CA NeWs Beta*: how to file in xbrl format

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Thursday, June 23, 2011

how to file in xbrl format

Background:        
Ministry of Corporate Affairs (MCA) vide its General Circular No 09/2011 has Mandated certain class of Companies to file their Annual Financial Statements in XBRL format only.  Therefore the companies falling under the defined category of MCA have to comply with this circular w.e.f. financial year 2011-12.

Applicability:
In the first instance, the following type of companies will require to file their annual financial statements in XBRL format:
 · All companies listed in India & their subsidiaries including overseas subsidiaries
 · All companies having a paid up capital of Rs. 5 Crore or more & above or a Turnover of Rs.100 Crore or above.

What is XBRL?
XBRL stands for extensible Business reporting Language. It is basically an open royalty free soft ware of a universally preferred language for online transmission of information. XBRL is specifically used to transmit the financial information in a common Business Reporting Language.

What should be done to file the Annual Financial Statements In XBRL format:
MCA has issued guidelines on its portal to file the Annual Financial Statements in the XBRL format. However a brief procedure for the same shall be as follows:

Steps for filing financial statements in XBRL form in MCA21 system:
Step 1 – Creation of XBRL instance document:
I. Map Company’s each financial statement element to a corresponding element in published taxonomy
Firstly each & every element in the Financial Statement of the company should be converted into a corresponding element in the Business Taxonomy.  To get this done, the companies have to do tagging (classification) of the XBRL taxonomy elements with the corresponding accounting heads in the Financial Statements. This mapping of taxonomy elements will help to convert the accounting related information into XBRL format.
However the said conversion will require the precise judgment & caution. Therefore it is advisable to involve those in the conversion procedure who are well conversant with the financial statements.

II. Creation of instance document for Balance sheet and Profit and loss Account-
Having passed the mapping & classification stage, an instance document is to be created for the financial statements. An instance document is a XML file that contains business reporting information and represents a collection of financial facts and report-specific information using tags from the XBRL taxonomy. Separate instance documents need to be created for the following:
1. Stand Alone Balance sheet of the company
2. Stand Alone Profit and Loss Account of the company
3. Consolidated Balance sheet & Consolidated Profit and Loss Account of the company.

It is to be noted that no extensions to the core Taxonomy will be allowed.
III. Review and verify the instance document
Once the instance document is prepared, it needs to be ensured that the instance document is a valid instance document and all the information has been correctly captured in the instance document.

Step 2 – Download XBRL validation tool from MCA portal
Validating the instance document is a pre requisite before filing the balance sheet and profit & loss account on MCA portal.  A validation tool is to be downloaded from MCA portal to validate the instance document. The validation should be done according the business taxonomy available on the MCA portal. 

Step 3 - Perform pre-scrutiny of the validated instance document through the tool
Once the instance document is successfully validated from the tool, the next step is to pre-scrutinise the validated instance document with the help of the same tool. This can be easily done by connecting to internet.

Step 4 - Attach instance document to the Form 23AC and Form 23ACA
There shall be a separate set of Form 23AC and Form 23ACA available on the MCA portal for filing in XBRL form. After filing the form on MCA portal a validated & prescrutinized instance document is to be attached for Balance sheet, Profit & Loss A/C & Consolidated financial Statements. Separate instance documents need to be attached w.r.t. Standalone financial statements and consolidated financial statements.

Step 5 - Submitting the Form 23ACA and Form 23ACA on the MCA portal
Once the instance documents are validated & pre-scrutinize, e-form can be uploaded easily on the MCA portal.

Step 6 - Viewing of balance sheet and profit and loss submitted in XBRL form on MCA portal:
The XBRL instance documents submitted along with Form 23AC and 23ACA are in machine readable format. Therefore, for viewing the same in a human readable format, these shall be converted into human readable format by the MCA21 system. For viewing the same on MCA21 portal and for taking certified copies of the same, these converted documents shall be made available.
In a nutshell, this is how the filing in XBRL format will take place.

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