The IFRS Foundation is a non-profit organization established to develop high-quality, comprehensible, enforceable, and globally accepted accounting standards. The IFRS Foundation also issues the latest version of IFRS-based taxonomy every year to include changes in IFRS standards.
The accounting bodies /XBRL regulators in several countries around the world use the taxonomy issued by the IFRS Foundation as a base taxonomy for the implementation of XBRL in their respective countries.
ESMA ESEF Taxonomy Upgrade – History
ESMA released the first version of its taxonomy (ESMA ESEF 2017 Taxonomy) on 21st March 2019 which was based on the IFRS 2017 taxonomy. On 20th December 2019 ESMA released an updated version of the taxonomy (ESMA ESEF Taxonomy 2019) based on the IFRS 2019 taxonomy.
What are new updates?
The ESMA ESEF Taxonomy includes changes/updates made in the taxonomy resulting from:
Common reporting practice:
Relating to disclosure requirements in IFRS 13 Fair Value Measurement. From the year 2012, the IFRS taxonomy started to include disclosures that are commonly reported by entities that apply IFRS standards in the preparation of financial reports. These are known as ‘common reporting practices’. Common reporting practices are identified by the IFRS board by analyzing IFRS financial statements across companies. The addition of such common reporting practices in the taxonomy helps entities in saving time while mapping their financial reports using the IFRS taxonomy because they don’t need to create custom elements for disclosures that are commonly reported.
- Applying IFRS 9 Financial Instruments with IFRS 4 Insurance Contracts (Amendments to IFRS 4) issued by the Board in September 2016
- IFRS 17 Insurance Contracts issued by the Board in May 2017, and
- Prepayment Features with Negative Compensation(Amendments to IFRS 9) issued by the International Accounting Standards Board in October 2017.
The enhanced data model for:
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- Reporting relating to continuing and discontinued operations.
- Changes to better reflect disclosures in IAS 19 Employee Benefits and
- Disclosures in IFRS 7 Financial Instruments: Disclosures.
Addition of new elements
IRIS has analyzed the new elements added in the ESMA ESEF 2019 taxonomy on account of accounting standards updates. Here is the summary:
The taxonomy does not provide accounting references to abstract elements. An abstract element, or a header, is only used in a hierarchy to group related elements together, and cannot be used to tag data in an XBRL document.
These 584 ‘unique’ new elements are added multiple times in the ESMA ESEF 2019 taxonomy across several Extended Link Roles/ Presentation Links, making the total count of new elements even higher at 904. Below is the summary of new elements added ELR wise:
Elements deleted in the ESMA ESEF 2019 taxonomy
Apart from elements added, the ESMA ESEF 2019 taxonomy has also removed 167 elements that were part of the earlier ESMA ESEF 2017 Taxonomy. Reasons for deletion include:
Changes/modifications in accounting standards:
For example, the element ‘ifrs-full: DisclosureOfRecognisedRevenueFromConstructionContractsExplanatory’ has the definition ‘The entire disclosure for revenue recognized from construction contracts with reference ‘Expiry date 2018-01-01 IAS 11 2017-01-01 Disclosure’’, referring to the International Accounting Standard 11.
The IAS 11 — Construction Contracts standard has been replaced by ‘IFRS 15 — Revenue from Contracts with Customers. Hence, the corresponding tag which references the IAS11 standard has also been deleted from the taxonomy.
Wrong data type:
For example, the element ‘ifrs-full: WeightedAverageSharePrice’ had the wrong data type ‘xbrli:monetaryItemType’ and documentation ‘The weighted average share price. [Refer: Weighted average [member]]’. This element has been deleted/deprecated and a new element ‘ifrs-full: WeightedAverageSharePrice2019’ is introduced with the correct data type ‘num:perShareItemType’.
Re-modeling of taxanomy structure:
For example, in the presentation link ‘[823000] Notes – Fair value measurement’ in ESMA ESEF 2017 taxonomy there were specific line items available for the disclosures related to unobservable inputs. Please see the screenshot below:
In the ESMA ESEF 2019 taxonomy, a single generic element ‘ifrs-full: SignificantUnobservableInputAssets’ with the definition ‘The value of significant unobservable input used in the measurement of the fair value of assets.’ is introduced, and all the line items highlighted above are replaced by member elements in the new taxonomy.
Changes in existing/older elements
Apart from adding and deleting elements from the taxonomy, the IFRS board also updates the XBRL attributes, documentation, and references of existing elements as required. Below is the summary of these changes:
Apart from adding and deleting elements from the taxonomy, the IFRS board also updates the XBRL attributes, documentation, and references of existing elements as required. Below is the summary of these changes:
- Balance types used to describe whether an element is expected to be reported with a debit or credit balance. The balance type for the following 3 elements are assigned in the latest ESEF taxonomy, earlier these elements didn’t have any balance type.
- Documentation is a human readable textual description of the accounting meaning of the elements. There is an update in the documentation of 69 elements.
- References are used to link elements to authoritative literature, for example, for the element ‘ifrs-full: DisclosureOfBusinessCombinationsExplanatory’ the reference provided in the taxonomy is ‘IFRS 3 2019-01-01 Disclosures’ which means this element is referenced to accounting standard IFRS 3. There is an update in the references of 3904 elements.
We hope you found this high-level summary of changes in the ESMA ESEF 2019 taxonomy useful. Stay tuned for our upcoming blog where we will deep dive into the accounting standard that has resulted in the maximum element additions to the taxonomy – the IFRS 17 standard around insurance contracts.
