XBRL Medlemsmøde i DIRF – 17.05.2011 Financial data goes interactive v/Martin Juul Møller og Henrik Grønnegaard

XBRL

Medlemsmøde i DIRF – 17.05.2011

Financial data goes interactivev/Martin Juul Møller og Henrik Grønnegaard

http://www.dirf.dk/

2 © 2011 Deloitte

Hvad er regnskabsreguleringens krav?

Hvorfor XBRL?

Hvad er XBRL?

Hvordan bruges XBRL i praksis?

Hvilke overvejelser bør en virksomhed gøre sig?

Hvad er perspektiverne for årsrapporten på sigt?

Hvordan kommer man videre?

Agenda

3 © 2011 Deloitte

Hvad er regnskabsreguleringens krav

4 © 2011 Deloitte

• Law enacted 7 April 2011‒ Only annual reports

• Expected that reporting to SKAT and Danmarks Statistik in time can be done in XBRL as well

‒ Two solutions offered by DCCA: Regnskab Basis and Regnskab Special• Regnskab Basis: A simple Annual Report can be prepared manually in a template developed by DCCA

• Regnskab Special: Annual Report in XBRL and PDF is prepared and submitted by company/auditor

• Danish taxonomies for Class B and C including consolidated accounts are ready• Taxonomy for Class D is under development

Requirements in DenmarkMandatory submission of Annual Reports in XBRL

Accounting Class Mandatory for: Comments, etc.

Class B Financial periods ending 31.01.2012 or later

Transitory rule: Enbloc mapping of note information

Class C Financial periods ending 31.12.2012 or later (at the earliest)

Class D Financial periods ending 31.08.2013 or later (at the earliest)

Taxonomy expected finished at the end of 2011 based on IFRS

5 © 2011 Deloitte

What shall be submitted?• PDF-document with the Annual Report as approved at the general

assembly• XBRL Instance Document containing all the information in the Annual

Report tagged to the Danish XBRL taxonomy from the DCCA‒No audit requirements

How can it be submitted?• Using the ”Regnskab Basis”-solution from DCCA (Only class B)• Manual upload using NEM ID / digital signature• System-to-system solution

Requirements in DenmarkMandatory submission of Annual Reports in XBRL

6 © 2011 Deloitte

Hvorfor XBRL?

© 2010 Deloitte Touche Tohmatsu

Google’s 10-K filingIncome statement


What’s wrong with paper-based or PDF filing?

•The meaning of data can be confusing:

• Is it in thousands or millions? (For Google even in billions?)

• Euros or Dollars? What kind of Dollars?

•Definitions can look the same but might have different meanings

• “Profit” or “Pro-forma profit”

•Although a human-being can read and understand it, a computer can not

•As soon as data is on paper or in PDF, it cannot be reused easily

•Who’s asking for the data? What is the data definition?


Using computer languages to exchange data

What can XML offer?

•Structured exchange of data, based on well-described data definitions

•Used to structure, store, share and present data across software platforms

•XML is flexible…

Example of XML

How to model a business fact?

<revenue>23650563</revenue>

<Revenue>23650563</Revenue>

<Turnover>23650563</Turnover>

<Revenue value=“23650563” /> <Fact ID=“Revenue” value=“23650563” />

Revenue $ 23,650,563

too flexible for reporting


23650563

XBRL offers more guidance than XML

•eXtensible Business Reporting Language

•“Dialect” of XML; with restrictions and extra functionality

<Revenue>23650563</Revenue>

(in thousand, except per share amounts)

Google Inc.

We prepare our Consolidated Financial Statements in accordance with accounting principles generally accepted in the U.S.

