Considerations and areas of judgment for accounting professionals
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CONSIDERATIONS FOR ACCOUNTING PROFESSIONALS WISHING TO PERFORM XBRL-SPECIFIC ASSURANCE SERVICES
Hang Miao
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BRIEF INTRODUCTION TO XBRL
eXtensible Business Reporting Language
Computing language designed to improve quality of financial reporting by: Eliminating manual keying Making financial statements between
companies more comparable
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BRIEF INTRODUCTION TO XBRL (CONT’D)Example:
Consider the following piece of financial information:
Assets held For Sale € 100,000
In XBRL, this information would be represented as:
<ifrs-gp: AssetsHeldSale ontextRef=”Current_AsOf” unitRef=”U-Euros” decimals=”0”> 100000 </ifrs-gp:AssetsHeldSale>
Source: http://www.xbrl.org/Example1/
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BRIEF INTRODUCTION TO XBRL (CONT’D) XBRL financial statements are created
by tagging financial statement data with elements from an XBRL taxonomy
An XBRL taxonomy is a dictionary of the XBRL tags.
<ifrs-gp: AssetsHeldSale contextRef=”Current_AsOf” unitRef=”U-Euros” decimals=”0”>100000</ifrs-gp:AssetsHeldSale>
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Financial statement
s
XBRL taxonomy
XBRL documen
t (Instance
)
Users
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Source: http://www.informationbuilders.com/images/products/webfocus/enlarge/enl_xbrl-fml.jpg
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WHAT SERVICES CAN AN ACCOUNTANT PROVIDE WITH RESPECT TO XBRL?
XBRL was not designed with information integrity in mind
Possible problems with XBRL include: Improper use of taxonomic elements Improper use of custom elements XBRL document does not match original
financial statements
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CAN PROFESSIONAL ACCOUNTANTS PROVIDE XBRL SERVICES?
Assurance is currently not required for XBRL documents
As with any other assurance engagement, the accountant must be independent
See AICPA SOP 09-1 for list of engagement conditions
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CHOOSING BETWEEN AN ATTESTATION REPORT AND SPECIFIED PROCEDURES REPORT Two types of reports can be issued:1. Attestation Report (US: AT 101, Can:
HB 5025)2. Specified Procedures Report (US: AT
201, Can: HB 5025) Choice depends on user needs Specified procedures report requires
input from users
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SKILLS/EXPERTISE REQUIRED
Knowledge of regulatory environment (e.g. SEC filing rules in the US)
Knowledge of IT and XBRL Ability to use XBRL reading and
manipulation programs
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FUTURE DEVELOPMENTS
More guidance – AICPA Exposure Draft Increased size and complexity of XBRL
filings Increased user sophistication with
respect to XBRL
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