Regulators are putting XBRL at risk, says Basda

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Regulators are putting XBRL at risk, says Basda

Cliff Saran
XBRL, the XML standard which promises to revolutionise business reporting, is being undermined by regulators going it alone, according to the head of the Business Application Software Developers' Association.

The standard is in danger of being relegated to just another file format instead of a common language for financial governance and IT integration, according to Eduardo Loigorri, chairman of Basda and managing director of Exchequer Software.

The UK's Financial Services Association and the Inland Revenue have put back major XBRL projects and other groups have added to the taxonomies in a way that reduces the power of a common business reporting standard, Basda said.

Wide use of XBRL across business and regulatory bodies would simplify and provide greater transparency in financial compliance and allow enterprise IT systems to share business information without the need for custom mapping of data.

In spite of the release in June 2004 of definitions or taxonomies within XBRL to support the UK Generally Accepted Accounting Principles (UKGAAP) for filing company reports, hurdles still remain before it can be widely adopted.

The FSA said, "We had initially expected an XBRL-based system-to-system submission method to be available, but this will not be available in July 2005, when the first reports are due for submission."

The Inland Revenue's plans to allow corporation tax submission to be made via XBRL over the Government Gateway have also been delayed. The Inland Revenue said, "We had planned to introduce XBRL in October 2003, but because of IT capacity constraints, we had to reprioritise our plans. We now hope to deliver XBRL in October this year."

John Court, head of the IT faculty at the Institute of Chartered Accountants in England & Wales, said, "The FSA approach illustrates that the process of introducing electronic reporting is by no means simple."

Paul Hammerman, vice-president of research at Forrester Research, said, "XBRL has not fully stabilised and taxonomies are still evolving." He said XBRL would become more accessible to end-users when it is supported in software packages and enterprise resource planning systems.

But Basda chief executive Dennis Keeling said regulators were proposing their own extensions to the UKGAAP XBRL taxonomy. ÊAnd none had plans to consult with the others over commonality of their requirements. Part of the problem he said, was the tight timescales to which some are working do not offer flexibility to receive feedback from other government departments.

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