Free Printable Bank Account Ledger

Interactive data and the tax executive: why tax standards setters are paying attention to XBRL (and why you should, too!).

Introduction

What can lower the costs of finding and training tax staff, increase access to (and the reliability of) tax-related data globally, and improve communication between all members of the
tax planning

, compliance and audit supply chain? “Speaking and understanding a common digital language,” in the virtual sense, sounds like a lofty and perhaps peril-filled concept, but could help contribute to these goals and more.

Developing and encouraging the adoption of a common digital business reporting language–not only for tax information but also for the broader class of business reporting information–is the goal of a global, collaborative effort, and it is an effort that tax administrations around the world are joining. This article discusses that collaborative effort, describes the benefits to the tax executive, and encourages readers to help make these benefits a reality.

It has been five years since The Tax Executive last covered the progress of a worldwide collaborative effort to create a standardized digital format for exchanging accounting, tax, and other business reporting information. In light of the growth of that effort, recent worldwide adoption of its recommendations, and extreme interest and support of key regulators–led by U.S. Securities and Exchange Commission (SEC) Chair Christopher Cox and leaders from the FDIC/FFIEC–it is time again to look at that effort. Chairman Cox and the SEC (1) use the term “Interactive Data” to describe how standardized, machine-coded business reports can more easily be created, published, discovered, and consumed by business applications for analytics and other purposes. More precisely, the effort is known as
XBRL

 (2) (Extensible Business Reporting Language).

XBRL is more relevant to the tax executive than ever before. Tax departments are under increasing pressure to do more, with less help from their auditor, and in cooperation with other parties, both within the corporation and without.
Owing to

prep.
Because of; on account of:

 prep → ,  
 section 404 of the
Sarbanes-Oxley Act

 of 2002 and some high-profile documentation failures, tax processes and documentation have greater visibility. Tax executives have increased responsibilities as part of the financial reporting supply chain and the enhanced internal controls environment, and they face new requirements from financial regulators and tax administrations to provide information in a format that increases the efficiency and effectiveness of the administrator. These pressures–and the benefits we will discuss–call for tax executives to actively take part in small and big steps to assure that XBRL become a reality, to everyone’s benefit.

Relevance

XBRL is increasingly relevant to the tax executive, first because it is growing rapidly in many other areas of business reporting that will potentially effect tax planning, compliance, and audit; and second, because of recent interest by many of the world’s tax administrations. Finally, tax executives are under pressures to perform–pressures that XBRL can help relieve.

XBRL is growing in many different ways. Many software products are now available to work with XBRL. Many regulatory environments, such as banking involving US (FDIC/FFIEC) and European banking regulators (
CEBS
 
), are using or implementing XBRL.

Significantly, tax administrations are starting to allow or mandate XBRL. But some of the greatest reasons and pressures come from within the organization. The “Tax Information Supply Chain”–the information flows and parties involved in creating, publishing, analyzing, approving, assuring, consuming, and otherwise “touching” tax-related information–has become increasingly visible within both the corporate environment and the capital markets. This has been driven by factors like financial reporting requirements related to accounting for income taxes, Sarbanes-Oxley and transparency requirements, and disclosure.

Financial Reporting Requirements

Tax is, of course, intricately connected with the financial reporting supply chain. Taxes begin as one of the largest, if not the largest, group of expenses on the income statement. Accounting for Income Taxes, driven by FAS (Financial Accounting Standard) 109 for U.S.-based filers or
IAS

 (International Accounting Standard) 12 for many international filers, requires extensive tax department participation, focusing on foreign tax provisions, with the need to understand the U.S.
GAAP

See generally accepted accounting principles (GAAP).
 requirements for accounting for deferred taxes for foreign jurisdictions, the interaction of the U.S. or international reporting standards and foreign tax systems, and data flows leading to corporate taxes and provisions.

