Wednesday, September 17, 2014

Integrated Reporting

Integrated reporting is a process that results in a periodic report by an organization about value creation and related aspects over time. It is generally a concise communication about the organization’s strategies, governance, performance and prospects in the context of its external environment. 
 The whole idea of integrated reporting is the improvement in the quality of information available and to have a more efficient allocation of capital. It is also used to promote a more cohesive and efficient approach to corporate reporting that brings to light different reporting strands; and communicates all the factors that materially affect the ability of an organization to create value over time.  Lastly, it enhances accountability and stewardship for the broad base capitals (financial, manufactured, intellectual, human, social and relationship and natural) and promotes understanding of their interdependencies.
Compared to the traditional standalone financial and sustainability reports that are published, integrated reports offer a concise and holistic view of how the company manages risk and develops new business opportunities. Ultimately it provides the stakeholders with a complete picture of the company’s overall performance. The idea of integrated reporting is taking off and spreading over to companies on a global scale. 

Tuesday, September 16, 2014

XBRL Extensions

An extension is a custom XBRL tag that isn’t part of the standard US GAAP Taxonomy (UGT).  It is needed when the information being tagged isn’t represented by any of the standard tags from the UGT. The extension can also modify the structure of the taxonomy, add or disapprove of elements, their labels, linking order of appearance as well as many other characteristics. The main idea for an extension is for businesses to modify it to their specific needs while using a common ground in the base taxonomy to guarantee comparability.
While extensions are most helpful, it is important to keep in mind quality over quantity. The more extensions there are the harder it becomes for tools to properly analyze data over numerous companies or industries. XBRL consumption tools are also built to use the structure that is found in the UGT. When it is extended for either the table structure or axes, the tools are not able to read the extended XBRL automatically and may need to be read manually by a person. Another situation where a person may need to come in is with line items or individual accounting concepts. If not read through again manually the data may go unread and unreported.
The process to help reduce the number of extended concepts and how to select the appropriate tags is included in the EDGAR Filing Manual (EFM). Some key points to keep in mind are that the definition of the tag should faithfully represent the individual facts in the HTML financial statements and should now exclude any material information. It is also important that the examples that are included with the definitions are not exclusive; so one custom tag should not be created just because the tag does not conform to one single element. Lastly, if there are multiple standard elements, it is most helpful to pick the one with the narrowest definition. 
            Reducing the number of extensions in XBRL is about taking the time and doing the research to get the most precise definition. Reviewing the information and checking for updates are the best practices to help keep only the number of tags that are absolutely needed.

Monday, September 15, 2014

Data Disclosure

Data disclosure is the voluntary sharing of any information that is considered relevant to a given situation. Disclosure typically varies; it depends on the circumstances of the situation at hand. In certain cases, disclosure of some information is not required under the terms of prevailing laws and regulations. Other times, failure to properly disclose data can lead to serious ramifications.
The process of data disclosure takes place during an attempt to secure employment with a business. As part of the application process, the potential employee provides the information or data that is requested by the employer, often times on a formal application. Failure to provide accurate and complete data often leads to the automatic rejection of the application, and ends the opportunity for employment.
Employees routinely work around or correct majority of the errors that are found in reporting as they are doing their work daily. But in the present day, costs are enormous and much of the time of employers is wasted hunting for, identifying and correcting errors.

Controls and Procedures for XBRL Exhibits

The first step in developing XBRL exhibits is to create a repeatable and documented process that should have a checklist of all the goals for the key reviewers. One can take into consideration the reports from XBRL service providers when developing controls to guarantee that it is effective and efficient.  Besides tagging one of the biggest challenges in XBRL is the large quantity of data and the amount of items that have to be reviewed to ensure its effectiveness with regard to completeness, accuracy and comparability.
The most effective way to review all the XBRL data is with the HTML submission by streamlining the process by reviewing the HTML version of your filing along with the disclosure tags and the fact properties all at once. Another way to check your data is by creating a backline report between two versions of the XBRL data, and using it to focus the review on new XBRL tagging and items that have seen the most change.
Regardless of the format that is used, implementing a fixed set of controls and procedures for XBRL exhibits is absolutely necessary. Now that the limited liability period is over and the exhibits are filed, not furnished, it is more important than ever to make sure your controls and procedures are in place.

