Overview
XBRL (eXtensible Business Reporting Language) is a global standard for sharing business information. XBRL provides major benefits in the preparation, analysis, and communication of business information, all at a reduced cost. XBRL provides standardized controls that can result in improved efficiency and effectiveness of the audits. As such, it is important that internal auditors be proactive and stay ahead of the curve on XBRL.
R647,37
Item No.: 5003-062
ISBN: 0-89413-588-0
Publisher: The IIA Research Foundation
Publish Date: November 2012
Authors: Peter R. Scott, APR, and J. Mike Jacka, CIA, CPCU, CLU, CPA
Media: Hardcover
Page count: 176
This report, prepared by a member of the XBRL International Consortium:
· Introduces XBRL.
· Discusses its benefits and uses.
· Includes hands-on XML/XBRL tutorials.
· Summarizes what it all means for internal audit.
ABOUT THE AUTHOR
Glen L. Gray, Ph.D., CPA, is a professor in the Accounting and Information Systems Department of the College of Business and Economics at California State University at Northridge. He specializes in information technology and accounting information systems. He is currently conducting research in XBRL, Sarbanes-Oxley, data mining and analysis, assurance services, Web-related design and financial reporting, and electronic commerce. He has been a member of the San Fernando Valley Chapter of The Institute of Internal Auditors (IIA) since 1988 and has served as an officer, a member of the Board of Governors, and the past Webmaster. He has authored or co-authored four research reports published by The Institute of Internal Auditors Research Foundation, titled Changing Internal Audit Practices in the New Paradigm: The Sarbanes- Oxley Environment (2004); Assurance Services within the Audit Profession (2000), Enhancing Internal Auditing through Innovative Practices (1996), and Business Management Auditing: Promoting of Consulting Auditing (1994). He was a member of the FASB Electronic Delivery Working Group, which published the research report, Business Reporting Research Project: Electronic Distribution of Business Information. He was involved in an electronic financial dissemination project for the IASC, which resulted in the publication of Business Reporting on the Internet that includes a proposed code of conduct for financial reporting on the Internet. He recently co-authored a comprehensive data mining audit case study funded by the KPMG/University of Illinois Business Measurement Case Development & Research Program. He co-authored Electronic Commerce Assurance Services published by Harcourt Brace Professional Publishing. He has written numerous academic and trade articles on accounting information systems, assurance services, financial reporting, and a wide variety of technology topics. Dr. Gray has made numerous presentations at trade, professional, and academic conferences in the United States, Europe, and Asia. He has also helped organizations establish Web sites, acquire computers and software, identify procedural inefficiency and control weaknesses, and develop database applications. He is the Webmaster for the audit section of the American Accounting Association. Before joining the academic world, Dr. Gray was a consultant with national CPA firms and an engineer at an aerospace company. He holds a BSEE from Michigan Technological University; an MBA from the University of California, Los Angeles; and a Ph.D. from the University of Southern California.
About the Author ………………………………………………………………………………………………………… vii
Acknowledgments …………………………………………………………………………………………….. ix
Preface ……………………………………………………………………………………………………………… xi
Executive Summary ………………………………………………………………………………………….. 1
Current Information Supply Chain Problems ……………………………………………………………………. 1
Potential Benefits of XBRL …………………………………………………………………………………………… 3
High-level Overview of XBRL Technology ……………………………………………………………………… 4
XBRL International Consortium ……………………………………………………………………………………… 5
Moving Toward Critical Mass ………………………………………………………………………………………… 5
Focus Group Summary ………………………………………………………………………………………………….. 6
Sarbanes-Oxley and Internal Controls …………………………………………………………………. 7
XBRL Contributions to Sarbanes Oxley and Internal Control Environment ………………. 8
Fear of Spreadsheets …………………………………………………………………………………………… 9
XBRL Contributions to Alleviating Spreadsheet Concerns ……………………………………… 9
Retrieving and Consolidating Accounting Information …………………………………………… 10
XBRL Contribution to Consolidating Accounting Data …………………………………………. 11
Auditing Tools …………………………………………………………………………………………………… 11
XBRL Contribution to Audit Tools ……………………………………………………………………… 12
XBRL Comments and Questions ………………………………………………………………………….. 12
Research Report Organization …………………………………………………………………………….. 15
Chapter 1 — Introduction ……………………………………………………………………………………..
XBRL Overview……………………………………………………………………………………………….. 18
Potential Benefits of XBRL ……………………………………………………………………………….. 19
Potential Uses of XBRL………………………………………………………………………………………. 22
XBRL Drivers …………………………………………………………………………………………………….. 23
The Evolving Use of XBRL …………………………………………………………………………………..
