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XBRL Financial Statements - Requirements in India

CA sawan kumar 
on 04 October 2013

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The following class of companies have to file their Balance Sheet, Profit and Loss Account and other documents as required under section 220 of the Companies Act, 1956 with the Registrar using the Extensible Business Reporting Language (XBRL) taxonomy given in Annexure enclosed to the rules for the financial year ending on or after 31st March, 2012 with e-Form no.23AC-XBRL and 23ACA-XBRL specified under the Companies (Central Government) General Rules and Forms, 1956, namely:-

(i) all companies listed in India and their Indian subsidiaries;

(ii) all companies having a paid up capital of Rs 5 crore and above; and

(iii) all companies having a turnover of Rs 100 crore and above.

(iv)all companies who were required to file their financial statements for FY 2010-11, using XBRL.

However, banking companies, Power companies, Non Banking Financial Companies (NBFC) and Insurance companies are exempted from XBRL filing till further order.

INSIDE THIS ISSUE

WHAT IS XBRL?

HOW XBRL WORKS?

FILE STATEMENTS IN XBRL FORMAT ON MCA FORMAT

WHY XBRL?

What is XBRL?

XBRL is a data-rich dialect of XML (Extensible Markup Language), the universally preferred language for transmitting information via the Internet. It was developed specifically to communicate information between businesses and other users of financial information, such as analysts, investors and regulators. XBRL provides a common, electronic format for business reporting. It does not change what is being reported but only changes how it is reported. XBRL is a worldwide standard, developed by an international, non-profit-making consortium, XBRL International Inc. (XII). XII is made up of many hundred members, including government agencies, accounting firms, software companies, large and small corporations, academics  and business reporting experts. XII has agreed the basic specifications, which define how XBRL works.

How XBRL Works?

XBRL makes the data readable, with the help of two documents – Taxonomy and instance document. Taxonomy defines the elements and their relationships based on the regulatory requirements. Using the taxonomy prescribed by the regulators, companies need to map their reports, and generate a valid XBRL instance document. The process of mapping means matching the concepts as reported by the company to the corresponding element in the taxonomy. In addition to assigning XBRL tag from taxonomy, information like unit of measurement, period of data, scale of reporting etc., needs to be included in the instance document.

The entire process of XBRL conversion can be shown in 7 steps:

1. Obtain Audited Financial Statements.

2. Prepare source document.

3. Mapping of Source Document with MCA mandated taxonomy.

4. Validating the mapped document & Error elimination.

5. Elimination of errors.

6. Approval from Board and Instance Document Creation.

7. Validation of Instance Document with MCA Tool and filing with ROC.

Documents required for XBRL Conversion:

a) Audited Accounts including Balance Sheet, P/L account and cash flow statement.

b) Director's Report.

c) Auditor's Report.

d) Subsidiary Company Information.

e) Additional information required under XBRL Taxonomy.

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