Gemma Kearney recently graduated from University College Cork where she studied Business Information Systems and, as part of her degree undertook a significant software development project that involved designing an application that she named - XSolutions. XSolutions is a proof of concept which demonstrates that XBRL can be designed to specifically meet a company’s needs and highlights some of the potential benefits of XBRL albeit on a smaller scale than an actual business implementation. Gemma was awarded the top prize in the Business Reporting Ireland Ltd (BRIL) academic competition for third level students earlier this year. BRIL is the not-for-profit company established to promote XBRL in Ireland.
PROJECT OVERVIEW
XML for financial reporting enables a dramatic improvement in the processing of financial reports. XBRL documents can be:
- Prepared efficiently
- Exchanged reliably
- Published more easily
- Analyzed quickly
- Sent to potential investors simply and enable smarter investments.
Large corporations may have several subsidiaries all of which may be using different computer systems to publish their financial statements. The application I developed -’XSolutions’ uses a Company with 3 subsidiaries for demonstration purposes: Cork, Galway and Dublin. The 3 Cost Centres input their Balance Sheet and Income Statements through a user friendly Graphical User Interface which converts the data to XBRL Format. The Company can then use this information to quickly roll-up, analyze and publish financial statements of the cost centres and summarize group information. This is a major enhancement to the distribution and usability of existing financial statement information.
The main challenge of this project was to create the XBRL instance documents. There are tool that currently exist in the market that can create instance documents. However, these tools are extremely difficult and time consuming to use and expect the user to have a high level understanding of both XBRL and Accounting, a skill set that may not be readily available to a company. XSolutions application overcomes this obstacle by allowing the user create the XBRL documents with no knowledge of XBRL.
One major issue that was raised by a number of Cork based accountants that I spoke with, is the need to be able to trust a system and the information produced by it. To deal with this issue the information contained in the XBRL documents is available to the user at all stages of XSolutions at the click of the mouse. The user simply has to switch from Account Details view to XBRL view and they can see all information contained in the XBRL document that was used to populate the account details.
XSolutions should provide a single point of entry for all Departments / Cost Centres within the Company. It should provide an interface to allow the input of financial data from various Cost Centres that will allow the production of Budgeted and Actual Income Statements and Balance sheets for both individual Cost Centres and aggregate this data to produce overall company Income Statements and Balance Sheets. In my application the data is stored in XBRL format and the file location referenced in the database for future use or used to produce value-adding reports.
SYSTEM OBJECTIVES
The objective of XSolutions is to provide a company with the tools to create XBRL instance documents and use these to increase the efficiency of their financial reporting process. XSolutions:
- Allows individual Cost Centres input their Balance Sheet and Income Statement data in a User Friendly manner and converts and stores this information in XBRL format.
- Allows Group information to be created by merging the accounts of the individual cost centres and stores this information in XBRL Format.
- Allows users view previously entered account information in XBRL format and dynamically extracts the information from the instance document to populate the account details on screen.
- Reports can be created to analyse accounts specified by the user, these reports are stored in XBRL format but can also be exported to Word, Excel, PDF or Rich Text Format if the user wishes.
FUNCTIONAL REQUIREMENTS
1. Allow user enter, edit or view Cost Centre Balance Sheet and Income Statement figures and convert and store these details in XBRL format and reference the location of the file in the database. The actual account details are stored in an XML file in
XBRL format.
2. Allow User create Group Account details by specifying Account Type and Period and selecting cost centres to merge to calculate company wide information. Group Accounts consist of Balance Sheet and Income Statement details as previously outlined. If for example the Period is 31-12-2002 and the account type is BUDGET then all records matching those criteria are displayed and the user can decide which to include in the Group Account. Generally the user will select all 3 Cost centres, Cork, Dublin and Galway and the group account will consist of the combined results of those accounts.
3. Allow User create reports based on a number of combinations of the following parameters: Account type, Cost Centre and Period. The reports are stored in xbrl format and can also be exported to word, pdf, excel or rich text format.
4. An Administrator should be able to view and edit current Employee details, delete employees from the system and add new employees to the system.
NON-FUNCTIONAL SPECIFICATION
The main Non Functional Specification - the design of the User Interface is one of the benefits of using this application over existing technology.
Current applications to create instance documents are often complicated, technical and not at all user friendly.
The main issue in designing the User Interface was to hide the
complexities of XBRL from the end user and remove the need for the person entering data to either be familiar with accounts or XBRL. At the same time, the user is able to see at any stage the XBRL that is populating the accounts so they can trust the data generated.
TECHNICAL DESIGN
Technical design of XSolutions incorporates the following issues:
- Database Design
- XBRL Taxonomy and Instance Documents.
