XBRL Hot Buttons for CS & CFO's (17th Nov'11)

Blue Consulting Pvt. Ltd.A Finance & Accounts Outsourcing Company

July 13’ 2009

Blue Consulting Pvt. Ltd.Consulting F&A Outsourcing Internal Audit

XBRL Webinar : Hot Buttons for CS and CFOsCA Chandan Goyal17th November’2011

Doing common things, Uncommonly well.

Blue Consulting Pvt. Ltd.www.xbrlconsulting.co.inIndex

Index

1. XBRL in India 3-4

2. MCA’s mandate 5-6

3. Chronological order of developments 7

4. Common terms 8-11

5. Tagging requirement 12

6. Process flow 13

7. Skill set required for conversion 14-15

8. How to select a service provider? 16-23

9. Interesting facts about XBRL 24-25

10. Contact detail 26

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Page No.

http://www.xbrlconsulting.co.in/�


1. XBRL in India

In India, the Reserve Bank of India (RBI) has already

implemented (since Oct 2008) XBRL-based reporting for three

returns: capital adequacy data as per Basel II norms, Form A

and the GPB Return by banks.

Further, it is mandatory for top 100 listed companies in India

to report their quarterly results etc. to BSE & NSE in XBRL. It is

called Corpfiling.

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https://secweb.rbi.org.in/orfsxbrl/customer/�

https://secweb.rbi.org.in/orfsxbrl/customer/�

http://www.corpfiling.co.in/home/homePage.aspx�


…contd.(XBRL in India)

Now, it’s MCA’s turn to implement it on a wider canvas. In the

1st phase, around 30,000 companies in India need to report to

the MCA in XBRL this year. Going ahead, (from FY 2012-13) it is

expected that almost 9 lakh companies would need to report

in XBRL in the next three years.

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2. MCA mandate

Ministry of Corporate Affairs (MCA) has mandated

financial reporting in XBRL from the Financial Year

2010-2011 for :

all listed companies and their subsidiaries (excluding overseas subsidiaries),

all unlisted companies having paid up capital of Rs. 5 Crore and above

All unlisted companies having a turnover of Rs. 100 Crore or above

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…contd.(MCA mandate )

The companies listed above are permitted to file XBRL

compliant documents up to 30.11.2011 or with in 60

days of their due date, whichever is later without any

additional filing fee.

The current mandate excludes banking companies,

insurance companies, power companies and Non

Banking Financial Companies (NBFCs).

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3. Chronological order of XBRL developments

7

23rd MayMCA released 1st version of

Taxonomy

31st MarchMCA came out with its

First Notification on XBRL

28th JulyExtension of due date of filing from 30th Sep

to 30th Nov

27th AugMCA released

UPDATED Taxonomy

13th OctMCA released the

list of XBRL software vendors and service

providers

5th OctXBRL Forms for

filing issued

1st OctRelease of

Validation Tool

14th OctREVISED

Validation Tool released

1 2

3 4

5 6

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4. Common terms

Taxonomy

Generally speaking, taxonomy means a catalogue or

set of rules for classification; in XBRL, taxonomy can be

referred to as an electronic dictionary of the reporting

concepts containing computer-readable definitions of

business reporting terms, as well relationships between

them and links connecting them to resources.

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…contd. (Common terms)

Elements

An element is a business or a financial concept which is defined

in the taxonomy according to XBRL specifications. Each element

has a type, is identified by name and may have a set of attribute

specifications as per the XBRL standards. There are 3187

elements in the revised taxonomy issued by MCA.

Business rules

There are approx. 350 business rules which incorporate the

checks for minimum tagging requirements.

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Tagging

The process of assigning tags (referred to as elements in

taxonomy) from the taxonomy to the company specific

reporting concepts is called tagging.

Tagging requires appropriate selection of elements from

the taxonomy based on attributes, documentation and

relationships with other elements.

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Instance documents

The final output, which is converted in XBRL format, is

called instance document. Two instance documents are

generated, Balance Sheet and Income Statement (Profit &

Loss a/c).

A company with subsidiary companies, needs to generate

two sets of instance documents, i.e., one on a standalone

basis and another on a consolidated basis.

