Search results

The Internet financial reporting language known as XBRL continues to develop and has now reached the point where much of its promised benefits are available. The authors look at the history of this project, provide a case study of how Morgan Stanley has made use of the system and predict some developments for the future.

EXtensible Business Reporting Language (XBRL) is a revolutionary digital language that “tags” information for business reporting since it represents a universal standard for global business reporting. XBRL usage has a significant impact on auditors – both external and internal and is seen as a tool to implement the American Institute of Certified Public Accountants’ (AICPA) new reporting model. The model calls for real‐time, or continuous, reporting of company information. In order to do so reliably, continuous assurance on the data would need to be performed by external auditors. XBRL General Ledger (GL) is a taxonomy incorporating all ledger functions into XBRL. Thus, company information that typically takes days to create could be available in real‐time, anywhere in the world. This article reports on an XBRL survey conducted using accountants and auditors. Results indicate many accountants and auditors have low (if any) knowledge or experience with XBRL and do not perceive the intended benefits XBRL usage provides.

This study aims to examine the impact of extensible business reporting language (XBRL) technology and its functionality on various aspects of financial reporting and its overall quality.

To conduct this study, data was collected from a variety of professionals, including accountants, auditors, tax advisors and others. A structured research instrument was developed, and the collected data were analysed using structural equation modelling and mediation analysis techniques.

The study’s results showed that XBRL technology and its functionality have a noteworthy impact on different aspects of financial reporting. Moreover, the various aspects of financial reporting positively affect the overall quality of financial reporting.

This study solely relied on the opinions of various professionals regarding the current issue under investigation and did not empirically assess the reporting practices of companies by examining their XBRL-based reports. Additionally, it concentrated solely on financial reporting aspects and did not account for non-financial aspects. The main theoretical contributions of this paper to technology in financial reporting, XBRL and accounting literature are that it sheds light on the influence of the use of technologies in the business reporting process and their influence on various aspects of business reporting, which has only received confined focus from earlier studies so far.

This study’s findings could provide valuable insights to the managerial teams of organizations seeking to digitize their business reporting practices, specifically in areas such as regulatory compliance, integrated reporting and timely dissemination of reports in a sustainable way. Furthermore, it could help these teams reap the benefits of technology for various regulatory compliance matters.

This study could assist business organizations and regulatory authorities in adopting and implementing technology such as XBRL for accounting and business reporting. Furthermore, the study’s findings can aid in enhancing financial reporting practices by considering emerging aspects such as ESG and sustainability aspects.

The financial world of today is evolving at a rate that can be challenging to keep up with and comprehend due to developments in information and communication technology. When compared to a conventional disclosure, the eXtensible Business Reporting Language (XBRL), which was named one of the top ten accounting technologies, has a clear advantage in reducing information asymmetry by providing interactive data disclosure. This study aims to examine whether forcing companies to adopt XBRL would cause them to prefer misclassifying income statement items as an alternative to more risky earnings management methods.

The study sample includes nonfinancial UAE companies listed on Dubai Financial Market and Abu Dhabi Securities Exchange from 2012 to 2019. Fixed effect and system General Method of Moments regressions were used to analyze the study data.

The study found that XBRL reporting resulted in lowering the quality of financial reporting as companies have a higher tendency to misclassify income statement items as earnings management mechanism.

The findings of this research can be used by stakeholders and practitioners in the UAE to better understand whether the use of XBRL is linked to the engagement of financial reporting manipulative practices. The findings of this study also inform policymakers and regulators about the consequences of companies formally adopting digital disclosure language in an effort to improve the quality of their reporting. Besides, the results offer guidance to regulators considering imposing XBRL usage regulations.

Limited number of studies have tested the association between XBRL mandatory adoption and misclassification of income statement items as an earnings management tool in the Gulf Cooperation Council region.

The purpose of this study is to investigate the effects of ownership structure, board attributes and eXtensible Business Reporting Language (XBRL) on annual financial reporting timeliness of non-financial companies listed on Borsa Istanbul (BIST).

To conduct the analyses, the authors used two samples. The main sample consists of 187 companies, while the subsample includes 54 companies in the BIST 100 index. The data set covers the 2010–2018 period. To investigate the influence of ownership structure, board attributes and XBRL on timeliness, panel regression and univariate analyses were used. To explore the factors associated with the likelihood of late filing, panel logistic regression analyses were employed.

The findings provide evidence that companies that have a high level of institutional ownership and women board membership file earlier. In line with prior studies, profitable companies file their accounts faster. Highly leveraged companies are late reporters. Further, XBRL has a positive influence on the filing of financial reports for the BIST 100 companies due to technological agility. Finally, companies that have less institutional ownership and that get qualified audit opinions are more subject to late filing.

