28 Ibid.










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market.30

This is important since it is almost a given that XBRL will be the de facto standard for financial

reporting in the future. Further, the authors examined the impact on information asymmetry without

considering the reduction effects expected due to mass adoption of XBRL, meaning that the impact could

be higher. They examined capital markets in Korea that have implemented XBRL since October 2007.31

They tested various hypotheses regarding XBRL and its effects on information asymmetry. Their first

hypothesis is the most important: “XBRL adoption reduces information asymmetry in the capital market.”32

The results of their statistical analyses show that XBRL adoption reduced information asymmetry in

Korea, the coefficient was -0.05 with a p-value of 0.00 suggesting highly significant evidence was found.33

The above discussion shows that in addition to all of the efficiencies that come with using one electronic

format that is platform independent, XBRL also allows accountants and auditors to reduce information

asymmetry which is a primary goal of the profession.

Boritz and No (2008) predict that eventually XBRL reporting will completely be replaced by the XBRL

paradigm.34

The SEC of the US and similarly the Ontario Securities Commission (OSC) has taken the

stance not to require any assurance over XBRL documents at the present time.35

However, it appears a

certainty that some form of assurance will be required for XBRL related documents in the future. Plumlee

and Plumlee (2008) find that reports with negative or no assurance such as reviews and compilations

currently performed are highly unlikely to fulfill investor expectations.36

In addition, the CFA institute

surveyed its members as to what level of assurance was needed for XBRL documents to be considered

reliable, the survey found only 3% of objected to assurance of any kind.37

All of the above indicates that

accountants will be called upon to provide assurance over XBRL documents. The idea of assurance

coupled with change to an electronic reporting paradigm will have an immense impact on audits. Auditors

will have to adapt their audit approach to incorporate XBRL document audit into the regular financial

statement audits. The audit approach will forever be changed since auditors will increasingly have to rely

on internal controls to carry out audits, assurance issues are discussed in more detail later in the report.

30

Yoon, Hyungwook, HangJung Zo, and Andrew P Ciganek. "Does XBRL adoption reduce information asymmetry?" Journal of Business Research 64, no. 1 (2011): 157-163. http://www.sciencedirect.com/science/article/pii/S0148296310000251

31 Ibid.

32 Ibid.

33 Ibid.

34 Boritz, J. Efrim, and Won Gyun No. "Auditing XBRL-Related Documents: The Case of United Technologies

Corporation." SSRN Working Paper Series, 2008: 1-46. http://ssrn.com/abstract=1288376 35

Dzinkowski, Ramona. "Do you speak XBRL?" CA Magazine, December 2008. http://www.camagazine.com/archives/print-edition/2008/dec/features/camagazine4118.aspx



CFA Institute. XBRL Survey Report. CFA Institute, 2008. http://www.cfainstitute.org/Survey/xbrl_survey_report.pdf

http://www.sciencedirect.com/science/article/pii/S0148296310000251




http://www.cfainstitute.org/Survey/xbrl_survey_report.pdf

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3.1 Top management concerns about XBRL

Although XBRL is promoted heavily in the media and literature as a revolution in financial reporting, top

management have some concerns about the new format. A committee of CFO’s of major organizations

wrote to the SEC citing concerns that the implementation of XBRL will only increase costs and does not

benefit the organization’s internal processes.38

This argument does have some merit since most of the

perceived benefits of XBRL are toward the external users of financial information and not the actual

organization preparing the information. Nevertheless, the strong points of XBRL should be noted by the

CFO’s especially the notion that XBRL will decrease information asymmetry which is likely to increase the

company’s stock price. However, it does seem like the timing of XBRL is bad since the economy has

recently recovered from the recession and it is a time when CFO’s would like to post higher profits and

not incur additional costs that would lower the bottom line.

Another concern is that since XBRL is benefitting mostly external users and CFO’s do not see any

internal process improvements with it coupled with the recent recession companies are more likely to

adopt a bolt-on process rather than a built-in one. The consequence of this will be that the companies and

economy as a whole will not obtain the full benefit out of XBRL since the companies will simply see it as

another new format to comply with and simply add on the tagging after the financial information is

prepared. This would obviously only marginally improve the current financial reporting paradigm. On the

one hand, organizations can be seen as righteous because of the major adoption of another set of

standards, IFRS. Canada will be moving to IFRS starting in 2011 any built-in system based on XBRL will

need to be revised through a mass changeover of taxonomies to IFRS standards. Further, organizations

currently have no choice but to have bolt-on procedures for XBRL since there are no widespread

solutions that integrate a corporations internal financial reporting with XBRL.39

To conclude, clearly the hysteria and prospects of XBRL as a communication tool are not being echoed

by top management. They view the change as just another format change that regulators require and that

corporations will have to comply with, as a cost of doing business.

