The Italian Roadmap to The Italian Roadmap to XBRL electronic filingXBRL electronic filing

Paola Fumiani •XBRL technical advisor at InfoCamere•member of "Associazione XBRL Italia"

11/01/2008 2

The filing of The filing of annual financial statementsannual financial statementsThe filing of The filing of annual financial statementsannual financial statements

Is a mandatory provision for limited liability companies

Managed by the Italian Business Register The Register is held by the Chamber of Commerce network,

on a territorial basis:

about 6.000.000 of Businesses are registered as per todayprocesses financial Statements from about 950.000 companies per year

It relies on:

UnionCamere, the Union of the 103 Italian Chambers of Commerce, Industry and Handicraft;InfoCamere, the technology provider

– Hosting of the Italian Business Register; – Storing data on the relevant company’s events: establishment, variations,

winding-up, cancellation.

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Who is involved ?Who is involved ?

The accountants, actually drawing up annual accounts for almost all companies in Italy

The Italian accounting software development association

The Italian Company Registration System

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The key role of Assosoftware

On-going collaboration with the public authority: Tax Agency, Ministry of Technology & Innovations, Business Register System Creating and managing an updated tools set Supporting the accountants action on operational duties

85% IT firms represented 80% of the SME sector160.000 accountants5.000 notaries

Creating the real effective e-filing background

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E-filing to the Italian Business Registrer

It’s the fundamental XBRL background

mandatory … since year 2003

0

500.000

1.000.000

1.500.000

2.000.000

2.500.000

3.000.000

2000 2001 2002 2003 2004 2005 2006 2007

on FLOPPY DISC

on PAPER

by POST

eFILING

11/01/2008 6

Steps to the XBRL e-filing

The law requirements The Italian government pushes for the adoption of a

standard by approving the law decree (n. 223 of July

2006) providing for the "mandatory deposit of annual

financial statements related to the year 2007 via

electronic support and with a processable format".

The jurisdiction September 2006: foundation of “Associazione XBRL

Italia”

11/01/2008 7

The “Associazione XBRL Italia”

The association outreaches a community made up of: 104.000 registered professional accountants; 103 Chambers of Commerce 1.100 Financial analysts 250 Industrial enterprises association 193 Insurance companies 799 banks and 454 financial institutions 300 listed companies

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The members

The highest Italian institutions in the field of financial information

Associazione Bancaria Italiana (Italian Banking Association) Associazione Italiana Analisti Finanziari (Association of Financial Analysts) Consiglio Nazionaledei Dottori Commercialisti e degli Esperti Contabili (Doctors in commerce and Accountants and commercial estimators) Confederazione Generale dell’Industria Italiana (Association of Industries) Associazione Nazionale fra Imprese Assicuratrici (Association of Insurance companies) Associazione fra le società italiane per azioni (Association of Italian Limited by shares

companies); Organismo Italiano di contabilità (Italian Standard Setter) Unione Camere di Commercio Italiane (Union of Italian Chamber of Commerce) Banca D’Italia (Central Bank of Italy) Borsa Italiana (Italian stock exchange) Istituto Italiano Vigilanza Assicurazioni) (National institute of insurance oversight)

11/01/2008 9

The Roadmap 2007: pilot project set-up

The commitment:

No extra investments !! by the Business Entities while

supplying their XBRL Annual Accounts

the environment (web sites, tutorial, training, tools)

filing limited to PFS (Primary Financial Statements)

figures of the pilot 2007 (voluntary filing) running from May 2007 ("Annual Accounts" filing campaign )

All 103 Chambers of Commerce involved

80 volunteer users : software providers and professional accountants

905 instance documents filed

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The Roadmap 2007: Environment set up

Publishing on the free access web site of: the GAAP Italy Taxonomy an introduction to XBRL Technical Specifications the XBRL filing guidelines and tools’ tutorials

Running training sessions on the XBRL standard

Activating a rendering and validation tool for XBRL

instances on the InfoCamere public website…

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The Roadmap 2007: instance generation support

.. for the user’s work station a downloadable package based on MS Office/Open Office, generating XBRL instances by: Data entry on a specific application form Automatic import in the application form of the financial

facts directly from the accounting management software using customized mapping tables

11/01/2008 12

The outcomes for XBRL instance documents

12 % of incorrect XBRL instance documents:XBRL related errors

Calculation errors: missing data in the sub total fields

invalid mappings between taxonomy elements and the accounting process

"abstract" items filled with values

XML related errors

incorrect usage of data types (numeric/alphanumeric)

Special characters used in the company name element ( typically '&' )

usage of delimiters in numeric items ( i.e. 1,000 )

usage of decimal digits (i.e. 2459,00 – while the Italian Code provisions states

that values must always be integers )

XML validation errors : not well-formed files

11/01/2008 13

The Roadmap 2007: the feedback

Taxonomy design : Concepts definition is governed and verified against the ‘civil code’ provisions. Elements of the taxonomy have to describe the financial concepts consisting of

elements and an un-limited number of nested sub-elements....

common practice is Most companies are able to draw up their financial reports using the Italian

GAAP taxonomy

while exceptions are some companies want to deeply detail their financial facts; no limits on

detailing are imposed by the civil code

How can a financial report with un-limited details be translated in an XBRL document, referring a mandatory taxonomy schema?

11/01/2008 14

The Roadmap 2007: towards the legal provision

Technical strategies/alternatives analized by the Italian XBRL

Jurisdidtion :

allowing companies to define their own taxonomy extensions

the consequence is a loss of standardization and interoperability.

Adopting a maintenance program to update the existing taxonomy on demand

and managed by the Xbrl jurisdiction

increased work for the taxonomy management (definition of acceptance criteria,

editing, testing etc)

Organizational solution proposed to the Ministry of Reforms

and Innovation in the Public Administration Companies needing extra facts definitions are allowed to add the

PDF Annual account to the XBRL instance document

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The Roadmap : the law decree enforcement

The gradual adoption of XBRL

2008 Mandatory for companies closing their fiscal year after March 2008

About 10.000 companies starting filing after August 2008

Limited to PFS (Primary Financial Statements)

2009 Mandatory for all companies

Based on approved and recognized taxonomies by the Italian

jurisdiction

11/01/2008 16

Revision of existing filing procedure

2008: the filing process changes slightly according to the pilot 2007 steps:

1. Download the e-filing software from the central server

2. Make the Dossier : PDF + XBRL mandatory

3. eSign the Dossier components

4. eFile the Dossier into the central server

11/01/2008 17

Financial reports: different formats for the same information

XBRL

PDF

financial information to be consumed directly by

software applications

Deeply detailed PDF financial report

Business Register

(Registro Imprese Italiane)

11/01/2008 18

Benefits coming from XBRL are well known

selection of key figures using a query language

Multi-language features on viewing and reporting

merging data from different Data Bases

Information handling through XBRL

11/01/2008 19

The link to XBRL exploitation: Brite case

XBRL is becoming a strategic data format

XBRL has been adopted by some research

projects:Brite – Business Registers Interoperability across

Europe

– BriteCBD: turnover figures

11/01/2008 20

The technical support for the development of the GAAP Italy

taxonomy by the Trento University:

Professor Luca Erzegovesi – head of (Department of

Computer and Management Sciences ).

Doctor Davide Panizzolo – researcher of

(Department of Computer and Management

Sciences ).

The taxonomy building team