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5. Tagging requirement12

Balance sheet and its schedules

Profit and loss a/c and its

schedules

Cash flow statement

Related party transactions (party

wise)

Segment reporting

Subsidiary and Holding company

information

Associates and Joint Ventures

Detailed tagging

Director’s report

Auditor’s report

Notes to accounts

Text Block tagging

Note: From our experience, detailed tagging takes approx. 90% of total tagging time



6. Process flow of conversion13

Client Client provides soft copy of Annual Report of FY 2010-11

XBRL Service Provider

Analysis of Annual Report

Mapping and tagging

Review and validation

XBRL instance document

Client Review and upload of XBRL documents to MCA website



7. Skills required for conversion

To convert Financial Statements in XBRL format, one needs to

have a good understanding of Financial Statements and

Business Rules defined for Taxonomy.

Software is just an enabler and plays less than 25% part in

whole conversion process.

Every company has its own set of peculiarities in the Financial

Statements and a service provider should be proficient in

Indian GAAP’s to understand the Financial Statements.

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…contd.(Skill set for conversion?)

The quality of tagging (i.e., choosing a particular tag) plays

an important role in making a tagged Financial Statements

useful for analysis. However, this area is normally

overlooked by clients while engaging any service provider

for conversion service.

The most problematic information to be tagged is Profit and

Loss a/c as there is no specified format in Schedule VI and

every company follows it’s own format.

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8. How to select a service provider?16

Index


#1. Experience

Ask prospective service providers about their experience in

handling of Financial Statements across various industries.

Ask about the number of years of experience in Finance and

Accounts, Financial Reporting; training in XBRL; total team

size;

The nature of services provided by the service provider can

be a good indication about its knowledge of Financial

Statements.

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#2. XBRL conversion process

Ask potential XBRL service providers about their XBRL

conversion process. What inputs shall be required from the

client and at what stages?

The amount of additional information required for accurate

conversion and filing varies from company to company; it

could include information other than that provided in the

Annual Report of the company.

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…contd.( XBRL conversion process)

Normally, a service provider should be able to ascertain and

evaluate the requirement for additional information within

one working day from the receipt of the Annual Report. If not,

you may want to reconsider your selection.

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#3. XBRL team

Enquire about the following from a prospective service

provider’s :

No. of people in XBRL team

Their qualifications

Do they have prior experience on the XBRL conversion process

Is there a separate team or person for review of tagging quality?

This information will help you to assess whether a

particular service provider can handle volumes or not.

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#4. Clients or References

Ask about the service providers’ existing client list.

Ask for at least two reference for whom the service

provider has converted financial reports into XBRL. One

phone call can provide you an assurance about the

competence and quality of an XBRL service provider.

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#5. Confidentiality of information

A client should enquire about the data handling process at

service the provider’s office.

Does the service provider have a policy of signing a

confidentiality agreement or an NDA (non-disclosure

agreement)?

Even if there is no policy or practice of signing NDA, you must

insist on signing an NDA prior to data conversion. This secures

confidentiality and is in line with best practices, globally.

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Some further questions !

Can someone there help with tagging questions specific to

my industry?

Where is the help/support team located precisely?

What are the support hours?

Who will be in charge of my filing? How will I defend this

choice if something goes very wrong?

Do I trust these people with my company's good standing

with stakeholders, MCA, and others?

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9. Interesting facts about XBRL24

Presently, there is no software available in the market which

does automatic tagging.

XBRL software prices ranges from Rs. 5,400 to Rs. 400,000.

Similarly, conversion fee ranges from Rs. 9,000 per company

to Rs. 45,000 per company and Rs. 300 per page to Rs 3,000

per page.

No certification/ accreditation process for XBRL software's

and service providers.



…contd. (Interesting facts about XBRL)

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At present, there is not much difference in effort in tagging

between a listed company and an unlisted company.

There are service providers who quote their fees over the

phone without ascertaining the complexity of Financial

Statements.

Complete dearth of channels which can train/educate clients

about XBRL process.



Contact us Blue Consulting Pvt. Ltd. is a listed

service provider for XBRL conversion by

MCA.

BC, has its roots in a well established,

four decade old chartered accountants

firm.

We have a separate division for XBRL

conversion services.

Our XBRL team members also have

experience of XBRL filing for UK and US

companies as well.

For further detail, please log on to:

www.xbrlconsulting.co.in

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Chandan Goyal

Chief Executive Officer

[email protected]

+91 98104 10421

+91 120 4230649

Delhi Pune

“A dream is not thatwhich you see in sleep

A dream is thatwhich does not let you sleep”

Index



XBRL Hot Buttons for CS & CFO's (17th Nov'11)

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