3.2 Practitioner and Industry Concerns about XBRL

As examined above, top management is hardly excited about XBRL. The rest of the financial community,

mainly practitioners, is also not ecstatic about XBRL. In this section I examine the risks relating to XBRL

from the perspective of practitioners.

One disadvantage of XBRL is that the benefits relating to XBRL adoption are unlikely to be seen for a

several years. As any analyst will reveal that the real benefit of XBRL will be once there is tagged

financial and non-financial data for a company across a number of years. This is unlikely to happen for

38


39 Ibid.


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the next several years since, Canada only requires XBRL in 2011 for those entities that apply IFRS.40

Further, in the US the SEC has given XBRL filing companies a grace-period of one year before they are

required to tag non-financial information such as the MD&A in their filings.41

Given the influence that SEC

policies have on the OSC it is likely that Canada will follow suit.

Another disadvantage is the fact that in order for all of the XBRL’s benefits to accrue most of the financial

filings should be done in accordance with one taxonomy. The problem is that no taxonomy is “robust or

flexible enough”42

at the moment to handle all of the specific needs of individual firms, for example firms

in a specific industry.43

The result of this is that companies will start to use customized reporting

taxonomies under which they are allowed to create their own tags. This is a huge risk from all points of

view, most of the benefits related to XBRL will be lost and analysts will not realize any benefits

whatsoever. 91% of analysts oppose letting companies set their own customized tags; however, it is

unclear how regulatory bodies will meet the challenge of forming a universal taxonomy.44

The SEC

currently takes the stance of allowing customized tags leading to results that should not surprise anyone.

Allowing companies to create their own tags is to allow companies to invent additional line items to make

their financial situation look as bright as possible. Finding and correcting these errors is going to take the

kind of manual labour and effort that gave rise to the invention of XBRL in the first place.45

This type of

management, i.e. making XBRL documents look better than they are by managing tags could lead to

even more serious problems. Neff (2009) articulates this point well stating that two investors could come

up with different debt-equity ratios depending on if one uses the company tagged XBRL codes or one that

relies on purely the PDF version of the statements.46

3.4 Opportunities for Introduction of New Services

XBRL is a major change in how public companies will be expected to file financial information for the

foreseeable future. It is raising interesting new problems that are making spaces for CAs and other

professionals to fill the void. There are two main areas in which CAs can enhance their service offerings

to corporations: (1) Implementing XBRL and preparing tagged documents and (2) Providing Assurance

on XBRL documents.

40

Neff, Todd. "XBRL Looms, but Exactly Who Will Use All This?" ComplianceWeek, 2009: 54-55,70. http://proquest.umi.com.proxy.lib.uwaterloo.ca/pqdweb?did=1737382281&sid=9&Fmt=3&clientId=16746&RQT =309&VName=PQD 41


42 Neff, Todd. "XBRL Looms, but Exactly Who Will Use All This?" ComplianceWeek, 2009: 54-55,70.

http://proquest.umi.com.proxy.lib.uwaterloo.ca/pqdweb?did=1737382281&sid=9&Fmt=3&clientId=16746&RQT =309&VName=PQD 43

Ibid. 44

Ibid. 45

Ibid. 46

Ibid.

http://proquest.umi.com.proxy.lib.uwaterloo.ca/pqdweb?did=1737382281&sid=9&Fmt=3&clientId=16746&RQT%20%20%20%20=309&VName=PQD





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First, one of the new services that CAs can offer is to implement XBRL in the organization and prepare

XBRL tagged documents. Companies will have to do a lot in terms of preparing themselves for this new

form of financial reporting. Some of the issues pertain to training, education, adequate software, and

taxonomy selection and reader software. CAs can assist with all of the above. The collective process will

be talked about within the context of XBRL implementation. This would be a good source of revenues for

CAs because they can perform these services without aggravating the independence rules for auditors.

However, there is considerable evidence that there may not be a market for these services at the present

time. Choi et al. (2008) found that the jump to XBRL reporting was not as problematic as once thought.47

The authors found that of the voluntary XBRL filers with the SEC most completed their XBRL filings

simply by making an in-house task force of 3-4 people.48

These teams had to spend about 80-100 hours

learning XBRL and coding statements into the format.49

However, they had significant difficulty choosing

the tags for the line items and most chose to get specific advice regarding this; other than that, most

companies in the study did not find the change to XBRL a costly or a lengthy process.50

Therefore, the

study appears to preclude any possibility of generating significant revenues through consulting on XBRL

implementation.

