xbrl: new opportunities for cpas
DESCRIPTION
TRANSCRIPT
1
XBRL:XBRL:New Opportunities for CPAsNew Opportunities for CPAs
Glen L. Gray, PhD CPADepartment of Accounting & Information Systems
2009 Accounting & Auditing Conference
22
SpeakerSpeaker
Glen L. Gray, PhD, CPA Professor Accounting & Information Systems Department California State University, Northridge [CSUN] Academic Member of XBRL-US since January 2000 Many XBRL articles, speeches, panels, and presentations 145-page research report published by The IIA Research Foundation: XBRL: Potential Issues and Opportunities for Internal Auditors
3
AcknowledgementsAcknowledgements
Mike Willis and Eric Cohen, PwC
Charlie Hoffman, UBmatrix
Yossef Newman, Deloitte
Walter Hamscher, Standard Advantage
Liv Watson, IRIS India
Jan Pasmooij, Royal NIVRA, Netherlands
Roger Debreceny, U. of Hawaii
Clinton “Skip” White, U. of Delaware
Raj Srivastava, U. of Kansas
Neal Hannon,The Gilbane Group
Greg Zegarowski, Financial Leadership Corporation
Amy Pawlicki, AICPA
Paul Penler, E&Y
XBRL InternationalXBRL USCenter for Audit Quality
Apologies to anyone I missed.
44
A Brief History of Financial ReportingA Brief History of Financial Reporting
1969: Al Gore invents the Internet 1994: Commercialization of the Internet 1999: FASB and IASC each publish reports on financial
reporting on the Internet Most large companies are including financial reporting information
on their Web sites No consistency in terms of content, format, and navigation Probably violating financial reporting regulations! (Still true?) Boundary problems (In or out of financials?) Automated searches almost impossible
October 1999: First XBRL meeting with 13 members 2008: The XBRL consortium has approximately 550
members around the world December 2008: SEC requires XBRL starting in 2009
55
Calendar of Major XBRL EventsCalendar of Major XBRL Events
66
The First time……..The First time……..
77
Calendar of Major XBRL EventsCalendar of Major XBRL Events
88
The Morgan Stanley SessionThe Morgan Stanley Session
April 2000
99
XBRL Membership GrowthXBRL Membership Growth
2000 2003 2006 2009Time
Members
100
200
300
400
13
80
130
210
300
550+ members20+ jurisdictions
1010
XBRL International GovernanceXBRL International Governance
cover
1111
What are the Problems at the Ground Level?
1212
The Basic ProblemThe Basic Problem
2008 2007
Sales $ 145 $ 132
Cost of Goods Sold 101 92
Gross Profit 44 40
Sales, general, and administrative
10 8
Net Income $ 34 $ 32
GrayCoIncome Statement (Audited)
Year ended Dec 31, 2008(millions)
1313
Possible SolutionPossible Solution
Tag every piece of data using XML (not XBRL yet)
<CostOfGoodsSold>101000000</CostOfGoodsSold >
Intelligence built into data (parsing is easy) Map once, use many
For analysis For different reporting requirements For different formatting requirements
Free lunch? Bigger files Tags pose security risk
1414
Basic XML Concepts & TerminologyBasic XML Concepts & Terminology
Anatomy of XML element
<CostOfGoodsSold>101000000</CostOfGoodsSold >
Starting tag = <CostOfGoodsSold> Ending tag = </CostOfGoodsSold> Element name or element-type = CostOfGoodsSold
[no spaces and case sensitive] Element content = 101000000
1515
Basic XML Concepts & TerminologyBasic XML Concepts & Terminology
Need for attributes What are the problems with the following
elements? <price>34.50</price> <receipt_date>05/04/2008</receipt_date>
Adding attributes<price currency=“USD”>34.50</price><receipt_date date=“ISO 8601”>2008-05-04</receipt_date>
1616
A Remaining ProblemA Remaining ProblemCompany Property, Plant and
EquipmentSales Cost of Goods Sold