The authors acknowledge that this study has certain limitations. First, the results may not be generalized to the entire BIST population due to the exclusion of financial companies from the samples. Future research may explore the financial reporting timeliness of these companies. Second, the study did not investigate the relationship between timeliness and the information content in financial statements and the market reactions they arouse. Third, this study is trying to find out early evidence on the mandatory adoption of XBRL filings, which cover only three-year period due to the recent implementation of this regulatory practice. Thus, it needs further elaboration after the accumulation of data in the forthcoming years by the expansion of the sample beyond the 2016–2018 period. As companies would have more time to become familiar with XBRL, a more reliable conclusion may be drawn. Further, the study particularly focuses on the effect of XBRL adoption on the timeliness among filers. XBRL could also influence investors, auditors and other stakeholders. Future research could investigate the influence of XBRL on different stakeholders to produce more insightful implications.

This study offers several implications for managers, regulators and policy makers. First, companies that do not make timely financial reporting may find it more difficult to attract long-term capital by means of institutional investors. Since these investors view timely reporting as an ideal ingredient in corporate governance, it may have a positive impact on company reputation and corporate sustainability. The results also provide insights for regulatory authorities, policy makers and auditors on the causes of the reporting lag, thereby increasing their awareness and helping them in their decision-making process since improvements in timely availability and accessibility of financial information reduce information asymmetry for users and increase market efficiency. Additionally, companies that reduce their filing timeframe will be able to compare their results with other companies. However, the XBRL mandate could be much more burdensome to smaller firms. This may stem from the fact that larger firms may tend to use the in-house approach for XBRL and can afford more advanced financial reporting systems with automated coding algorithms attached to streamline their XBRL filings, whereas smaller firms are more likely to use the outsourcing approach due to the difference in the level of resources available for XBRL preparation. This finding also lends support to recent concerns that new technology creates an unleveled benefit in reporting efficiency for large companies, but not for small ones (e.g. Blankespoor et al., 2014). This benefit may change the dynamics of the financial market and information environment, leading to further segmentation of the capital markets. The positive effects of XBRL adoption may accrue over time due to the potential benefits of learning curve experience since the XBRL mandate will help companies automate their reporting process and information processing, thereby strengthening internal control over financial reporting (Deloitte, 2013; Du et al., 2013; Li, 2017). Companies may also efficiently incorporate auditor-proposed adjustments by cross-referencing impacted accounts and prepare revised versions of the financial reports, which are automatically rendered in various formats for auditors to assess (Wu and Vasarhelyi, 2004). Finally, investors and other users of financial information benefit from having quicker access to data, since this allows them to make more timely and reliable decisions, leading to greater benefits.

This paper contributes to the literature on the impact of adopting XBRL on the timeliness of financial reporting in emerging markets. Second, this study extends the literature and provides evidence on determinants of timeliness, covering both ownership structure and board attributes besides firm-specific characteristics. Hence, it provides valuable insights for companies, investors, auditing firms and policy makers.

The purpose of this paper is to evaluate the impact of the International Financial Reporting Standards (IFRS) and eXtensible Business Reporting Language (XBRL) on audit fees based on evidence from listed companies operating in an emerging economy. Whilst IFRS constitute high-quality accounting standards, XBRL represents a technology standard that can enhance the usability of IFRS and overall financial reporting transparency.

Multivariate analyses are used on a sample of 1,798 firm-year observations between 2000 and 2011 from companies listed in the Shanghai Stock Exchange that were subject to XBRL and IFRS adoption mandates.

The main results suggest that XBRL has a main negative effect on audit fees which is weaker for larger firms. Additionally, the authors find that IFRS increases audit fees for all companies. Whilst this effect is positive for firms of different sizes, it is weaker for larger firms.

Whilst the findings are applicable to the selected sample and may or may not be generaliseable to other economies, they can provide important implications for both regulators and companies that are undertaking IFRS convergence and XBRL implementation projects in developing economies around the world.

This study offers a timely assessment of the economic consequences of IFRS and XBRL on listed companies operating in an emerging economy, in addition to providing an important basis upon which further research can be designed in order to extend the analysis.

eXtensible Business Reporting Language (XBRL) is an internet-based interactive form of reporting language that is expected to enhance the usefulness of financial reporting (Yuan and Wang, 2009). In the UK and the USA, XBRL is mandatory, and in Australia, it is voluntarily adopted. It has been reported that in the not too distant future, XBRL will be the standard format for the preparation and exchange of business reports (Gettler, 2015). Using an experimental approach, this study assesses the usefulness of financial reports with XBRL tagged information compared to PDF format information for non-professional investors. The authors investigate participants’ perceptions of usefulness in relation to the qualitative characteristics of relevance, understandability and comparability.

