XBRL –New Opportunities for theAccountancy Profession CA K.Raghu Director XBRL India Central Council Member
What is XBRL XBRL stands for eXtensible business reporting language. XBRL is a language for electronic communication of business and financial data. XBRL is set to revolutionise business reporting around the world. XBRL provides major benefits in preparation, analysis and communication of business information. XBRL offers cost savings, greater efficiency and improved accuracy and reliability to all users of financial data
XBRL – The new language inbusiness reporting XBRL enables automated processing of business information by computer software. Avoids manual entry of financial data Computers can treat XBRL data intelligently and recognise the information in a XBRL document, select it, store it, exchange it with other computers and present it in many ways to a user. XBRL increases the speed of handling of financial data and reduces the chances of errors.
Users of XBRL data Regulators like MCA, RBI,SEBI, IRDA, can automatically review and analyse pre-validated XBRL filings. Banks and Financial Institutions can automatically review and analyse pre-validated customer financial statements for monitoring loans and also assist them in credit risk assesment. Analysts can automatically import pre-validated company financial information in XBRL format for investment analysis. Investors can access XBRL corporate reporting data and analyse the same at a lower cost. Management can benchmark their performance against competitors and peers anywhere in the world.
XBRL – Very flexible XBRL can handle data in different languages XBRL can be flexibly be adapted to meet different reqauirements and users. Users of financial data can compare and analyse data much more rapidly in XBRL format
XBRL – Huge savings Regulators, banks, financial institutions, companies spend a lot of money and time in re-keying, cleansing and analysing financial data as and when quarterly and annual results are published by various companies. XBRL tools and applications will eliminate the tasks of duplication and promote transperancy and reliability of information
How to creat FinancialStatements in XBRL ? XBRL aware accounting software will support the export of data in XBRL form. These tools will allow users to map charts off accounts and other structures to XBRL tags. Financial statements can be mapped into XBRL by using XBRL software tools. Data from accounting databases can be extracted in XBRL format by using XBRL software.
Formation of a group onXBRL in IndiaIn the year 2007 the Institute ofChartered Accountants of India (ICAI),the premier accounting body and theNational Standard setter constituted aGroup for promotion and development ofXBRL in India.
Support of Regulators The group had representatives of the major regulators in India viz. the Securities and Exchange Board of India (SEBI) Ministry of Corporate Affairs (MCA) Reserve Bank of India (RBI) Insurance Regulatory and Development Authority (IRDA) National Stock Exchange (NSE) Bombay Stock Exchange (BSE)
XBRL IndiaIn the year 2008, ICAI set up an Indian XBRLJurisdiction in the year 2009 as an extendedarm of XBRL International in India. TheJurisdiction was Provisional in nature for aperiod of 2 years.
TaxonomiesLike other standard setters, across theglobe, ICAI developed taxonomiesbased on the Indian AccountingStandards and the Indian Company Lawrequirements.
TaxonomiesThe jurisdiction first developed a generalpurpose taxonomy called theCommercial and Industrial (C&I)Taxonomy which could be used by anyCommercial and Industrial Enterprise. Itis based on the IFRS 2006 architecture.
C&I TaxonomyThis taxonomy was developed through a dueconsultative process where the Industryexperts reviewed the draft taxonomy,thereafter it was exposed in the publicdomain for comments. After finalisation onthe basis of comments, the taxonomy wasacknowledged by XBRL International.
C&I Taxonomy Cont….This taxonomy has been developed to enablecompanies prepare their financial statements,viz., Profit and Loss Statement, BalanceSheet and Cash Flow Statement in XBRLformat, based on the requirements of theaccounting standards, Indian company lawand the requirements under Clause 41 of theListing Agreement.
Banking TaxonomyMean while a need was felt to developIndustry-specific taxonomy for BankingSector as their requirement could not bemet with the C & I Taxonomy as theirformat for presentation of financialstatement were very different. ThereforeTaxonomy for banking was developed.
Banking TaxonomyBanking taxonomy is an extension to the coreIndian XBRL C&I taxonomy.The banking specific elements have beenadded to the core schema.The schema file contains all the elementdeclarations along with there XBRLproperties (including the elements of C&Itaxonomy).
Taxonomies in futureIt is proposed to develop other industry-specific taxonomies viz. the Insuranceand Power sector. Taxonomy for NBFCsis also in the process of development.
XBRL India – anEstablished JurisdictionIn the year 2010,XBRL India was awarded the status of an“Established jurisdiction” capable of having arepresentative of India at the InternationalSteering Committee (ISC), the governingbody of XBRL International.
XBRL India – A Company ‘XBRL India’ is now a company registered U/s 25 of Companies Act, 1956. The company is facilitated by ICAI. It has been incorporated for managing the affairs of Indian Jurisdiction of XBRL International.
Website of XBRL IndiaA separate website dedicated to the XBRLIndia Jurisdiction to keep members and otherusers aware about the Indian XBRLJurisdiction has been set up by the ICAI.Its URL is www.xbrl.org/in.
Way Forward ICAI being the neutral facilitator of XBRL India Jurisdiction, shall assist the regulators and users of the financial statements by: Developments of XBRL taxonomies. Ensure compliance of taxonomies with the requirement of Companies Act 1956 and other relevant legislations (LLP).
Way Forward Cont…. Update the existing taxonomies as per the requirements of the IFRSs on implementation of Indian AS in India. Maintenance and updation of the XBRL Taxonomies from time to time as per the requirements and any revisions in the Accounting Standards.
XBRL India-Membership The membership of XBRL India is open to the following categories: (a) Regulators (b) Organizations (c) Academicians Certain parameters have been laid down for the interested organizations and academicians to become member of XBRL India.
XBRL India – MCAMandate The Ministry of Corporate Affairs (MCA) has issued a circular dated 31st March, 2011 mandating certain class of companies for filing their financial statements in XBRL formats for the year 2010-11.
XBRL India – MCA Mandate Cont….. Considering the requirement for training professionals in view of the mandate issued by MCA, it has been decided to provide trainings in collaboration with CMII and CPE Committees of ICAI across the country. However, to start with the hands on training on XBRL filing, it shall be imparted at the metros and bigger cities viz. Bangalore, Ahmedabad, Pune etc. as of now, covering 17 cities in all in the initial phase, which shall be extended to other cities in the future XBRL India is also developing basic Training material and schedule on the basic concepts and process involved in XBRL filings.
XBRL India – Road Ahead It is proposed to design the XBRL Certification Programs in India for the promotion and education of XBRL in India. Facilitating education in XBRL through a series of workshops, seminars and conferences.
XBRL, India – Road Ahead Cont….. Roping in other regulators like CBDT/ IRDA for implementing XBRL in their reporting requirements. Launching a certificate e-learning course on XBRL
XBRL – Opportunities forChartered Accountants Assist companies in preparing XBRL compliant Financial Statements. Assist companies in their regulatory filings. Investment and Credit analysis