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The importance of versioning for the European COREP/FINREP taxonomy projects”

December 5, 2007

Vancouver, British Columbia, Canada


Background
Background

While national supervisory authorities are free to decide on the technical transmission specifications to implement the reporting framework, CEBS considers that XBRL can be a helpful tool in constructing a harmonised European reporting mechanism.

CEBS will therefore develop an XBRL platform and make it available free of charge to national authorities and supervised institutions. XBRL taxonomies will be developed for both the COREP (COmmon REPorting -Basel II-) and FINREP (FINancial REPorting -IFRS-) frameworks.”

Point 4, Cover Note to the Framework for Common Reporting of the New Solvency Ratio


Flexibility principle

CEBS

Report 27

----------------------------------------------------------------------------------------------------------------------------------------------------------------

Flexibility Principle

Basel II, IAS/IFRS …

Global best practices

European Law

9X,XX% best practices + EU requirements

EC 2006/48 & 49 …

Transposition into

national Legislation

Country 1

Country 2

Country 3

Country 27

National Regulation

Sup. 1

NCB 2

FSA 3

Sup. 27

National Implementation

Report 1

------------------------------------

Report 2

Report 3

----------------------------------------------------------------------------------------------------------------------------------------------------------------

XBRL challenge!


Cebs xbrl eu implementation model

Bank Management

IS Supervisory

Operations

Counterparties

Collateral

Reports

Other data

CEBS XBRL EU: implementation model

Didactic model for explanatory purposes only

Basel II

IFRS

Basel II

IFRS

XBRL National implementation

XBRL (National)

XBRL (Europe)

Bank

Supervisor

Internet

Bank operations, controls….

Presentation, Analysis…

Errors

Errors

Basel II

IFRS

Basel II

IFRS

to XBRL

from XBRL

Report

------------------------------

Report

------------------------------

XBRL Europe

File Transfer (National)


European adoption

XBRL (optional or compulsory)

  • Belgium

  • Cyprus

  • Denmark

  • France

  • Finland

  • Germany

  • Italy

  • Lithuania

  • Luxemburg

  • Netherlands

  • Norway,

  • Poland

  • Spain

    Definitely Other Format

    Austria, Czech, Denmark, Eesti, Latvia, Portugal, Slovak, Sweden, UK

    Interested in XBRL

    Hungary, Estonia, Greece, Lithuania, Bulgaria, Italy

    No information

  • Source: www.c-ebs.org

  • European adoption



    Project management
    Project Management

    Weekly Conf. Call

    Yahoogroups 300+

    Core Team:

    Supervisors

    DE, ES, IT, BE, GR +

    Non Supervisors

    Workshops:

    8 editions *

    70+ attendees

    Website, News &

    Communication



    Cebs xbrl resources
    CEBS XBRL Resources

    • Ownership & Intellectual Property: CEBS Secretariat Ltd, UK

    • Allocated Budget: 0 €/Year.

    • Team: Supervisors (Core IT) part time + external support + Basel II & IFRS Supervision experts

    • Initial advice of Walter Hamscher and Carlie Hoffman

    • Workshop logistics provided by hosting National Supervisor


    Cebs xbrl reporting line
    CEBS XBRL Reporting Line

    Committee of European Banking Supervisors

    Expert Group on Financial Information

    SubGroup on Reporting

    COREP Network

    FINREP Network

    XBRL Network

    Supervisors: Katrin Schmehl, Panagiotis Voulgaris, Mark Creemers, Victor Morilla, Michele Romanelli, Jacobo Varela, Ignacio Boixo +….

    Collaborators: Colm O hAonghusa, Javi Mora +….


    Cebs contribution to xbrl community
    CEBS Contribution to XBRL community

    • Dimensions: required for COREP

      • Proposed by Charles Hoffman

      • Main developers: Ignacio Hernández-Ros + Walter Hamscher

      • Test cases, proof of concept tools and three (3) rewriting cycles of COREP taxonomy, by the CEBS team.

    • Versioning: Mainly CEBS team plus contract with consultant.

    • Formulas: Deep involvement of CEBS team, contract in course.