Staples Total property and equipment
Sales Cost of goods sold and occupancy costs
ExxonMobil Property, plant, and equipment, at cost, less accumulated depreciation and depletion
Total revenue and other income
Crude oil and product purchases
Intel Property, plant and equipment, net
Net revenue Cost of sales
Amazon.com Fixed assets, net Net sales Cost of sales
IBM Plant, rental machines and other property
Total revenue Total cost
Wal-Mart Property and equipment, net Net sales Cost of sales
Source: company annual reports
1717
Where XBRLWhere XBRLComes InComes In
1818
Some XBRL TermsSome XBRL Terms
2008 2007
Sales $ 145 $ 132
Cost of Goods Sold 101 92
Gross Profit 44 40
Sales, general, and administrative
10 8
Net Income $ 34 $ 32
GrayCoIncome Statement (Audited)Year ended Dec 31, 2008
(millions)
Label
Context Scenario
Attribute
Value
1919
What XBRL is not…What XBRL is not…
NOT a set of accounting standards
NOT a detailed chart of accounts
NOT a GAAP translator
NOT a software application
2020
What XBRL is based on ..What XBRL is based on ..
XML Specifications
XBRL Specification
Taxonomy
Instance Document
BuildsModules
Bind toDomain
Builds
2121
THE XBRL Specification 2.1THE XBRL Specification 2.1
The XBRL Specification provides the fundamental technical definition of how XBRL works.
The spec defines XML elements and attributes that can be used to express information used in the creation, exchange, and comparison tasks of business reporting.
XBRL consists of a core language of XML elements and attributes used in XBRL instances as well as a language used to define new elements and taxonomies of elements referred to in XBRL instances, and to express constraints among the contents of elements in those XBRL instances.
Only one specification for the whole world
2222
TaxonomiesTaxonomies
• A Taxonomy is a dictionary of financial reporting terms or concepts
•The concepts captured in a taxonomy are referred to as ELEMENTS. These Elements form the core of XBRL.
• Separate Taxonomies are developed for different reporting purposes such as US GAAP, IFRS, bank regulatory reporting. etc
2323
Anatomy of an XBRL ElementAnatomy of an XBRL Element
XBRLElementXBRL
ElementFinancial
Reporting ConceptFinancial
Reporting Concept
2424
Anatomy of an XBRL ElementAnatomy of an XBRL Element
2525
Anatomy of an XBRL ElementAnatomy of an XBRL Element
2626
COUNTRY / JURISDICTION TAXONOMY LEVEL STATUS
Canada GAAP Primary Financial Statements Ack Draft
Notes to Financial Statements Ack Draft
China China Listed Company Taxonomy Framework Ack Draft
China Fund Company Taxonomy Framework Ack Draft
China Financial Listed Company Information Disclosure Taxonomy Ack Draft
IASB IFRS General Purpose, 2005 rules Ack Final
IFRS General Purpose, 2004 rules Ack Final
IFRS General Purpose, 2003 rules Ack Draft
International Global Common Data Taxonomies Ack Draft
Ireland GAAP Commercial and Industrial Ack Draft
Israel Israeli Annual and Periodic Reports General Purpose Financial Reporting, extension for International Financial Reporting Standards (IL-IFRS-GP)
Ack Draft
Japan EDINET Taxonomy Ack Final
Korea GAAP Primary Financial Statements Ack Draft
New Zealand GAAP Commercial and Industrial Ack Draft
Spain General Data Idenfication Ack Final
Thailand Listed Companies - Banking Services Ack Draft
Listed Companies - Commercial and Industrial Ack Draft
Listed Companies - Securities Companies Ack Draft
United Kingdom GAAP Commercial and Industrial Ack Draft
27
COUNTRY / JURISDICTION TAXONOMY LEVEL STATUS
United States GAAP - Investment Management App Final
XBRL US Accountants' Report Taxonomy 1.0 Ack Final
