XBRL and Financial Applications

Paul SnijdersBoard member XBRL NederlandFounding member XBRL in EuropeFormer vice chair XBRL Solutions groupProject manager Architecture NTP

What do we want as SW vendor

New business opportunities Government ‘inventing’ new requirement ‘All’ our customers asking for it One standard for many possibilities Minimal investment

in other words: Make some money

XBRL: from a software point of view

XBRL with software eyes XBRL Concepts Implementation strategy Threats and Opportunities

key to market adoption

Will XBRL have an impact on software ? XBRL and financial applications XBRL and reporting software XBRL and ETL vendors (Extract Transform Load)

XBRL and consolidation vendors XBRL and Business Intelligence

XBRL throughout the reporting chain

Current software products

Accounting

ERP/GL

Logic

BusinessIntelligence

Data Warehouse

Logic

ConsolidationReporting

FinancialReporting

Logic

Taxreporting

TaxSoftware

Logic Each application has a

proprietary data model

Application have specific

logic and business rules

Data is transformed

multiple times

What is XBRL? XBRL is just another data format XBRL is a sophisticated XML implementation XBRL contains reporting definitions XBRL has data validation and quality inside XBRL removes many export formats XBRL is NOT a standard chart of accounts

XBRL is a very active consortium

XBRL is externalization

XBRL delivers a complete standardization and externalization of data definition, business rules and reporting requirements

Data exchange format Data definitions

also labels, references

Multiple data modelsHierarchical, dimensional and relational

Reporting rules Validation rules Business rules

Externalization of:

Exports, Queries Data Dictionary

Application data modelRDMB, Cubes

Reporting software Application logic Business Logic

Impact on

Example XBRL

Based on

Taxonomy

Goodwill 3.400.500Goodwill 3.400.500Goodwill 3.400.500Goodwill 3.400.500

Turnover 168920000Turnover 168920000Turnover 168920000Turnover 168920000

Common stock 12.500.000Common stock 12.500.000Common stock 12.500.000Common stock 12.500.000CEO Bill GatesCEO Bill GatesCEO Bill GatesCEO Bill GatesProfit 45.870.000Profit 45.870.000

Financial or business fact

How it works

Validation

Compliance checking

Analysis

Mapping

Validation

Companies

XBRLReport

XBRLReport

Reporting

Taxonomy creation

Accountingrules

Validation

Regulator

TaxonomyTaxonomy

XBRL: more than a data definition

LabelCash & Cash Equivalents

LabelCash & Cash Equivalents

LabelKas en Geldmiddelen

LabelKas en Geldmiddelen

FormulasCash Beginning Balance ≥ 0

FormulasCash Beginning Balance ≥ 0

ReferencesIAS 16, 2, a

ReferencesIAS 16, 2, a

PresentationAnnual report

PresentationAnnual report

PresentationBalance sheet Indirect

PresentationBalance sheet Indirect

PresentationIncome statement

PresentationIncome statementPresentationCash flow statement

PresentationCash flow statement

CalculationCash = Currency + Deposits

CalculationCash = Currency + Deposits

Currency Euro/US$ M2,

Currency Euro/US$ M2,

Segment2Prod TVHifi

Segment2Prod TVHifi

Segment2VideoAudio

Segment2VideoAudio

ScenarioBudgetActual

ScenarioBudgetActual

PeriodFY 2004 Q1,

PeriodFY 2004 Q1,

Segment1BeneluxEU

Segment1BeneluxEU

LabelComptant et Comptant Equivalents

LabelComptant et Comptant Equivalents

LabelGeld & Geld nahe Mittel

LabelGeld & Geld nahe Mittel

LabelГроші та їх еквіваленти

LabelГроші та їх еквіваленти

XBRL Taxonomy

XBRL Instance

ElementsElements

Profit : 45.870.000Profit : 45.870.000

Entity: XYZ Ltd Entity: XYZ Ltd

Example taxonomy hierarchy - NTP

Dutch GAAP RelationsData types Dutch GAAP RelationsData types

IFRS

RelationsPresentationCalculation

Dutch Gen-baseGeneric Elements Netherlands

Dutch GAAP RelationsData types

Data types

Form set Form set Form set

Report

Dutch Core

Domain specific• Tax Admin• Annual reports• Statistics

Form Sets

Per sub/target group

International basis

Instance document

Instance document

<ifrs:profit contextRef=“Contex1” unitRef=“Euros” Decimal=“0”>45870000</ifrs:profit>

Value Definition

Taxonomy

<xbrli:unit xbrli:id="u0"> <xbrli:measure>iso4217:EUR </xbrli:measure> </xbrli:unit>

Unit Defintion

<xbrli:entity>Virtual Company</xbrli:entity > <segment>North</Segment><xbrli:period> <xbrli:startDate>2004-01-01</xbrli:startDate> <xbrli:endDate>2004-06-30</xbrli:endDate> </xbrli:period> <scenario> <Scenario>Actual</Scenario> </scenario>

Context Definition

Simplified

Different data models in XBRL

Element 1: 4000Element 2: 203Element 3: AmsterdamElement 4: 8000Element 5: KPMG

Simple list

+ Element 1: 12000 + Element 2: 8000 + Element 3: 4000Element 4: Address Element 5: Street Element 6: zip