The Sarbanes-Oxley Act of 2002

That same chain of information provision and exchange is also associated with the most common material weaknesses revealed in the first round of Sarbanes-Oxley Section 404 filings. (3) Those familiar with the systems and resources available to the tax department are seldom surprised that Sarbanes-Oxley, with its focus on internal controls, pointed a spotlight on the less integrated and human-intensive processes (nominally integrated at best,
cut and pasted

 or manually reentered at worst) of the tax department, which are outside of the normal financial reporting processes. In addition, the deficiencies cited concentrated on staff shortages and competency.

Transparency Requirements and Disclosure

In addition, Commissioner Mark Everson of the U.S. Internal Revenue Service and SEC Chairman Cox have been talking about additional public disclosure of tax information, with the goal of making “side by side” comparisons of financial reporting and tax reporting information available. In light of Commissioner Cox’s campaign for interactive data and an increased focus on much faster (“real time”) disclosure, (4) tax departments may face additional pressure to report more information, more often, and more timely.

Where Will Help Come From?

All this happens at a time where there has already been a deluge of new and increased responsibilities. Although tax departments hope to be recognized as more than simply compliance shops, they are forced to concentrate on controls and risk management rather than on substantive tax issues; the mechanics of reporting and paying divert resources and focus from analysis and management of tax exposure.

* How can the tax executive better communicate with senior management on tax needs, and collaborate with financial reporting to develop systems that will meet everyone’s needs and provide the support for
transfer pricing

 and other tax specific needs?

* How can tax executives more easily take advantage of outsourcing and gain collaborative benefits both through improved internal integration, as well as working with tax software, advisor, external preparers, and tax administrations? How can they tame the spreadsheet sprawl that is so difficult to oversee and control?

* How can they work more closely, as appropriate, with their relevant tax administrations and encourage different countries’ tax administrations to work together for more consistent approaches, which may lead to less effort needed to understand their disparate requirements?

Without question, what is not the complete answer is ERP–Enterprise
Resource Planning

. Few companies use a single instance of the product. Most companies use several different instances of one vendor’s products and often
intermix
  
tr. & intr.v. in·ter·mixed, in·ter·mix·ing, in·ter·mix·es
To mix or become mixed together.


[Back-formation from obsolete intermixt, from Latin
 vendors’ products. In addition, almost every company winds up using informal, spreadsheet-based systems to augment and compensate for business needs that develop after
ERP

 selection, configuration, and implementation and before changes can be made or updates received.

An important part of the answer to these questions is collaboration within the tax reporting supply chain–discussion, compromise and agreements by its members–and standards related to the information they exchange. Much of that information (especially that which is common with those on the financial reporting side) is meant to be expressed with XBRL.

Introduction to XBRL

The initials “XBRL” refers to a standards-based, market-driven, collaborative approach to more trustworthy business reporting (including numeric, narratives, and other content types) that uses standards-based Internet recommendations. XBRL focuses on the use of
XML

, the
Extensible Markup Language

, to improve the exchange of business reporting information. As such, XBRL can refer to:

* XBRL International Inc. and its local jurisdictions, representing 400 companies, regulators, software developers, accounting firms, and others who have come together to “agree to agree” on the use of XML to optimize business reporting information interchange

* A technical Specification, currently version 2.1, that defines how to use XML standards from the World Wide Web Consortium (5) to create agreed-upon business reporting languages (taxonomies) and how to express business data using those languages (instance documents);
in other words

, XML optimized for business reporting.

* Specific reporting languages for expressing reports
according to

prep.
1. As stated or indicated by; on the authority of:

2. In keeping with:

3.
 specific rules and for regional, industry and business report purposes. Some of these languages are the intellectual property of XBRL International and are freely licensed and royalty free, such as XBRL GL, the standardized Global Ledger. Others are the intellectual property of their creators; these include the rules for creating agreed-upon documents according to U.S.
Generally Accepted Accounting Principles

,
International Financial Reporting Standards

, the U.K.’s
Her Majesty’s Revenue and Customs

 (
HMRC

HMRC Health Management Research Center
HMRC Helicopter Multi-Role Computer
HMRC Hierarchical Maximal Ratio Combining
) CT-6 calculations, bank reports sent to the U.S. banking regulator, and many other types of statutory or entity-specific reports.

