A CalCPA Presentation titled: XBRL - The Digital Transformation of Compliance and Business Reporting in the Fourth Industrial Revolution!

1. XBRL - The Digital Transformation of Compliance and
Business Reporting in the Fourth Industrial Revolution!
COUNCIL CalCPA Council Mtg Jan 2020 - W1200120
Discussion:
Anthony Pugliese CPA, CGMA, CITP- Chief Executive Officer - CalCPA
Liv A. Watson - Sr. Director of Strategic Customer Initiatives - Workiva, Inc [NYSE:WK]

2. Liv Watson
Senior Director of Strategic
Customer Initiatives
Anthony Pugliese
Chief Executive Officer
CPA, CGMA ,CITP

3. Our Objectives
Explain What
and How XBRL
Works
Demonstrate
Broad Adoption of
XBRL
21 3
Provide a vision for
why XBRL is the data
standard fit-for-
purpose in the 4th
Industrial Revolution!

4. Reporting in Need of a Digital Transformation

5. Data Fit-for-Purpose in the"Fourth Industrial Revolution"

6. Data Fit-for-Purpose in the"Fourth Industrial Revolution"

7. What is XBRL?
X = eXtensible
B = Business
R = Reporting
L = Language
XBRL is a freely
available and
global framework
for exchanging
digital business
information.

8. Why XBRL?
Our governments, Your
business operates on
information, so you
need to know the
fundamentals of XBRL.

9. The new data needs to
be analyzed and thought
through for what it says:
1. How big are revenues?
2. How big are profits?
3. How big are profit
margins?
The new data must be
compared to earlier
data to answer these
questions:
1. How fast are revenues
growing?
2. How fast are profits
growing?
3. How are margins
changing?
4. How are growth rates
changing?
The company’s results
must be related to other
companies’ results:
1. How is this company
doing relative to its
competitors?
2. How is this company
doing relative to other
places the investor
can place his or her
money?
Accessing Financial Reporting Data Today?
1 2 3

10. What Could Happen...
If the Exchange’s
Data Systems is
not in XBRL.
…...The Exchange
drops off the
Radar Screens
If a Company’s
data is not
available in XBRL
…..The Company
risks dropping off
the Radar Screens

11. How Does XBRL Work?
A Global Consortium
XBRL International Inc.
The international standards organization
which develops and maintains the XBRL
standard and related specifications in
order to improve business reporting for
the public good
XBRL Taxonomies
Taxonomies are the reporting-area specific
hierarchical dictionaries used by the XBRL
community. They define the specific tags that are
used for individual items of data (such as “net
profit”), their attributes and their interrelationships.
XBRL Technical
Specification
A set of technical rules that define the structure of a
given version of XBRL.

12. Machine Readable Data | An XBRL Taxonomy
Standardization
Validation
Calculation
Cash = Currency + Deposit
Formulas
Cash > 0
Context
US $$$
FY 2019
Budget
Label
<CashEquivalentAnd
ShortTermInvestment>
Reference
GAAP 1.2.(a) Instruction Ad
Hoc Disclosure
100
Presentation
EN: Cash
SE: Kontanter

13. Who Uses XBRL?
Analysts and
Investors
Financial
Regulators
Securities
Regulators
Business
Registry
Government
Agencies
AccountantsData
Providers
Companies

14. How Did We Get Here?
1998
XBRL
IS BORN!!
2000
XBRL
SPECIFIC
ATION 1.0
2001
1st SEC XBRL
Submission
Morgan
Stanley
+
XBRL for
General
Ledger
2003
XBRL
Specification
2.1
2006
XBRL
Spins off from
the AICPA to
become
separate non-
for-profit
2008
SEC
Mandates
XBRL
2009
XBRL for
Dummies!
2005
FFIEC
Mandates
XBRL
For Call Reports
2010
UK
HMRC Tax
Authority
Mandates
XBRL
2007
South Korea
developed a
mandatory XBRL
filing program

15. How Did We Get Here?
2018
XBRL Required for
Florida State,
County, Municipal
& Special District
Financials by
2022
2014
The Digital
Accountability
and
Transparency
Act of 2014
(DATA Act)
2014
AICPA XBRL
US Study
Shows XBRL
Filing Costs
Lower than
Expected
2017
Financial Data
Standards
mandated for
Automating Data
Collection in Surety
Underwriting
2018
Orange Buttonsm
data standards for
solar financing
announced for
easier to exchange
solar data
2018
XBRL US Forms
State and Local
Government
Disclosure
Modernization
Working Group
2018
House Passes
Grants
Reporting
Efficiency &
Agreements
Transparency
(GREAT) Act

16. How Did We Get Here ?
2019
Open
Government
Data Act Passed
2019
State of California
Senate Bill No. 598
2019
State of Virginia
municipalities
recommends that
CAFRs
2019
The Federal Energy
Regulatory
Commission
(FERC) posted a
proposal to require
the use of XBRL for
reporting
Commission
2019
SEC proposal, Updated
Disclosure Requirements and
Summary Prospectus for
Variable Annuity and Variable
Life Insurance Contracts, File
Number S7-23-18.

