{"id":39208,"date":"2022-01-06T11:28:46","date_gmt":"2022-01-06T05:58:46","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=39208"},"modified":"2022-01-06T11:31:35","modified_gmt":"2022-01-06T06:01:35","slug":"xbrl-applicability","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/xbrl-applicability\/","title":{"rendered":"XBRL Applicability: Here&#8217;s What You Need to Know"},"content":{"rendered":"\n<p class=\"has-drop-cap\">XBRL refers to the data-rich language of XML, the standard dialect for transmitting data via the internet. It was developed to share information between companies and other users of finance-related information such as investors, analysts, and regulators. XBRL facilitates a common, digital format for business reporting. It does not alter or modify what is being reported. It only deals with the presentation aspect of the reports. <\/p>\n\n\n\n<p>XBRL is a standard dialect developed by\nXBRL International Inc. (XII), a non-profit making consortium backed by\nhundreds of members, including government institutions, accounting agencies,\nsoftware firms, small and large companies, academics, and business reporting\nexperts. XBRL International Inc has agreed on the fundamental specifications\nthat define how XBRL functions. <\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/xbrl-applicability\/#What_is_the_role_of_XBRL_tags\" >What is the role of XBRL tags?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/xbrl-applicability\/#A_Brief_Overview\" >A Brief Overview<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/xbrl-applicability\/#How_does_XBRL_function_in_general\" >How does XBRL function in general?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/xbrl-applicability\/#XBRL_Applicability_under_Companies_Act_2013\" >XBRL Applicability under Companies Act, 2013<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/corpbiz.io\/learning\/xbrl-applicability\/#Underlying_Benefits\" >Underlying Benefits<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/corpbiz.io\/learning\/xbrl-applicability\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_the_role_of_XBRL_tags\"><\/span>What is the role of XBRL tags?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In XBRL, information is not considered as\na static block of text or group of no. Instead, the information is bifurcated\ninto unique items of data (eg total liabilities = 200). Further, these items of\ndata are then assigned mark-up tags that are readable to the computers.<\/p>\n\n\n\n<p>For instance, the tag\n&lt;Liabilities&gt;200&lt;\/Liabilities&gt; enables the system to fetch that the\nitem is liabilities, and it has a value of 200. Systems can compile information\nthat has been tagged leveraging XBRL &#8216;intelligently&#8217;; they can identify,\nprocess, store, &amp; analyze it via software.<\/p>\n\n\n\n<p>Because XBRL tags are created in a\nglobally-accepted way, they can be easily fetched and complied by any system\nvia XBRL software. Such tags are defined &amp; organized via categorization\nschemes known as taxonomies<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"A_Brief_Overview\"><\/span>A Brief Overview<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Most nations leverage different\naccounting standards that reflect differing reporting definitions. The XBRL\nlanguage takes advantage of different dictionaries, called &#8216;taxonomies&#8217;, to\nsets out the specific tags used for each standard. Each dictionary may define\ndifferent objectives and types of reporting.<\/p>\n\n\n\n<p>Taxonomies refer to system-readable\n&#8216;dictionaries&#8217; of XBRL. Taxonomies render definitions for XBRL tags, they\nfacilitate detail about the tags and they organize the same so that they have a\nlogical structure.<\/p>\n\n\n\n<p>Consequently, taxonomies enable systems\nwith XBRL software to fetch:<\/p>\n\n\n\n<ul><li>what\nis tag is (ex: whether it is text, %, or a monetary item)<\/li><li>what\nthe tag has (ex: if it adheres to a negative value);<\/li><li>its\nrelationship to other items (ex: if it is part of a calculation).<\/li><\/ul>\n\n\n\n<p>Technically, such information is regarded\nas meta-data. When the XBRL-tagged information is transmitted, the meta-data\nassigned within the tags is also transmitted. Taxonomies vary as per reporting\nobjectives, the type of information being reported &amp; reporting presentation\nrequisites.<\/p>\n\n\n\n<p>As a result, an organization may utilize\none taxonomy while reporting to the stock exchange, but utilize a different\ntaxonomy while reporting to a specific regulator. Taxonomies are accessible to\nmost of the national accounting standards globally.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_does_XBRL_function_in_general\"><\/span>How does XBRL function in general?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>XBRL is a dialect of Extensive Markup\nlanguage, aka XML, which is standard for the digital sharing of information\nbetween entities and on the internet. Under XML, identifying tags are applied\nto items of data so that they can be processed efficiently by computer\nsoftware.<\/p>\n\n\n\n<p>It is an advanced version of XML which has been defined to cater to the requirements of financial and business information. It enables distinctive tags to be applied to items of financial information, such as &#8216;net profit&#8217;.<\/p>\n\n\n\n<p>Apart from being simple identifiers, they\nserve other purposes as well. They facilitate a range of information relating\nto the item, such as whether it fraction, %, or monetary item. It allows labels\nin any language to be assigned to items and accounting references or subsidiary\ninformation.<\/p>\n\n\n\n<p>XBRL can manifest how items are connected. It can therefore manifest how they are computed. Moreover, It is easily extensible, so entities &amp; other firms can adapt it to fulfill a variety of special requirements.<\/p>\n\n\n\n<p>It ensures seamless and efficient\nhandling of business data via system software. It bolsters all the standard\nactivities involved in fetching, storing, and compiling business data. This\ninformation can be transformed into XBRL via apt mapping processes or generated\nin XBRL via software. It can then be easily, searched, selected, shared or\nanalyzed by the system, or published for ordinary viewing.