XBRL US Country Taxonomy 1.0 Ack Final
XBRL US Currency Taxonomy 1.0 Ack Final
XBRL US Document and Entity Information Taxonomy 1.0 Ack Final
XBRL US Exchange Taxonomy 1.0 Ack Final
XBRL US GAAP Taxonomy 1.0 Ack Final
XBRL US Management's Discussion and Analysis Taxonomy 1.0 Ack Final
XBRL US Management Report Taxonomy 1.0 Ack Final
XBRL US North American Industrial Classification System (NAICS) Taxonomy 1.0
Ack Final
XBRL US SEC Certification Taxonomy 1.0 Ack Final
XBRL US Standardized Industrial Classification (SIC) Taxonomy 1.0 Ack Final
XBRL US State-Province Taxonomy 1.0 Ack Final
GAAP - Commercial and Industrial (superseded by the 2008 version) App Final
GAAP - Banking and Savings (superseded by the 2008 version) App Final
GAAP - Insurance (superseded by the 2008 version) App Final
GAAP - Brokers and Dealers (superseded by the 2008 version) Ack Draft
GAAP - Pensions (superseded by the 2008 version) Ack Draft
SEC Certification (superseded by the 2008 version) App Final
Management Report (superseded by the 2008 version) App Final
Accountants Report (superseded by the 2008 version) App Final
MD&A (superseded by the 2008 version) App Final
ICI Mutual Fund Risk/Return Summary Taxonomy Ack Final
28
Extension TaxonomiesExtension Taxonomies
Why you might need an extension taxonomy1. You want to include a financial statements item not
in the standard taxonomy you are using.
2. Changing a label for a standard base taxonomy to match your label name
3. Changing the presentation structure of one or more standard base taxonomy elements to match the presentation structure of your report.
4. Changing the calculation structure of one or more standard base taxonomy elements to match the calculation structure of your report.
US GAAPPrimaryTerms
US GAAPFS
Terms
Taxonomies and Extensions can be thought of as Taxonomies and Extensions can be thought of as the building blocks for XBRL reportingthe building blocks for XBRL reporting
US GAAPBank Terms
First Raleigh BankTerms
Foundation Terms
Industry Terms
Company Specific Terms
30
Closer Look at Taxonomies
Discoverable Taxonomy Set (DTS)
Instance Document
XBRL Specification
Presenta-tion
Linkbase
CalculationLinkbase
TaxonomySchema
LabelLinkbase
ReferenceLinkbase
DefinitionLinkbase
CalculationLinkbase
PresentationLinkbask
TaxonomySchema
LabelLinkbase
ReferenceLinkbase
DefinitionLinkbase
CalculationLinkbase
PresentationLinkbask
DimensionLinkbase
Standard Taxonomy
DimensionLinkbase
Extension Taxonomy
3131
XBRL LinkbasesXBRL Linkbases
Definition linkbase: Indicates for each concept whether it is a special case of some other defined concept.
Calculation linkbase: Indicates how one concept in a group of “sibling” concepts is related to the value of their parent concept.
Presentation linkbase: Indicates the order in which each concept should be presented when grouped with its siblings.
Label linkbase: Associates each concept with one or more presentation labels, one per language.
Reference linkbase: Associates each concept with one or more places in authoritative literature where the concept is defined.
Dimension linkbase: Captures detailed information about the horizontal and vertical axes of a table in a note to the financial statements.
3232
Instance DocumentsInstance Documents
• An Instance Document is your XBRL financial report
• Instance Documents will include:
• Values (ex. numbers, blocks of text etc)
• Tags to identify the values
• Taxonomy references – Telling you where the tags are defined
• Context – Information describing the reporting entity and period
• Units/Measure – Information on unit of measure, currency etc.