    • Close relationship with IFRS XBRL Team 


    Xbrl europe contribution to cebs
    XBRL Europe Contribution to CEBS

    • Best XBRL practices both at European and National level when implementing COREP & FINREP

    • XBRL Taxonomies acknowledgment

    • Support on required XBRL Standards

  • Advocacy at CEBS level: CESR, CEIOPS, ECB, EFRAG…

  • Background: Kick off meeting for XBRL Europe preparation at IASCF premises in London on 18 September 2007


  • Modular design of the cebs taxonomies

    .

    .

    .

    .

    dimension

    dimension

    .XSD

    .XSD

    template

    templa

    templa

    template

    template

    template

    .XSD

    .XSD

    .XSD

    .XSD

    .XSD

    .XSD

    primary

    primary

    .XSD

    .XSD

    Modular design of the CEBS taxonomies

    MS Excel

    XBRL

    mapped into

    c o n s i s t s o f


    Extension structure of the corep taxonomies
    Extension structure of the COREP Taxonomies

    i m p o r t s

    i m p o r t s

    i m p o r t s

    COREP Taxonomy

    i

    .

    .

    .

    .

    m

    Version 1.2

    dimension

    dimension

    p

    .XSD

    .XSD

    o

    template

    template

    r

    i

    .XSD

    .XSD

    m

    t

    common

    p

    s

    .

    primary

    o

    primary

    primary

    .XSD

    r

    .XSD

    .XSD

    t

    s


    Extension structure of the finrep taxonomies

    common

    .

    primary

    .XSD

    Extension structure of the FINREP Taxonomies

    i m p o r t s

    i m p o r t s

    FINREP Taxonomy

    .

    .

    Version 1.2

    .

    .

    i

    dimension

    m

    dimension

    .XSD

    IFRSdated 2006-08-15

    .XSD

    p

    o

    template

    i

    template

    r

    m

    .XSD

    taxonomy.XSD

    .XSD

    p

    t

    o

    s

    r

    t

    s


    Period of changes

    IFRSTaxonomy

    CEBSTaxonomies

    taxonomy.XSD

    common

    .

    primary

    .XSD

    .

    .

    .

    .

    i

    dimension

    dimension

    m

    .XSD

    .XSD

    p

    o

    template

    template

    r

    .XSD

    .XSD

    t

    s

    Period of changes

    flexible

    two years period

    yearly


    Current obstacles of cebs taxonomy users
    Current obstacles of CEBS taxonomy users

    • The CEBS mission is to provide a common reporting frameworks for solvency ratio and financial statements in Europe but:

      • The definition of the reporting standards is in the responsibility of the national legislator.

      • The level of harmonisation depends on their willingness to harmonise.

      • The process of harmonisation will last for some time.

    • XBRL is useful format to incorporate the different requirements among the European supervisors but:

      • XBRL alone is not able to achieve the aim of harmonisation.

      • XBRL taxonomies can be as good as their underlying framework.

        XBRL could support the European financial institutions by providing a standardised way to handle changes and differences between taxonomies.


    Cebs versioning requirements
    CEBS versioning requirements

    • Documentation of the changes / differences between two taxonomies

      • two versions of the COREP or FINREP taxonomies

      • two extension taxonomies based on CEBS taxonomies

    • Addition of documentation concerning changes  change category

    • Supporting a human readable versioning report

    • Capturing versioning information during and after the development process of a XBRL taxonomy

    • Providing a standardised syntax to be processed by XBRL software

    • Support for mapping processes to adopt changes automatically

    • Flexibility and extensibility of the versioning report to

      • provide data from a specific point of view

      • add supplementary information and structures


    Requirements on xbrl software
    Requirements on XBRL software

    Diffingcontainer

    Visualise informationAnalyse differences

    Diffingcontainer

    Diffingcontainer

    interface

    Add comments,i.e. Spanish vs. German COREP extension taxonomy

    Global support for supply chains and change managers

    Diffingcontainer

    Diffingcontainer

    Versioningcontainer


    Detect changes differences
    Detect changes / differences

    • XVS defines all information to be compared between two taxonomy versions.

    • XVS defines equivalences between concepts, relationships and resources

    Diffingcontainer

    • VWG recommends the use of the XBRL Infoset (a description of the content of a DTS without any references to the XBRL syntax.

