Presentation on theme: "XBRL Discussion Material A summary of discussions to date related to the components of a taxonomy for SEC EDGAR filing purposes."— Presentation transcript:
XBRL Discussion Material A summary of discussions to date related to the components of a taxonomy for SEC EDGAR filing purposes.
SEC XBRL Filing An SEC XBRL filing is composed of company specific taxonomy files and an instance file.
Taxonomy A taxonomy is a collection of schema and linkbase files. A taxonomy can be as complex as the US-GAAP taxonomy (15,000 elements), or as simple as a company-specific taxonomy (100+ elements) submitted to the SEC as part of a filing.
Taxonomy: Schema A schema defines elements and roles and may call in external schema and linkbase files which may then be referenced. An example of an import command in a schema file, importing the US-GAAP taxonomy:
Taxonomy: Element An element is a fact or code that contains some meaning. Its definition in a schema will include an identifying name, type (i.e. monetary, shares, string, etc), period type (instant, duration), balance (debit, credit) and whether or not is an abstract value (a header).
Taxonomy: Element An example of an element definition in a schema file:
Yes/No Monetary, Shares, Decimals, etc Instant, Duration, Blank What defines an element? Element Period Type Type Is Abstract? Debit, Credit, Blank Balance
Mixing element types Instant and duration period type elements do not mix within calculation relationships (like oil and water!) Abstract elements are just text strings and do not have a balance attribute and are generally considered to have durational period types
Taxonomy: Element XBRL US is a non-profit organization which has built a taxonomy of 15,000 elements relating to line items or facts used by companies in US-GAAP compliant financial reports. These are the codes the SEC wishes filers to associate values with for easy identification.
Taxonomy: Role A role is a grouping of elements for use in a Calculation, Presentation, or Definition linkbase. For example, we would create the role Balance Sheet and have it appear in both the Calculation and Presentation linkbases which would contain the display and roll up relationships for this group respectively.
Taxonomy: Role An example of a role defined in a schema file: 104 - Statement - BALANCE SHEETS link:calculationLink link:presentationLink link:definitionLink
Taxonomy: Linkbase A linkbase is a file containing specific information in relation to the schema. There are five kinds of linkbases, each serving a different purpose. These include Presentation, Calculation, Label, Definition, and Reference.
Taxonomy: Linkbase Presentation Linkbase: describes how elements should be displayed on screen, including both ordering and nesting. A schema may contain 100 elements, but if only 50 are included in this linkbase only those 50 will appear when rendered with a viewer.
Taxonomy: Linkbase Calculation Linkbase: describes how elements are rolled up or added together. This linkbase makes it possible for XBRL validators to compare tagged facts to their expected calculations, and provide errors or warnings where appropriate.
Taxonomy: Linkbase Label Linkbase: contains a database of labels that can be referenced when elements are displayed. An element can have multiple label types associated with it. Labels in this linkbase can override labels defined in linkbases of imported schemas.
Taxonomy: Linkbase Definition Linkbase: contains information related to dimensional tables. Dimensional tables are those that require more than just a date and element to uniquely identify a fact. An equity table is an example of a dimension table as it typically contains column headers that provide further detail in relation to a number (i.e. Retained Earnings).
Taxonomy: Linkbase Reference Linkbase: contains references to official accounting documentation that help bring meaning to an element. For example, the element Cash has an official meaning in relation to US-GAAP; this linkbase would explain this meaning. This linkbase is not typically submitted in conjunction with an EDGAR XBRL filing.
US-GAAP Taxonomy Contains thousands of elements for face financial statements (Balance Sheet, Income Statement, etc) and disclosures (financial notes). Includes linkbases that describe default presentation and calculation relationships and collections of default labels.
IFRS Taxonomy The IFRS (International Financial Reporting Standards) taxonomy is similar in purpose to the US-GAAP taxonomy but contains only elements related to the international standard. It is much smaller than the US-GAAP taxonomy and simpler in structure as well. Canadian companies will start using IFRS in January, 2011.
