The IFRS Foundation has concluded the pilot initiative that it launched in April 2010 to work with US-listed foreign companies to produce IFRS financial reports in eXtensible Business Reporting Language (XBRL) that are compliant with United States Securities and Exchange Commission (SEC) requirements.
The SEC issued a ruling in December 2008 requiring all US-listed foreign private issuers to submit their IFRS financial reports, including their periodic reports in XBRL from 15 June 2011.
12 companies voluntarily used the IFRS Taxonomy to produce 20-F filings in XBRL format that could be accepted by the US SEC EDGAR filing system. 'Level 1' XBRL tagging was applied to the filings, i.e. all items in the primary financial statements were tagged while notes were tagged using a single text block.
The outcomes of the pilot initiative revealed some interesting outcomes:
- Between 6 and 60 hours was required to complete the first stage of the process, which was the mapping of the primary financial statement line items to IFRS Taxonomy items
- Many participants found that they needed to create additional taxonomy items (i.e. IFRS Taxonomy extensions) to reflect common-practice concepts for their 20-F filings. The need for these extensions arose largely from IFRS requirements and the flexibility that IFRS allows for presentation and aggregation. The Foundation acknowledges this will need to be addressed, with an analysis to be undertaken of concepts that are not in the IFRS Taxonomy but that are commonly reported by commercial and industrial companies
The results of the pilot and further analysis will be used to make amendments to the IFRS Taxonomy. Further field tests are expected with financial institutions and insurers, and on detailed note tagging.