Avoid ESEF pitfalls with our new series!
Accompanying the launch of filings.xbrl.org, we bring you a new blog series from Revathy Ramanan, XBRL International’s Guidance Manager, on ‘ESEF Errors and Common Pitfalls.’ She has analysed many of the filings we have gathered – and the validation errors and warnings they generate – to start to understand where and how problems are occurring.
There is an inevitable learning curve with any new filing arrangement, but errors in an electronic format like ESEF can prevent reports from opening properly in software products, as well as potentially introducing factual inaccuracies and causing users to misinterpret the data – so it is important to straighten them out early on. This series will examine some of the most common errors we have found, discuss their implications and describe how these pitfalls can be avoided. Many of the issues are technical in nature, and can be avoided easily by applying automated validation using conformant software. Others relate to the content of the XBRL data, and while software can often help to identify such issues they highlight the need for preparers to adopt review processes that ensure the accuracy of XBRL tags.
In an example of content-related errors, in her first post Revathy looks at ‘Incorrect Signs,’ where a value is tagged as negative rather than positive or vice versa, usually due to a discrepancy between accounting conventions and how facts are defined in XBRL. A sign error can, for example, turn expenses into income – which, while it would be a useful power to have, can clearly lead to major misunderstandings.