XBRL: reducing reporting complexity
eXtensible Business Reporting Language (XBRL)
Digital reporting using XBRL is gaining momentum. It has been adopted in more than 30 countries for business-to-government reporting. Deloitte advises both reporters and data collectors in implementing digital reporting solutions ranging from preparing reports to collecting and analysing data.
What is XBRL
eXtensible Business Reporting Language (XBRL) is an open standard for the exchange of financial and non-financial information in a digital form. It has been developed in cooperation with XBRL International, numerous national governments, regulators and companies.
Key benefits of XBRL
XBRL belongs to the family of XML languages. Because it is machine-readable, computers can directly recognise information in an XBRL document, process this information, and exchange it with other computers. No manual re-keying of data at various points in the reporting chain is needed. This reduces the reporting and overall data processing time and minimises the risk of reporting and analysing inaccurate or inconsistent information. XBRL also allows for customised reporting to meet the specific needs of information users, such as investors and analysts.
XBRL is already used in more than 30 countries for business-to-government reporting. It is mandated for listed companies in the United States, Belgium, UK, Denmark etc. Standard setters of non-financial reporting, such as GRI and CDP have adopted XBRL.
At a European level, the European Single Electronic Format (ESEF) became law in May 2019. The mandate is due to take effect for all IFRS based annual reports issued by public companies and PIEs for financial years that start on or after January 1 2020 and heralds a huge step forward for transparency in Europe. ESEF will require all public companies across Europe to submit their Annual Financial Reports digitally as Inline XBRL documents and in accordance with the IFRS standards.
Deloitte's global network of member firms support both reporters and data collectors in implementing digital reporting with XBRL by focusing on four areas:
- Taxonomy Design and Management: Create structured reporting sets by designing XBRL taxonomies to collect data in digital form
- Digital Reporting: Embed XBRL in the reporting process to produce digital reports
- XBRL Assurance & Support: Verify the process and quality of the XBRL reporting process and the correct application of the XBRL filing requirements to make sure collectors receive the right information
- Data Collection & Analytics: Automate the data collection and validation of digital data to save time in processing reporting information