This paper uses an experimental approach featuring a profit-forecasting task to determine if participants perceive XBRL-tagged information to be more useful compared to PDF-formatted information.

Results reveal that financial information presented with XBRL tagging is significantly more relevant, understandable and comparable to non-professional investors.

The authors address a gap in the literature by examining XBRL usefulness in Australia where XBRL adoption will be mandated within the not too distant future. Currently, the voluntary adoption of XBRL by preparers and users is low, possibly, because of a lack of awareness about XBRL and its potential benefits. This study yields significant implications for the accounting regulators in creating more awareness on the benefits of using XBRL and to create an impetus for XBRL adoption.

The purpose of this paper is to examine the implementation and development of eXtensible Business Reporting Language (XBRL) at the Federal Deposit Insurance Corporation (FDIC). The investigation seeks to gauge the roles and experiences of the FDIC and its main stakeholders to determine their engagement in XBRL diffusion within their organizations.

This is an qualitative research approach that is driven by the use of an in-depth case study and supported by the use of semi-structured interviews.

The findings showcase the role played by the FDIC as the first US regulatory authority that implemented and developed Inline XBRL. In addition, the use of diffusion of innovation theory provides better understanding of each stakeholder’s issues, benefits and challenges based on their experience.

The research does not examine the institutionalization of XBRL at the FDIC or its stakeholders. Therefore, future research could incorporate a different research design to capture the impact of the pressure resulting from the regulatory mandate.

The research offers practical insights into public information technology managers and policymakers at global government agencies which are either non-adopters of XBRL technology or current adopters and consider transitioning into Inline XBRL. Global stakeholders could learn from the US experience and develop better understanding of Inline XBRL applications and functionalities.

The originality of this research is driven by the FDIC’s experience as the first regulatory developer of Inline XBRL. As such, the case study is a best practice to future and current adopters who often navigate the nuisance of implementing new technologies and/or developing existing ones.

Corporate reporting infrastructure and communication are being transformed by the emergence of digital technologies. A key element of the digital accounting infrastructure underpinning international corporate reporting is the IFRS Taxonomy, a digital representation of international accounting standards that is required by firms to produce digital corporate reports. The purpose of this paper is to trace the development, governance and adoption of the IFRS Taxonomy to highlight the implications for accounting practice and standard-setting.

The authors mobilise Actor Network Theory and a model of transnational standardisation to analyse the process surrounding the formation and diffusion of the IFRS Taxonomy as a legitimate “reference” of the IFRS Standards. The authors trace the process using interview, observation and documentary evidence.

The analysis shows that while the taxonomy enables IFRS-based reporting in the digital age, tensions and detours result in the need for a realignment of the perspectives of both accounting standard-setters and taxonomy developers that have transformative implications for accounting practice and standard-setting.

The study explains how and why existing accounting standards are transformed by technology inscriptions with reflexive effects on the formation and diffusion of accounting standards. In doing so, the paper highlights the implications that arise as accounting practice adapts to the digitalisation of corporate reporting.

The purpose of this paper is to examine whether and how firm's agency costs played a role in the voluntary adoption of the eXtensible Business Reporting Language (XBRL) under the SEC's voluntary filing program (VFP) that encouraged the voluntary adoption of the XBRL.

This study employs a logistics regression and a sample of 140 firms that voluntarily participated in the VFP during its entire existence in the United States, and 140 matched-pair counterparts that did not voluntarily adopt the XBRL to investigate the role of agency costs in the voluntary adoption of XBRL-based financial reporting.

We find evidence consistent with the conjecture that a firm's low magnitude of agency costs plays a significant motivating role in the voluntary adoption of XBRL-based financial reporting. Our results continue to hold after using an alternative measure of agency costs and conducting two-stage least squares regressions. Supplementing these results, the study also shows that the level of agency costs of voluntary XBRL adopters remains statistically unchanged after the adoption while the level of agency costs associated with the firms that did not participate in SEC's VFP significantly decline after the adoption during the XBRL mandate.

The findings of this study suggest that based on a firm's level of agency costs, regulators and policymakers, especially those in countries that are yet to mandate XBRL reporting, can, in advance, identify firms that are more likely to comply with their new financial reporting initiatives.

This paper provides first evidence on the role of agency costs in the voluntary adoption of XBRL using data from the United States.