| 1 | | | Frequently Asked Questions 1.Who is using XBRL for what? 2.What is most urgent for XBRL...

| 1 | | |

Frequently Asked Questions1. Who is using XBRL for what?2. What is most urgent for XBRL International?3. How will XBRL impact content based businesses?4. Why XBRL instead of our own XML Schemas?5. What XBRL tools and products are available?6. What is XLink and why is XBRL based on it?7. When will XBRL become widely used?8. Who is behind XBRL… and why?9. Is XBRL like FpML (RIXML, MDDL, SomeotherML)10. Where can I get a copy of these slides?

| 2 | | |

Frequently Asked Question:Who is using XBRL for what?

B2G - Regulatory Applications Australian Prudential Regulatory Authority (2001) US Federal Depository Institution Corp. (2002) UK Inland Revenue (2003)

B2L – Business to Lenders Bank of America / Moody’s – Credit Analysis (2003) Deutsche Bank – same

B2M – Business to Markets Traditional financial reporting (2002) Business performance reporting (2003)

Internal applications

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Frequently Asked Question:What is most urgent for XBRL International?

Taxonomies Wide coverage Consistent practices Reusability

Specifications Enhanced validation Richer representations Move to interoperability

Implementations Profiles

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Transport envelope

TransportLayer

(SecureProtocols)

Content Layer(Payload

Language)

ApplicationLayer

(ValidationRules)

Internet

XBRL Instance Document

Producers Consumers

FTPHTTPS

SOAP

S/MIME

OFX2 ebXML

Softwaredevelopers

Business Rule Documents

DataRepository

Meta DataRepository

Alternativeprotocols

Producers

XBRL Taxonomy Documents

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Taxonomy as Dictionary

Disclosure

MarketingAdvertising

ResultExpenseIncome

Profit Net Interest

inc exp inx

exp.adv exp.mkt inx.prf inx.int

| 6 | | |

Taxonomy as Classification

Disclosure


ResultExpenseIncome

Profit Net Interest

Defined as

Defined as Defined as

| 7 | | |

Taxonomy as Calculation

Disclosure


ResultExpenseIncome

Profit Net Interest

Subtracted from

Added into

Added into

Added intoAdded into

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Taxonomy as Reusable Building Block

Disclosure


ResultExpenseIncome

Profit Net Interest

Subtracted from

Added into

Added into

Added intoAdded into

Rebates

Website Expenses

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Example: XBRL for Web Site Reporting

GAAP C&I v2 Taxonomy

Element Schema andDefinition Linkbase

Calculation andOther Linkbases

Insider trades

Significant events

Restrictions on redefining links

US Site Taxonomy



imports

Company Site Custom Taxonomy



imports

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Taxonomy as Collaborative Effort

Agree naming Agree structure Agree schedule

Disclosure


ResultExpenseIncome

Profit Net Interest

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XBRL Taxonomies in 2002

Best practices e.g. ast.amz.goodwill = Amortization of Goodwill e.g. Assets have “current” & “non current” children e.g. Reusable common components taxonomy

Focused development efforts IAS Taxonomy: Core financials, Core + Notes US GAAP C&I Taxonomy UK GAAP C&I Taxonomy Inland Revenue “Computation” Taxonomy FDIC Taxonomy (US) Canadian GAAP, others.

| 12 | | |

Transport envelope

TransportLayer

(SecureProtocols)


Language)

ApplicationLayer

(ValidationRules)

Internet


Producers Consumers

FTPHTTPS

SOAP

S/MIME

OFX2 ebXML

Softwaredevelopers


DataRepository

Meta DataRepository


Producers


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Validation The financial information integration problem

Any (XBRL) application involving data transfer across enterprises must validate incoming data one way or another.

Consumer can validate after the fact, return errors (bad) Producer can validate before submitting (good)

Common solutions and their consequences Custom code, database constraints XML Schema validation

Computation linkbases Like XML Schema – used in many programming environments Native to XBRL and works well for financial computations Do this the way other standards bodies would

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Validating XBRL today

Form AA Filing

Schema Validation

XBRL Taxonomy

Element Schema


Current assets, liabilities,Pretax profit, expenses,

Directors compensation…

Schedule BB Schema

Form BB Filing

Schema Validation

“Include only directors’ comp”

Imports

Form AA Schema

Schema Validation

Imports

“Include only profit and expenses which must be whole numbers”

CalculationArc cwa Validation

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Validation Levels Data elements

“Current assets” is represented by uk:ast.cur Primitive data types

The value of uk:ast.cur must be nine digits and not negative Compound data structures

A Maturity Breakdown must contain Loans, Securities and Derivatives Calculated data values

RIAC4410 = RIAC4411 + RIAC4412, plus or minus 1 Co-Constraints among data values – “Business Rules”

Box27 is True if and only if Box28 is the same as Box29 Cross-document constraints

If Box28 is larger than any other value ever reported, Var50 is True

Benefit of Upstream Validation: Low

Benefit of Upstream Validation: High

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Computation LinkbasesSample “business rule”

