The Companies and Intellectual Property Commission (CIPC) mandated the use of Inline-XBRL (iXBRL) reporting is now well into its third year. Introduced in 2018, the goals of this CIPC iXBRL mandate are twofold – reduction of administrative burden on businesses and achievement of regulatory compliance furthering transparency for all stakeholders.
Under South African law promulgated in 2011, business entities in the region were bound by 3 main accounting standards viz. the IFRS, IFRS for SMEs, and the SA GAAP. What standard would be used depending on their public interest score. While the GAAP was withdrawn in subsequent years due to its similarity with the IFRS, state-owned companies in the region were facing problems. The financial statements of these entities were adhering to the Generally Recognized Account Practice (GRAP) standard whereas their Annual Financial Statement (AFS) submitted under the CIPC iXBRL mandate were based on the IFRS.
This needed to be rectified. Therefore, the CIPC included GRAP standards in the taxonomy revision released in October 2020. Public sector companies may voluntarily file their AFS in iXBRL using the new taxonomy until September 2021, and thereafter, their CIPC iXBRL filings would be mandatory.
The GRAP is issued by the Accounting Standards Board (ASB) under section 89 of the Public Finance Management Act (PFMA) and was initially based on the International Public Sector Accounting Standards (IPSAS), itself an offshoot of the IFRS.
While the GRAP has largely been identical to the IFRS, recent developments have seen it diverging from its forefather to a much larger degree than before. Several new standards of GRAP have been issued recently, providing accounting guidance for some specific transaction types that are unique to the public sector. This has resulted in there now being several GRAP standards for which there is no IFRS equivalent and other standards that show a significant difference between the two.
Keeping abreast of these constant changes and developments can be laborious as well as prohibitively expensive. Here we outline what to look out for in a filing partner to make CIPC iXBRL submissions reliable and hassle-free:
Experience: As with most things, a good indicator of reliability is the number of years your chosen partner has devoted to iXBRL filings. Consequently, a higher figure implies more iXBRL filings handled to date, in relation to the competition and thus more trustworthiness.
Diversity: It is important to note how many different taxonomies (and thus countries) your service partner has worked with. This adds an extra layer of assurance to the filer or issuer.
Support strength: Having an expert to answer queries and provide guidance 24×7 is invaluable to any customer and goes a long way in building dependability.
TAT: This is an important metric in any time-bound activity and key in the context of CIPC iXBRL filings. It should ideally range between 7-10 days. Of course, the lower the better.
Testimonials: The simplest way to verify the authenticity of a service provider’s claims is to talk with their existing clientele to get a sense of how they are to work. Positive references perhaps go the furthest in making a final decision.