Unlike traditional
Electronic Data Interchange

 (
EDI

), XBRL leverages its “X”: extensibility. XBRL’s design focuses on the ability to customize more broadly agreed-upon taxonomies with standardized methods of extending, or customizing, the taxonomies for specific industry, regional, or company needs. This ability is key toward a tax administration sharing information with a securities regulator, such as when the tax administration is interested in the “amount per books” reported by the company.

XBRL is not a software package, but there is software developed especially to work with XBRL, as well as mainstream software products that have added or are adding the ability to understand and publish XBRL. XBRL is not a programming language, but it allows groups to develop computer languages to define and describe business reports and business reporting data. It is application-independent, internationally-focused, and facilitates both computer exchange and human comprehension. It is not a programming language, but it allows the collection of validation and business rules that can be leveraged to create programs or macros to make sure business reporting data is valid or to create new data from existing data.

XBRL seeks to be business payload which can be exchanged on a website, sent by email, or communicated as part of the emerging approach to
enterprise computing

 based on
Web services

, and known by names such as Service Oriented Architecture (
SOA

) and Enterprise Service Bus (
ESB

). With Web services, monolithic systems give way to far more granular, process-centered services, where standard payloads, like XBRL GL, facilitate the rapid development of designs. With XBRL, a piece of information, once entered into any computer, anywhere, never needs to be retyped as it flows into an organization, around an organization, and off to auditors, regulators or the markets, anywhere in the business reporting supply chain.

XBRL FR and XBRL GL

There are two existing areas of concentration using XBRL to develop agreement on business reports. One of those areas concentrates on printed reports and forms, such as financial statements or tax returns. This area, known as XBRL for Financial Reporting (FR), is being embraced today by many countries to begin or improve their electronic filing (e-Filing) programs, with proof that XBRL can reduce compliance burden while increasing the efficiencies of collecting, preparing, and sharing reporting data. XBRL FR requires taxonomies specific to the area of business reporting, such as U.S. GAAP,
IFRS

IFRS Inter Frame Relay Service
IFRS Indiana Facilities Registry System
 GAAP, or a specific tax return.

The other area of XBRL is XBRL GL, the standardized Global Ledger. The Global Ledger is a single, generic, extensible, and modular taxonomy framework for standardizing information from transaction through end reporting-essentially all of the information found in a typical accounting system. XBRL GL was designed to facilitate the simultaneous capture and representation of information for both books and tax purposes, capturing permanent and timing differences, tax-specific accounts and entries, and information needed for both direct and indirect taxation.

Who Is Supporting XBRL in the Tax Standards Environment?

Many of the world’s tax administrations are working together to leverage the standards environment, influence existing market efforts, and support efforts relevant to their efforts. These groups have different goals and different constituents, but share an acute interest in XBRL. They all recognize the value of a single, global standard for representing everything necessary along with the audit information supply chain and facilitating the reestablishment of the seamless audit trail.

XBRL, and in particular XBRL GL, have received support from OASIS (Organization for the Advancement of Structured Information Standards) Tax XML, a group dedicated to promoting XML-based standards and interoperability concentrating on tax administrations and those with whom they exchange information, and the
OECD
 see Organization for Economic Cooperation and Development.
 (
Organisation for Economic Co-operation and Development

) Taxpayer Services Subgroup, representing tax administrations from leading nations. Their support was published in the OASIS Tax XML Position Paper (now in its second edition), which was provided to OECD Taxpayer Services and received their recommendation. (6) The Tax XML Position Paper points to two other OASIS efforts as important to tax administrations:
UBL

 (Universal Business Language, developing standards to represent trade documents) and
CIQ

CIQ Customer Information Quality
CIQ Customs, Immigration and Quarantine
CIQ Community Integration Questionnaire
CIQ Chiquimula, Guatemala  
 (Customer Information Quality, developing standards for names and addresses).

