As is well-known now, XBRL tags enable automated processing of business information whereby computers can treat XBRL data ‘intelligently’: the XBRL-tagged information can be selected, analysed, and exchanged automatically at users’ will. XBRL has greatly improved the ways and speed of handling financial data, while reducing dramatically the error rate and the time wasted. It has become the de facto standard for most regulatory reports demanded by regulation and control authorities.
iXBRL (Inline XBRL) brings a new dimension to the community of users and analysts as it renders XBRL data human-readable, be it on screen or in print. Whereas specialised XBRL viewers exist to present and manipulate XBRL documents (and AREVIO XBRL wizard is a powerful one), iXBRL documents can natively be viewed on standard browsers. Moreover, the author’s report layout (coded in XHTML is maintained so that the recipient can view the document as the author created it, with the guarantee that at the same time ICT systems can ‘intelligently’ recognise and process the XBRL tags embedded in the document.
In addition to managing the intelligent tagging and rendering of information, iXBRL may bring indirect benefits to your organisation. Indeed, whenever upgrading your ICT systems you can use the XBRL standard as a lever to improve internal processes. You may want to streamline and automate the methods for capturing, treating, monitoring and reporting business data across the whole operation. System architecture (and urbanism) coming into play to align disparate data systems, you can as well transform your reporting obligations into processes which bring your data alive!
Why is this format 'suddenly' so popular?
The advantages evoked above about the ‘intelligence’ of XBRL tagging and the ‘smartness’ of XHTML coding for browsers and elegant rendering are certainly attractive. Being in a position to check visually on a browser what is at the same time machine-readable is quite an improvement over the ‘rough-XBRL’ reporting.
However nice, we have also to mention the pressure by regulatory authorities. Indeed, companies present on EU regulated markets shall prepare their annual financial reports from 1 January 2020 along the European Single Electronic Format, so says in December 2017 the European Securities and Markets Authority (ESMA, in Paris). The so-called ESEF will become mandatory and iXBRL will be the standard. Also, in June 2018, the formidable U.S. Security and Exchange Commission (SEC) published an announcement that iXBRL will be mandatorily used ‘on a phased basis’ until mid-2021.
More generally, all reporting effort in line with the IFRS standard (or U.S. GAAP for that matter) can exploit iXBRL richness. It won’t be long before a generalisation both of the norm and the XBRL taxonomy that underpins it.
The approach will be a combination of (A) the data gathering, aggregating and tagging as result of the regular XBRL taxonomy implementation – see also how we tackle it for regulatory machine-oriented reports, and (B) the report design, layout and branding that your organisation wants to produce. A five-step method is depicted:
- Define what you want to, or must, publish
The content of the iXBRL report is very sensible for the company. The specification of the report structure and details is a crucial step of the process. This job is all the more important if you have to obey a taxonomy published by regulation authorities. The time spent to design the initial structure with the help of AREVIO will never be wasted, and all desirable refinements may be added later.
- Specify your XBRL taxonomy accordingly
The reference taxonomy, defined by your supervisory authority, will serve as the bedrock to your reporting since it supplies a common minimum set of information. Usually, it cannot be used as is, and it has to be customised to reflect your business operations. Specifying a ‘taxonomy extension’ is then necessary, a feature that AREVIO iXBRL edition offers to the user. This extension will contain any meaningful adaptation to the report structure that you want to communicate, and become your reference dictionary for accounting concepts you want to report upon, year in year out.
- Specify your content and generate the default report in iXBRL format
Statutory reports demanded by Market Authorities combine financial statements with notes. The accounting and reporting rules specify which categories, amounts, ratios and indicators should be extracted from your financial and ICT systems and included in your report, whereas textual data will be added at will. Once all data is in, validate your report with AREVIO iXBRL edition.
The report may then be generated in the requested format by retrieving all the ‘facts’ and organising them along the XBRL directives. An AREVIO iXBRL edition formatted document will be automatically created.
- Design the reports’ layout
Independently of all contents consideration, the physical rendering of your report matters, as it is your signature way to communicate with the financial community. You need then to use a XHTML editor to dress your report and to paste the richness of your branding effectively. Today, AREBA iXBRL edition won’t offer you this feature in a practical way.
- Validate the new report (in terms of both XBRL correctness and layout rendering)
AREVIO iXBRL edition will catch your XHTML-enabled report and check the XBRL-formatted data! This is an in-depth operation to detect any discrepancy between the norm as per the published taxonomy and your production. Diagnosis for you to improve comes automatically.
Once the final changes have been validated, the report is ready to be consumed by the regulation authorities.