Next, the other new service that CAs can offer is the audit of XBRL documents. As mentioned earlier the

SEC has taken the stance of not requiring assurance on XBRL documents, but it is a certainty that it will

be required. The audit of XBRL documents is a natural extension of the work that CAs already do, the

audit of financial statements. Indeed, if the SEC requires audits of XBRL documents Canada will follow

suit. Boritz & No (2008) go as far as to state that: “[current XBRL filings by corporations have] limited

quality assurance …This is both a threat to the reliability and quality of XBRL-tagged business information

and to the success of XBRL.”51

The authors further point to other studies that show: “errors,

inconsistencies, and limitations that could undermine users’ confidence” in XBRL documents.52

The

current audit guidance that is provided by the AICPA and PCAOB is mainly concerned with comparing the

traditional financial statements with the XBRL tagged documents to ascertain whether or not both

documents “reflect the same information.”53

This is giving rise to other major auditing issues which will be

discussed further in the next section. In conclusion, CAs should provide assurance on XBRL documents

as it will be main source of revenue from XBRL for accounting firms for the foreseeable future.

47

Neff, Todd. "XBRL Looms, but Exactly Who Will Use All This?" ComplianceWeek, 2009: 54-55,70. http://proquest.umi.com.proxy.lib.uwaterloo.ca/pqdweb?did=1737382281&sid=9&Fmt=3&clientId=16746&RQT =309&VName=PQD. 48

Ibid. 49

Ibid. 50

Ibid. 51


52 Ibid.







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3.5 Assurance Issues and XBRL

There are a plethora of assurance issues for practitioners to solve before auditing of XBRL documents

with the efficiency and effectiveness normally associated with audits can be achieved. I will limit myself to

the more important issues in this report these tend to be: (1) Lack of clear accounting framework and

guidelines for audit; (2) How to conduct the audit and what should auditors be testing; (3) The concept of

materiality and sampling in XBRL audits. Currently, the CICA recommends the use of CAS 5025 to audit

XBRL documents; these requirements however are very vague and unclear.54

First, there is a general lack of a clear accounting framework and guidelines to help auditors provide

assurance on XBRL documents. The implication of the above is that audits are carried out inefficiently.

Boritz & No (2008) carried out an audit of United Technologies Corporation’s (UTC) XBRL instance

documents and a major task performed was tracing items in the instance document to the paper version

of the statements.55

This task alone took them over 63 hours to complete and they were able to state that

the instance document was complete and accurate.56

However, Srivastava & Kogan (2009) rightly

criticize Boritz’s methodology because even after doing all of this all they had done was prove that the

mapping of the instance document to the paper statements was identical (one-to-one).57

The issue is that

even if the instance document is mapped correctly with the paper financials that does not mean that the

company has used appropriate tags in the instance documents. Srivastava & Kogan (2009) come up with

a set of assertions to help formalize the audit.58

Some of their assertions are as follows (some are

adapted from traditional financial statement assertions): (1) Completeness of instance document; (2)

Existence of facts not in paper statements; (3) Accuracy of the tagged items; (4) Well-formedness,

compliance with XBRL syntax rules; (5) Validity, compliance with XBRL taxonomies; (6) Proper

Representation, using appropriate tags in the specified taxonomy.59

Therefore I recommend the use of

the above document to ensure that procedures address all of these assertions in the paper.

Next, there are concerns about what the audit’s objective is and what the auditors should be testing. In

Canada, there are no specific audit requirements for XBRL documents. Boritz & No (2003) cite that

PCOAB audit guidance was limited to ensuring that the XBRL documents conformed to the audited paper

54


55 Boritz, J. Efrim, and Won Gyun No. "Auditing XBRL-Related Documents: The Case of United Technologies

Corporation." SSRN Working Paper Series, 2008: 1-46. http://ssrn.com/abstract=1288376 56

Ibid. 57

Srivastava, Rajendra P, and Alexander Kogan. "Assurance on XBRL Instance Documents: A Conceptual Framework of Assertions." Academic/Working Paper, 2009: 1-27. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1289467

58 Ibid.

59 Ibid.




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financial statements.60

These requirements are woefully inadequate to addressing the needs of the

investing public. For example, just because the statements appear the same as their paper version it

does not mean that all the tags are appropriate (i.e. debt tagged as equity). Further the PCOAB is

implementing rules that will make it mandatory for auditors to test the appropriateness of tags; however,

given the differing taxonomies and the extensive tagging done to annual reports it is difficult to see how

an XBRL audit can be done efficiently if auditors are required to test all tags.