    • XBRL Infoset object model could be integrated in XBRL software that support XBRL versioning.

    • XBRL Infoset is pending to be approved as Public Working Draft

    • The differences are being defined as “events”.


    Analyse and comment changes differences
    Analyse and comment changes / differences

    Visualise informationAnalyse differences

    • On basis of the events identified by the XBRL software supporting XBRL versioning comments and documentation should be able to be added.

    • Errors as well as business changes should be reflected therefore the changes need a categorisation.

    • Especially when changes influence the creation of the instance document, a documentation is necessary.

    • Changes that aren’t relevant should be able to be removed.

    • The versioning result should also support multi-lingual documentation.


    Versioning report

    Assignment

    Assignment

    Action

    Action

    Versioningcontainer

    Versioning report

    Versioning Report

    Mapping rules

    Assignment

    Action

    Event

    Event

    Event


    Object model of the versioning report
    Object model of the versioning report

    From DTS

    To DTS

    Concept or Resource (A)

    Concept or Resource (B)

    Corresponds to

    Assignment

    Documentation

    Action

    Categories

    Documentation

    Differences

    Event

    Version

    • all defined object are optional, so the versioning report can be reduced to contain only the necessary or project relevant changes

    • i.e. IFRS changes with no impact on the FINREP taxonomy will not be part of the versioning report


    Provisional implementation
    Provisional implementation

    • the syntax of the versioning report is defined in an XBRL taxonomy

      • versioning report is an instance document

    • tuples are used to define the structure

    • advantages:

      • extensibility

      • well-know syntax

      • the two compared taxonomy versions aren’t directly linked

    • disadvantages:

      • real intension of an instance document is a business report

      • context has no real usage


    Criteria for a preferred solution
    Criteria for a preferred solution

    • in excess of 8,000 users across Europe have to facilitate the mapping and remapping that will arise by using any new taxonomy version / change.

    • the preferred solution is to be based in technology already familiar for users.

    • adding extra information might be useful for:

      • Change management on mapping by financial institutions.

      • Software vendors providing change management tools.

      • Project teams including value added information on changes.

    • Easy extensibility while protecting common core is a must

      XBRL instance technology as a suitable option.


    Versioning on dimensions
    Versioning on dimensions

    • General requirement: No syntactical changes should be reported!

    • In terms of dimension:

      • No report of changes that don’t influence the Cartesian product of the hypercubes

      • No versioning information when the dimensional representation of a concept changed

    not all

    not all

    all

    not all


    Versioning on dimensions1
    Versioning on dimensions

    • General requirement: No syntactical changes should be reported!

    • In terms of dimension:

      • No report of changes that don’t influence the Cartesian product of the hypercubes

      • No versioning information when the dimensional representation of a concept changed

    all

    all

    all


    Versioning on dimensions2

    To DTS

    FROM DTS

    SalesCanada

    Sales

    i

    i

    Canada

    i

    SalesSpain

    i

    A

    Spain

    i

    SalesGermany

    i

    A

    Germany

    i

    A

    Versioning on dimensions

    • General requirement: No syntactical changes should be reported!

    • In terms of dimension:

      • No report of changes that don’t influence the Cartesian product of the hypercubes

      • No versioning information when the dimensional representation of a concept changed


    Conclusions
    Conclusions

    • CEBS needs to have a workable solution on versioning to increase the acceptance of the COREP and FINRE taxonomies in Europe.

    • The current XBRL Versioning Specification

      • is based on XBRL 2.1.

      • covers a great amount of the requirements .

      • provides an extensible as well as reducible versioning report.

    • A subgroup inside the VWG deals with the development of the XBRL Versioning Specification on Dimensions.

    • COREP XBRL Network mission: provide versioning files for

      • (1) each COREP/FINREP version/release,

      • (2) each new IFRS version as used in FINREP,

      • (3) each national extension (if possible).


    www.c-ebs.org

    www.corep.info

    www.finrep.info

    Ignacio Boixo

    [email protected] / [email protected]

    +34 618 52 64 34

    Katrin Schmehl

    [email protected]

    +49 69 9566 6584

    The XBRL Network of the


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