17. EVERY ORGANIZATION WANTS A
CLEAN BILL OF HEALTH WHEN IT
COMES TO THEIR CORPORATE
COMPLIANCE AND REPORTING
EVERY ORGANIZATION WANTS A
CLEAN BILL OF HEALTH WHEN IT
COMES TO THEIR CORPORATE
COMPLIANCE AND REPORTING
Data Fit-for-Purpose in the"Fourth Industrial Revolution"

19. The Digital Transformation of RegData!

20. Collecting disparate
data sources is very
time-consuming
Manipulating data
manually increases
compliance costs
and risks
Decentralized disclosures makes businesses have to
produce unique capabilities to report to reach
regulatory authorities and increases compliance costs
and risks
INPUT THROUGHPUT OUTPUT
RISK MANAGEMENT & INTERNAL REPORTING

21. Collecting disparate
data sources is very
time-consuming
Manipulating data
manually increases
compliance costs
and risks
Decentralized disclosures makes businesses have to
produce unique capabilities to report to reach
regulatory authorities and increases compliance costs
and risks
INPUT THROUGHPUT OUTPUT
Skilled
Professionals
RISK MANAGEMENT & INTERNAL REPORTING EXTERNAL REPORTING

22. Regulatory Reporting and Compliance Fragmented Ecosystem

24. The Key Fragmentation and Divergence Challenges

25. Business Reporting

26. Data Fit-for-Purpose

27. The Need for a RegData Revolution!
1. Data Types Fragmentation
2. Standards & Supporting Documents
Fragmentation
3. Technical Standards Fragmentation
4. Submission Modes Fragmentation
5. Data Definition

28. The Aim of the RegData Revolution
1. Are Regulatory Authorities Ready for the Data
Revolution?
2. Is the Accounting and Compliance Professional
Ready for the Data Revolution?
3. Are Standards Setters and Policy Makers
Ready for a Data Revolution?

29. Who will own the basic infrastructure of our futures?
Taxonomy
Governance
Layer
Governance Framework, Protocols, Rules, Regulations Best Practices,
Guidances, Codes,
Board of Directors, Advisory Board
………………………………………………………………………………….
The First Intelligent Digital Library and Laboratory for ESG Reporting Taxonomies and the codification taxonomies of the
governance documents and/or best practices available for Public Good

30. Who will own the basic infrastructure of our futures?
Taxonomy
Registry
Community Layer
Taxonomy
Governance
Layer
Reporting
Taxonomies
Registry
Standards
Codification
Taxonomy
Registry
Governance Framework, Protocols, Rules, Regulations Best Practices,
Guidances, Codes,
Board of Directors, Advisory Board
………………………………………………………………………………….
The First Intelligent Digital Library and Laboratory for ESG Reporting Taxonomies and the codification taxonomies of the
governance documents and/or best practices available for Public Good
Reporting
Taxonomy
Certification
Authority +
Accreditation
Codified
Supporting
Documents
Taxonomy
Certification
Authority +
Accreditation

31. Who will own the basic infrastructure of our futures?
Open Model
Innovation
Layer
Taxonomy
Registry
Community Layer
Taxonomy
Governance
Layer
Reporting
Taxonomies
Registry
Standards
Codification
Taxonomy
Registry
Sector Collaboration
Public and Private
Partnership
Technology Collaboration
Governance Framework, Protocols, Rules, Regulations Best Practices,
Guidances, Codes,
Board of Directors, Advisory Board
………………………………………………………………………………….
The First Intelligent Digital Library and Laboratory for ESG Reporting Taxonomies and the codification taxonomies of the
governance documents and/or best practices available for Public Good
Company Alignment Creating Best Practice
Alignment on Metrics
Reporting
Taxonomy
Certification
Authority +
Accreditation
Codified
Supporting
Documents
Taxonomy
Certification
Authority +
Accreditation

32. Ultimately,
digital
transformation
will result in
three types of
accounting
professionals
Those pro-actively
embracing change
Those who adapt and
learn as they go
Those left behind
wondering what happened

34. Accounting and compliance
will only remain relevant in
this new age if we connect
the data dots so that
critical financial, non-
financial, and other
Emerging forms of
External Reporting
(EER) is collectively
accurate, auditiable,
complete, consistent, and
fit for purpose!
Key Takeaway

35. 1. The acceptance of this new tool
in the broad-based business and
business-reporting community
1. The use of this tool in areas
broader than just financial
statement information.
Success is Defined

36. To be released at the
CalCPA GAAC Event
Sacramento, California
To be released at the
CalCPA GAAC Event
Sacramento, California

37. Thank You!
CPA, CGMA ,CITP