SEC filers that submit financials using International Financial Reporting Standards (IFRS) should take note that the IFRS Foundation has published digital tagging of certain Illustrative Examples from the IFRS accounting standards.
By tagging the Illustrative Examples, the IFRS Foundation is demonstrating the use of the IFRS Taxonomy and the XBRL syntax for digital financial reporting. These tagged disclosures are a good way for filers to see first-hand how XBRL can properly be used to digitally communicate the same information as is communicated in the traditional paper-based financials.
Digital communication of common disclosures
The IFRS Foundation created XBRL-tagged disclosures for 20 Illustrative Examples. These examples cover common IFRS disclosures in the face financial statement as well as the notes to the financials. The tagged disclosures include:
- Statements of Financial Position, Comprehensive Income, and Changes in Equity
- Financial Instruments
- Operating Segments
- Business Combinations
- Revenue from Contracts with Customers
- And others
Inline XBRL format
Notably, the tagging of the IFRS Illustrative Examples demonstrates not only the conventional XBRL format, but another key XBRL format - Inline XBRL. This is important because, as I noted in June, the SEC passed a requirement for Inline XBRL reporting. The requirement for IFRS companies starts with fiscal periods ending on or after June 15, 2021.
XBRL tagging for EU-listed companies
The tagged examples provided by the IFRS Foundation are applicable not only for SEC filers, but also for filers in other regulatory jurisdictions.
For IFRS filers listed on an exchange in the European Union, the tagged examples will provide a benefit since those filers will be required to submit XBRL as a result of the upcoming mandate in 2020 for EU-listed companies. The EU rules for filing XBRL, which were developed by the European Securities and Markets Authority, pertain to IFRS consolidated financials, so the examples tagged by the IFRS Foundation will be very relevant to those companies.
Submitting proper XBRL
Submitting proper XBRL requires having strong knowledge of the IFRS Taxonomy, the IFRS accounting standards, the regulator’s rules and the proper way to structure the XBRL tags. The IFRS Foundation’s examples will provide a start down the right path.
Merrill Corporation has been heavily involved with IFRS and XBRL, and fully understands the IFRS Foundation’s tagged Illustrative Examples. Merrill is deeply engaged with the IFRS Foundation’s IFRS Taxonomy Consultative Group, the Data Quality Committee of XBRL US, the FASB’s Taxonomy Advisory Group and several international XBRL projects. And more importantly, Merrill has an unparalleled XBRL team that knows how to help get the XBRL tagging right, so filers can move forward confidently.