Under OASIS Tax XML, there is a subgroup called the Tax XBRL Liaison SC. This working group was begun to provide a single window to XBRL, offer resources to XBRL, encourage Tax XML values by XBRL, and promote use of XBRL by tax administrations. The group has also been working to understand and influence standards organizations relevant to the audit trail to facilitate the reestablishment of the seamless audit trail.

Another task group under the OECD, the Tax e-Audit Task Group, is working on compiling and publishing the requirements for “Standard Audit Files,” to encourage business software developers to provide more standardized data exports for tax audit uses. The OECD Tax e-Audit Task Group has published a
simple XML

 representation of the first set of requirements; they also indicated that an audit file is fully realized when it is standardized and holistic, with full realization in a format like XBRL GL. (XBRL GL is not optimized only for the tax auditor or limited to
general ledger

 entries and trade transactions. XBRL GL can be used for system integration, consolidations, data migration, data archival for organizations of all kinds–for profit, not for profit, or governmental.)

Representatives from both OASIS Tax XML and OECD Tax e-Audit are involved in making sure XBRL GL properly represents the content required by the
SAF-T
 
, the first of the standard Audit Files, and by member organizations.

Who Is Embracing XBRI. Among Tax Administrations?

With this global support for XBRL, it is not surprising that some of the tax administrations have already begun to allow or mandate XBRL for e-Filing and plan the drill down to the XBRL GL level.

One of the best known success stories is the Netherlands Taxonomy Project. (7) The Dutch Tax Office, working with many other governmental agencies, collaborated to find overlapping requests for information and simplify the request of information from taxpayers. This work resulted in an incredible decrease from 180,000 data points to 4,000, resulting in an expected decreased in compliance burden last quoted at 900 million annually.

The U.K.’s Her Majesty’s Revenue and Customs has also been developing XBRL taxonomies to work in conjunction with the UK Financial Reporting taxonomy. HMRC recently announced, “All companies should be required to file their company tax returns online, using XBRL, and make payments electronically, for returns due after 31 March 2010.”

Numerous other countries are actively involved in exploring the relevance of XBRL to their administrations, including the U.S. Internal Revenue Service, the Australian Tax Office, and
New Zealand
 , island country (2005 est. pop. 4,035,000), 104,454 sq mi (270,534 sq km), in the S Pacific Ocean, over 1,000 mi (1,600 km) SE of Australia. The capital is Wellington; the largest city and leading port is Auckland.
 
Inland Revenue

Noun

(in Britain and New Zealand) a government department that collects major direct taxes, such as income tax

Noun 1.
.

Potential Benefits of Widespread XBRL Acceptance

“What can lower the costs of finding and training tax staff, increase access to (and the reliability of) tax-related data globally, and improve communication between all members of the tax planning, compliance and audit supply chain?” XBRL does not magically make all of
these things

 happen, and ”
your mileage may vary

” based on how deeply embedded XBRL is in the process and how widespread the agreement on the information being exchanged. But XBRL can be the catalyst for these benefits for all the parties in the tax information supply chain.

For companies, XBRL is leading to new internal efficiencies and quicker integration today, while making data interchange totally transparent to the end user tomorrow. With greater integration comes reduced risk (owing to reduced human interaction) in a more
homogenous

 and consistent controls environment, reduced training requirements, and better data available on a more timely basis that is easier to consume and analyze for tax planning and simulations. Off-the-shelf software that works with standards and the ability to implement Web services more efficiently can make for a more powerful and cost-effective systems environment.

Tax preparers will be able to service their clients more efficiently, more often, and with greater transparency into current and historical data.