Finally, new audit methodology is needed for XBRL instance documents since traditional constructs of

risk, materiality and sampling break down under this new reporting environment. Plumlee & Plumlee

(2008) discuss that the concept of risk does not translate well into the XBRL reporting regime.61

This is

because in the financial statement audit the concept of risk of material misstatement is well-defined as the

amount that would cause a user to change their business decision; however, in the XBRL context it is

difficult to quantify since the business can simply extract and show data outside the financial statements

to users.62

For example, a user may see company reported debt figures which may fairly stated within the

context of the financial statements taken as a whole (misstatements netted out etc.) but not when looking

at debt on its own. Further, audit sampling cannot work in the XBRL context either because by sampling

tags would only give the number of tags that are inappropriate.63

It is easy to think of a scenario where a

large number of tag misstatements may not amount to a material misstatement for financial statement

purposes.64

Furthermore, if auditors have to check all tags this would mean that audits will cost an

enormous amount of time and money, the cost/benefit of such an exercise would also be unfavourable.

3.6 Recommendations for Practice Professionals

For most of the above issues there is no answer but to wait until a more cohesive framework is

established with concrete guidelines. Boritz & No (2008) have proposed data-level assurance in which

auditors will add an additional tag to the financial statement item that would comprise of their signature

and other information attesting to its accuracy.65

This is a promising proposition however the future of

such a system remains to be seen.

Even though there are no requirements to audit XBRL documents CAs can enhance services offered to

their clients by offering assistance with implementation and resolving issues regarding the tagging of

financial data. CA firms can further increase services by stressing the importance that investors place on

60




Ibid. 63

Ibid. 64

Ibid. 65





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audited information and its role in reducing information asymmetry and auditing XBRL information in

conjunction with financial statement audits. To this effect, I recommend the use of audit frameworks as

those outlined in Srivastava & Kogan (2009) until more detailed guidance is issued by the CICA

governing the audit of XBRL instance documents. CA firms can also help train first-time adopters of

XBRL. I believe that most revenue generated by CA firms will be in providing assurance on XBRL

information and firms should take steps to set themselves apart from other firms by offering these

services early.

4.0 Conclusions

In conclusion, it is clearly seen that XBRL is the future of financial reporting. Through the report I have

examined the problems with the current financial reporting paper paradigm. The benefits offered by XBRL

clearly and sufficiently alleviate most of the problems that are found with paper reporting. I have also

examined the concerns of management and auditors that threaten the use of XBRL. It was also shown

that most of the problems appear to be related to the timing and the lack of standards, both of which in

my opinion are easily resolved. CAs should be especially aware of these issues since XBRL has the

potential to change the profession forever. From everything to how CAs communicate financial

information to external parties to how to audit financial statements. I have also examined how XBRL will

work and the process behind preparation of XBRL instance documents. CAs have opportunities to

expand their services by incorporating XBRL consulting and assurance into their current offerings. XBRL

is all set to revolutionize financial reporting, CAs need to be ready or run the risk of losing relevancy in a

post-paper paradigm financial world.

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Appendix 1

66

66

Plumlee, David, and Marlene Plumlee. "Assurance on XBRL for Financial Reporting." Academic Paper, 2008: 1-27. http://ssrn.com/abstract=1104245, pg.27


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Annotated Bibliography

Author Title of Article Periodical/

website Vol. / No. / Edition Year

published Pages Date

accessed Location, data base, website, link

Richards, Jim; Smith, Barry; Saeedi, Ali.

An Introduction to XBRL

Academic Paper/Working Paper

N/A 2006 19

May 12, 2011

SSRN

n/a http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1007570

Annotation Article goes in-depth into what XBRL is and how it can benefit financial reporting, and identifies the short-comings of other formats etc.

1. Authors are all affiliated with Universities. 2. Describe the problems with traditional financial reporting, problem today is: comparability, propose XBRL is a way to solve these issues. 3. Definition of XBRL, eXtensible Business Reporting Language

- Extensible implies that language is flexible enough to be changed according to financial community needs. 4. History of XBRL

- Current development overseen by XBRL international; responsible for setting specifications tags etc. Over 30 countries involved~2006 - Originally started by AICPA 1999

5. Two key items to understand XBRL - Taxonomy: a hierarchical classification of something. i.e. Cash is subset of Current Assets such is a subset of Total Assets etc. - Instance document: when accounting data is mapped to a specific taxonomy the result is an instance document containing the XML

tagged data 6. Why XBRL is needed, 3 problems pertaining to current web-financial reporting. (1) resource discovery problem: locating the specific

financial data, (2) attribute recognition problem: no schemas to classify data consistently that are robust or well structured, and (3) standards problem: Websites use existing schemas inconsistently if at all

7. Describes why a standard is needed in web-reporting (i.e. problems with html, pdf’s etc). And positives of a one standard system.

