If you are an accountant, a company secretary, or in someway connected with accounts and annual return, the first question you must have asked yourself is ‘Why XBRL?’ Correct?
People do not like change. And this does not change. We will resist change – simply because we are used to a certain style of living. We always look at change as causing or having a potential to cause pain!
Well XBRL cleans the data. Let me repeat XBRL is a data cleansing tool. Iris a significant player in the xbrl space – nationally and internationally – did a research and came up with some significant findings. Many printed balance sheets had mistakes. And real big ones. One MD of a company said ‘it is a printing mistake’. Fairly obvious. But the outside world works with that data. So if the Sundry debtors schedule shows Rs. 3645 crores and the balance sheet figure is Rs. 3845 crores…which figure do I take for my analysis? And what as an analyst if I refused to consider this company – because of this mistake. When you deal with very disciplined investors, you realise that they create a model and stick to it without second guessing it everyday.
So if you are in the data business – creating, using, selling, building applications for analysis – you will love the fact that data comes to you clean! Auto cleaning of data is an amazingly useful tool is it not?
XBRL for compliance is another fantastic application…will write about it soon…
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