3333
XBRL TaxonomyCreated by XBRL Consortium
Consumed
Rendered
XB
RL
Cre
ati
on
XBRL DocumentCreated by Preparer
Company Financial StatementCompany Financial Statement
TAGGING
AT 101 Assurance
34
FDIC & SEC ActivitiesFDIC & SEC Activities
3535
The US Banking Industry The US Banking Industry [[pre-XBRLpre-XBRL]]
Today
8900 Banks
FDIC OCC FRB OTS NCUA
Multiple copies of data exist inside multiple agencies (error prone)
Avg of 60 – 75 days to receive, validate + publish filings (not timely)
Estimated processing costs over next 10 years - $65 million (costly)
March 2003 reports had nearly 18,000 errors that needed to be corrected (integrity issues)
1,000 basic math errors17,000 quality (validation) errors
3636
Future
8900 Banks
FDIC OCC FRB OTS NCUA
FFIEC
XBRL open source data standard used for communicating report requirements, validations, instructions (timeliness/flexibility)
Filers required to submit data in XBRL format over the web (automation)
Multiple sources of data SINGLE SOURCE (integrity)
Processing Time 60-75 days 2 Days (timeliness)
Processing Costs $65M $39M, a savings of $26M (cost/efficiency)
The US Banking Industry The US Banking Industry [[post-XBRLpost-XBRL]]
3737
Sample of 2008 SEC VFP Test GroupSample of 2008 SEC VFP Test Group
3M Company
AGL Resources, Inc.
Alcoa Inc.
Altria Group, Inc.
Anadarko Petroleum Corporation
Autodesk Inc.
Automatic Data Processing, Inc.
Banco Bradesco S.A.
Banco Itaú Holding Financeira S.A.
Bowne & Co. Inc.
Brazilian Petroleum Corporation
Bristol-Myers Squibb Company
Broadridge Financial Solutions
Comcast Corporation
Commonwealth Edison Company
Community Bankers Acquisition Corp.
Crystal International Travel Group, Inc.
The Dow Chemical Company
Dupont E. I. de Nemours and Company
EDGAR Online Inc.
E*TRADE Financial Corporation
Exelon Corporation
Exelon Generation Company, LLC
Fastenal Co.
38
Sample of 2008 SEC VFP Test GroupSample of 2008 SEC VFP Test Group
38
Ford Motor Company
Ford Motor Credit Company
General Electric Company
Gol Intelligent Airlines, Inc.
Infosys Technologies Limited
Lehman Brothers Holdings Inc.
Liberty Global, Inc.
Liberty Media Corporation
Microsoft Corporation
Net Servicos De Comunicacao SA
NYSE Euronext
Oceanic Exploration Company
Old Mutual Capital, Inc.
PECO Energy Company
PepsiCo, Inc.
Pfizer, Inc.
R.R. Donnelley & Sons Company
Radyne Corporation
South Financial Group, Inc.
Tenet Healthcare Corporation
United Technologies Corporation
W. R. Grace & Co.
Xerox Corporation
XM Satellite Radio Holdings, Inc.
