Extensible Business Reporting Language, which is also known as XBRL, is an electronic language designed to enable the automation of business information requirements, i.e. the preparation, sharing and analysis of financial reports, statements, and audit schedules. Governments, regulators, and other organisations in many nations have adopted XBRL as it automates the process and communication of business and financial data. Furthermore, XBRL helps to save cost, improve efficiency and accuracy to all involved in supplying or using financial data.
XBRL initiatives in Malaysia
Although the XBRL initiatives in Malaysia are in its infancy, we can foresee that the development and deployment of a new SSM’s XRBL online document submission platform will improve the administration of business reporting and the maintenance of data.
a) The automation of business reporting
The implementation of XBRL will be enable companies to file their annual returns and audited accountselectronically. In addition, it allows SSM to capture critical financial information from registered companies and provide analytical insights into the Malaysian business landscape.
b) The improvement in transparency and efficiency of data analysis
The new XBRL initiative will improve transparency and enhance the efficiency of capital markets by enabling analysts and other users to sort out and analyse facts easily with the automation of business intelligence.
c) The enhancement in data exchange
The new XBRL platform will make business information to be exchangeable among regulators (regulators here include tax and financial authorities, central bank and governments) because XBRL is a global standard used to electronically exchange business information.
Why XBRL?
The implementation of XBRL initiative has many advantages:
a) Global standard
XBRL is a global standard that has been accepted and adopted to reduce inconsistencies in terminologies and data formatting.
b) Improved accuracy
The automation of business data improves data accuracy, as the data can be both calculated and verified.
c) Speed
XBRL enables producers and consumers of financial data to switch from expensive manual processes to the automation of business data. The automation of business information is less time-consuming – where the time needed to assembly and re-entry of data is now much shorter than before.
d) Reusable
The XBRL data is reusable – the data can be reused to represent the same data in multiple ways and multiple formats once entered.
Benefits from using XBRL?
The following is a list of how XBRL will affect various parties in the financial information supply chain:
a) Companies who prepare financial statements
Financial statements will be created one time and rendered as printed reports, on websites, or as other regulatory filings.
b) Analysts, Investors, and Regulators
Automated analysis, less re-entering of financial information from one form into another form, are the advantages that will benefit analysts, investors and regulators.
On a final note, XBRL’s language is flexible in which it supports all current aspects of reporting in different countries and industries. It can be adjusted to meet particular business requirements, even at the individual organisation level. SSM’s new XBRL platform will automate the data collection process, transform the submission of statutory reports by registered companies and allows data consumers to conduct company information analysis easily.
