xbrl conference brussels - bas groenveld and paul hulst - xbrl detail tagging and aup

XBRL detail tagging Client work and AUP

Bas Groenveld & Paul Hulst

Deloitte Innovation, Netherlands

18 May 2011 15:00 – 15:30

22nd XBRL International Conference, Brussels

Introduction

Client case

SEC mandate

Client request

Approach

◦ Tools

Lessons learnt

© Deloitte Innovation B.V. 2

Bas Groenveld

Deloitte XBRL team

Involved in XBRL since 2005

Projects:

◦ Taxonomy creation

◦ SEC Filing

◦ Disclosure management

◦ Deloitte annual report in XBRL

Paul Hulst

Deloitte XBRL team

Involved in XBRL since 2007

Projects:

◦ Taxonomy creation

◦ e-reporting architectures and processes

◦ Automating instance document creation for statutory reporting and credit reporting

◦ Design of formulas for validation


Dutch company on US stock exchange Foreign Private Issuer 20-F

US GAAP

Large accelerated filer

Public float > USD 5 bn

Year end 31/12

Deloitte audit client



Which accounting principles are used?

US GAAP

IFRS What is the public float?

> $ 5bn > $ 700mn Smaller

Phase 1 Phase 2 Phase 3

June 2009 June 2010 June 2011 Block tagging; grace period

June 2010 June 2011 June 2012 Detail tagging; grace period

June 2011 June 2012 June 2013

~ 500 ~ 1,200 ~ 8,000 Companies affected

Fully liable; no grace period

Year-end 20-F deadline XBRL deadline

FY2009 2009/12/31 2010/06/30 2010/07/31

FY2010 2010/12/31 2011/06/30 2011/07/31

FY2011 2011/12/31 2012/04/30* 2012/04/30


Year-end 20-F filed XBRL filed

FY2009 2009/12/31 2010/01/29 2010/02/26

FY2010 2010/12/31 2011/02/15 2011/03/9

FY2011 2011/12/31 ~ 2012/02/15 ? 2012/02/15 ?

Theoretical deadlines

Actual filing

*SEC amendment 2008/08/27

The client had 2 options:

Prepare (and file) XBRL themselves

Outsourcing of XBRL filing

Since “traditional” 20-F was filed by outsourcer, and client was not familiar with XBRL, outsourcing was their choice


Although no assurance is required, the client asked for “comfort” on their second XBRL filing (20-F in year 2 detail tagging).

Offering

In April 2009 the AICPA issued Statement of Position 09-1, Performing Agreed-Upon Procedures Engagements That Address the Completeness, Accuracy, or Consistency of XBRL-Tagged Data.

Deloitte offered to perform an AUP engagement.


Definition: “Agreed-upon procedures is when the accountant is hired to issue a report of findings based on specified procedures. The users of the report agree upon the procedures to be conducted by the accountant that the user believes are suitable. The user takes responsibility for the adequacy of the procedures. In this engagement, the accountant does not express an opinion or negative assurance. Instead, the report should be in the form of procedures and findings. A representation letter is prepared that depends on the nature of the engagement and the specified users.”


• Have “comfort” about the right application of XBRL.

• To improve their knowledge / experience with the XBRL reporting process.

• Assist with understanding the complex XBRL specifications and SEC XBRL requirements (EDGAR Filer Manual).

• Reduce reputational and other risks associated with submission of inaccurate financial information.

• Want insights and best practices to improve XBRL-formatted financial statements & processes.

10

Split up AUPs and selected EFM rules to concise work packages

◦ Tools help to remove the XBRL complexity

◦ Enabling non-XBRL experts to complete packages

◦ Split XBRL/non-XBRL is 50%/50%

Multi-disciplinary team

◦ Deloitte Audit

◦ Deloitte XBRL team

Close coordination with client‟s financial reporting department

Tools

◦ Off-the-shelf XBRL instance/taxonomy viewer

◦ Deloitte Innovation developed AUP tools to support audit teams


Input data for AUP:

◦ „traditional‟ 20-F in HTML or PDF

◦ XBRL instance document

◦ XBRL extension taxonomy

Schema

Label, presentation, calculation & definition linkbases

◦ Any documentation about mapping 20-F to XBRL and decisions about concept choice and extension

Be aware of different file versions and make sure the filed versions are the actual files reviewed



Source data

XBRL instance

document

20-F HTML

document

XBRL conversion

Rendering

XBRL taxonomy & extension

Objects of review

* Depending on

process; instance

is created directly

from source

system(s), or from

SEC form

Output to check if there are:

◦ Units without facts

◦ Duplicate units

◦ Single identifier scheme & entity

◦ Naming conventions for contexts

Standard XBRL validation (including calculation) with off-the-shelf XBRL software


EFM 6.6.36 If a fact whose element type attribute equals „us-types:dateString‟ [...] refers to a specific date, then it must be an ISO 8601 format date.

14-9-2009 2009-09-14


Reporting inconsistent “decimals” attribute creates confusion

us-gaap: Effective Income Tax Rate [...]

◦ 0.124 with precision=2

◦ 0.12 ?


Tools not always perfect, leading to uncertainty for non-technical users

Same tool; different outcome

EPS displayed shares/EUR when exported


User interface

Export to spreadsheet

Sample BS extract 2010 2009

Inventory 1,500 1,400

Property, Plant & Equipment 1,200 1,000

Goodwill 500 500

Non-current Assets 3,200 2,900


Sample disclosure extract (for detail tagging):

[...] At December 31, 2006, Inventory level was 900.

[...] At December 31, 2006, Non-current Assets amounted to 1,500.

2006

900

1,500

Calculation inconsistency

Additional

column as

interpreted by

XBRL software

from instance

document

XBRL and EDGAR Filer Manual are difficult to understand for non-technical users

Knowledge of company‟s financials and US GAAP is essential

User-friendly tools are necessary, both for looking up concepts (& extension creation), data exports and rendering / viewing

In the current reporting outsourced process, the one month grace period can be necessary to allow for effective review

Companies should be aware that communication and coordination with outsourcer can be time-consuming


Questions?


We invite you to our booth in the exhibition hall.

Contact us directly:

◦ Bas Groenveld, [email protected]

◦ Paul Hulst, [email protected]

or visit www.xbrlplus.com

Follow us on Twitter: @xbrlplus


mailto:[email protected]

http://www.xbrlplus.com/

xbrl conference brussels - bas groenveld and paul hulst - xbrl detail tagging and aup

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