Outstanding Loans in Q1Monetary

Outstanding Loans in Q2Monetary

Riad4011-Q1 >= Riad4022-Q2 Formula

VariableVariable

FRB Edit Check 0125True/false

Upper tolerance

Lower toleranceConstant

Constant

Result

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Computation Linkbases (Vun Kannon)

<element name="FRB-EDCK-0125" type="xbrl:booleanItemType"> <annotation> <documentation>Current quarter value should be greater than or equal to previous quarter's value. </documentation> <appinfo> <xbrl:formula select="(number($riad4011-q1) - $lower_tolerance) >= (number($riad4011-q2) + $upper_tolerance)" xlink:type="resource" xlink:label="RI_FRB-EDCK-0125_fm" xlink:title="RI_FRB-EDCK-0125_fm"> <xbrl:variable name="riad4011-q1" xlink:type="simple" xlink:href="ffiec-031.xsd#riad4011"> <xbrl:precondition name="period" interval="m" value="6 9 12"/> <xbrl:precondition name="period" minimum_value="20010101"/> </xbrl:variable> <xbrl:variable name="riad4011-q2" xlink:type="simple" xlink:href="ffiec-031.xsd#riad4011"> <xbrl:restriction name="period" interval="m" offset="-3"/> </xbrl:variable> <xbrl:constant name="upper_tolerance" value="0"/> <xbrl:constant name="lower_tolerance" value="0"/> <ffiec:edit type="i"/> </xbrl:formula> </appinfo> </annotation></element>

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Entity Linkbase proposal

Proposed additional computation / validation requirements: Ability to define, publish and re-use general financial

formulas Ability to express computational relationships across

entities

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Entity Linkbase proposal

Common need to represent financial relationships among subsidiaries, owned assets, etc.

TLA

TBD BFD

owns100%

owns50%

Enron Group(Virtual)

Enron

Enron JV’s (Virtual)

owns100%

owns100%

St. Advil’sHospital

MA_571XVH(Asset)

owns100%

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Entity Linkbase proposalSample fragment

<ownershipLink>  <entity xlink:label="tla" xlink:type="resource" xlink:title="tla“ /> <entity xlink:label="tbd" xlink:type="resource" xlink:title="tbd" /> <entity xlink:label="bfd" xlink:type="resource" xlink:title="bfd" /> <ownershipArc weight="1" from="tla" to="tbd" xlink:type="arc" /> <ownershipArc weight="1" from="tbd" to="tla" xlink:type="arc" /> <ownershipArc weight="1" from="tla" to="bfd" xlink:type="arc" /> <ownershipArc weight="1" from="bfd" to="tla" xlink:type="arc" /> </ownershipLink>

TLA

TBD BFD

owns100%

owns100%

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Augmented Computation Linkbase:Compact, reusable business rules TLA Q1 Revenue = TBD Q1 Revenue + BFD Q1 Revenue HPCQ Q2 Interest = HP Q2 Interest + Compaq Q2

Interest etc…

For all Owned EntitiesCorresponding “Flow”type items

in corresponding Periods

For all Owned EntitiesCorresponding “Flow”type items


All Owned EntitiesCorresponding “Flow” type items


Owning EntityAll “Flow” type Items

In All Periods

Owner/Owned Flow ItemsFormula

Variable Variable

CheckTrue/false

Upper tolerance

Lower tolerance

Constant

Result

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Augmented Computation Linkbase Sample “business rule”

<xbrl:formulaType select="(number($R1)) - $lower_tolerance) >= (number($R2) + $upper_tolerance)" xlink:type="resource" xlink:label="GTPP" xlink:title="GTPP"> <xbrl:variable name="P" type="period"/> <xbrl:variable name="E" type="entity"/> <xbrl:variable name="I" type="item"/> <xbrl:variable name="R1"> <xbrl:precondition name="entity" bind="$E"/> <xbtl:precondition name="item" bind="$I"/> <xbrl:precondition name="period" bind="$P"/> <xbrl:precondition name="period" interval="m" value="6 9 12"/> <xbrl:precondition name="period" minimum_value="20010101"/> </xbrl:variable>  </xbrl:formulaType> <xbrl:formulaInstance xlink:label="GTPP"> <xbrl:bind name="P" value="20010101P3M"/> <xbrl:bind name="E" xlink:href="entity.xml#bailey_bank"/> <xbrl:bind name="I" xlink:href="ffiec-031.xsd#riad4011"/> </xbrl:formulaInstance>

…but my point is…

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Creating a Specification in a “capital-S” Standards Body Requirements document

Market requirements – define needs, assess current solutions Technical requirements – compatibility with other open specs Use cases – specific cases to be covered

Specification document Technical documents including design rationale

Reference implementation Sample instances, documentation of instances Sample application that illustrates correct semantics

QA and Review process Define criteria, set deadlines, have 2nd editor, vote.