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"XBRL_Applicability_under_Companies_Act_2013\"><\/span>XBRL Applicability under Companies Act, 2013<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>It is a well-known fact that the provisions of the <strong>Companies Act, 2013<\/strong><sup><a href=\"https:\/\/www.mca.gov.in\/Ministry\/pdf\/CompaniesAct2013.pdf\"><strong>[1]<\/strong><\/a><\/sup> and rules underpinned thereunder, mandate entities to file compulsory documents, including financial statements and yearly returns, with the respective RoC of their jurisdiction.<\/p>\n\n\n\n<p>The said Act mandates company to file its\nannual returns and annual accounts within 60 and 30 days respectively from the\nconclusion of the AGM i.e. Annual General Meeting. Filing of annual accounts is\nregulated u\/s 137 of the Act, 2013 read with Rule 12 of the Company (Accounts)\nRules, 2014 &amp; yearly return is regulated u\/s 92 of the Act, 2013 read with\nRule 11 of the Companies (Management &amp; Administration) Rules, 2014.<\/p>\n\n\n\n<p>According to Section 137 of the Companies\nAct, 2013, incorporated entities are mandated to file their audited financial\nstatement via form AOC-4 within thirty days of AGM. There are different types\nof forms prescribed for different companies&#8217; classes. Besides, the given\nclasses of companies are obligated to disclose their financial reports in extensible\nbusiness reporting language (XBRL).<\/p>\n\n\n\n<table class=\"table table-bordered\">\n<tr>\n<td width=\"66\">\n<p><strong>Sr. No<\/strong><\/p>\n<\/td>\n<td width=\"335\">\n<p><strong>Company Types<\/strong><\/p>\n<\/td>\n<td width=\"138\">\n<p><strong>Applicable taxonomy<\/strong><\/p>\n<\/td>\n<\/tr>\n<tr>\n<td width=\"66\">\n<p>1.<\/p>\n<\/td>\n<td width=\"335\">\n<p>Companies on stock exchanges in India &amp; their Indian subsidiaries<\/p>\n<\/td>\n<td width=\"138\">\n<p>IndAS<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td width=\"66\">\n<p>2<\/p>\n<\/td>\n<td width=\"335\">\n<p>Companies with paid-up capital of Rs 5 crores or above<\/p>\n<\/td>\n<td width=\"138\">\n<p>C&amp;I<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td width=\"66\">\n<p>3<\/p>\n<\/td>\n<td width=\"335\">\n<p>Companies with yearly turnover of Rs 100 crores or above<\/p>\n<\/td>\n<td width=\"138\">\n<p>C&amp;I<\/p>\n<\/td>\n<\/tr>\n<tr>\n<td width=\"66\">\n<p>4<\/p>\n<\/td>\n<td width=\"335\">\n<p>All companies which are obligated to prepare their financial statements as per Companies (Indian Accounting Standards) Rules, 2015<\/p>\n<\/td>\n<td>\n<p>IndAS<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n<p><strong><em>However, given entities are not required\nto file financial statements in XBRL:<\/em><\/strong><\/p>\n\n\n\n<ul><li>Non-banking\nfinancial companies (NBFCs)<\/li><li>Housing\nfinance companies (HFCs)<\/li><li>Banking\nCompanies<\/li><li>Insurance-based\nCompanies<\/li><\/ul>\n\n\n\n<p>Note that OPCs are mandated to file\nfinancial statements within 180 days from the completion of the FY.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Underlying_Benefits\"><\/span>Underlying Benefits<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul><li>XBRL\nfacilitates potential benefits at all phases of business reporting as well as\nanalysis. The benefits are noticeable in cost-saving, automation, accurate data\nhandling, improved analysis, and better quality of information. <\/li><li>All\ntypes of companies can leverage XBRL to ensure cost-saving and improve efficacy\nin handling business &amp; financial data.<\/li><li>Because\nXBRL is extensible, it can be applied to a wide range of different requisites.<\/li><li>XBRL\nenables producers and users of financial information to mobilize resources away\nfrom tedious and manual processes, generally involving time-consuming\ncomparison, collection, and re-entry of data. They can lay more emphasis on\nanalysis, aided by software that can verify and compile XBRL information.<\/li><li>By\nusing XBRL, different organizations and other generators of financial\ninformation and business reporting can automate the processes of data\ncollection.<\/li><li>Government\nagencies and regulators can assemble, verify and examine data much more\nseamlessly and accurately when compared to previous working frameworks.<\/li><li>XBRL\nsoftware is spot on when it comes to prompt validation of data, error\nidentification, and mitigation.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Technically, XBRL refers to a structured way of digital reporting which enables information&#8217;s tagging into a machine-readable format. As this has countless benefits for entities and regulators&#8217; reporting processes, XBRL is becoming the standalone standard for electronic reporting globally.<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/circulation-of-member-resolution\/\">Circulation of member resolution: Everything you need to know<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>XBRL refers to the data-rich language of XML, the standard dialect for transmitting data via the internet. It was developed to share information between companies and other users of finance-related information such as investors, analysts, and regulators. XBRL facilitates a common, digital format for business reporting. It does not alter or modify what is being [&hellip;]<\/p>\n","protected":false},"author":22,"featured_media":39209,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[415],"tags":[2069],"acf":{"service_id":"27"},"authorName":"Pankaj Tyagi","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2022\/01\/MicrosoftTeams-image-42.jpg","authorDescription":"Pankaj has a diverse experience of writing research papers, blog, and articles during his college time. Earlier, he was working as a tax consultant in a financial firm, but his interest in writing drives him to pursue a career in the writing field.","postViews":3989,"readingTime":4,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/39208"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/22"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=39208"}],"version-history":[{"count":10,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/39208\/revisions"}],"predecessor-version":[{"id":39220,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/39208\/revisions\/39220"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/39209"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=39208"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=39208"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=39208"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}