INFORMATION SYSTEMS AND PROCESSES XBRL FORMULAE MOTIVATION Víctor Morilla Member of CEBS XBRL Network IX European Banking Supervisors XBRL Workshop Paris September 29th 2008

INFORMATION SYSTEMS AND PROCESSES INTRODUCTION XBRL 2.1 provides different types of validation for instance documents: –Basic XBRL validation –XML Schema validation –Calculation linkbase –XBRL Dimensions Not enough in most cases: –Basic arithmetic operations: product, division, … –Arithmetic comparisons: item A must be equal to item B, … –Checks for the presence of elements Derivation of new facts from existing ones is not possible XBRL Formulae fills the gap 2

INFORMATION SYSTEMS AND PROCESSES ESTIMATED SCHEDULE UPDATE Mar 08 First CR Feb 08 Fourth PWD Jun 08 First implementations Oct 08 Second CR Dec 08 / Jan 09 Final Rec Bank of Spains reporting system implements Formulae validation for COREP statements Bank of Spains reporting system implements Formulae validation for COREP statements

INFORMATION SYSTEMS AND PROCESSES WHY HAS BANK OF SPAIN CHOSEN XBRL FORMULAE? Bank of Spain is since 2005 in a process of evolution of its system for reception of regulatory information: Flat text proprietary format XBRL Form oriented model Data oriented model 4

INFORMATION SYSTEMS AND PROCESSES MULTIDIMENSIONAL REPRESENTATION OF THE DATA 5 t Credit institution Concept 100 (prec 3) Dexia Dec 2007 Incomes 100

INFORMATION SYSTEMS AND PROCESSES EVOLUTION 6 Statements XBRL Statements SIIF XBRL SIIF Validations Basic XBRL Validations Basic XBRL Validations + Formulae Non XBRL validations

INFORMATION SYSTEMS AND PROCESSES CURRENT SITUATION 7 XBRL Statements SIIF Validations Basic XBRL Validations Basic XBRL Validations + COREP Formulae Statements Public statements Solvency

INFORMATION SYSTEMS AND PROCESSES PROJECT SO FAR Support of the FWG Formulae linkbase development European linkbase Spanish extension Test cases generation Integration of Fujitsu formula processor (CR-1 beta implementation) Parallel development of validations in the legacy system 8

INFORMATION SYSTEMS AND PROCESSES RELATIONSHIPS

INFORMATION SYSTEMS AND PROCESSES SOME NUMBERS Spanish COREP is composed of 23 statements (17 based on COREP Europe) Number of relationships defined by our users: Legacy system: -Most validations implemented using a proprietary language95% -Rest covered by ad-hoc developments: 170 XBRL validations: -Limited to relationships in an instance document. Still not covered: -Relationships with previous periods -Information not sent in XBRL -Rest: a high percent of formulae to be expressed in XBRL %

INFORMATION SYSTEMS AND PROCESSES PENDING TASKS Following weeks: Finish the testing of formulae for some credit risk statements 10% percent of formulae not working: CR-1 bugs Some product bugs Adapt current linkbase to CR-2 syntax Integrate new formulae processor (second week of October) Next year: XBRL Formulae validation crossing information in database 11

INFORMATION SYSTEMS AND PROCESSES BENEFITS Powerful and flexible solution Better maintainability Striking reduction in the number of rules to maintain: 3400 relationships expressed using around 400 XBRL Formulae Reusability between different actors Regulators and credit institutions (consistency assertions) Different countries: European rules Domestic ones Data available sooner and improved quality Standard and formal language to express formulae Can be validated at the source of information Market tools available Support from software vendors 12

INFORMATION SYSTEMS AND PROCESSES THANKS FOR YOUR ATTENTION VÍCTOR MORILLA