<Revenue unitRef=“USD”> 23650563</Revenue>

<Revenue unitRef=“USD” contextRef=“I-2009-E”>

23650563</Revenue>

<Revenue unitRef=“USD” contextRef=“I-2009-E”>

23650563000</Revenue>

<identifier>Google</identifier><Revenue unitRef=“USD” contextRef=“I-2009-E”>

23650563000</Revenue>

<identifier>Google</identifier><us-gaap_SalesRevenueNet

unitRef=“USD” contextRef=“I-2009-E”> 23650563000

</us-gaap_SalesRevenueNet>

Form 10-K XBRL Instance Document

<identifier scheme=“http://www.sec.or/CIK”>1288776</identifier>

<us-gaap_SalesRevenueNet unitRef=“USD” contextRef=“I-2009-E”>

23650563000</us-gaap_SalesRevenueNet>

Collection of facts

11 © 2011 Deloitte

Hvad er XBRL?

What is XBRL?

XBRL is a language for the electronic communication of business and financial data which is revolutionising business reporting around the world. It provides major benefits in the preparation, analysis and communication of business information. It offers cost savings, greater efficiency and improved accuracy and reliability to all those involved in supplying or using financial data.

XBRL stands for eXtensible Business Reporting Language. It is one of a family of "XML" languages which is becoming a standard means of communicating information between businesses and on the internet.

http://www.xbrl.org/


Essential XBRL

In short, XBRL is about:• A taxonomy defining concepts and structure• An instance document containing facts

Taxonomy

XBRL

Instance

Inventory

Profit

5.340

1/1/2008

€

14

XBRL uniquely tags financial and non-financial facts

Consolidatedfinancial statementsConsolidated balance sheet as of 31 May 2009(before result appropriation)

Assets (in € thousands) Note 31 May 2009 31 May 2008Fixed assetsIntangible fixed assets [1] 19,050 21,584 Tangible fixed assets [2] 50,213 56,851 Financial fixed assets [3] 2,135 4,463

71,398 82,898 Current assetsWork in progress 33,347 46,297 Receivables and prepayments [4] 158,668 186,000 Cash and cash equivalents 20,749 2,170

212,764 234,467

284,162 317,365

Liabilities (in € thousands) Note 31 May 2009 31 May 2008

Group equity *) [5] 7,150 8,150 Provisions [6] 12,737 8,137 Long-term liabilities: [7]Subordinated loans Stichting Financiering Deloitte *) 116,595 118,920 Current liabilities and accruals [8] 147,680 182,158

284,162 317,365

[ ] The figures between brackets refer to the corresponding notes on the specific items of the consolidated balance sheet.*) The group equity and the subordinated loans represent the group’s capital base € 123,745 (31 May 2008 € 127,070), see note 7.

Entity Deloitte

Fact Work IP

Value 33,347

Unit Euro

Date 31/5/09

Work in progressWerk in uitvoeringProdução em curso작업이 진행工作进度

Example XBRL document

Google instance

16

External requirements

XBRL helps to standardize data, without the need to standardize systems

Data

ALIGNMENT

Reporting definitions

CorporateReporting Taxonomy

17

XBRL adds value to many areas in business reporting

Streamline internal and external disclosure management • Report to multiple regulators and stock exchanges• Prepare board reports and management reporting packs• Increase transparency and comparability

Accelerate M&A consolidation process• Easy transfer information between organisations• Consistent classification of reporting data

Improve internal control• Eliminate human intervention and re-keying of data• Consistency in terminology and data definitions• Numerical accuracy as XBRL can also calculate and verify

Integrate internal and external systems through XBRL GL• Share data on a transaction level• Improve data quality through system-to-system feeds

18 © 2011 Deloitte

XBRL is key enabler for semantic standardization in finance

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A wide range of disclosures are supported by XBRL

XBRL mandates XBRL voluntary

• Stock exchanges: China, India, Italy• Basel II reporting: Spain, Belgium,

Poland, France, Spain• Statutory: Australia, Belgium,

Singapore• Tax: UK, Japan• Central banks: USA, Japan, India

• EU Reform of Financial Markets Regulation

• Stock exchanges: South Africa, South Korea

• Statutory: Germany, Denmark, Ireland, Sweden, Canada

• Basel II: most EU countries• Micro credit & insurance

Standard Business Reporting Trends

Initiatives around the globe• Australia• Netherlands• New Zealand• Poland

Topics• Tax, Statistics, Statutory• Credit risk

• Sustainability Reporting(Global Reporting Initiative)

• XBRL Global Ledger(transaction level)

20 © 2011 Deloitte

Hvordan bruges XBRL i praksis?


