XBRL: The Time to Learn

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XBRL The Time to Learn is Now
ASWA November 2001 by Neal Hannon
Bryant College
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Why Are Academics Involved in XBRL?
XBRL will soon become a dominant method of
handling business reporting Other areas of
business are also moving to XML enabled
information. (HR, CRM, ERP, Insurance, etc.)
Colleges and Universities need to understand how
business changes with the introduction of XML,
Web Services and the rapid movement of
information from computer to computer
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The Case for XML..

• XML - a computer markup language that is
  extensible (flexible can be added to)
• XML is actually a bare-bones set of syntax rules
  to markup any kind of text and data
• XML provides the structure of the text or data
• XML describes to humans to computers what the
  data is not how to display it

XML has become the fastest growing technology for
information transportation and exchange the world
of computing has ever seen. Business Integrator
Magazine says that nearly nine out of every ten
enterprises claim that XML will be and important
technology for their IT strategies over the next
year
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The Case for XBRL
The purpose of XBRL is to enhance the flow of
financial information through the creation of a
globally useful language in which to describe
financial facts and concepts. David vun Kannon
XBRL is uniquely positioned to Provide mobility
and transportability to financial and business
facts. Students in AIS, Advanced
Accounting,Auditing, Consolidations, Mergers,
Tax, Not-for-Profit will all be affected by
XBRL, which will drive change in Finance
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The Case for XBRL
Arthur Levitt, Former Chairman, SEC
I would like to see you take your XBRL project
a step further, providing account
classifications for companies in Common
industries. In short, I challenge you to turn
all of this data into meaningful information for
investors
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The Case for XBRL
Business Week, November 5, 2001
SEC Chairman Pitt complains that financial
Reports are backward-looking, hard to
understand, and don't highlight the Information
investors need. Some of the improvements he is
considering SLICE N' DICE Accountants are
developing XBRL, a way of coding financial
reports on the Internet, that will let investors
download and manipulate companies' numbers any
way they like
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The Case for XBRL
Financial Professionals will need to collect,
interpret and report data in many different XML
dialects XBRL provides a bridge not only to
financial statements, but to all business
reporting.
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The Case for XBRL
Do your main job first get the financial
statements right. Then tackle enterprise data
integration. But not until the integrity of the
financial statements are at the highest level
possible. The SEC is a strong supporter of
XBRL Lynn Turner, former chief accountant for
the SEC
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How XBRL Works
Improves the way companies -- and applications
-- share business reporting information
5. XBRL data can be used in applications B or
other comparable applications
3. XBRL information flows freely across the
Internet or VPN, LAN and WAN
1. XBRL Specific Data
XML/XBRL translator
XML/XBRL translator
Application - A
Application - B
Common XBRL Vocabulary
2. Application data is converted into a common
XBRL vocabulary
4. XBRL-tagged data is mapped into applications
specific data
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What software sees is the differentiator and
drives benefits
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XBRL Business Uses
Internal Uses include Account analysis Balanced
Scorecard
Wireless, PDA Cell Phone
Automated exception reporting
The internal use of XBRL is just Beginning to be
explored, brought on by XBRL for General Ledger
in public beta. New XBRL releases are
compliant with the latest version of W3Cs XML
Schema
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Consider External Financial Reporting
How much of this painting would be needed to
represent spent on external financial
reporting for a major US corporation last year
compared to total spending?
Maybe 1???
Can you guess why some companies are
not thrilled with XBRL?
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XBRL Business Uses
External Uses include SEC Filings IRS and State
Tax Filing
Wireless, PDA Cell Phone
Annual Reports Creditor Reports
Externally, XBRL focuses on the production of
GAAP financial statements for the business
financial reporting supply chain. The
external focus of XBRL is evident by the heavy
participation in XBRL.org by the AICPA and Big 5
Accounting firms
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XBRL International
International Accounting Standards and Major
Countries are changing the way Accounting is
conducted world-wide
Hot spots of development include Australia,
Singapore, Germany, Japan, followed by Canada,
the Netherlands, Spain, South Africa, Hong Kong,
Great Britain, and the Scandinavian countries.
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Stig Enevoldsen (Chairman IASC) September
1998
The fact is that we not only speak different
accounting languages but also give different
interpretations of the same events and
transactions
I believe that the best way forward in
accounting is to converge towards one single
world-wide accounting language.
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Sir David Tweedie (current IASB
Chairman) The mission of the newly-created
IASB is to increase the transparency of
financial reporting by achieving a single, global
method of accounting for transactions -- whether
in Stuttgart, Sydney, Seattle or Singapore.
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Need to define One Accounting LanguageOne
Transaction Methodology Within the IAS
Financial Reporting Framework To achieve the
objectives of High Quality Transparent Comparable
Financial Statements
IAS Philosophy Implications
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The VisionTo produce High quality,
Transparent, Comparable,General Purpose
Financial Reporting to International
Accounting StandardsUsing one accounting
languageOne transaction methodologyWhich are
useful for making economic decisions.
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The Vision for XBRL Just do
it Electronically in a binary
environment With the Seamless Transfer Of
Financial Information In a known state
Without Human Intervention
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The One Accounting Language ChallengeLanguage
System of words rules of a particular
communityObjectiveUnambiguous globally
understandable classifications Accounting
classificationsBy nature and classScientificall
y extensibleA place for everything and
everything in its placeTo classify items as yet
unknownAbsolute precisionBinary environment no
room for judgmentFact definition increases
exponentially as judgment is eliminated
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Mountain Zebra
Hartmans Zebra