Final count: 141 organizations, 628 filings
3/16/2005 to 4/12/2009
39
Software UsedSoftware Used
39
Six Steps to XBRL , Journal of Accountancy, Feb. 2008
40
1st submission/ block-text footnotes & schedules
Subsequent submission/ block-text footnotes & schedules
1st submission/ detailed footnotes & schedules
Subsequent submission/ detailed footnotes & schedules
Preparation face financials
$31,369 $4,312 $4,312 $4,312
Preparation footnotes
$1,750 $1,750 $25,000 $12,500
Preparation schedules
$250 $250 $2,500 $1,250
Software and filing agent services
$6,140 $6,140 $6,140 $6,140
Web site posting $1,000 $1,000 $1,000 $1,000
Total cost $40,509 $13,452 $38,952 $25,202
Source: SEC VFP Survey (33-9002.pdf, page 133)
41
2009 SEC Mandatory Filing2009 SEC Mandatory Filing
Timeline 2009 (first quarterly report for period ending on or after
June 15, 2009): Approximately 500 largest GAAP filers*
2010-2011: Remaining GAAP filers 2011: IFRS filers By December 2011, all public companies will be filing
XBRL financial information
XBRL documents provided as additional exhibits Must also post XBRL documents to own Web site
41* Public float > $5 billion
42
2009 SEC Mandatory Filing2009 SEC Mandatory Filing
Tagged disclosures… Primary financial statements, notes, and financial
statement schedules. Initially, notes and schedules would be tagged as blocks
of text, and a year later, they would provide the details tagged within the notes and schedules
Use current (January 31, 2009) taxonomy Updated EDGAR financial reporting system
accepts XBRL filings See EDGAR Filing Manual at:
http://www.sec.gov/info/edgar/edmanuals.htm
43
XBRL: XBRL: A World-Wide A World-Wide PhenomenonPhenomenon
44
Creating Your First FilingCreating Your First Filing
45
46
47
48
49
50
51
52
53
54
5555
Embedding XBRL Embedding XBRL Inside the Inside the
OrganizationOrganization
5656
The business information supply chainThe business information supply chain
ExternalFinancialReporting
BusinessOperations
InternalFinancialReporting
Investment,Lending,
RegulationProcesses
Participants
AuditorsTradingPartners
Investors
FinancialPublishersand Data
Aggregators
Regulators
Software Vendors
ManagementAccountants
Companies
Economic Policymaking
You are here
CentralBanks
XBRLLedger
XBRL“Financial Statements”
Presentation has focused on XBRL “FR”
5757
Subsidiary ERP’s
Senior Management
Supplemental information aggregation
Controls
Controls
Controls
Controls
Controls
Controls
Controls
Controls
Controls
Controls
Controls
Controls
Controls
Controls
Control located with data or in supplemental manual processes
Current Management Reporting (SOX issues!)Current Management Reporting (SOX issues!)
5858
Services architecture leveraging taxonomiesServices architecture leveraging taxonomies
Transaction and or subsidiary
Data
Senior Management
Viewing and aggregation for department & management
XBRLWeb
Services
Controls
Controls
Controls
Controls
Controls
Controls
‘Wrap & Map’ACORDXBRL GL
ACORDXBRL GL
ACORDXBRL GL
5959
System 3System 1
Identificador de la Cuenta
Descripción Principal de la Cuenta
Monto Monetario
Fecha de Asignación/Ingreso
Account Number
Account Description
Entry Amount
Posting Date
Account#
Description
Amount
PostDate
System 2
accountMainID
accountMainDescription
amount
postingDate
accountMainID
accountMainDescription
amount
postingDate
accountMainID
accountMainDescription
amount
postingDate
XBRL GL XBRL GLXBRL GL
The Answer - XBRL GLThe Answer - XBRL GL
Putting it all together:What are the opportunities for CPAs?
61
Providing XBRL services: Providing XBRL services: Still many unknowns/questions/issuesStill many unknowns/questions/issues!!
62
Errors found in SEC VFP filings Errors found in SEC VFP filings
Extensions created when standard elements already exist
Text block elements too broad
Labels do not match html document (including information in parentheses)
Extensions for monetary items require assignment of debit/credit or definition, companies are not including
New elements created with company-specific information in the element name
Missing elements and amounts
Incorrect amounts & sign flips
Duplicate items
63
Financial Statements
StandardTaxonomies
Select appropriate taxonomy
Compare each line (concept) on
financial statements w/
taxonomy
Are there concepts not in
taxonomy?
Create extension taxonomy
Create XBRL instance document
XBRL instance document
Extension taxonomy
Validate XBRL instance document
Are there validation errors?
