ISB Publication ISB-000286 Accounting Structures - XBRL Options Paper Version: 0.3 Issue Date: 23/10/2014 Document Version History Version Status Issue Date Modified by Description 0.1 Draft 09/10/2014 ISB TSS For internal review 0.2 Draft 16/10/2014 ISB TSS Following internal review 0.3 Draft 23/10/2014 ISB TSS Ready for consultation © Crown copyright 2014 ISB-000286 - Accounting Structures - XBRL Options Paper Contents 1 Purpose ___________________________________________________ 3 2 Progress to date ____________________________________________ 3 3 Existing Data Standards ______________________________________ 4 3.1 XBRL ________________________________________________________ 4 3.2 ISO 20022 and SWIFT ___________________________________________ 4 3.3 IFX __________________________________________________________ 5 3.4 SDMX ________________________________________________________ 5 3.5 Others________________________________________________________ 6 3.6 Recommendation _______________________________________________ 6 4 XBRL Options ______________________________________________ 7 4.1 Option 1 – XBRL recommended for ESCS ___________________________ 7 4.2 Option 2 – XBRL recommended for ESCS and integrated within ISB BDA ___ 9 4.3 Option 3 – develop ISB standards for ESCS _________________________ 10 4.4 Option 4 – do nothing ___________________________________________ 11 4.5 Option 5 – collaborative standards _________________________________ 12 5 Recommendation __________________________________________ 12 6 Copyright Notice ___________________________________________ 13 File: ISB-paper-E- Page 2 of 14 Version: 0.3 Issue Date: 23/10/2014 supplementary- Status: Draft XBRL-Options- Paper-v0-3 ISB-000286 - Accounting Structures - XBRL Options Paper 1 PURPOSE The ISB Technical Support Service has been tasked with developing data standards for Accounting Structures. Analysis to date has shown that individual ledger accounts are not normally exchanged between organisations but aggregated financial data are. This can be in the form of annual financial statements, management financial reports, interim statements, summaries of monies managed by third parties etc. Therefore, the focus of any data standards should be on the exchange of aggregated financial data. The approach taken by the ISB TSS would normally be to model the business processes and define the atomic data used in those processes, from which the data standards could be determined. However, the current situation is unique in that the aggregated financial data is not atomic and that existing data standards, particularly XBRL, already exist and so must be evaluated. The purpose of this paper is to: • Summarise progress to date • Identify existing data standards that should be considered • Outline why XBRL is the recommended existing standard, what options are possible for implementing it, and our recommendation to the ISB 2 PROGRESS TO DATE The ISB Technical Support Service set out to analyse data standards for Accounting Structures in August 2014. During Stage 2, Scoping, it was determined that the work should concentrate on aggregated financial data. The aggregated data that is exchanged within ESCS are the financial returns, financial statements and financial reports that are typically produced periodically (eg annually, quarterly etc) to state the financial health of an organisation to other organisations that have an interest or regulatory duty. If we were to consider the general ledger as the raw atomic data and develop a data standard to exchange this financial data then theoretically it would be possible for any organisation receiving this data to derive any financial statement or report they require. However, in practice this is not possible as financial statements are often produced by accountants combining or apportioning the data from the general ledger accounts to create the data required by the format of the financial statement. In some cases the data created only exists in the financial statement and could not be recreated without knowing the precise rules and conditions that were used to create it. Our analysis has therefore reached the conclusion that the exchange of financial data within ESCS are the aggregated financial statements, which cannot be derived from any lower level of data or atomic data, and which must be exchanged in the format in which they were created due to auditing constraints. It is at this point that we look to existing data standards that meet these requirements and find that XBRL is already providing precisely this standard. File: ISB-paper-E- Page 3 of 14 Version: 0.3 Issue Date: 23/10/2014 supplementary- Status: Draft XBRL-Options- Paper-v0-3 ISB-000286 - Accounting Structures - XBRL Options Paper 3 EXISTING DATA STANDARDS 