Post on 22-Jan-2015
description
Dr Paul Booth
Technical & Development Manager, IT Faculty
SETTING THE SCENE
The story so far
• XBRL is all about tagging
• … but the tags are electronic
• A bit like a bar code
• … for financial reporting concepts
A bit like a bar code …
• But instead of tagging a tin of beans
• … we’re tagging an item in a set of accounts
But what’s this ‘i’?
• iXBRL = Inline eXtensible Business Reporting Language
• It’s still XBRL – same tags etc
• … but the ‘i’ bit means that human eyes can read it too
Lots of applications of XBRL
• … but it’s HMRC’s impending requirement that is concentrating minds.
• CT filings submitted after 31 March 2011 for year-ends after 31 March 2010 must be done online, using iXBRL for
– Accounts
– Computations
• Today we’re focusing mainly on the accounts. The tax computations bit is relatively straightforward.
How do we make the iXBRL?
• Wide range of methods
• But many software products not yet publicly available
• … in some cases, even though they are ‘recognised’ by HMRC
• Which method is best depends on circumstances: who you are, what you do, existing methodology, business priorities, etc.
Year-end Accounts Production and Filing
Bookkeeping Year-end accounts Filing
Some scenarios …
… but they come with a health warning
… and not pretending to be
comprehensive
I’m not necessarily describing anyone
who’s here
The ‘best’ solution for your practice/business
could depend on many factors
Scenario 1: just one simple filing
• One single, simple business. Just one filing per year. (Or possibly a practice with a very small number of client filings.)
LikelyPossible solution: HMRC’s free product
• Does the whole filing: accounts, comps, CT600
• But it’s limited: suitable only for ‘smaller companies … with less complex tax affairs
• A bit slow and clunky.
HMRC’s free product
Bookkeeping
Type into a form
iXBRL filing
accts
comps
CT600
Scenario 2: already using AP software
• Practice doing filings for several clients and using established accounts production software product.
LikelyPossible solution: Use your AP supplier’s iXBRL-enabled product• For many sets of accounts, could be as simple as clicking the new ‘iXBRL output’ button.
• But make sure your supplier is releasing an upgrade, and on time.
• Accounts that depart from standard template may need extra work.
Accounts Production Software
Bookkeeping Year-end accounts
+ other adjustments and inputs
Software adds XBRL tags
Taggedaccounts
Scenario 3: currently use Word/Excel
• Practice with several clients, or business with several subsidiaries – multiple filings to do
LikelyPossible solution (a): get iXBRL-enabled AP software• May be more efficient in the long term
• But significant change to existing processes
Scenario 3: currently use Word/Excel
• Practice with several clients, or business with several subsidiaries – multiple filings to do
LikelyPossible solution (b): use post-production converter/tagger or outsourced iXBRL service• No disruption to your existing processes
• But you have an extra task at the end of those processes
• … or you have an extra expense and supplier to manage
Post-production tagging
Bookkeeping Year-end accounts
No change in present process
Extra process
Extra process
Taggedaccounts
Software adds XBRL tags
Scenario 4: currently do both book-keeping and accounts prep/tax filing• … whether in business or in practice
LikelyPossible solution: use ‘end-to-end’ software that does it all, or two closely integrated products
• Probably the greatest potential efficiency gains
• But probably the biggest disruption to existing processes
‘End to end’ software
Bookkeeping Year-end accounts
Single software product does both bookkeeping and AP
Taggedaccounts
… and adds XBRL tags
Scenario 5: currently do tax filings but not final accounts preparation• … taking the final accounts as a ‘given’, from the client or
from client’s other adviser
LikelyPossible solutions (a) get A N Other to supply an iXBRL file; (b) get them to supply a Word file and use post-production converter or outsource
• Not necessarily your problem
• Make sure you are given the correct accounts
The ‘soft landing’• HMRC say ‘sympathetic
approach’ to penalties in first two years
– Reasonable Excuse
– Reasonable Care
• In the first two years, we can use a smaller ‘dictionary’ of tags
– Not everything in accounts will need to be tagged.
Don’t panic!
• XBRL page: www.icaew.com/xbrl• HMRC’s ‘recognised’ list: www.hmrc.gov.uk/efiling/ctsoft_dev.htm• Implementing XBRL publication soon on www.ion.icaew.com/itcounts
Paul BoothIT Faculty020 7920 8476paul.booth@icaew.com
Further information available