Modify taxonomy & instance
document as needed
XBRL instance document
Yes
Yes
No
No
Steps to Prepare an XBRL Instance Document
64
Introduction to OpportunitiesIntroduction to Opportunities
Advisory Services Assurance Services Agreed-upon Procedures Examination of an Assertion About XBRL-Tagged
Data Examination of Controls Over the Preparation of
the XBRL-Tagged Data AT Section 601, Compliance Attestation Review of an Assertion About XBRL-Tagged
Data
Center for Audit Quality [Alert #2009-55]
65
Advisory ServicesAdvisory Services
Assisting management in obtaining an understanding of XBRL, relevant requirements, implementation processes, and timetable
Providing observations and recommendations to management on its XBRL project management plan, implementation process or supporting documentation prepared by the client XBRL team members? Outsourcing (filing agent)? Software selection? Timeline?
Providing comments on the client’s mapping of its financial statements to the XBRL US GAAP Taxonomy
66
Preparing XBRL Documents for External ReportingPreparing XBRL Documents for External Reporting
Recommend fire drill to client(s) to work out issues before filing is required: Allocation of work between client, CPA, and 3rd parties Degree of changes to face of financial statements to
match standard taxonomy [could be zero] Decide on block vs. detailed footnotes Develop/implement/test/modify extension taxonomies
Develop plan for official filing based on fire drill results
67
Advisory Services: Warning…Advisory Services: Warning…
Avoid for audit clients… Performing project management of the XBRL
implementation project; Selecting or recommending a specific software product
for the client to use; Mapping the client’s financial statements to the
XBRL US GAAP Taxonomy; Designing a plan for the client to implement, or
designing controls over that process; Preparing a prototype of the client’s financial
statements using XBRL; Providing ongoing support to management in tagging
financial statements.
68
AssuranceAssurance
Independent auditor not required to have any role in XBRL exhibits in SEC filings.
The following standards do NOT apply: AU 550--Other Information in Documents Containing
Audited Financial Statements, AU 722--Interim Financial Information AU 711--Filings under Federal Securities Statutes
However, the client may request the audit firm perform procedures or report on the XBRL instance document…
Assurance Services
Key components of audit/attestation/assurance engagement… Subject matter Client assertions about subject matter Criteria Attestation of client’s assertions about subject matter in
compliance with criteria
Paper financial statements vs. XBRL What are the subject matters, assertions, criteria, and
attestations? Are they the same of different? (Yes, no, maybe!)
70
Assurance IssuesAssurance Issues
Paper financial statements not same as XBRL instance document (different subject matter/criteria)
Current audit opinion focuses on document level (fair view)
XBRL document is a dataset, presentation via a style sheet, so no fair view? XBRL needs assurance on data-level
No taxonomy for the audit opinion or guidance how to connect the opinion to an instance document, could be the FS
No guidance yet about signing audit opinions and validations of the signature
No audit tools (as opposed to validation tools) available for analyzing instance documents
71
Preparation & Assurance QuestionsPreparation & Assurance Questions11
Was the appropriate standard taxonomy chosen based on the industry and applicable GAAP?
Was the extension taxonomy properly created for new concepts and relationships not included in the standard taxonomy. Some related questions include:
Was a tag included in the extension taxonomy that already existed in the applicable standard taxonomy?
Are the customizations of labels, presentation order, and calculations, as captured in applicable linkbases, appropriate?
1List inspired by Eric Cohen CICA presentation, 2004
72
Preparation & Assurance QuestionsPreparation & Assurance Questions
Is everything tagged that should be tagged? Was the most appropriate XBRL tag chosen for
each fact or concept in the source document? Two general types of errors could occur here:
Judgment error Mechanical error
Were there tags in the standard taxonomy that would have been expected to be used, but were not used?
Are contexts consistent and appropriate?
73
Audit Approach (AICPA)Audit Approach (AICPA)
“Attest Engagements on Financial Information Included in XBRL Instance Documents” (AT 9101.47–.54)
.52 …practitioner should consider performing include: • Compare the rendered Instance Document to the financial
information. • Trace and agree the Instance Document's tagged information to the
financial information. • Test that the financial information is appropriately tagged and
included in the Instance Document. • Test for consistency of tagging (for example, an entity may use one
taxonomy tag for one year and then switch to a different tag for the same financial information the following year. In this case, the financial information for both years should use the same tag).