3.1 XBRL XBRL (eXtensible Business Reporting Language) is a data standard used to communicate and exchange business information between business systems. XBRL allows the expression of semantic meaning commonly required in business reporting. This is defined by metadata set out in taxonomies, which capture the definition of individual reporting concepts as well as the relationships between those concepts. Essentially the data item is tagged with a label given within a taxonomy and this tag gives the data item its meaning. The language is XML-based and uses the XML syntax. The XBRL Specification is developed and published by XBRL International, Inc. (XII). One use of XBRL is to define and exchange financial information, such as a financial statement. Organisations that make use of XBRL include regulators of stock exchanges and securities, banking regulators, business registrars, revenue reporting and tax-filing agencies, and national statistical agencies. XBRL has been mandatory for the filing of company tax returns, including accounts and computations, to HMRC since April 2011. It may also be used for the filing of company accounts to Companies House. Since Academies and some FE/HE providers are registered companies they may already be submitting XBRL returns. All returns for HMRC and Companies House must be filed in Inline XBRL format (iXBRL). This XBRL format simply provides a human-readable version of the report based on XHTML, with the XBRL tags normally hidden from view in the underlying file. An important aspect of XBRL is that it supports Dimensions and Tuples, two important technical features that allow data to be reported in the form of tables, rather than simple lists. 3.2 ISO 20022 and SWIFT ISO 20022 is the ISO Standard for Financial Services Messaging. It describes a Metadata Repository containing descriptions of messages and business processes, and a maintenance process for the Repository Content. The metadata is transformed into the syntax of messages used in financial networks. The first syntax supported for messages was XML. ISO 20022 is primarily designed to support transactional processes between financial institutions, such as the processing of payments. It is implemented by SWIFT (Society for Worldwide Interbank Financial Telecommunication) whose network carries the majority of international interbank messages. SWIFT is also the Registration Authority for ISO 20022. This standard is included here for comparison, but it is clearly not appropriate for the requirements we have identified. However, it is interesting to note that there is an initiative in the US between the Depository Trust & Clearing Corporation (DTCC), SWIFT and XBRL called Issuer to Investor that combines ISO20022 and XBRL standards. File: ISB-paper-E- Page 4 of 14 Version: 0.3 Issue Date: 23/10/2014 supplementary- Status: Draft XBRL-Options- Paper-v0-3 ISB-000286 - Accounting Structures - XBRL Options Paper 3.3 IFX Interactive Financial Exchange (IFX) is an XML specification for financial transactions in business to business and consumer to business banking (eg: balances, financial transaction information, payments and automated teller machine (ATM) communications). The Interactive Financial eXchange Forum was formed in 1997 to create a messaging standard for financial services that would address the challenges brought on by the advent of network-based computing models. This was based on the work previously done by the Open Financial Exchange (OFX). The IFX Forum membership is made up of industry-leading financial institutions, service providers and independent software vendors contributing to the development of open financial standards. IFX is a messaging protocol with a common object model and a service oriented architecture with defined data standards. Currently IFX provides messaging in the areas of: • Electronic Bill Presentment and Payment • Business to Business Payments • Business to Business Banking (such as balance and transaction reporting, remittance information) • Automated Teller Machine and Point of Sale communications • Branch Banking Services • Consumer to Business Payments • Consumer to Business Banking • Card Management and Services Again, this standard is included for comparison but is not suitable for the requirements we have identified. 3.4 SDMX The Statistical Data and Metadata eXchange (SDMX) initiative sets technical standards and statistical guidelines to facilitate the exchange of statistical data and metadata with an emphasis on aggregated data. The SDMX sponsoring institutions are the Bank for International Settlements, the European Central Bank, Eurostat (the statistical office of the European Union), the International Monetary Fund (IMF), the Organisation for Economic Co- operation and Development