Software developers will find their products less subject to
obsolescence
  
adj.
1. Being in the process of passing out of use or usefulness; becoming obsolete.

2. Biology Gradually disappearing; imperfectly or only slightly developed.
 and be usable by a broader target audience.

Tax administrations will be able to reduce compliance burden, the cost of handling paperwork and error rates; increase self-service and value-added services and communication with all parties–taxpayers, tax preparers, tax filers and other government entities, as well as moving toward that standardized e-Audit tool with the potential for a more real-time audit environment.

All parties can benefit from shared communication today, and enhanced abilities tomorrow.

Where This Could All Be Going: Futures

Many of the benefits described in this article are available today by using XBRL as the data hub format used for data integration rather than proprietary approaches, and soon more transparently when XBRL is embedded in more mainstream products as a standard import/export and Web services payload content.

When that happens, tax executives and financial executives will not be competing for funds in the same way, squabbling over systems or rioting and rebelling over reconciliations–at least less often as they are doing now. Systems will simply be able to more easily talk to each other. Applications will be more efficient and updating application programming for new tax and accounting rules will be simplified. Because standard data formats would be available, developers would better understand the needs of tax data interchange and potentially be able to capture information that must be captured manually at the present time.

XBRL, however, is not just about “paving the cow path,” doing what we are doing today but doing it more efficiently. Once the information friction within an organization and between members of the tax reporting supply chain is reduced or eliminated, efforts can be made to change tax processes for participants’ mutual benefit.

Some of these changes have already been proposed by tax administrations involved in XBRL, shaking expectations on the nature of tax reporting and its relationship to other reporting. Discussions in some countries are already underway weighing the costs against the benefits of book/tax differences and considering that book reporting with on-demand access to the underlying systems might provide most of the benefits at a great reduction of burden to the taxpayer. Should a number of countries chose to use IFRS as both their book and tax method of accounting, the FAS 109/IAS 12 issues will be reduced substantially. Also associated with that on-demand access is the reduction of specialized disclosures necessary–a reduction in the forms-based filings–and the need for more real time access. The IRS’s existing Compliance Assurance Process (CAP) program, which involved two dozen companies at the time of this writing, does not currently leverage XBRL standards, but is a model for reduced interruption of business and increased services (speedier feedback of approval of tax treatment of transactions) in exchange for ready access to data systems.

Why Hasn’t This Moved Faster?

If these benefits are so obvious for everyone involved, why has XBRL not become commonplace? Why isn’t it built into my ERP system and tax software today?

Good questions. Some possible answers:

* Taxpayers have not moved to implement XBRL on their own because they are waiting for software developers. Companies themselves often lack the internal tax systems knowledge and have relied on the past on their independent auditors. This might change with the new requirements that auditors cannot be relied upon for tax guidance to the same degree and with increased focus on XBRL encouraging the software developers to act.

* XBRL, and especially XBRL GL, is a
holistic approach
 A term used in alternative health for a philosophical approach to health care, in which the entire Pt is evaluated and treated. See Alternative medicine, Holistic medicine.
 to the company’s problems and not just a tax or finance issue. It is therefore not a simple, or “quick,” fix, and it must be driven by the need for real efficiency. Increasing focus on improving tax systems in light of Sarbanes-Oxley and the need for holistic approaches as the market moves to real time may support a move to XBRL, as might the struggle in the tax department for more resources or staffing, which can be ameliorated by standard-based systems.

* There has been confusion and competition in the standards marketplace, both generally, related to e-Filing and related to e-Audit. The support of tax administrations in their position papers from Tax XML and the public successes of XBRL in the tax environment may help here.

* Software developers are waiting for end users to tell them what they want, while end users are waiting for software developers to deliver solutions. In addition, software developers are hesitate to be the first to incorporate standards into their product for fear that users will take the standard data from their systems and “churn” their systems, moving to other applications. End user demand coming from regulator requirements and benefits may help in this area.

