XBRL

What is XBRL?
XBRL is a standardised “computer readable” language designed to enhance the electronic communication and analysis of business information. It is an international standard that has been adopted by many Government regulators, agencies and companies around the world, including the SEC in the United States, Companies House and HMRC in the United Kingdom and the Revenue in Ireland. These organisations are currently, or in the near future, requiring financial information, normally submitted manually or through proprietary electronic methods, to be tagged and submitted using XBRL.

This website will keep you up to date and provide you with information to assist you in understanding how XBRL affects your organisation.

XBRL in Ireland
In Ireland, Revenue has indicated that voluntary use of XBRL will be introduced possibly from as early as 1, January 2012. Revenue are expected to mandate for the use of XBRL on a phased basis possibly from 1, January 2013. A formal consultation process is expected to commence shortly in respect of Revenue's plans.

iXBRL for UK companies
All UK companies required to file a corporation tax return are now required to do so electronically using inline XBRL (iXBRL) for both the tax return itself and the related statutory financial statements. The requirement took effect from 1, April 2011.

How PwC can help
PwC has already developed and successfully piloted e-filing solutions for the submission of tax calculations to HMRC.

Our teams have extensive experience of advising on change programs prompted by new tax and financial regulation and has been closely linked with the development of XBRL.

We have also began using iXBRL software for tax calculations and company financial statements and have practical experience in tagging financial information using iXBRL and in structuring engagements to helping clients with their tax compliance.

  • iXBRL tagging: a simple, effective, managed service

    If HMRC’s iXBRL tagging requirement applies to your business, you could be looking for a simple and effective solution to provide a short- to medium-term fix.

    At PwC, we’ve devised a managed tagging service that can tag completed financial statements for our clients.

    Our service:

    • generates output you need and can readily review
    • explains the judgments made in selecting the tags
    • averts the pain of buying and implementing new software.

    Find out more detail about our iXBRL tagging service from your usual PwC contact or from our XBRL team.

    Of further interest:

     

  • Assurance and iXBRL

    HMRC's iXBRL requirement is a regulatory-driven change which will require action by management to deliver financial information in a new format using XBRL tags as well as in human-readable form.

    The terms 'regulatory-driven change', 'new format' and 'require action', when placed in close proximity, can only mean one thing. Risk.

    The primary risk is that companies may not take the actions necessary to be able to continue to deliver company tax returns acceptable to HMRC. Secondary risks arise connected with the quality of the application of the XBRL tags and the potential for the XBRL tagging process to identify errors in completed statutory financial statements.

    HMRC now require iXBRL statutory financial statements and tax computations. In broad terms this means that 2011 will be the first year in which tagging work is necessary and therefore should be the year of implementation of systems, processes and controls necessary for iXBRL tagging.

    Here are some questions the Audit Committee or Senior Management can usefully ask their colleagues:

    • Who has responsibility for iXBRL implementation?
    • Has someone been identified to devote time to assessing the implementation choices, making a recommendation and devising a plan?
    • How many financial statements need to be tagged and what is the current process for preparing financial statements? Is there more than one process being followed in the organisation?
    • How is the iXBRL requirement for the tax computation being addressed?
    • When will a proposed plan and budget be reviewed by the audit committee or senior management?

    If you would like some more background information before asking these questions, then why not call one of our XBRL team. We would be happy to share perspectives with you.

    Of further interest:

     

  • Corporate simplification

    All UK companies whether active or dormant required to file a tax return will be affected by HMRC's new requirement for electronic tagging. This will add a further layer of cost to retaining companies and for those that serve no economic purpose, the benefits of dissolving them may prove even more compelling.

    When the time spent by management dealing with the current level of corporate governance matters is factored in then clients tell us the "cost" of retaining dormant companies typically ranges from €3,000 to €5,000 per entity per annum and for regulated entities €6,000 to €8,000 pa. Needless to say this figure increases significantly for active companies.

    Groups with a number of UK companies should consider a corporate simplification project to dissolve any dormant or inactive companies and to optimise the number of active companies required to operate their business. Such a project could result in significant savings both in terms of direct compliance costs and in management time.

    Find out more about how we can help simplify your existing corporate structure from your usual PwC contact or from our XBRL team.