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Author Title of Article Periodical/ website

Vol. / No. / Edition Year published

Pages Date accessed

Location, data base, website, link

Willis, Mike [Affiliation: XBRL international, PwC partner]

Corporate Reporting enters the Information Age

Regulation Vol. 26, No. 3 Summer

2003 56 - 60

May 12, 2011

ABI Inform


Annotation Article goes through the whole process of why XBRL is needed, what its advantages are, why it is better than other alternatives and even why a standardized XBRL is better than a customized XML system.

Some of the problems with paper reports article claims are: it is very late and not timely at all, no way to extract the required information properly without a lot of labour.

Advantages of XBRL:

Lower production costs and more efficient reporting.

Lower consumption costs and greater transparency

Enhanced information sharing

Article also goes through the advantage that there is no more data shovelling that needs to be done.

XBRL is described as the one standard for multiple information needs. Both software and platform neutral.

No need for costly software or platforms etc.

There are substantial cost savings, gives the example of FDIC and the amount of costs saved there.

Mainly asserts XBRL is a game changer in that it will solve the current problems with paper and the manual labour required with assembling and extracting financial data.

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Pages Date accessed


Srivastava, Rajendra P.; Kogan, Alexander

Assurance on XBRL Instance Documents: A Conceptual Framework of Assertions

Academic Paper/Working Paper

N/A 2009 27

May 10, 2011

SSRN


Annotation Paper mainly talks about the challenges that are facing the auditing profession, in that while there exist a large amount of detailed guidance on procedures and what needs to be audited there does not exist a unifying model, like the audit risk model for financial statement audits for XBRL. The authors contribute to the literature by providing a set of assertions that should be the focus point of any procedural testing when it comes to XBRL attestation engagements. Article is mainly US based, referencing the current SEC filing requirements.

1. Authors are reputable, Rutgers and Kansas University academics. 2. Authors speculate on the future nature of assurance will be required for XBRL tagged documents.

- Most of the efforts into specifics of the auditing procedures and not enough on developing an auditing framework of assertions. 3. Current SEC requirements are quite blurry leaving a lot of room for interpretation. 4. In order to determine what it is that the audit is trying to accomplish, the authors provide a detailed set of objectives for the audit and spell out

the following assertions as they apply to XBRL audits: - Instance documents: Completeness, Existence, Accuracy, Well-formedness, Validity, Proper Representation - Meta-data external to instance document: Proper taxonomies, valid taxonomy extensions, proper extension elements, proper

linkbases 5. Authors also go through the determination of Materiality, and define and implement inherent risk, detection risk and control risk and statistical

sampling techniques as they apply to the XBRL attestation engagements.

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Pages Date accessed


Plumlee, David and Plumlee, Marlene

ASSURANCE ON XBRL FOR FINANCIAL REPORTING

SSRN N/A; Academic Paper

2008 1-27

May 21, 2011

ABI Inform

n/a http://ssrn.com/abstract=1104245

Annotation 1. Academic article. Mainly concerned with assurance issues relating to auditing XBRL related information. 2. US Article, focuses on voluntary filer program in the US. Where the PCAOB currently required the agreement of formally rendered annual

reports and financial statements to their XBRL counterparts. Author argues and gives several reasons as to why this practice is inherently flawed.

3. Citation of study done by SEC finds most stakeholders prefer assurance over XBRL tagged information. Author goes through many alternatives and other considerations that are necessary to ensure that auditors are providing adequate assurance that actually makes sense.

4. Another part of the paper focuses heavily on the problems with traditional auditing and how if auditors choose to rely on the existing frameworks, auditors will not be providing adequate assurance over XBRL.

5. Author also goes through the two very big problems with XBRL tagged data: (1) custom taxonomies and examines some alternatives relating to the use of these esp. in the USA. (2) the extraction of specific financial information without regard to traditional financial statements. Author continues to give some ideas on how auditors might provide assurance over these as well.

6. Discusses materiality/risk assessment and tolerable deviations in the context of XBRL audits.

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Pages Date accessed


Garbellotto, Gianluca.