XBRL instance approaches

TaggingAd-hoc creation of an instance document with source data (e.g. Word document) by marking the values with XBRL codes and adding contextual information manually (date, currency, etc.)

generate XBRL instance fast; not reusable

Positional mappingSetting up a repeatable process by marking positions in a document with XBRL codes (e.g. cell D51 in Excel equals IFRS_profits for current year)

relatively easy to set up and reuse; difficult to maintain

Keyword mappingSetting up a repeatable process by linking own accounts or database records to XBRL codes (e.g. Chart_of_accounts_profits equals IFRS_profits)

more effort to set up; but results in controlled environment

Instance creation – tagging




212,764 234,467

284,162 317,365



284,162 317,365


Tag number with XBRL concept and provide contextual information manually.

Entity Deloitte

Fact IFRS_WorkInProgress

Value 33,347

Unit Euro

Date 31/5/09

Instance creation – positional mapping




212,764 234,467

284,162 317,365



284,162 317,365


Cell C14

Positional mapping

Map cell to XBRL concept and provide contextual information.Mapping can be reused to create instance documents.

Entity Deloitte


Value 33,347

Unit Euro

Date 31/5/09

Instance creation – keyword mapping

Entity Deloitte


Value 33,347

Unit Euro

Date 31/5/09

Output data<account>A100</account><date>2009/05/31</date><value>33347</value>

Mapping tableA100 = IFRS_WorkInProgress

Map account code and contextual information to XBRL concepts.Mapping can be reused to create instance documents.


Standard Business Reporting – A company perspective

Administration

Map

pin

gChart of accounts

Sub ledger

Danish Taxonomy

Credit risk reporting

Annual report

Tax return

26 © 2011 Deloitte

Hvilke overvejelser bør danske virksomheder gøre sig?

27 © 2011 Deloitte

Different approaches to preparation of XBRL instance documents:1. Outsource the preparation of XBRL Instance Documents to third parties based

on the ”paper version” of the Annual Report?2. Prepare the XBRL Instance Documents yourself based on the ”paper version”

of the Annual Report?3. Integrate XBRL in the preparation of the Annual Report?

Different approaches to meeting the requirements in the XBRL taxonomy:4. Participation in the development of the Danish XBRL taxonomy for Class D?5. Adjust the ”paper version” of the Annual Report to the requirements in the

XBRL taxonomy?6. Making company specific extensions to the XBRL taxonomy?

Other considerations7. First movers – Pro and cons?8. Attract attention to the company’s financial reporting?

How to approach the XBRL requirements in the short run

DCCA Mandate - First step to Data Centric Disclosure Management?

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Comply with 1rst deadline

of DCCA Mandate!

Take control over detailed tagging requirements

Redesign the ‘last mile’ to a data centric

disclosure management process

Connect internal and external reporting

processes & systems

Incr

easi

ng #

of

requ

ired

repo

rts

and

part

ies

invo

lved

Take control over tagging

Improve disclosure

management process

Align in company reporting process

through XBRL

Increasing efficiency, mitigating risks, speeding up reporting process

Roadmap to data centric disclosure management

‘Quick fix’

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Take control over taggingGoal: Better control over the transformation process from paper based filing to XBRL filing.

Considerations: in-house or outsourcea. Detailed-tagging is more complex and adds extra constraints to existing deadlines. b. Even “printer” companies expect companies to produce XBRL filings in-house.c. Software is readily available to support the process of XBRL filing.

