INSIGHTS: REGULATORY CHANGE AND THE ANNUAL REPORT
This year's Evolution of the Annual Report conference takes place in London on 13 September. CtrlPrint is leading the session on best practice in corporate reporting
The annual reporting landscape is constantly changing with updated regulatory requirements and new trends in terms of how to portray a company’s story and plans for the years ahead. Clearly, the recent proposal to introduce new regulations with regard to primary financial statements in an annual report has thrown some dust in the air and there has been a lot of information for everyone to absorb and understand.
Here at CtrlPrint things were no different and we went on a steep learning curve to ascertain what the likely implications were of the European Securities and Markets Authority’s (ESMA) requirement, the European Single Electronic Format (ESEF). As things transpired it is set to replace the world of annual financial reports in Europe as we know it from 2020 onwards. Unstructured annual reports in PDF only and those solely as printed reports will no longer be compliant – and Inline Extended Business Reporting Language (iXBRL) makes it possible to structure the annual reports and make them machine-readable and comparable.
As a business, we had to first outline a framework and explore solutions that would make sense for the corporate client as well as preserving the designed report element that all our partner communication and design agencies rely on as the mainstay of their business.
Second, it was imperative that the ideal solution should involve as little disruption to the workflow processes of either the corporate or the agency as possible and that the solution should sit within the safe accredited working environment that CtrlPrint users already experience.
Third, the process should be as simple as possible to allow easy integration and application by all involved, and that it would be scalable and flexible to accommodate future expansion or amendments to the regulations.
And finally, the ultimate aim on the wish list, was that the solution should allow the production of a regulation-compliant document that was consistent with the designed annual reports that all the stakeholders and agencies work so hard on – hopefully heading off at the pass any potential move by clients towards US-style annual reporting.
We at CtrlPrint are delighted with our solution and believe it is set to become the new benchmark for documents subject to ESEF/iXBRL requirements, with a designed output. In fact in an Extended HTML (xHTML) output no less, meaning that there is virtually no significant impact on either the corporate client or the agency on what needs to be produced! Not only have the conditions above been met but additional benefits have been realised too, including the ability to instigate the initial tagging early on in the production phase, extensions and anchoring of the taxonomies for individual companies and industries, a robust validation process to flag incorrect application of taxonomies, and a simple output for review and approval.
The iXBRL Tagger allows you to assign end-of-year figures without any specific IT expertise automatically, quickly and easily, to the relevant ESEF items in your taxonomy. The tags are stored as external mapping and therefore can then be used for all subsequent reports.
A key variable here is what the final decision will be from the Financial Conduct Authority in terms of audit ownership of iXBRL-tagging, and there is much speculation in this area. One thing is certain however, keeping your iXBRL-tagging close to your existing internal company ownership can only make auditing easier, more efficient and transparent.
CtrlPrint’s iXBRL Tagger launches in Autumn 2019 and will be available for clients to dry run on this year’s annual reports ahead of the required 2020 date.
Richard Fosbury is head of client services at CtrlPrint
