Netherlands offers a model for ESEF audit

Posted on June 11, 2021 by Editor

How can we facilitate effective and efficient assurance of European Single Electronic Format (ESEF) filings, and make it possible for auditors to do their jobs without needing to understand the technical aspects of Inline XBRL? Jacques Urlus, policy advisor IT & Audit at the Royal Netherlands Institute of Chartered Accountants (NBA) and Vice Chair of XBRL NL, explains his model for doing just that, in the latest in a series of guest posts over in the Taggings section of the XBRL International website exploring ideas from April’s Data Amplified Virtual.

Companies across Europe have started to submit ESEF filings, making audit to ensure data quality a crucial challenge. “One of the goals for audit of a digital reporting format like ESEF is to ensure that a human reader reaches the same decisions and understands the data the same way as a computer analysing the tagged data,” says Urlus. “This means that the machine-readable aspect of the report needs to be checked by the auditor, and compared with the human-readable content.”

The Dutch digital audit approach allows the technical aspects of filings to be audited by software, thanks to the NBA’s analysis of ESEF rules for software companies. Their method also renders the tagged digital content of an ESEF filing into a consistent, readable view, which can be compared to the original human-readable report, allowing auditors to spot discrepancies.

This is an extremely useful model for the assurance of ESEF filings and other Inline XBRL reporting, and we urge audit organisations and software vendors in other countries to learn more and assess its utility in their own environments.

Please do read the post here, or watch the video of his Data Amplified session here.

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