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Transport envelope

TransportLayer

(SecureProtocols)


Language)

ApplicationLayer

(ValidationRules)

Internet


Producers Consumers

FTPHTTPS

SOAP

S/MIME

OFX2 ebXML

Softwaredevelopers


DataRepository

Meta DataRepository


Producers


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Implementation Profiles Excited advocates of XBRL face cost uncertainties

Process analysis of exporting, transmitting, revising, importing Authenticating sender and receiver, privacy, version control Schema and linkbase version management, repositories

Current solutions require reinvention of wheels Plug XBRL payloads into an existing communication path Develop dedicated login, signature, transport

Publish suggested bindings to other specifications OFX2 – not typically used for reporting, but it would work SOAP / WSDL / UDDI / XLANG – Web Services ebXML – business transaction protocol, process definitions

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Producer-Consumer interactions appearing in all e-reporting Register, retrieve, update

producer and producer standing data;

Register, revoke, update authorized persons at the producer;

Register, revoke, update authorized intermediaries reporting on behalf of the producer;

Obtain new versions of the reporting form; communicate other change notices;

Submit a test report, submit an actual report;

Obtain an error check or analysis on a report;

Recall a previously submitted report; submit an updated report; modify individual data items within a report;

Confirm acceptance or rejection of a report;

Obtain a transaction history, version history; access log, and detailed audit trail of reports, by institution and/or report.

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Frequently Asked Question:How will XBRL impact content based businesses?

Intermediaries’ value added does not change Completeness – History and breadth Consistency – Data linkage via unique identifiers Availability, Anonymity of access Customization, Convenience

Intensifies competition over unique content Producer & consumer behaviors change slowly

ProducerConsumer

Intermediary

Intermediary

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Frequently Asked Question:How will XBRL impact content based businesses?

Less data preparation Less data re-keying More direct communication among processes More emphasis on analytics Dashboards Expansion of non-financial information content Rapid transformation of products Semantic analysis Information agents Reduced data tailoring costs and revenues Reduced application tailoring costs and revenues

Source:Liv Watson, Edgar Online

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ICC Information

Part of the Bonnier Group, BBI 61 companies covering 19 European countries local information specialists core competence based around content XML adopted throughout BBI

ICC Information - UK & Irish company info. Private Companies, Directors & Shareholders

CaptureAnalysisDirect & Indirect distribution

Source:Terry Dawson, ICC

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Why XBRL is important to ICC Standardisation of content is always important! Isolates content value in purchasing decisions Provides greater distribution opportunities Standardises delivery platforms beyond XML Supports analysis methods and data structure Potential to significantly reduce costs Leverages existing technology and skills Positive revenue impact


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Mid and Long-term impacts For the Industry

reduced switching costs / development expense increasing emphasis on content and end-user

integration reduced publishing costs intermediaries must seek new ways of adding value

For ICC Information greater ability for content to be integrated in a wide

variety of applications cost of capture reduces (subject to UK Companies

House & other Company Registries adopting)


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Frequently Asked Question:Why XBRL instead of our own Schemas?

Don’t reinvent the features of XBRL Item types – financial parameters Predefined concepts (labels, references) Entities, periods, segments, scenarios Extensibility using XLink

Business Informationthat is

• Financial in nature• Enhances standard definitions• Refers to multiple entities• Refers to multiple periods

InformationProducer

9,000€ 2.5m 57%

EPS

InformationProducer

InformationProducer

InformationConsumer

InformationConsumer

InformationConsumer

| 33 | | |

Frequently Asked Question:Why XBRL instead of our own Schemas?

ICAEW IASB AICPA IDW JICPA CICA CPAA

| 34 | | |

Frequently Asked Question:What is XLink and why is XBRL based on it?

XLink is a W3C standard way to use XML to represent all kinds of relationships between XML elements no matter where they are.

XML Document 1 XML Document 2Linkbase







b is the same as c

b explain

s a

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XBRL uses XLink to represent all relationships between data elements

<element id=“ast.inv”>

<element id=“ast.cur”>

Definition:more

general

<Label>Current Assets</Label>

label

<Label>Inventory</Label>

label

A formal explanation of

Inventory in the Accounting

Literature

reference

Presentation:before

<element id=“ast.fixed”>

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XLink allows customization and explicit, modular changes to reusable material

<element id=“ast.inv”>

<element id=“ast.cur”>

Definition:more

general

label

label

A formal explanation of

Inventory in the Accounting

Literature

reference

Presentation:before

<element id=“ast.fixed”>

<Label> </Label>

<Label> </Label>

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Frequently Asked Question: What about other financial markup languages?

MDDL – Market Data RIXML – Research Reports FpML – Financial Instruments SMDX – Statistical Metadata ISO 15022 – UML repository of financial data

fields and business processes (SWIFT, FIX, etc.) NewsML – News Packaging and Distribution PRML – Press Releases IFX and OFX – Financial transactions

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What is the Role of XBRL in Finance? Beyond company reports, XBRL is a good

format to choose wherever a numerical breakdown/roll-up needs to be expressed.

If there are no such breakdowns, then the main XML file risks being just another XML file

Little to be gained from using XBRL, unless a significant proportion of items have accepted XBRL definitions

So it is a matter of horses for courses XBRL’s forte is numerical breakdown/roll-ups Supports drill-down into numbers of interest.

Source:Tony Coates, Reuters

| 1 | | | Frequently Asked Questions 1.Who is using XBRL for what? 2.What is most urgent for XBRL...

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