Document and Entity (DEI) Taxonomy Contains a small collection of elements relating to the filing and/or company. For example, company name, cik, form type, accelerated filing status, etc are all elements that appear in this taxonomy. The SEC requires that values for a number of these elements be part of every EDGAR XBRL filing.
Company-Specific Taxonomy Contains a customized schema and linkbase files that meet the reporting requirements of a given company. Will reference an external taxonomy (i.e. US-GAAP) and where appropriate, include elements defined there in its respective linkbase files.
Company-Specific Taxonomy A company will place any specialized custom elements in its schema file and describe how facts in an instance file should be presented and calculated in its respective Presentation and Calculation linkbases. Relationships defined in these linkbases will override those available in imported taxonomies.
Company-Specific Taxonomy A company will create a collection of custom labels and include these in the Label linkbase. The company-specific taxonomy files are submitted to EDGAR as exhibits in a filing template, along with official HTML documents.
Instance File Contains facts (numbers) tagged with elements, units, and contexts. Every tagged fact references a unit, context, and decimals attribute. An example is: 8346000000
Precision / Decimals Tagged numbers must be complete in the instance file (for example, one million must be 1000000). However, through setting the decimals attribute for the tagged item in the instance file you can request it be displayed in tens, thousands, etc. A decimal value of -3 means knock off three zeros.
Contexts Contexts defined in the instance file describe date and dimension information related to a tagged fact through the contextRef attribute. A context can only relate to an instant (point in time) or duration (a period), not both. A duration context cannot be applied to a value tagged using an instant type element, and vice-versa.
Units Units are defined in the instance file (i.e. US Dollars, Shares, US Dollars per Share, etc). A unit is applied to each tagged fact through the unitRef attribute. A share type unit cannot be applied to a monetary type element and vice versa.
CALLABREFDEFPRE XSD XML US-GAAP DEI IFRS Contains links to accounting regulations, bringing official meaning to an element. Not part of a company specific taxonomy for EDGAR filing purposes. Contains a database of custom element labels which overwrite imported defaults. Describes how elements should be displayed in relation to ordering and nesting. Elements will only be displayed if they are in this linkbase. Describes how elements should be rolled up or added when comparing calculated values to reported values. Describes dimension related data for tables requiring additional column headers (i.e. equity table) Schema file containing links to linkbases, imported schemas, a list of roles, and custom elements. The GLUE that holds an XBRL taxonomy together. Instance file containing a collection of tagged facts; contains the actual numbers being reported. Generated for each report. Official taxonomies located on the web which are loaded into a company taxonomy for potential reference. Each of these taxonomies typically has its own set of linkbase files, which are overridden by the ones in the company specific taxonomy. The company specific XBRL files to be submitted as exhibits in an EDGAR template to meet the EDGAR XBRL requirements. Schema Import Link REFDEFLABPRECAL The company specific taxonomy files (may remain unchanged from period to period). The term taxonomy does not typically include the instance file.
Parenthetical Data Some financial tables contain data in label values that the SEC requires be tagged using specific XBRL elements (i.e. common stock authorized). Parenthetical roles are created in a schema that contain these elements. For example, a typical XBRL filing would contain Balance Sheet and Balance Sheet (Parenthetical) roles.
Null Values Tagging null values will often result in these values not displaying in most viewers. This means that some rows tagged and submitted in instance files may not show up when viewed in the SECs XBRL viewer. Using zeros 0 instead of null values may avoid this issue.
Instants and Durations Each element is coded as either an instant or a duration in a schema file. Each context is either an instant or duration. These cannot be mixed together in the calculation linkbase. A balance sheet contains only instant type elements while the income statement, cash flow statement, and equity statements predominantly contain duration type elements.
Instants and Durations Text blocks for containing HTML code for notes are duration type elements representing the period of the report.
Debits and Credits An element is defined as either a debit or credit. While accounting oriented, the debit/credit value of a custom element can generally be determined by considering elements that appear next to or close to it in the statement in question (i.e. assets vs. liabilities, revenue vs. expenses).
