by Anuradha | January 23, 2019
Happy New Year to our readers!
Close to 12 months from now, the European Single Electronic Format (ESEF) will commence. As briefed in our introductory blog, What is the ESMA Mandate about? the Inline XBRL (iXBRL) reporting standard will be applicable to all public companies in EU. Therefore, this is the best time to start preparing for this mandate.
In this blog, we walk you through the steps you need to start with in preparation for the mandate:-
1) Start planning early
Give me six hours to chop down a tree and I will spend the first four sharpening the axe.
Abraham Lincoln said it all; the efforts you put in planning your ESEF iXBRL reporting is how it will turn up.
The ESEF iXBRL reporting needs careful planning. This comes directly under the purview of the CFOs office involving the Compliance teams. It is important that your compliance teams start planning as early as 2019 as it involves critical activities that have an impact on your companys ability to file in time and share results with investors and other stake-holders.
2) Evaluate your business requirements
Does your business require conversion services or are you looking for a self-filing solution and take the process completely in-house?
If you intend to file by yourself, a number of fit-for-purpose staff maybe required. The resources will need to have a background in finance and also have a working knowledge of the IFRS standards. This will help them understand the ESEF taxonomy in greater depth. (A Taxonomy is a dictionary of financial concepts against which each disclosure in the annual report needs to be mapped to).
3) Plan for a budget
We didn't actually overspend our budget. The allocation simply fell short of our expenditure.- Keith Davis
Failing to plan is planning to fail. Budget planning is key to financial planning, and of course, compliance.
Based on your budgetary requirements, there are software solutions available which you can license on an annual basis and take the process completely in-house. On the other hand, there are also options to outsource the conversion of your Annual Report to iXBRL to service providers.
The budget varies on the strategy you choose. If you want to take the entire process in-house you will need to plan for higher budgets, on the other hand there are several outsourcing options available which come with varied price ranges.
A concrete evaluation of the strategy by mid-2019 would be ideal
4) Involve your teams and plan your calendar
Our experience in countries where a new mandate commences show that companies prefer to outsource iXBRL conversions- at least for the first year round. If you consider an outsourcing option, its best to set aside 1-2 weeks time to review your iXBRL tagging once you have it ready from your provider. If you wish to take the process in-house, it is even more important that you get started early and learn XBRL, which might need at least about a week of training and close to 1-2 months time for XBRL preparation, review etc. Budget at least 20% time for review and approval of all stake holders.
How can IRIS CARBON® help you?
IRIS CARBON® is a global leader in compliance reporting. The platform comes with a robust set of intuitive features designed to seamlessly file in compliance with the ESEF Mandate. IRIS CARBON® participated and completed the ESMA field tests and is ready for European markets.
Send us an email at firstname.lastname@example.org if you need any assistance with getting started with the ESEF iXBRL mandate requirements.