* Companies may hesitate due to fear of “too much transparency.” This may be an initial reaction, but collaboration and the benefits that regulators may offer for sharing information may help companies temper or overcome those objections–especially if companies and regulators can collaborate to make sure that sensitive information remains confidential.

Call to Action

Do the needs ring familiar and the benefits sound attractive but the tasks sound
daunting
  
tr.v. daunt·ed, daunt·ing, daunts
To abate the courage of; discourage. See Synonyms at dismay.


[Middle English daunten, from Old French danter, from Latin
? “How do you eat an elephant? One bite at a time,” notes the
aphorism
 , short, pithy statement of an evident truth concerned with life or nature; distinguished from the axiom because its truth is not capable of scientific demonstration.
. Standards do not grab hold instantly, unless there is a major disaster that completely disrupts
normal operations

. Hoping that no such cataclysm occurs, the benefits of XBRL will be realized through many small steps.

Each member of the business reporting supply chain stands to benefit from XBRL; each member must invest for the goals of mutual benefit to be realized. Users are waiting for features to be embedded in applications. Application vendors are waiting for widespread consumer demand or regulatory mandate. Regulators do not wish to impose a burden on their constituents. Here is what you can do:

* Discuss XBRL with executive management, financial management and IT. Common requirement, common benefit. Web services, SOA, and ESB will grow and a standard payload format like XBRL will help.

* Talk about XBRL with your vendors, systems integrators, consultants and advisors. Communicate the benefits, be part of the voice of business to software developers asking them to incorporate XBRL GL as a standard import/export format for tax planning, compliance, FAS 109/IAS 12.

* If you are already considering integration projects, consider the benefits of standardization as part of that project today; a standards-based approach can bring all of the benefits of a proprietary, “hard-wired” approach with a small additional effort (taking the time to understand the standard) that will retain its value in the future.

* Talk about XBRL with your tax administration. Don’t let them mandate a proprietary audit file and draw developer attention away from holistic approaches.

Tax executives have a number of choices. These include trying to slow down standards of any kind, which could result in the requirements and costs of standards being postponed but the possible benefits also being deferred.

A second option is to allow the standards to be set without your participation, i.e., to act as if the work is
destined
  
tr.v. des·tined, des·tin·ing, des·tines
1. To determine beforehand; preordain:

2.
 to happen and prepare to cope with whatever the outcome is. Eventually, standards will become commonplace or required, and companies will have to conform their businesses to those standards without having acted to expand or optimize their benefits.

A third course is to stay educated and engaged, and to encourage the vendors with whom you work to adopt specific standards. This is the approach of OASIS Tax XML, which has chosen to survey the XML-based standards relevant to tax administrations and to choose the most important ones to champion. Sometimes, there might not be a clear “winner” between two “competing” standards efforts; if forces get behind one or the other, however, it will act as a catalyst to see the benefits received earlier and the resources concentrated rather than dispersed.

Finally, a tax executive could actively take part in the standards work. They could attend meetings of the standards group. Review materials they provide. Do conference room pilots to investigate the abilities, benefits, and challenges, and provide feedback. Provide ideas, solutions, utilities, applications to the market (open source) to move the work forward. Work with your software vendors to define the features and capabilities you want in their products today … and tomorrow.

Conclusion

It is better for tax executives and their companies to play a role in developing the solutions to today’s increasing pressures than to be a victim of the circumstances and an after-the fact “recipient” of the solutions someone else may impose. Tax executives should monitor and provide feedback to standards organizations and tax administrations. With XBRL, tax executives will have a set of tools to improve their internal reporting environment; with XBRL GL, the standardized Global Ledger, in particular, they will be laying down a framework to improve the health of the organization and markedly improve the tax information environment.

(1.) See http://www.sec.gov/spotlight/xbrl.htm for more information about the SEC’s focus on XBRL.