• Test that the entity extension or custom taxonomy meets the XBRL International Technical Specification (for example, through the use of a validation tool).
74
PCAOB Guidelines (2005!)PCAOB Guidelines (2005!)
PCAOB published 11-page staff Q&A regarding XBRL on May 25, 2005.
A3. An auditor may be engaged to examine and report on whether the XBRL-Related Documents accurately reflect the information in the corresponding part of the official EDGAR filings… under AT section 101, Attest Engagements, as amended.
A4…the auditor must have sufficient knowledge of the applicable SEC Regulations, EDGAR Filer Manual requirements, and XBRL taxonomies and specifications to perform the examination.
75
PCAOB GuidelinesPCAOB Guidelines
Q5. What criteria…? A5. US GAAP Version 2.1…suitable criteria [however]
Company extensions of those taxonomies normally do not go through the same development processes as [standard taxonomies]. Accordingly, the auditor should evaluate whether company extensions represent suitable and available criteria as described in AT section 101.
Agreed-Upon Procedures
Firm’s report identifies proceduresperformed and results.
Report does not express an opinionand makes no representations regarding the sufficiency of the firm’s procedures.
Report is restricted to the client and the named parties who have agreed to the procedures & accepted responsibility for the sufficiency for their purposes.
It is not appropriate for companies to refer to services in a publicly available document
77
Examination of an Examination of an AssertionAssertion about XBRL- about XBRL-Tagged DataTagged Data
SEC Rules note that issuers can obtain third-party assurance under the PCAOB Interim Attestation Standards, AT section 101 AT 9101.47–.54 suggests rending, but this procedure alone
does not sufficiently address the risk that errors could exist in the tagged financial information.
Criteria: SEC Rules and the XBRL US GAAP Taxonomy Preparers Guide What about extension taxonomies? Are they subject matter
or criteria? What about highly-technical XBRL Specification 2.1? What
content? How do you decide? Skills? Specialist? How is materiality assessed? Document as a whole vs.
line-by-line?
78
Examination of Examination of ControlsControls Over the Preparation Over the Preparation of XBRL-Tagged Dataof XBRL-Tagged Data
Not likely to be a stand-alone service Probably conducted in conjunction with other XBRL
services Client’s focus is on just delivering an accurate & complete
XBRL document [controls and efficiency are secondary for now]
Because XBRL document creation is bolt-on (after-the-fact), tagging is typically not part of a company’s SOX 404 internal control over financial reporting [but that could change in the future]
79
AT Section 601, Compliance AttestationAT Section 601, Compliance Attestation
AT section 601 provides guidance on performing an examination or agreed-upon procedures engagement related to: An entity's compliance with the requirements of specified
laws, regulations, rules, contracts, or grants or The effectiveness of an entity's internal control over
compliance with specified requirements. SEC Rule 405 of Regulation S-T imposes certain content,
format, submission and posting requirements that an entity’s compliance could be evaluated against.
However, the EDGAR Filer Manual includes highly detailed, technical information; as such, audit firms should consider carefully whether they have the technical expertise to perform such compliance services.
80
General Requirements under SEC Rule 405 Regulation S-TGeneral Requirements under SEC Rule 405 Regulation S-T
Information in interactive data format should not be more or less than the information in the ASCII or HTML part of the report
Use of the most recent and appropriate list of tags released by XBRL U.S. or the IASCF as required by EDGAR Filer Manual.
Viewable interactive data as displayed through software available on the Commission’s Web site, and to the extent identical in all material respect to the corresponding portion of the traditional format filing
Data in the interactive data file submitted to SEC would be protected from liability for failure to comply with the proposed tagging and related requirements if the interactive data file either Met the requirements; or Failed to meet those requirements, but failure occurred despite
the issuer’s good faith and reasonable effort, and the issuer corrected the failure as soon as reasonably practical after becoming aware of it.