Simpler Isn’t Always Better

Strategic Finance February 2009 2009 56-58

May 21, 2011

ABI Inform


Annotation 1. Short article where author discusses the current direction of XBRL and the attempts to simplify the XBRL framework and reporting is a major

shortcoming of XBRL. 2. Author argues that there is a lot more that XBRL can do, but because regulators and implementers of XBRL are so focused on simplifying

XBRL they are taking away the additional benefits of XBRL as well. Author argues in the current regime XBRL is just another format to which f/s must be converted before filing which is a tragedy in his opinion.

3. Author argues in the current framework of how XBRL is proposed to be used, only the users of information get any benefit at all from the XBRL tagging, the preparers of information still need to rely on the way they used to do things. That is that XBRL does not benefit preparers or auditors at all.

4. Instead auditors get stuck auditing this XBRL tagged documents that have: (1) potential for a lot more misstatements, (2) offer little or no value to the client or the public since the underlying financial statements have already been audited.

5. Author concludes be recommending constant improvement to the format and other considerations of XBRL because they can benefit a lot more than just the users of financial information.

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Pages Date accessed


Dzinkowski, Ramona.

Do you speak XBRL?

CA Magazine December 2008 2008 N/A

May 21, 2011

CICA Website


Annotation 1. Although everyone from auditors to analysts to securities commissions across NA are for XBRL implementation. Some CFO’s do not

necessarily agree with XBRL adoption at the current stage. 2. There are many countries across the world that have already implemented XBRL. Canada is taking a wait-and-see approach because 2010-

2011 is already the year in which the standards are going to change from Canadian GAAP to IFRS and GAAS to CAS. The OSC however has a voluntary program in place for voluntary filers.

3. No current jurisdiction currently mandates audits for XBRL tagged documents in North America. However, investor demand and SEC statements indicate that this practice will soon change and investors will require some form of assurance over XBRL tagged data.

4. CFO’s however are against this because they feel that they are already going to have to change to IFRS so soon, and implementing XBRL at this stage is useless because any effort devoted to establishing taxonomies and other software programs to deal with XBRL will go to waste because in another year everyone will require IFRS taxonomies. In addition, they also raise the valid point that if XBRL is required right now (as it is in the US) most companies are going to use a bolt-on rather than a comprehensive solution, this will thwart any kind of altruist motive by the SEC or other securities commissions that are implementing XBRL as a way to increase efficiencies etc.

5. Author finds that role of the auditor will probably increase with the implementation of XBRL and that the CICA currently has a document out which deals with some of the audit issues:

Additional procedures for XBRL audit

Review of controls over the use of appropriate taxonomy, tagging of data and integrity of tagged data.

Completeness testing to ensure that all valid data is tagged in annual reports.

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Pages Date accessed


ITAC Audit and control implications of XBRL

CICA Research and Guidance

N/A 2005 1-13

May 21, 2010

Website


Annotation 1. Article basically goes through risks associated with XBRL particularly related to controls and audit. 2. Risk of Error: High because normal risks in f/s are present with XBRL information but these are going to be higher risk because auditors also

need to ensure that (1) appropriate taxonomies are used, (2) mapping to tags is accurate and (3) data retrieved is appropriate. 3. Article discusses control issues relating to XBRL documents as: (1) Usage of appropriate taxonomy, (2) Tagging of Data, and (3) Integrity of

tagged data. Also articulates that certain procedures need to be in place and recommends bare-bone procedures and their objectives as they relate to control risks for XBRL documents.

4. Article discusses Assurance Issues but also recommends that as part of the audit environment the entity using XBRL can use XML and XBRL embedded signatures as a control measures for data integrity and change management, the issues it raises are: (1) Implementation of XBRL, since XBRL is implemented for financial statements at a point in time. Auditors must ensure that the procedures relating to the generation of XBRL financial statements are valid so as to generate valid XBRL documents, (2) Procedures for financial statements that are generated at a point in time as opposed to real time, for real time statements recommends the use of specified programmable audit programs that generate periodic exception reports or reports on operating effectiveness or changes to the system on a periodic basis. (3) Ensuring that the company is using an appropriate taxonomy, especially the presence of any customized taxonomies. (4) Tag testing.

5. The final issue covered by article is reporting options on instance documents, at the time this was written the article acknowledges that there is a lack of reporting options when it comes to instance document assurance. The ITAC recommend using the section 5025 report for providing assurance on XBRL instance documents. The criteria that the audit will be based on would be the US GAAP taxonomies or standard taxonomy etc. These have undoubtedly changed since the article was written.

