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Indian Banking Taxonomies and Its Complexities. IBA – RBI Workshop 30 th October, 2009. The XBRL Journey Has Begun – Where are you?. Consider this. Are you an XBRL User? Why should I get down to the plumbing ? Do you want to get into XBRL Internals ? How does this help me?.

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indian banking taxonomies and its complexities

Indian Banking Taxonomies and Its Complexities

IBA – RBI Workshop

30th October, 2009

consider this
Consider this..
  • Are you an XBRL User?
    • Why should I get down to the plumbing ?
  • Do you want to get into XBRL Internals ?
    • How does this help me?
in this session
In This Session
  • XBRL Taxonomies – A quick look at the concepts
  • The Taxonomy building process
  • XBRL Taxonomies with the RBI
  • Harmonization with the Indian GAAP taxonomy
  • Way Forward
xbrl taxonomies
XBRL Taxonomies

A system understandable description and classification of business and financial terms

  • It is commonly referred to as dictionary of business and financial terms
  • Contains the universe of accounting and other related concepts
  • Contains the XBRL properties of the elements
xbrl a quick recap
XBRL – A Quick Recap

XBRL is an XML based standard

and xml
And XML …
  • XML is a key Internet standard for transmission and interoperability
  • Electronic transmission is newer than electronic storage
  • With the growth of the Internet, transmission of data is exploding
  • No Interoperability problems earlier – lots of interoperability problems now
  • XML uses "tags" to define data and is self-descriptive
  • XML has been developed by w3 consortium
slide10
XBRL combines hierarchical xml data with relationships and references between the data points.

It uses Xlink technology of linking xml files

It links the data xml files with various other files containing definitions, presentation, calculation, references relationships

XBRL data files are a set of xml and xsd files.

Extending XML - XBRL

key taxonomy concepts
Key Taxonomy Concepts

Taxonomy Built from Schema and linkbases

Schema

  • Contains the element declarations
  • XBRL properties (Data type, Balance type etc.)

Linkbases

  • Interrelationships between elements
  • References to regulatory material
  • Human readable definitions of elements
  • Five types of linkbases
xbrl taxonomy instance architecture
XBRL Taxonomy & Instance Architecture

XBRL Data

XBRL Data Definition

XBRL Data Relationships

xbrl taxonomy instance architecture contd
XBRL Taxonomy & Instance Architecture Contd.
  • Let’s take following data as sample:
  • Bajaj Auto Limited, March 31 2009 Report
  • Statement of Income
xbrl taxonomy instance architecture contd14
XBRL Taxonomy & Instance Architecture Contd.

Calculation linkbase:

IncomeTotal

NetSales +1

Sales +1

Excise -1

OtherIncome +1

Presentation linkbase:

IncomeHeading

Sales 10

Excise 20

OtherIncome 30

NetSales 40

IncomeTotal 50

Definition linkbase:

Income by Product

Product A

Product B

Income by Region

Asia

Africa

Europe

Latin America

Reference linkbase:

IncomeTotal IAS 9

SalesIAS9

Excise IAS 2,10

Formula:

Expense Ratio = Sales / Expenses

Label linkbase:

IncomeTotal Total Income

IncomeTotal आय (Hin)

IncomeTotal Inc.

Relationship Layer

Schema:

Element Name: Income

Abstract = false

Type: monetaryItemype

Balance: Debit

XBRL Data:IncomeTotal 12234.0

Sales 22345.0

Less: Excise

Duty 1000.0

Net Sales 3349.0

Other Income 1000.8

XBRL Data:IncomeTotal 89322.6

Sales 90496.9

Less: Excise

Duty 6127.2

Net Sales 84369.4

Other Income 4953.2

Data Instance: Company A

Data Instance: Company B

Definition

dimensions in xbrl
Dimensions in XBRL
  • The XBRL 2.1 base specification enables storing defined set of dimensions for a data element:

All of these dimensions together uniquely identify the data point 20000

dimensions in xbrl17
Dimensions in XBRL
  • The dimensions specifications released in 2008 enable storing additional dimensions.
  • In the previous example:Revenue has two dimensions, By Product & By Region.
  • Other Examples:
    • Investments by Type, by Periodicity.
    • Advances in India, outside India
    • Credit Risk On Balance Sheet, Off Balance Sheet
terminology in dimensions
Terminology in Dimensions
  • Primary Item
  • Hypercube
  • Dimension
  • Domain and Domain Member
  • Explicit and Implicit Dimensions
  • Aggregator-Contributor
  • All / Not All composers
few xbrl taxonomies around the world
Few XBRL Taxonomies around the world..
  • US-GAAP 2009
    • Financial Reporting to US SEC
  • IFRS 2009
    • Represents IFRS 2009
  • FinRep & Corep
    • Financial Reporting & BASEL II based Reporting in CEBS*
    • XBRL GL

Indian Taxonomies

  • Indian GAAP
    • Based on IFRS 2006 Architecture
    • Caters to Indian Accounting Standards
    • Taxonomy owned by ICAI
  • RBI – BASEL II
    • Based on Corep, though have a different architecture
    • Used by banks to file their RCA (Returns on Capital Adequacy)
    • Taxonomy owned by RBI
taxonomies designed for rbi
Taxonomies designed for RBI..
  • RCA 2 Taxonomy for BASEL II Returns
  • Form A taxonomy for Section 42 returns
  • Taxonomy for GPB returns
  • Taxonomy for Financial Reporting

* Based on the underlying principle – common elements to be defined only once

steps in taxonomy building
Steps in taxonomy building
  • Identifying the elements
  • Determining the interrelationship amongst the elements
  • Defining the XBRL properties of elements
  • Modeling the elements and their interrelationship in the taxonomy
  • Validating the taxonomy
rca2 taxonomy
RCA2 taxonomy
  • Taxonomy tailored to Basel II Reporting Requirements
  • XBRL 2.1 and Dimensional Specification Compliant
  • Taxonomy Architecture along COREP lines
  • Multi dimensional in nature
rca2 taxonomy25
RCA2 taxonomy

Statistics

Taxonomy files

icai taxonomy structure
ICAI Taxonomy Structure
  • Industry-based classification
    • Commercial and Industrial companies
    • Banking companies
    • Non-Banking Financial companies
  • Core Schema
    • Exhaustive list of all element declarations
    • Common elements defined once
  • Distinct extended links for each industry
icai c i taxonomy
ICAI : C&I Taxonomy
  • Statistics
  • Prefix : in-gaap
  • Status : Exposure draft
icai bank taxonomy
ICAI : Bank Taxonomy

Element identification

  • Analysis of regulatory literature.
    • Banking regulation Act
    • Annual Reports of 25 banks (documenting common practice)
    • SEBI Listing agreement
    • Accounting standards*
    • Companies Act*

*These have been referred while defining C&I taxonomy.

  • Identifying the common elements, already defined in C&I taxonomy #

# Additional task required for designing subsequent taxonomies

icai bank taxonomy30
ICAI : Bank Taxonomy
  • Taxonomy Structure
    • Based on IFRS 2006 structure
    • Banking specific tags have been defined additionally in the core schema
    • Separate extended links for the bank reporting appended to existing taxonomy
    • Basic structure of financial statements and their details, both included in the same extended link (unlike C&I)
    • No dimensions have been defined, instead extended links have been used
    • Primary references – BR Act and RBI circulars
icai banks taxonomy
ICAI : Banks Taxonomy
  • Statistics
  • Prefix : in-gaap

*Excluding dimensions

taxonomy structure
Taxonomy Structure

ICAI Core schema

RBI Reporting Requirements

(ICAI elements +

Common elements)

RCA 2

Banks

Form A

NBFC

Industry specific entry-points

GPB

C&I

overview corep finrep taxonomies
Overview :COREP –FINREP Taxonomies

COREP :

Common Reporting framework for the new solvency ratio for credit institutions

FINREP

Financial reporting framework for credit institutions

corep finrep taxonomies39
COREP –FINREP taxonomies

FINREP Structure

  • Imports elements from IFRS 2006 taxonomy
  • Defined additional elements for financial reporting
  • The relationships (or the linkbases) are newly defined
  • Usage of dimensions
  • Prefix of extended elements – p-FINREP
corep finrep taxonomies40
COREP –FINREP taxonomies

COREP structure

  • Designed for a multidimensional data
  • Concept of separate primary and dimensional taxonomies
  • Within primary taxonomies, further classification of common taxonomy and specific taxonomy
  • Prefixes :
    • d- :dimensional taxonomies,
    • p- : primary specific taxonomy
    • p-cm : primary common taxonomy