Hierachy

Relational

6000Street 4Address 4Employee 4

Street 3

Street 2

Street 1

Street

4000Address 3Employee 3

1700Address 2Employee 2

1300Address 1Employee 1

SalaryAddressName

6007507000Employee 4

560

420

230

4005000Employee 3

1702700Employee 2

1302300Employee 1

Insur.GrossName Soc.Sec

Multi dimensional

200300 Costs

1100012000 Sales

18002700 Profit

BudgetActualSales, 2006 April

200024002500Product D

1200

400

UK

10002000Product C

700Product B

300500Product A

FranceGermanySales, 2006 Actual, April

XX

Sofisticated technical fundament

TaxonomyTaxonomy

XBRL- InstanceXBRL- Instance

XBRL Spec 2.1XBRL

Spec 2.1

XMLSchema

XMLSchema

InstanceSchemaInstanceSchema

XlinkSchemaXlink

Schema

FRTAFRTATaxonomyguidelines

FRISFRISInstanceguidelines

Valid

ati

on

& C

on

form

an

ce s

uit

eV

alid

ati

on

& C

on

form

an

ce s

uit

e

1000+ pages spec700+ Conformance tests150+Mb Test set

More technical capabilities

• XBRL specification 2.1• Schema driven XML language• Heavy use of X-link

• Data structuring• Relational data models• Multidimensional structures• Hierarchical data• Flat structures• Multiple data representations

• Fully extensible • Taxonomies• Data structuring• XML and custom data types• Presentation & Calculation

And more great material to expect

• Link Role Registry (LRR) (100%)• Dimensional taxonomies (90%) • Formula linkbase (80%)• Functions (80%)• XBRL GL (95%)• Versioning (1%)• Approval processes (90%)• Entity taxonomies (0%)• Consolidation linkbase (0%)• Rendering standards (5%)

Who is involved in reporting

Internal IT departmentsFinance

(Control/Consolidation)

ReporteesExternal

• Software vendors• Consultancy • System Integrators• Auditors (also EDP auditors)

Software functionalities

Exploring taxonomies Mapping to applications/Data Validation (technical) Compliance monitoring Audit & control Transactions in XBRL (XBRL-GL)

Opportunities for SW vendors

Single export format New reporting functionalities Enhance application data model

Reporting data structures? Relational/multidimensional

New audit and control capabilities XBRL GL support XBRL as application data model

XBRL consortium deliverables

• Ready to use global standard• Complete data model• Standardization on export formats• Standard transaction level format• Multi language support• Data quality and validation• References to guidelines • Generic business rules• Presentation views• Intrinsic flexibility

FREE OF CHARGE

Alternatives Make

Hard coded implementation Generic implementation

Buy Ready to use Reporting Module Generic XBRL Product XBRL Library /XBRL Engine

The biggest question of all:

What new solutions can I offer?

Appl.Database

XBRL as hard coded format

hardcoding

• Not a generic solution• Recoding on any taxonomy change• No new taxonomies• New coding for new instances

Dead end street

Generic approach

GUI

Business Software

Complete Reporting Data Model

XBRL Solution

Mapping

Standard Software

FinancialReport

XBRL

Standard Format

TaxonomyBuilding

InstanceCreation

ValidationCompliance

Audit &Control

XBRL-GL

Functionalities

Options

XBRLGUI

GUIBusiness Software11

Build

- Make your own XBRL processor - Application development

XBRLGUI

XBRLEngine

GUIBusiness Software22

OEM - Buy XBRL components - Application development

GUIBusiness Software33 XBRL

Engine

ReportingModule

Buy - Ready to use XBRL module - Simple implementation

Easiest road map

1. Embed existing Reporting Module

2. Provide basic XBRL output

3. Make use of XBRL functionalitiesPresentation, Calculation, data validation

4. Enhance with validation options

5. Provide taxonomy building options

6. Embed XBRL data concepts in your application

7. Support XBRL GL

8. Support all other XBRL stuffFormulas, functions, dimensions, Conformance suite

Financial application in the future

ERP/GL

Logic

Data Warehouse

Logic

FinancialReporting

Logic

TaxSoftware

Logic

Data models

XBRL Business rules

XBRL Meta data

XBRL exchange format

XBRL Reporting

International standard

XBRL transactions

XBRL

XBRL

XBRL

XBRL

XBRL

XB

RL

XB

RL

XB

RL

XBRL

XBRL

XBRL

XBRL: Threat or opportunity

1. Transparent and open Data model

2. You have to support complex technology

3. Extra maintenance 4. Possible threat to

several solutions 5. Low license

revenue6. Open source XBRL

1. Better serve customers

2. Only one export format to maintain

3. New solutions & functionalities

4. New business opportunities

5. Extra licenses from new products

Todo’s Knowledge

Build your own XBRL team

Technology To what extent to provide support

Data How far to go with data integration?

Business What can you charge the customer?

Market development - thank you XBRL

• Global sophisticated standard

• Complete set of material

• Complete test sets

• Ready to use reporting data model

• Single format

• Reduction of maintenance

• Guaranteed use and market demand

• Huge market potential

“Above all, continue with your enthusiastic

contributions to the global development of

the XBRL standard. As I said at our last XBRL

Conference in Tokyo: Have no doubt, you are

changing the world for the better”

Chairman Christopher Cox, U.S. Securities and Exchange

Commission

San Jose, California, Jan. 18, 2006

Interesting promoters

“One way, perhaps, to distance

ourselves from relying on these

quarterly earnings forecasts, is to

make progress toward real-time

disclosure. ”

Michael G. Oxley , House Committee on Financial Services

Washington, March 29, 2006

www.xbrl.org

Paul SnijdersBoard member XBRL NederlandFounding member XBRL in EuropeFormer vice chair XBRL Solutions groupProject manager Architecture NTP

paul.snijders@semansys.com

Free Taxonomy ViewerVisit the Semansys booth