In a continued effort to educate on the development of XBRL technology in industries such as financial services (and beyond), Merrill Corporation will share articles and columns published on the topic.
XBRL has become an industry standard in the states, but until now, its reception worldwide has been mixed. These are a few of the global issues making headlines in the world of XBRL today:
The deadline to meet the newest XBRL taxonomy regulations in India is swiftly approaching, and many experts are still concerned about the unaddressed problems and hiccups in the system. Analyst Sangeeta Singh provides some insight:
There is no updated validation tool that will test the XBRL software developed by various vendors, the project lacks extensions to the glossary of financial terms—known as taxonomy—and analysts and investors are not allowed to download the data in the XBRL format, they add. By 30 November, around 30,000 companies with a paid-up capital of Rs.5 crore [around one million US dollars] and more, or a turnover of at least Rs.100 crore [around 20 million USD], have to file their profit and loss account and balance sheet for the year ended 31 March in XBRL. The ministry [of corporate affairs] missed a deadline of 30 September of implementing the project because both the taxonomy and the validation tool had to be revised.
The MCA hopes to improve financial reporting by adopting the United States XBRL system, but experts in India feel that they are missing the point. Vinod Kashyap, director of NextGen Knowledge Solutions Pvt. Ltd., says “MCA’s attempt of putting up statements filed by companies in PDF form and not XBRL form for public viewing will defeat the purpose of adopting XBRL and will disallow analysis and comparison”
Overall, the experts all agree that there will be some persistent issues with India’s system, but the primary concern now is for the MCA to get the project moving in time for that country’s financial industry to meet the already-set deadlines.
Meanwhile, in Japan, the system is having a much warmer reception. Japan’s financial markets are making a special effort to maintain an internationally-friendly XBRL system.
The country's main corporate companies still utilize pen-and-paper methods for most of their reporting and analysis, according to analyst Makoto Shibata. “[Japan] will develop a taxonomy or standard process…They will experiment with how they can handle and proceed with the process.” Since its introduction to Japan in 2008, XBRL tagging was limited to a few specific needs, but is now being brought into use in accounting, pricing data, and corporate sustainability reports.
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