(2.) The Web page of XBRL International Inc. is http://www.xbrl.org.

(3.) Kris Frieswick, “Too Taxing,”
CFO

.com, http://www.cfo.com/printable/article.cfm/5077959?f=options

(4.) Section 409 of Sarbanes-Oxley was the
starting point

 for a direction to move toward real-time disclosure of an ever-increasing amount of corporate information

(5.) http://www.w3.org.

(6.) http://www.oasisopen.org/committees/download.php/14242 /OASIS_XML_Position_Paper for Tax_Administrations_v201.pdf

(7.) http://www.xbrl-ntp.nl/english

Glossary

ASCII
 or  a set of codes used to represent letters, numbers, a few symbols, and control characters. Originally designed for teletype operations, it has found wide application in computers.
:
American Standard Code for Information Interchange
 see ASCII.


See ASCII.


American Standard Code for Information Interchange – The basis of character sets used in almost all present-day computers.
, a 7-bit code standard for representation of “Latin” characters, numbers, symbols and control characters, used in data representation.
CSV

 files and fixed length ASCII files are two examples of ASCII files. Is being superseded by Unicode.

CIQ: Customer Information Quantity. http://www.oasis-open.org/committees/tc_home.php?wg_abbrev=ciq

An OASIS Technical Committee establishing standards for names, addresses and other information common to customer relationship management (
CRM

) systems.

CSV: Formally “comma separated variable”, but sometimes called “character separated variable”. A comma (“,”) is used to separate values in a record; quotes (‘””‘) are used to surround text values. In some countries, the semi-colon (“;”) is used instead of the comma primarily because of the comma’s role as the decimal separator in those countries.

EDI: Electronic Data Interchange: http://www.unece.org/trade/untdid/welcome.htm; http://www.x12.org/

An umbrella name for the standards (X12 in the
United States
 officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world’s third largest country in population and the fourth largest country in area.
, UN
CEFACT

 for the rest of the world) for exchanging standardized electronic business documents for trade and other purposes.

e-Filing: The electronic filing of tax (and other governmental) forms. This can be accomplished through transmitting electronic files; sometime, filling out forms
on-screen
 or on-screen  
adj. & adv.
1. As shown on a movie, television, or display screen.

2. Within public view; in public.
 for entry into the administration’s systems is classified here as well.

Fixed length ASCII: An ASCII file where data fields have fixed starting points and lengths, a very consistent and inflexible format.

GTCBAS: Guidance on Tax Compliance for Business and Accounting Software. http://www.oecd.org/dataoecd/13/45/34910263.pdf

Instance document: In XBRL, the expression of business data, where XML tags are associated with the numbers and text of the business data to point to taxonomies where the meaning for the data content is defined.

Interactive data: A phrase used by the US Securities and Exchange Commission to describe XBRL and other “tagged” (XML-coded) languages that links data (numbers, text) with machine-readable contextual information to allow applications to better recognize, understand and consume that date.

SAF-T Standard Audit File–Taxation. http://www.oecd.org/LongAbstract/0,2546,en_2649 201185_34910278_1_1_l_l,00.html

Taxonomy: For XBRL, a taxonomy is a collection of business facts, attributes and definitions related to each concept and descriptions of how the concepts so represented
interrelate
  
tr. & intr.v. in·ter·re·lat·ed, in·ter·re·lat·ing, in·ter·re·lates
To place in or come into mutual relationship.


in
. This shared information is then used to “tag”, or code, data held in instance documents.

UBL: Universal Business Language. http://www.oasis-open.org/committees/tc_home.php?wg_abbrev=ubl

Unicode: A 16-bit character set defined by
ISO

 10646 characterized as next generation ASCII that can represent most of the world’s language sets, including non-Roman languages such as Japanese.