- Object Orientated Design.
- Overview of Classes in XSolutions.
Database Design
As the database is mostly used to store references to the XBRL files, Microsoft Access is an appropriate choice . Basic Details used to identify the correct XBRL instance document and its location are stored in an Access Database.
XBRL Taxonomy and Instance Document Creation
There are numerous taxonomies available for use. However, for proof of concept I wanted to design my own extensible taxonomy because most of the taxonomies available were too generic and detailed to suit the scope of the project.
Creating my own taxonomy also proves the point that XBRL can be designed specifically to meet an individual company’s needs. As long as the taxonomy conforms to XBRL standards (the current standard is XBRL 2.1), and is hosted on the Internet, and the Instance documents reference the taxonomy correctly, it can be interpreted by any system. Generally, a company will have its own style sheets, which will allow it to view the data in a manner that suits its needs.
In order to design the taxonomy, I had to design the structure of the Income Statement and Balance Sheet. Once this was determined, Barry Smith in XBRL Ireland created the actual taxonomy documents as the software needed to do this is expensive and was unavailable to me. However, this also reflects the situation in Business, as a company is unlikely to change the taxonomy frequently, if ever they could simply outsource the production of the taxonomy documents.
The accounts above outline the structure of the taxonomy.
The taxonomy files are located within XSolutions itself and also hosted online.
Writing the XML instance documents that were compliant with XBRL 2.1 was the most difficult task of this project.
Instance Documents Creators exist and can be bought as software applications, however they are extremely difficult to use and require a high level of knowledge of both XBRL, Accounting and IT and in my opinion it would be a difficult task to convince managers to use these tools on a regular basis, plus the time spent familiarising people with the technology as well the cost involved and actual time taken would outweigh the benefits that XBRL could bring to a company.
I created the Instance documents by calculating the output that should be created and identifying the elements id at runtime so the type of instance document that needed to be created is determined dynamically. Based on the type of Instance Document being created the Header, Context Section and Body of the Instance Document and Footer were determined and using a StringBuilder the output is appended until all the information is converted to a string and then passed into an XMLDocument and converted to XML.
This task was extremely difficult as I found very little information on the actual creation of XBRL Instance Documents on the web and I contacted a number of people who had significant .Net or XBRL experience as well as posting on several forums for both .Net
and XBRL.
The response was invariably the same, the people who were familiar with .Net were unfamiliar with XBRL or how to create it and the experts in XBRL were unfamiliar with how the Instance documents were created practically but understood the details of the Instance document.
An example of this is a Lecturer's response:
Writing an XBRL file would be a mammoth task and I'm afraid I cannot be of any assistance there. You would be much better off if you simply parsed an existing XBRL file.’
The instance documents were created through trial and error and validated by Barry Smith of XBRL Ireland.
Object Orientated Design
As the taxonomy used in XSolutions is designed to be extensible, I also incorporated the same design in my code. XSolutions is designed with the main functionality being incorporated in classes and not procedurally behind forms. This is due to the fact that if the taxonomy was to be changed or say for example the design of the reports output was to be changed it would involve minimal changes to the code and simply the class in question could be updated or replaced without effecting XSolutions elsewhere.
TECHNOLOGIES
I decided to use a N-Tier architecture approach in my project as it provides a number of benefits. Programs partitioned into Tiers allow each layer or component part to be developed, managed, deployed and enhanced independently.
- Back End Database
I analysed a number of database packages and decided to implement Microsoft Access as my database of choice. This was due to the fact that it was non-complex information being stored so it was not necessary to have an enterprise level database that could hold large quantities of data. Also, a majority of businesses are currently committed to the Microsoft operating system and the majority would have Microsoft Access pre-installed.
- Middle Tier - XBRL
XBRL is composed of Data and Meta Data. It is extensible simply because business reporting concepts are extensible.
- Front-End
The application that is placed on system user desktops is developed using Microsoft Visual Basic .Net. This means that the application requires the .NET framework to be installed on each client application.
Before concluding this article, I have to acknowledge the support and help I received from Barry Smith at DCU. His knowledge of XBRL was invaluable.
In researching this project, I referenced the following websites:
www.xbrl.org
www.xbrl-ie.org
http:about.reuters.com/
investors/results/archive/2004.asp
www.bcentral.co.uk/issues/
administration/tax/ preparing
foryourannualaccounts.mspx
web.bryant.edu/
www.aicpa.org/
www.cpatechconf.com
From a technical perspective, I referred mainly to the Microsoft Website and .Net Forums for queries with code.
Tables have been omitted from the online version of this article
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