A phased approach to Data Centric Disclosure Management

Improve disclosure management processGoal: Putting data instead of reports at the heart of the disclosure management process

Considerations:a. Improving the “last mile” of finance (generating compliance reports including filing) leads to more efficiency, less risks,

fewer errors and a speedier process b. An increasing number of countries have their own XBRL reporting obligations or even a Standard Business Reporting

program, resulting in increasing XBRL requirements for companies

Align in company reporting process through XBRLGoal: align multiple interfaces between multiple source systems and internal & external reporting

Considerations: using XBRL throughout the information supply chain in and outside the organization will lead to:a. Improved quality, transparency, alignment, speed, efficiency and flexibilityb. Less risks and errorsc. Increased standardization and less interfacesd. Less dependence from 3rd parties

‘Quick fix’

Goal: Be compliant with applicable mandates and first year deadlines

Considerations: in-house or outsourcea. In-house requires software selectionb. Outsourcing requires selection of printer company (outsourcing block-tagging is relatively cheap (< US$ 10,000),

30 © 2011 Deloitte

Hvad er perspektiverne for årsrapporten på sigt?

31 © 2011 Deloitte

1. Will the users ask for specific informations more than a complete picture?2. Will the users still demand the overall ”true and fair view” of the current Annual

Reports?3. Will the accounting rules, regulations, etc. have to change?4. Will there be more or less information in the Annual Reports / XBRL

documents?5. Will the financial information be more industry specific (KPI’s, etc.)?6. Will user groups prepare specific XBRL taxonomies or extensions to be used

when reporting to them (e.g. Banks and other financial institutions)?

How will XBRL affect the Annual Reports in the long run?

32 © 2011 Deloitte

Hvordan kommer man videre?

Moving forward – How can we help

1. Training & Awareness Organize an XBRL Deep Dive to educate your team on

the impact of XBRL in your organization Share XBRL Best Practices on taxonomy design,

process design and implementation Learn to understand and extend XBRL taxonomies, like

DK GAAP, IFRS and FINREP/COREP Evaluate implementation scenarios, incl. tool selection Provide latest updates on local and global regulatory

reporting requirements, like the SEC regulation and filing requirements as stated in the Edgar Filing Manual

2. Ensuring the quality of XBRL filings

Conduct an independent review (agreed-upon procedures) on XBRL related regulatory filings, checking for example:

Selection of appropriate taxonomies

Accuracy and consistency of tagging financial statements and notes

Usage of extensions

Completeness and validity of XBRL instance documents and extension taxonomy (labels, calculation, presentation and corresponding link bases)

3. Implementation services Vendor selection (software or service)

Extending and mapping of taxonomies to financial statement items

Deployment of XBRL reporting and filing solutions

Development and maintenance of XBRL taxonomies

Align charts of accounts and reporting packs to XBRL filing requirements

Implement XBRL enhanced accounting manuals

4. Disclosure Management Roadmap Build the broader business case for both the external

and internal use of XBRL for business reporting

Conduct Business & Financial Reporting Impact Assessment

Design a phased implementation roadmap for the disclosure management process

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34 © 2011 Deloitte

Erhvervs- og Selskabsstyrelsen: http://www.eogs.dk/sw69484.asp

IFRS: http://www.ifrs.org/XBRL/XBRL.htm

Dansk XBRL organisation: www.xbrl.dk

Europæisk XBRL organisation: www.xbrl.org\eu

International XBRL organisation: www.xbrl.org

Links etc.

http://www.eogs.dk/sw69484.asp

http://www.eogs.dk/sw69484.asp

http://www.ifrs.org/XBRL/XBRL.htm

http://www.ifrs.org/XBRL/XBRL.htm

http://www.xbrl.dk/

http://www.xbrl.org/eu


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© 2011 Deloitte Statsautoriseret Revisionsaktieselskab. Member of Deloitte Touche Tohmatsu Limited

Partner, Audit

Direct: +45 36 10 32 14

Mobile: +45 25 12 32 14

Email: [email protected]

Martin Juul Møller

Director, Audit – National Office

Direct: +45 36 10 36 86

Mobile: +45 23 23 20 25

Email: [email protected]

Henrik Grønnegaard

https://www.deloitteresources.com/pgContent.aspx?cid=1071174