xbrl for beginners

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Nalin Anushke Bandara Dissanayake


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XBRL : eXtensible Business Reporting Language.

XBRL is the latest business reporting language in US SEC (Security & Exchange Commission)

What is XBRL ?


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US SEC Securities and Exchange Commission was

established in 1934 to enforce the newly-passed securities laws, to promote stability in the markets and, most importantly, to protect investors.

The mission of the U.S. Securities and Exchange Commission is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation.

Therefore all the listed companies need to submit financial reports.


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Financial reports are the documents and records put together to track and review how much money business is making (or not). The purpose of financial reporting is to deliver this information to the stakeholders.

What is Financial Reporting?


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Evaluation of Financial Reporting

Paper Based FR

HTML Based FR

XBRL


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For many years the financial information

provided to senior managers and external users was quite aggregated in a physical paper-based “report”.

Limitations : Only a person can read a report. The data can not be shared with other systems.

Paper Based Financial Reporting


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HTML Based Financial Reporting In 1990s HTML format is used for Financial

Reporting. Anyone can access to the database and

refer reports.

HyperText Markup Language (HTML) is the main mark-up language for creating web pages and other information that can be displayed in a web browser.

http://www.sec.gov/Archives/edgar/data/789019/000119312513310206/d527745d10k.htm




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Limitations of HTML.

◦ Only a display of values & Textual, computer does not understand the content.

◦ Human effort is required to analyse the content in order to make management decisions.

HTML Based Financial Reporting


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Limitations of Paper & HTML based reporting

Corporate Accounting Scandals like Enron, Tyco International, Adelphia, Peregrine Systems reduced confidence of investors.

The world of computerized financial reporting has not yet progressed as far as have other industries.

Background for a New Reporting Method.


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Father of XBRL CPA (Certified Public Accountant) Invented the concept of XBRL (XML

Reporting language) in 1998 Developed the concept of XBRL with the

help of AICPA (American Institute of Public Accountants)

Charles Hoffman


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XML (eXtensible Mark-up Language)-based mark-up language used to communicate financial and business data electronically.

What is XBRL


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Machine can understand XBRL report we produce using our accounting knowledge through a XBRL generating software by giving barcodes (Tags)

for each and every figure.

XBRL is machine (computer) readable financial data.


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Users of XBRL Report

Users

Non-Professional

General Public

Customers

Professional

Financial Institution

Shareholders

Government

Managers


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Generally financial reports are prepared assuming reader has understandability of basic accounting terminology. However this not always through, therefore XBRL meets the demand of Non professional stakeholders by giving a simplified definition on each line item:

http://www.sec.gov/cgi-bin/viewer?action=view&cik=789019&accession_number=0001193125-13-310206&xbrl_type=v#

Value for Non professional Users

http://www.sec.gov/cgi-bin/viewer?action=view&cik=789019&accession_number=0001193125-13-310206&xbrl_type=v

http://www.sec.gov/cgi-bin/viewer?action=view&cik=789019&accession_number=0001193125-13-310206&xbrl_type=v


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Generally Professional users analyse financial reports in order to make decisions, this process is called financial analysing

Computer readable XBRL report will automatically generate the financial analysis within less than a minute.

Value for Professional Users


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XBRL to XL

◦ http://www.xbrlxl.com/

Calcbench, Inc

◦ http://www.calcbench.com/

Microsoft XBRL Add-in to Excel http://xbrl.us/research/Pages/data.htm

XBRL Analytical Software


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XBRL offers major benefits at all stages of business reporting and analysis. The benefits are seen in automation, cost saving, faster, more reliable and more accurate handling of data, improved analysis and in better quality of information and decision-making.

Value of XBRL


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Worldwide XBRL Adaptation

China Belgium Canada Chile Netherlands Korea

Singapore South Africa Spain Denmark Germany India

Ireland Japan South America United States United Kingdom Australia

United State adopted XBRL, developing EDGAR (Electronic Data Gathering, Analysis and Retrieval) system spending 50 million in 2009.All listed companies should file XBRL report.


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Worldwide XBRL Adaptation

26 Countries since 2005


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XBRL Experts believe this could bring about the biggest change in financial reporting since the adoption in the 15th century of the double entry bookkeeping method.

Successor for manual Analytical work.

Founder & Executive Director for data Transparency Coalition suggest US government to use XBRL for other sectors like Education & Health to standardize and structure Big Data.

Success of XBRL


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Welcome to the Future of Financial Reporting

xbrl for beginners

Business

xbrl experts

financial reports

financial analysis

financial information

purpose of financial

microsoft xbrl addin

father of xbrl cpa

fr html based fr xbrl