ZEBRAS Plains Zebra
Quagga


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Bergzebra
Pyjama Donkey Z
EBRAS Steppenzebra
Kwagga

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Grevys Zebra

(Equus Grevyi )
Zebra
(Equus
Zebra Zebra) (Equus Zebra Hartmannae )
(Equus Quagga) (Equus Quagga Quagga)
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Many Human Presentations One Fact
in XBRL one fact with many labels
For example profit / non profit
organizations
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Do You Need to Understand XML?Yes
No

• Basics of XML are needed to understand how
  business events are captured and stored
• XML basics can be self-taught or self-directed
  over the Web
• XBRL is valid XML

• This is Accounting, not computer science
• I dont have the time to fool with XML, I need to
  learn it first.
• XBRL will soon go under the covers so I can
  ignore it.

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XBRL Market Activities

• MSDW SEC EDGAR filing
• Singapore and Australia (APRA) efforts
• XBRL Academic Competition
• XBRL Essentials and Introducing XBRL Decision
  Making in a Digital Economy
• Vendor support for XBRL
• Jurisdictional Activity/Status

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Vendor Implementations

• ACCPAC
• CaseWare
• Creative Solutions
• e-Numerate
• eKeeper

• KPMGs Columbus
• KPMG Consulting
• Navision
• Newtec
• PPC
• XBRL Solutions
• SAP
• FRS (South Africa)
• FRx (Microsoft)
• Hyperion
• IBMATRIX
• Syspro

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XBRL Media Summary

• 213 articles for 12 months ended August 31, 2001
  generating over 36 million impressions1
• Equivalent to over 6.1 million in annual
  advertising2
• Generated stories in major financial
  publications CFO, American Banker, Times of
  London, Barrons, Financial Executive, Financial
  Times, Financial Director, Securities Industry
  News, Securities Week, Wall Street Technology,
  Pensions Investments
• Secured major wire stories Dow Jones, Bloomberg,
  Reuters, Newsbytes News, ABIX
• 24 total news releases issued by Consortium and
  AICPA

1-Does not include wire stories or Web stories
which have virtually limitless impressions.
2-Based upon ad dollar equivalents extrapolated
for a one-year period does not include ad dollar
equivalents for wire stories or Web stories.
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Books, Articles, Videos

• XBRL Essentials, Hoffman and Strand, June 2001
• Introducing XBRL, Hannon and Coffin, January
  2002.
• AICPA E-business Update Video and Workbook,
  2001.
• IMA National Conference Video
• Over 300 Articles, Special Section in Strategic
  Finance Magazine (June 2001), Monthly XBRL Column
• SoftwareAG XML video www.softwareag.com

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Neal Hannonnhannon_at_bryant.edu XBRL Education
Work Group chair IMA IT ChairPhoto and
Creative Credit to Dave Garbutt, FRS, SA