81
ReviewReview of an Assertion about XBRL-Tagged of an Assertion about XBRL-Tagged DataData
Generally consist of inquiries and analytical procedures designed to provide a moderate level of assurance (i.e., negative assurance).
However, probably could not perform meaningful analytical procedures on XBRL-tagged data sufficient to achieve even this level of assurance and it is uncertain what other procedures could be identified that, when combined with inquiries, could form the basis for a review engagement.
Accordingly, the feasibility of a review engagement related to XBRL tagging is uncertain. If a review engagement could be developed, it would be important for the review report to communicate its limitations to users.
82
Management Assertions (SAS 106) & Related Audit Management Assertions (SAS 106) & Related Audit ObjectivesObjectives
Assertions about account balances Existence Completeness Rights and Obligations Valuation or Allocation
Assertions about classes of transactions and events Occurrence Completeness Accuracy Cutoff Classification
Assertions about presentation and disclosure Occurrence and rights and obligations. Completeness Classification and understandability
Audit Objectives Validity Completeness Ownership Valuation Cut-off Classification Disclosure
Based on research of Srivastava & Kogan
83
Risk Based Approach for Conceptualizing AssertionsRisk Based Approach for Conceptualizing Assertions
Data Deficiencies in the XBRL Instance Document Omissions of relevant data from the traditional format
documents (Completeness) Insertions of data not present in the traditional format
documents (Existence) Erroneous element values and / or attribute values
(such as context, unit, etc.) (Accuracy: Element Accuracy or Attribute Accuracy)
84
Risk Based Approach for Conceptualizing AssertionsRisk Based Approach for Conceptualizing Assertions
Deficiencies of the Mark-up in the XBRL instance Document Erroneous tagging of data that violates XML syntax
rules (Violation of Well-formedness) Erroneous tagging of data that violates XML Schema
(Violation of Validity) Inappropriate choice of XBRL elements to tag
traditional format document data (Violation of Proper Representation)
85
Risk Based Approach for Conceptualizing AssertionsRisk Based Approach for Conceptualizing Assertions
Deficiencies of XBRL Taxonomies used by the Filer Improper choice of general and industry-specific XBRL
taxonomies by the filer (Proper Taxonomies) Violations of XML or XBRL language rules in XBRL
taxonomy extensions by the filer (Valid Taxonomy Extensions)
Inappropriate introduction of new elements in XBRL taxonomy extensions (Proper Extension Elements)
Inappropriate / erroneous linkbases in XBRL taxonomy extensions (including the choice of inappropriate/misleading labels) (Proper Linkbases)
8686
XBRL XBRL ResourcesResources
8787
XBRL ShowcaseXBRL Showcase
www.xbrl.org/ProductsandServices/ 35 vendors listed Different mix of functions:
Taxonomy creation Instance document creation/conversion Validation Rendering/presenting Analysis Stand alone vs. Office add-in
8888
Where to go from here…Where to go from here…
Visit www.xbrl.org & www.xbrl.us -- include general and technical information about XBRL
Attend public and training days sponsored by XBRL, CalCPA, AICPA, vendors, etc.
Go to www.sec.gov and search on XBRL and “interactive data”
Visit Big 4 Web site and search on XBRL. Google XBRL Go to www.skipwhite.com
The Accountant’s Guide to XBRL (3rd edition)The Guide & Workbook for Understanding
XBRL
8989
Where to go from here…Where to go from here…
Search on XBRL at: www.aicpa.org and
www.journalofaccountancy.com www.calCPA.org Center for Audit Quality at www.thecaq.org International Accounting Standards Board at
www.iasb.org/xbrl regarding XBRL and IFRS The Institute of Internal Auditors’ home page
at www.theiia.org