Debits and Credits The debit or credit value is important when XBRL is using the Calculation linkbase to calculate totals. If a debit and a credit are being added up to equal a credit, the debit value must be given a weight attribute of -1. Likewise, if these two elements are being added up to equal a debit, the credit value must be given a -1 weight. The weight is defined in conjunction with the relationship of these elements within the Calculation linkbase.
Negating Labels A special negating label can be defined in the Label linkbase and applied to an element in the Presentation linkbase. This will flip the sign of the value when it is displayed in an XBRL viewer. Negating labels are needed – particularly in the cash flow statement – to properly display values that are internally represented as the opposite sign.
Negated Labels Credit –Credit –Debit (-1) –Credit Debit –Debit –Credit (-1) –Debit Undefined –Debit –Credit –Debit XBRL elements have a balance attribute which, if defined, can be set to either credit or debit. The balance of an element follows accounting rules. Neither is inherently negative or positive – it depends on their respective relationships in a given scenario. Negated labels allow you to flip the sign of an element when viewed to match the presentation intended while avoiding internal XBRL inconsistency errors. The weight attribute, set within the calculation linkbase
Negated Labels Revenues (credit) –Oil and Gas Revenue (credit) –Professional Services Revenue (credit) –Cost of Goods Sold (debit) Credit –Credit –Debit (-1)
Negated Labels Revenues $300 –Oil and Gas $200 –Consulting $200 –COGS $100 Revenues $300 –Oil and Gas $200 –Consulting $200 –COGS $(100) Works fine! Inconsistency error! Tag $100 and configure a negated label for COGS
SEC Filing Requirements All face financial statements (balance sheet, income statement, cash flow statement, and equity statement) must be coded on a line item basis where notes can be tagged as block text (chunks of HTML code). The bulk of Newsfile domestic (i.e. 10-Q filers) clients must begin filing in XBRL starting August, 2011.
SEC Filing Requirements The bulk of Newsfile foreign issuer clients will need to file XBRL with their 20-F or 40- F starting in spring of 2012. After August 2012, the bulk of Newsfile clients will need to tag notes on a line item basis, significantly increasing the time and cost related to preparing an XBRL filing.
Thoughts How do we best configure our software solution to handle all of the XBRL requirements in a simple manner? How well does our software solution work in relation to interpreting and producing taxonomy and instance files?
Next Steps Construct a simple taxonomy using the taxonomy builder. Begin working with the tagging software.
Working with the Taxonomy Builder The following slides provide hits and tips relating to the structure of the face financials and the use of debit and credit items.
Balance Sheet Assets Liabilities Stockholders Equity Debit Credit Liabilities and Stockholders Equity Credit Assets = Liabilities + Stockholders Equity (what you have is what you own and what you owe others) Instant
Income Statement Revenue Cost of Revenue / Cost of Goods Sold (COGS) Credit Gross Profit Debit Credit Operating Expenses Debit Nonoperating Expenses Debit Net Income Credit Gross Profit = Revenue – Cost of Revenue Net Income = Gross Profit - Expenses Watch out for sign reversals in line items! Duration
Cash Flow Statement Cash Flows from Operating Activities Cash Flows from Investing Activities Cash Flows from Financing Activities Outgoing Cash Flow = CreditIncoming Cash Flow = Debit Outgoing Cash Flow = CreditIncoming Cash Flow = Debit Adjustments to Noncash Items Increase / Decrease in Operating Assets and Liabilities Operating Asset = CreditOperating Liability = Debit Incoming Cash Flow (gain / revenue) = Credit Outgoing Cash Flow (expense) = Debit All Credits should have negating label applied Unique line items beginning with IncreaseDecrease Watch out for sign reversals in line items! Duration Some line items may be duplicated from income statement
Stockholders Equity Balance (Beginning of Period) Balance (End of Period) Increase in Equity = CreditDecrease in Equity = Debit Issuance of Stock Exercise of Stock Options Net Income Dividends Repeat section for each Period Balance rows are instant type elements (StockhodersEquit y)! Duration Only create a single instance of each element Create a detailed duration custom tag to capture share issue specifics No need to create Total dimension