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XBRL in India

XBRL India is the Indian Jurisdiction of XBRL International. Its main objective is to promote and encourage the adoption of XBRL in India as the standard for electronic business reporting in India. Members of XBRL India among others include regulators such as Reserve Bank of India (RBI), Insurance Regulatory and Development Authority (IRDA), Securities and Exchange Board of India (SEBI), Ministry of Corporate Affairs (MCA), stock exchanges like Bombay Stock Exchange Limited (BSE) and National Stock Exchange of India Limited (NSE), and some private sector companies.

Some Regulatory Initiatives

  • RBI’s initiatives

The Reserve Bank of India has already launched the Basel II reporting system using eXtensible Business Reporting Language (XBRL) through the existing Online Returns Filing System. With a view to providing direction for implementation of XBRL, RBI had set up a high level Steering Committee to develop and test the XBRL based reporting format.

  • SEBI initiatives

Some of the significant developments which have since taken place in Indian securities market with the encouragement of SEBI include setting up of a XBRL enabled platform for corporate reporting (www.corpfiling.co.in) by BSE and NSE. Both these have migrated to XBRL from the paper based model and offer a unified electronic platform, popularly known as ‘CorpFiling’ system, which enables the companies listed in either or both of the exchanges to electronically file their disclosures.

  • An example of XBRL application in Industry

Infosys Technologies Limited

Infosys Technologies Limited voluntarily furnished eXtensible Buisness Reporting Language (XBRL) data to the United States Securities and Exchange Commission electronically in a 6-k exhibit (A monthly report of foreign private issuer with SEC) way back on May 2005. It was also participating in SEC’s voluntary program for Reporting Financial Information on EDGAR using XBRL.

XBRL as Reporting Language for MCA 21 Portal & Our offerings for xbrl

The Ministry of Corporate Affairs has resolved to introduce extensible business reporting language (XBRL) for its MCA 21 portal, which is the database for 9 lakh companies in India. This means that the companies will also have to file their documents in the XBRL format w.e.f April 01, 2011. At present, XBRL is being followed in many countries including the US, where after a period of voluntary compliance with XBRL, they are now moving towards mandatory XBRL filings for the domestic companies.

The XBRL is an electronic format for communication of business and financial data that allows the users of financial information to electronically retrieve data with greater assurance of accuracy. According to experts, while XBRL would involve some initial conversion costs for companies, the long-term benefits for investors and the capital markets would be significant.

According to Jamil Khatri, head of accounting advisory services, KPMG, “XBRL filings would ensure that financial data is filed in a standard format and is retrievable electronically. This would also facilitate detailed analysis of the underlying data using standard data analysis tools. This would only involve initial conversion cost but keeping in mind the long term benefits, it is a good move.”

With the use of XBRL, the software can also immediately confirm the financial data, highlighting errors and gaps which can immediately be addressed. It also helps the user in selecting and processing the data for re-use. At present, MCA 21 is only able to provide the information of one company at a time and the data filed in the scanned PDF format cannot be collated. In case of XBRL language, the user would be able to obtain information of a number of companies that can be collated, analyzed and retrieved at the same time. This will be of a great help to the stakeholders as it would become easier for them to gather information about many companies.

The usage of XBRL in MCA 21 would make filing of documents much easier for companies, and at the same time the stakeholders would be able to receive the financial data in a customized manner. They would also come to know the profitability of a particular industry segment.

XBRL would be beneficial for those who collect business data including governments, regulators, economic agencies, stock exchanges, financial information companies and the like and those who produce or use it, including accountants, auditors, company managers, financial analysts, investors and creditors.

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