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Pages Date accessed


Victor Choi; Gerry H Grant; Andrew D Luzi

Insights from the SEC's XBRL Voluntary Filing Program

The CPA Journal 78/12 2008 69-71

May 21, 2011

ABI Inform

n/a http://proquest.umi.com.proxy.lib.uwaterloo.ca/pqdweb?did=1614453701&sid=5&Fmt=4&clientId=16746&RQT=309&VName=PQD

Annotation 1. Article is mainly concerned with implementation issues with XBRL. Recommendations are made towards companies on how to go about

implementing XBRL in their organizations. 2. The article makes the following recommendations to potential adopters: (1) Need formal approval process for XBRL statement approval. (2)

Small teams work best for XBRL implementation 3-4 people. (3)XBRL project managers tend to work best if they are in a medium-senior level accounting position. (4) It is perfectly fine if the organization does not know anything about XBRL since it does not take a long time to implement. (5) Cost and time constraints are overplayed for organizations, the amount of time that it takes to implement depends on if it is outsourced or in-sourced. The implementation time is 4 months if it outsourced and about 6 months if insourced. (6) The learning curve is steep and article cites the fact that it usually takes 3 months to completely become proficient at XBRL. But one that is taken care of the article recommends a substantial productivity increase.

3. The article also suggested ways to improve chances of success citing that outside consultants are usually not required in most situations. In addition, the cost-benefit constraint should not play a huge role since XBRL will be mandatory anyways so it is better that the company gets accustomed to this and implements XBRL as soon as possible, especially if they are a public company.

4.

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Pages Date accessed


Neff, Todd XBRL Looms, but Exactly Who Will Use All This?

ComplianceWeek 6/62 2009 54-55,70

May 21, 2011

ABI Inform


Annotation 1. This article is a critical review of the assertion that XBRL is a panacea for investors and analysts. 2. Article starts off by confronting the fact that although XBRL is frequently touted as the best thing to happen to financial reporting in 20 years.

Analysts are not that excited for it. Most of the excitement is coming from companies that would like to implement XBRL. 3. Article goes on to mention that although there is not that much excitement, it is mainly because while they see XBRL as inherently valuable it

is because they think that it is not going to be immediately useful right away. 4. Article also describes the timeline for XBRL implementation in the US. In the USA they are getting the largest companies to adopt first, and

so if analysts or investors want to invest or analyze anything about a company with a market cap of less than 1 billion they are going to have to wait for 2 years until all companies are forced to do XBRL tagging. And even then for this to be useful several years of data needs to be available in electronic form to make accurate comparisons. No one is going to get excited for 1 years worth of data in XBRL format. Currently there are no plans for retrospective application for XBRL.

5. Article also mentions another disadvantage. That since XBRL depends so much on taxonomies, there is the fear that taxonomies will not fit the models of many industries causing confusion and inadequate or overcompensated tagging techniques by companies.

6. The current policy of the US is that they will allow tag extensions even though 91% of the analyst community is against this idea and for good reason. Article cites a NASDAQ listed company that tried to manipulate its XBRL financial picture by creating a non-standard current liability category when one existed in the standard taxonomy. So if a investor tried to calculate a DE ratio based on the standard taxonomy, the debt would not be counted. This is another fear with XBRL that companies can tag “opportunistically” that even though the above is not a wrong practice it is intended to mislead less sophisticated investors.

7. The XBRL lead of CPA also gives some counter arguments in the sense that, she says that even with one year of data, analysts can do much more than they could previously. Because of currency and date tags with transactions which gives them more information than before. Another argument made is that as accounting standards converge, it will make it easier to convert information between standards.

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Pages Date accessed


Malhotra, Rashmi; Garritt, Francis

Extensible Business Reporting Language: The Future of E-Commerce-driven Accounting

INTERNATIONAL JOURNAL OF BUSINESS

9/1 2004 1-24

May 21, 2011

SSRN


Annotation 1. An academic article that I consider to be a classic in the field because it not only recaps the prior research done to date, but is the forerunner,

a pioneer in the way that it describes XBRL because it is panning out very close to what is being predicted here in the paper. 2. The paper describes the fundamental problem with financial information as it stands today. In that even though the web offers a dynamic

means to distribute and disseminate financial data, it is still not very useful barring the use of extensive labour techniques to make it consistent and comparable. Authors raise the timeliness issue as well, that companies are so worried about reporting the proper information that the timeliness and consequently the usefulness suffers.

3. The fundamental issues the author is citing is one of standardization, in that the problems that the financial information is not standardized, since the web fixes the timeliness issue to some extent the standardized issue has no solution. They propose that XBRL is that solution.