Thursday, July 31, 2014

2014 Taxonomy

           The Financial Accounting Foundation and the Financial Accounting Standards Board are responsible for the development and maintenance of the U.S. GAAP Financial Reporting Taxonomy (UGT). The notes released describe all the changes made from the 2013 UGT, with the purpose of informing required accounting standard changes, common reporting practices, and improvements to the calculation hierarchy. For the elements which were not changed from the 2013 UGT, the element names have remained the same, to not create confusion or affect the annual comparability and to facilitate conversion of filings to the 2014 UGT Update. Changes proposed in the fall of 2013 also allowed users of the taxonomy to provide feedback on the updates and the opportunity to become more familiar with and to incorporate new element names for their filings.
            ASU changes also played a role in the 2014 UGT update. While many aspects did not impact the update there were some that added new elements and saw alterations to the labeling or documentation. For example, liabilities (topic 405) saw 13 new elements as well as 2 documentation label changes. Meanwhile the presentation of financial statements (topic 205) saw 13 new elements, 3 documentation label changes, 1 modified standard, period start, period end, or total labels.
Another significant change was in revising the calculation hierarchy. This change was made to reduce, if not completely eliminate, the multiple inconsistent and redundant summations in the 2013 UGT. The 2014 update replaces the current presentation-centric calculation hierarchy with a data-centric model, resulting in a simpler more stable structure, with fewer redundant and inconsistent calculation relationships; making it more useful for users and simplifying taxonomy navigation and element selection for preparers.
Next there are the modifications made to the calculations for the assets and liabilities in discontinued operations. The UGT was initially modeled to treat concepts as either current or noncurrent based on the attributes of the concepts. This was proven to be inconsistent with the way that assets and liabilities were reported and was changed.
Smaller revisions were also made to areas that affected the industry in general. The changes to the taxonomy removed many industry entry points such as banking and savings institutions, brokers and dealers, insurance as well as real estate.  These entry points provided only the primary financial statements, and in the day and age of technology, they appeared to be of limited value. There is still full access with these points removed from the UGT after the update. It is now also more consistent with the SEC EDGAR filer sections. 
An industry specific change was also made in the 2014 taxonomy conversion. More emphasis was placed on insurance areas with input from the XBRL Insurance Industry Resource Group. With this, the redundancies were removed and elements were created, modified, or relocated to promote consistency and facilitate further developments. Overall there were 21 new elements as well as 34 deprecations. The FHLB resource group also added specific reporting requirements primarily related to disclosures for advances to member banks, contribution requirements, capital requirements and the affordable housing market.
Minimal changes were made to the maturity schedule as well as the country members. All of the changes were made to the labeling as a way to facilitate identification, use and to clarify appropriate use of the elements. The last new change was the addition of 403 new elements to the taxonomy. 

THE DATA Act of 2013: What is it?

                           The DATA Act, otherwise known as the Digital Accountability and Transparency Act of 2013, officially became a law on May 9, 2014. The major purpose of this act was to slowly remove the barriers between the government and the public and to improve the ability of Americans to track and understand how the government is spending their tax dollars. The act aims to make information on federal expenditures more easily accessible and transparent to the general public. This law will require the U.S Department of the Treasury to establish common standards for financial data provided by all government agencies and to expand the amount of data that agencies must provide to the government website, 

                            Data for this would be taken from federal contacts, loans, and grant spending throughout the government. The ultimate goal of this law is to improve the ability of Americans to track and understand how the government is spending their tax dollars.

Wednesday, July 9, 2014

Welcome to NeoClarus Inc.

NeoClarus, Inc.(Neo = New, Clarus = Clarity)is a leading provider of Extensible Business Reporting Language (XBRL) based software solutions to Enterprises, auditors, Financial Printers and fundamental data aggregators worldwide. XBRL is an internationally developed standard for inter/intra organizational interpretation, analysis and exchange of financial data.
XBRL assigns unique “tags” to financial and business information, allowing data entered in one application to be interpreted, analyzed and reused across systems, platforms, business units, applications and organizations.
However, Companies will need to assign resources to understand and adopt this process of adding value to data by tagging it according to the global standard. NeoClarus has developed an easy to deploy suite of applications for extracting financial data, tagging it with XBRL, validation (with global taxonomy/standard), creation of a completely accurate instance document and filing it with the respective regulatory body or partner. The complete end to end solution from the extraction of the financial data to the filing with the regulatory body/partner has been automated in a seamlessly collaborative approach by the NeoClarus suite of applications.
Enterprises, Auditors, Financial Printers and fundamental data aggregators will benefit from the simple and quick deployments by realizing faster Return on investment.
The result is the complete automation of the financial reporting business process which is more reliable, efficient, cost-effective, accurate and interactive. This unlocks tremendous value for the stakeholders in the process. NeoClarus provides its offerings in a ‘software as a service’ (SaaS/hosted), on-site deployment and partnership models.
Who are we - 
We are a team of dedicated professionals focusing on delivering XBRL-based solutions to Enterprises, auditors, Financial Printers and fundamental data aggregators worldwide.
Our mission is to help you achieve the results that define success on your terms. We have enabled our customers’ success through industry-specific deep domain and technological expertise, quality services, quality customer support and win-win relationships based on core business values and professional integrity.
Why We are different - 
Our focus on seamless delivery of XBRL-based solutions to Enterprise, auditors, Financial Printers and fundamental data aggregators worldwide makes us different.
Our core competency has evolved by collaborating with our customers from our target market.
We have successfully deployed solutions to address their specific pain points and requirements by leveraging our products and services.