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XBRL - eXtensible Business Reporting Language, the future of accounting

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  1. 1. XBRL . changing the way you share financial information
  2. 2. XBRL explained
  3. 3. XBRL e X tensible B usiness R eporting L anguage <ul><li>Standardised reporting language for financial information creating efficiencies and cost reductions for Australian businesses </li></ul><ul><li>It is a data standard based on the internet mark up language XML </li></ul><ul><li>The emerging global standard for financial recording </li></ul>
  4. 4. XBRL is ‘eXtensible Business Reporting Language’ <ul><li>XBRL is revolutionizing the business world in much the same way barcodes revolutionized merchandising </li></ul><ul><li>Like the barcode, XBRL is a system for coding and decoding information. However, XBRL goes further than the barcode: XBRL represents a huge leap forward in how complex business information and financial data is electronically transferred and reported around the world.  </li></ul>
  5. 5. XBRL allows electronic information collation and dissemination at the click of a button <ul><li>XBRL lets you to sit at your computer and gather information electronically from the office next door or the other side of the world. You can quickly collect data to create reports, complete regulatory filings, or use in any other way </li></ul><ul><li>Because XBRL enables your computer to access documents directly, you don't relay the information and there's less chance of human error. It's fast and efficient. </li></ul>Increased efficiencies in the information recording and dissemination process that allow for greater focus on interpretation of data
  6. 6. How XBRL works
  7. 7. XBRL is a code based language made up of tags representing various pieces of financial information <ul><li>It's easy to understand how XBRL works, but first you need to know some basics   </li></ul><ul><li>To begin, your computer must have XBRL-enabled software and the documents  you access must be XBRL-coded, or &quot;tagged,&quot; so they are readable by a computer </li></ul><ul><li>A tag is a string of computer code that represents one concept such as &quot;product revenues&quot; or &quot;total revenues.&quot; </li></ul><ul><li>Data types are tagged identically -- all company names have the same tag, all net assets have another tag, and so forth.   </li></ul>
  8. 8. Deloitte leads the market with the creation of their own XBRL taxonomy for financial reporting <ul><li>A collection of tags is called a taxonomy </li></ul><ul><li>A tag is like a word within a dictionary, while a taxonomy is like the language used to write the dictionary. Just as there are many languages and dialects, many taxonomies exist </li></ul><ul><li>New tags may be added to a core taxonomy to create a taxonomy extension to accommodate reporting requirements of local jurisdictions, industries, companies, or other XBRL users </li></ul><ul><li>A taxonomy extension is to a taxonomy as a dialect is to a spoken language.  </li></ul><ul><li>Example: See part of a document written in XBRL taxonomy below. Your computer reads the tags and your software integrates the information you select into a new document </li></ul>
  9. 9. An XBRL-tagged document is called an instance document <ul><li>An instance is a computer-readable version of a statement, business report, or other document, and contains both tags and information </li></ul><ul><li>An instance document looks like one long page of computer code. However, if you look closely, you can identify XBRL tags and the numbers and information the tags surround. Although you can read an instance document, software tools are more effective than humans at creating and reading instance documents </li></ul>Example: See a portion of an instance document on right that reflects annual sales for Acme Inc. and Subsidiaries. The instance document includes the facts and figures that appear in the original statement, plus the XBRL tags that allow your computer to read those facts and figures.  
  10. 10. Rendering interprets data from tags to easily read financial information <ul><li>Rendering  focuses on content and structure of displayed data: that numbers and information appear in proper sequence, order, or group, and that data can be interpreted clearly and reassembled as originally intended.  </li></ul><ul><li>By combining the rendering with presentational features such as font, colours, graphics or pagination, you can develop business reports or other &quot;fancier&quot; documents using data from XBRL instance documents.    </li></ul>
  11. 11. The XBRL process: Find a document, read it, pull content, render it <ul><li>Now that you know the terminology, the process will seem easy. You locate one or more instance documents, your computer reads the tags, and your office tool pulls the information you want into a spreadsheet or other format. The content is also rendered to be certain it is accurately portrayed.  </li></ul><ul><li>Numbers and data can be pulled from many documents in different locations and reassembled into your own document. Your computer also can read the same documents again and again to extract different information for different purposes. </li></ul>
  12. 12. How  XBRL works <ul><li>Taxonomy tags are added to information in a document to create an instance document. </li></ul><ul><li>Using the same taxonomy, your computer reads the instance document and identifies information associated with the tags. </li></ul><ul><li>Your software extracts and integrates the information into your new document. </li></ul>
  13. 13. Welcome to the revolution
  14. 14. What will the revolution mean <ul><li>XBRL will change the way you communicate with regulators in the next two years </li></ul><ul><li>XBRL under the title Standard Business Reporting (SBR) will be available to Australian businesses to report to government agencies in 2009 , with a go live date of full production systems scheduled for September 2010 </li></ul><ul><li>Under SBR the Australian government estimates this will create a saving of $795 Million to Australian businesses in the first year of operation </li></ul><ul><li>A limited Deloitte pilot recorded a 86% time saving in preparing financial reports, reducing errors through less human intervention creating significant cost savings for businesses </li></ul>
  15. 15. XBRL is rapidly becoming the de facto standard for defining, exchanging and storing business information by regulators, stock exchanges, statistical offices, banks, and corporations across the world. 2007 Japan: publishes XBRL specification as official industrial standard. Spain:   Spanish Stock Exchange uses XBRL for receiving and distributing public financial reports from 3,000 listed companies.  The Bank of Spain is receiving regulatory data in XBRL from banks covering 80% of the Spanish market. The Bank of Spain has developed a Financial Information Exchange System to support XBRL reporting by credit institutions. Italy:   MPS bank reports in XBRL. China:   More than 800 companies filed their 2005 half-year reports in XBRL. Ireland:   Central Statistics Office successfully piloted the use of XBRL in its industry surveys. Korea: Korean Stock Exchange offers XBRL-based financial statements in a multitude of languages. Denmark: Danish Commerce and Companies Agency (DCCA) allows XBRL filing of company financial statements. Belgium: 230,000 companies are expected to be using XBRL to report their required balance sheet to the Belgium Central Bank in 2007. US: FDIC receives quarterly bank information from 9000 financial institutions using XBRL. The SEC has offered incentives to companies to file financial reports in XBRL. UK:   UK Inland Review accepts XBRL filings. Corporation Tax to be filed using XBRL. Netherlands: developed XBRL taxonomy foundations for transactions between government and its citizens.
  16. 16. SBR Banco de Espana Bundesbank CSRC DCCA FFIEC SEC Bank of Japan Tokyo Stock Exchange UK Inland Review UK Financial Services Authority TSX Shanghai Exchange Shenzhen Exchange PRV IRD National Tax Agency of Japan Luxembourg Stock Exchange KOSDAQ The Irish Revenue Dutch Tax Authority Dutch Water Authority XBRL Regulatory Adoption – Publicly Announced.
  17. 17. To find out more <ul><li>Contact: </li></ul><ul><li>Stephen Graham </li></ul><ul><li>[email_address] </li></ul><ul><li>Deloitte Touche Tohmatsu </li></ul><ul><li>180 Lonsdale Street </li></ul><ul><li>Melbourne VIC 3000 </li></ul><ul><li>Australia </li></ul><ul><li>+61 (0) 3 9208 7000 </li></ul><ul><li>www.deloitte.com.au </li></ul>
  18. 18. © Deloitte Touche Tohmatsu, 2008. All rights reserved. Liability limited by a scheme approved under Professional Standards Legislation. Confidential This document and the information contained in it are confidential and should not be used or disclosed in any way without our prior consent.