4. Much of the literature published on the subject is supportive of the XBRL criterion that is they support the idea that XBRL is inherently a good thing. The paper cites many studies that confirm the claim.

5. The paper contains an extensive history of how XBRL was developed and the definition of XBRL. This is quite enlightening because as per the XBRL consortium mandate, the goal of XBRL is to search for find tagged information to compare performance of multiple companies etc. it was never to streamline the preparation process or make it easier to audit information or to make it easier to prepare information, which is an interesting by-product of XBRL.

6. What makes XBRL different than any other format (paper discusses HTML, PDF, ASCII) that it can tag data with contextual information rather than just be a contextual tool for presentation etc. HTML can also contain tags, but these are pre-specified and limited but with XML these tags can be built up like a language which can take the form of information with contextual references included. i.e. a cell has 50 in it, you don’t know if that’s 50 Million or Thousand, nor do you know if its assets, a liability etc. but with XML any number has a tag, i.e. current account receivable.

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Pages Date accessed


Henson, Jeff. The Ups and Downs of XBRL

XBRL USA N/A 2010 1

May 21, 2011

Website

n/a http://xbrlusa.wordpress.com/2010/05/03/the-ups-and-downs-of-xbrl/

Annotation 1. Article is mainly a comparison of the major advantages and disadvantages of XBRL. 2. Advantages:

XBRL is universally available and is already in use. It is available on any platform and for many different accounting standards.

XBRL is good for almost all stakeholders. Analysts, shareholders, auditors and financial statement preparers.

XBRL can be used for a variety of different uses. Tax preparation, financial statement filings, and regulatory communications.

XBRL can be used to improve speed and accuracy of financial information available to public. It can also be used inside the organization to increase efficiencies.

XBRL is open-source but it is supported by a wide array of constituents in the US and globally which means that it has all of the advantages of the open-source system but has none of the disadvantages because it is in use by the majority of users. The increased complexity that comes with open source programs can be mitigated by the fact there are 3

rd party solutions available to

make adoptions easier. 1. Disadvantages:

Short-term reporting and real-time reporting may overemphasize short-term results.

XBRL tagging can create inconsistencies and errors.

XBRL extensions can make XBRL invalid because they can make even XBRL documents incomparable.

XBRL can lead to information abuse, with tagging and disseminating fraudulent information since there are no real controls yet.

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Pages Date accessed


Boritz, J. Efrim Computer Control and Audit Guide

N/A 15th Ed. 2011 1.59-1.61,

2.55

May 21, 2011

ABI Inform

n/a http://accounting.uwaterloo.ca/uwcisa/resources.htm

Annotation 1. The CCAG comes up with an assurance framework to offer assurance to XBRL documents and introduces 5 distinct steps: (1) Client

Acceptance/Engagement acceptance; (2) Planning; (3) Testing; (4) Evidence Gathering; (5) Evaluation and Reporting. 2. The process is essentially very similar to a financial statement audit with, assertions being tested and evaluated and distinct steps for

gathering evidence. 3. Report on XBRL documents of the company is distinct from its regular financial statements. 4. Text goes in-depth about characteristics that an XBRL auditor would require and the seven most important objectives necessary to address

in the audit procedures during the audit. 5. Text also discusses the overall workflow of the XBRL documents. The general problem of the official taxonomies being barebones is

discussed. Alternatives to the standard taxonomies are also discussed, such as custom taxonomies or limiting information disclosure. 6. As discussed before, the requirements of the SEC and PCAOB are discussed in depth here.

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Pages Date accessed


Boritz, J. Efrim; No, Won Gyun

Auditing XBRL-Related Documents: The Case of United Technologies Corporation

SSRN Working Paper Series

NA 2008 1-46

May 21, 2011

SSRN

n/a http://ssrn.com/abstract=1288376

Annotation 1. This is a case study in which the current state of the audit of XBRL instance documents is examined. The two authors go through and try to

audit the XBRL documents of United Technologies company and report their findings as to the processes and discuss their effectiveness. 2. Article contains significant events in the timeline for XBRL, certain events like XBRL adoption across nations and when and how the XBRL

consortium operates is also covered. 3. This article is a good source for assurance material as the authors cover the stages of development of XBRL and at what stages further

assurance will be required. For example, in the stage that the authors call, “second evolutionary phase” there will be no more audit trails and so auditors will be required to audit the controls around the XBRL tagging and dissemination of information.

4. The authors also come up with an assurance framework for their audit of United Technology documents. 5. Further many findings relevant to auditors are found and should be solved before implementation.