XBRL International …………………………………………………………………………………………… 26
Research Motivation and Goals ………………………………………………………………………….. 27
Research Method ………………………………………………………………………………………………. 28
Chapter 2 — What Is XBRL? ………………………………………………………………………….. 31
How and Why We Got Here ………………………………………………………………………………. 31
Possible Solutions ……………………………………………………………………………………………… 35
The EDI Solution …………………………………………………………………………………………….. 35
The XML/XBRL Solution…………………………………………………………………………………. 36
XBRL to the Rescue ……………………………………………………………………………………….. 37
The Gestalt of XBRL ………………………………………………………………………………………. 37
XBRL: Potential Opportunities and Issues for Internal Auditors, (c) 2005 The IIA Research Foundation
An Introduction to XBRL Technology ……………………………………………………………………………. 38
Instance Document ……………………………………………………………………………………………. 38
Taxonomy ……………………………………………………………………………………………………….. 39
FRTA and FRIS ………………………………………………………………………………………………. 44
XBRL Specification …………………………………………………………………………………………. 45
A Deeper Look at Taxonomies …………………………………………………………………………… 46
Linkbases ………………………………………………………………………………………………………… 50
XBRL GL ………………………………………………………………………………………………………… 53
Data Integrity and Confidentiality ………………………………………………………………………………….. 55
Chapter 3 — Focus Groups ……………………………………………………………………………. 57
Sarbanes-Oxley and Internal Controls ………………………………………………………………….. 58
XBRL Contributions to Internal Control Environment ……………………………………………. 61
Fear of Spreadsheets ………………………………………………………………………………………….. 63
XBRL Contributions to Alleviating Spreadsheet Concerns ……………………………………… 65
Retrieving and Consolidating Accounting Information ……………………………………………………… 68
XBRL Contribution to Consolidating Accounting Data ……………………………………………. 71
Audit Tools ……………………………………………………………………………………………………….. 71
XBRL Contribution to Audit Tools ………………………………………………………………………. 74
XBRL Discussion ……………………………………………………………………………………………….. 74
Additional XBRL Comments ………………………………………………………………………………………… 80
Chapter 4 — What Does it All Mean for Internal Audit? …………………………………………. 83
XBRL as an Audit Tool and Aid ……………………………………………………………………………………. 83
Improving Data Analysis ………………………………………………………………………………………… 83
Accelerating the Use of Continuous Auditing……………………………………………………………. 85
Reducing Spreadsheet Proliferation …………………………………………………………………………. 85
Improving Two-way Audit Trails …………………………………………………………………………….. 86
XBRL as an Audit Domain …………………………………………………………………………………….. 86
Potential Audit Questions ……………………………………………………………………………………….. 86
Audit Approach …………………………………………………………………………………………………….. 91
Internal Controls……………………………………………………………………………………………………. 92
Risk Assessment …………………………………………………………………………………………………… 93
Man vs. Machine ………………………………………………………………………………………………….. 95
Concluding Comments …………………………………………………………………………………………………. 96
Chapter 5 — XBRL @ Work ……………………………………………………………………………………. 99
XBRL Around the World ……………………………………………………………………………………. 100
FFIEC Call Report Modernization Project …………………………………………………………….. 103
Commentary on FFIEC and SEC Projects ……………………………………………………………… 107
SEC Voluntary Financial Reporting Program …………………………………………………………. 107
Footnotes Optional ………………………………………………………………………………………………..110
XBRL: Potential Opportunities and Issues for Internal Auditors, (c) 2005 The IIA Research Foundation
PCAOB Guidance to External Auditors …………………………………………………………………..112
Where to Go From Here ……………………………………………………………………………………………..114
Appendix: XML/XBRL Tutorial ……………………………………………………………………………..117
Tutorial 1: Understanding XML Documents……………………………………………………………………117
Tutorial 2: Understanding XML Schema …………………………………………………………………. 123=
Tutorial 3: Understanding XBRL ……………………………………………………………………………. 127
Tutorial 4: Understanding the US Financial Reporting Taxonomy Framework …………….. 134
Resources: ……………………………………………………………………………………………………………. 140
The IIA Research Foundation Board of Trustees ………………………………………………………. 141
The IIA Research Foundation Board of Research and Education Advisors …………………… 143
The IIA Research Foundation Chairman’s Circle ……………………………………………………… 145