XBRL: Extensible Business Reporting Language. http://www.xbrl.org

XBRL GL: XBRL GL, the standardized Global Ledger. http://www.xbrl.org/GLTaxonomy

A framework for representing the information found in business operational and accounting systems using a generic series of modular XBRL taxonomies. It can represent information from the General Ledger and subledgers that support it.

XML: Extensible Markup Language, an agreement on how to create digital meta-languages, best known for encasing human-readable terms relevant to an area of interest within ”
angle brackets

” (e.g., <sales>1000</sales>). http://www.w3.org/XML

Reference to organizations discussed in the article

OASIS Open: Organization for the Advancement of Structured Information Standards. http://www.oasis-open.org

OASIS Tax
XML TC

: http://www.oasis-open.org/committees/tc_home.php?wg_abbrev=tax

OASIS Tax XBRL: Liaison SC. http://www.oasis-open.org/apps/org/workgroup/tax-xbrl-liaison]

The OASIS Tax XML Technical Committee was established to encourage
harmonization
  
v. har·mo·nized, har·mo·niz·ing, har·mo·niz·es

v.tr.
1. To bring or come into agreement or harmony. See Synonyms at agree.

2. Music To provide harmony for (a melody).
 and interoperability in standards.

OECD
Organization for Economic Cooperation and Development
 (OECD), international organization that came into being in 1961. It superseded the Organization for European Economic Cooperation, which had been founded in 1948 to coordinate the Marshall Plan for European
 http://www.oecd.org

OECD
CTPA

: Centre for Tax Policy and Administration

OECD
CFA

: Committee on Fiscal Affairs

OECD
FTA

abbr.
Future Teachers of America
: Forum on Tax Administration

TSS

: Taxpayer Services Sub-Group

SAF

: Tax e-Audit Task Group

The OECD is a forum for the world’s governments to discuss and recommend policy. It has a number of groups that concentrate on different aspects of tax policy. Two groups in particular have been involved in discussions about the establishment of a standard audit file–the group now known as the Tax e-Audit Task Group and Taxpayer Services Subgroup. The Tax e-Audit Task Group oversees the specification of the Standard Audit File–Taxation and similar tools.

W3C

: World Wide Web Consortium. http://www.w3.org

The W3C is the consortium that oversees the technical standards of the Internet, including XML and
XML Schema

.

XBRL International Inc.: Extensible Business Reporting Language. http://www.xbrl.org

XBRL GL Working Group: http://www.xbrl.org/GLTaxonomy

XBRL International is a worldwide consortium of 400 member organizations that oversees the development of the XBRL Specification and XBRL GL, the Journal Taxonomy, a standard based on the XBRL Specification that defines how the information inside a business system can be represented using XML.

Tax Administrations actively involved in tax standards:

ATO

ATO Alpha Tau Omega
ATO Air Traffic Organization
ATO Arab Towns Organization
ATO Air Tasking Order
ATO Assemble To Order
: Australian Taxation Office. http://www.ato.gov.au/

CRA

:
Canada Revenue Agency

 (CA). http://www.cra-arc.gc.ca/

DTO

DTO Data Transport Option
DTO Disruptive Technology Office
: Dutch Tax and Customs Administration (NL) http://www.belastingdienst.nl/

HMRC HM: (Her Majesty’s) Revenue & Customs (UK) http://www.hmrc.gov.uk/

IRS

: Internal Revenue Service (US) http://www.irs.gov

NZ IR: New Zealand Inland Revenue http://www.ird.govt.nz/

ERIC E.
COHEN

 is XBRL Global Technical Leader for PricewaterhouseCoopers
LLP

. He was one of the founders of the group developing XBRL (Extensible Business Reporting Language). The author of John Wiley’s “Accountant’s Guide to the Internet,” he has written and spoken extensively about XBRL and technology internationally. He is also a member of OASIS Tax XML, the chair of the OASIS Tax XBRL Liaison SC, and a member of the OECD Tax eAudit Task Group. Mr. Cohen may be reached at eric.e.cohen@us.pwc.com.