XBRL detail tagging Client work and AUP
Bas Groenveld & Paul Hulst
Deloitte Innovation, Netherlands
18 May 2011 15:00 – 15:30
22nd XBRL International Conference, Brussels
Introduction
Client case
SEC mandate
Client request
Approach
◦ Tools
Lessons learnt
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Bas Groenveld
Deloitte XBRL team
Involved in XBRL since 2005
Projects:
◦ Taxonomy creation
◦ SEC Filing
◦ Disclosure management
◦ Deloitte annual report in XBRL
Paul Hulst
Deloitte XBRL team
Involved in XBRL since 2007
Projects:
◦ Taxonomy creation
◦ e-reporting architectures and processes
◦ Automating instance document creation for statutory reporting and credit reporting
◦ Design of formulas for validation
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Dutch company on US stock exchange Foreign Private Issuer 20-F
US GAAP
Large accelerated filer
Public float > USD 5 bn
Year end 31/12
Deloitte audit client
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Which accounting principles are used?
US GAAP
IFRS What is the public float?
> $ 5bn > $ 700mn Smaller
Phase 1 Phase 2 Phase 3
June 2009 June 2010 June 2011 Block tagging; grace period
June 2010 June 2011 June 2012 Detail tagging; grace period
June 2011 June 2012 June 2013
~ 500 ~ 1,200 ~ 8,000 Companies affected
Fully liable; no grace period
Year-end 20-F deadline XBRL deadline
FY2009 2009/12/31 2010/06/30 2010/07/31
FY2010 2010/12/31 2011/06/30 2011/07/31
FY2011 2011/12/31 2012/04/30* 2012/04/30
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Year-end 20-F filed XBRL filed
FY2009 2009/12/31 2010/01/29 2010/02/26
FY2010 2010/12/31 2011/02/15 2011/03/9
FY2011 2011/12/31 ~ 2012/02/15 ? 2012/02/15 ?
Theoretical deadlines
Actual filing
*SEC amendment 2008/08/27
The client had 2 options:
Prepare (and file) XBRL themselves
Outsourcing of XBRL filing
Since “traditional” 20-F was filed by outsourcer, and client was not familiar with XBRL, outsourcing was their choice
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Although no assurance is required, the client asked for “comfort” on their second XBRL filing (20-F in year 2 detail tagging).
Offering
In April 2009 the AICPA issued Statement of Position 09-1, Performing Agreed-Upon Procedures Engagements That Address the Completeness, Accuracy, or Consistency of XBRL-Tagged Data.
Deloitte offered to perform an AUP engagement.
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Definition: “Agreed-upon procedures is when the accountant is hired to issue a report of findings based on specified procedures. The users of the report agree upon the procedures to be conducted by the accountant that the user believes are suitable. The user takes responsibility for the adequacy of the procedures. In this engagement, the accountant does not express an opinion or negative assurance. Instead, the report should be in the form of procedures and findings. A representation letter is prepared that depends on the nature of the engagement and the specified users.”
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• Have “comfort” about the right application of XBRL.
• To improve their knowledge / experience with the XBRL reporting process.
• Assist with understanding the complex XBRL specifications and SEC XBRL requirements (EDGAR Filer Manual).
• Reduce reputational and other risks associated with submission of inaccurate financial information.
• Want insights and best practices to improve XBRL-formatted financial statements & processes.
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Split up AUPs and selected EFM rules to concise work packages
◦ Tools help to remove the XBRL complexity
◦ Enabling non-XBRL experts to complete packages
◦ Split XBRL/non-XBRL is 50%/50%
Multi-disciplinary team
◦ Deloitte Audit
◦ Deloitte XBRL team
Close coordination with client‟s financial reporting department
Tools
◦ Off-the-shelf XBRL instance/taxonomy viewer
◦ Deloitte Innovation developed AUP tools to support audit teams
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Input data for AUP:
◦ „traditional‟ 20-F in HTML or PDF
◦ XBRL instance document
◦ XBRL extension taxonomy
Schema
Label, presentation, calculation & definition linkbases
◦ Any documentation about mapping 20-F to XBRL and decisions about concept choice and extension
Be aware of different file versions and make sure the filed versions are the actual files reviewed
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Source data
XBRL instance
document
20-F HTML
document
XBRL conversion
Rendering
XBRL taxonomy & extension
Objects of review
* Depending on
process; instance
is created directly
from source
system(s), or from
SEC form
Output to check if there are:
◦ Units without facts
◦ Duplicate units
◦ Single identifier scheme & entity
◦ Naming conventions for contexts
Standard XBRL validation (including calculation) with off-the-shelf XBRL software
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EFM 6.6.36 If a fact whose element type attribute equals „us-types:dateString‟ [...] refers to a specific date, then it must be an ISO 8601 format date.
14-9-2009 2009-09-14
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Reporting inconsistent “decimals” attribute creates confusion
us-gaap: Effective Income Tax Rate [...]
◦ 0.124 with precision=2
◦ 0.12 ?
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Tools not always perfect, leading to uncertainty for non-technical users
Same tool; different outcome
EPS displayed shares/EUR when exported
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User interface
Export to spreadsheet
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Sample BS extract 2010 2009
Inventory 1,500 1,400
Property, Plant & Equipment 1,200 1,000
Goodwill 500 500
Non-current Assets 3,200 2,900
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Sample disclosure extract (for detail tagging):
[...] At December 31, 2006, Inventory level was 900.
[...] At December 31, 2006, Non-current Assets amounted to 1,500.
2006
900
1,500
Calculation inconsistency
Additional
column as
interpreted by
XBRL software
from instance
document
XBRL and EDGAR Filer Manual are difficult to understand for non-technical users
Knowledge of company‟s financials and US GAAP is essential
User-friendly tools are necessary, both for looking up concepts (& extension creation), data exports and rendering / viewing
In the current reporting outsourced process, the one month grace period can be necessary to allow for effective review
Companies should be aware that communication and coordination with outsourcer can be time-consuming
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Questions?
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We invite you to our booth in the exhibition hall.
Contact us directly:
◦ Bas Groenveld, [email protected]
◦ Paul Hulst, [email protected]
or visit www.xbrlplus.com
Follow us on Twitter: @xbrlplus
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