The 6th Univ. of Kansas International Conference on XBRL
Past, Current and Future
Auditor Involvement
with SEC Registrant's
XBRL Exhibits
Paul Penler – Ernst & Young LLP
1
Auditor’s areas of involvement
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AUPs and F&R engagements
Other services for audit and non-audit clients
Utilizing the XBRL data on financial audits
2
AUP and F&R
engagements
AUP engagements-overview
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Auditors are not required (or expected) to:
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Agreed-upon procedures (AUP) engagements are separate from the audit and are less in
scope than an audit or review – no assurance is provided.
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Tagging selection – use of the taxonomy and extensions
Areas the SEC has identified as frequently having errors (e.g. signs, decimals, date contexts, etc)
Company should evaluate whether findings would improve the XBRL submission and make final
judgment related to potential changes
Level of effort:
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The objective is to perform procedures in order for management to evaluate the completeness,
accuracy and consistency of the XBRL data
Findings represents errors, alternatives, observations and recommendations
Procedures can be customized, but usually focus on:
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Read, perform procedures, assess, or issue separate assurance on the XBRL exhibit or controls
Typical block text engagement takes 2–3 elapsed weeks and ranges from 50–90hours
Typical initial detail tagging engagements takes 4–5 elapsed weeks and ranges from 150–250 hours
Reoccurring engagements take considerably less time
Volume of findings:
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Typical detail tagging engagement averages more than 150 comments, with companies making
changes on most of the commented areas
4
AUP engagements - common errors observed
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Not tagging all required information
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Tag selection
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Parenthetical information, amounts in superscript footnotes, amounts written out (e.g.,
twenty percent), not tagging all amounts in the notes/schedules (detail tagging)
Line items that have a non-determinable value (e.g., commitments and contingencies)
Missing required S-X schedules, not including all required levels
Not tagging all of the dimensions (e.g., missing dimensions represented in narrative)
Extending tags unnecessarily or selecting the wrong standard tag
Not using required tags or selecting different tags for the same amount and concept that
appear more than one time in the financial statements
Other tag related errors
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Wrong signs for the values (i.e., positive versus negative), wrong reporting period dates,
wrong decimal settings or wrong amounts (i.e., proper number of zeros),
Wrong or missing calculations, wrong or missing units of measure
Incomplete information provided for extensions tags (e.g., missing debit or credit
balances, as required)
Not using XBRL footnote links, as required
5
AUP XBRL demand
Involving auditor
44%
Not currently but will reassess as limited
liability provision expiration date approaches
24%
32%
No plan to involve auditor
Source: November 2010 responses from ~1,000 public company financial reporting personnel on an EY webcast
Other services for audit
and non-audit clients
Non AUP/F&R services
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Examinations
Supporting development of creation processes
and controls
Supporting development of XBRL consumption
Financial system implementation support
Other
8
Utilizing the XBRL data
on financial audits
Possible areas of usage by auditors
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Non Industry
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Industry
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Automatically updating analysis with each draft financials or when a
number changes
Uses during quarterly work or Reporting/Conclusion,
Uses throughout each phase of the audit
Identify sig. accts; Rev/Exp PSP; peer/industry data w/sig. accts
Extensive use of comparative face f/s info
Moderate use of comparative F/S Note info
Benefit scanning competitor/industry notes or supplemental
schedules for terms, numbers, relationships
Limitations
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Timing/approach of company’s XBRL preparation
All text is not tagged at lowest level (e.g., tagging of text
optional)
Data Quality
It’s all about data quality
When will quality XBRL data be easily accessible?
One perspective in August 2009
Initial filers - 10%
Face – Quality & consistency
Face – Company to company comparability
Detail Notes – Quality & consistency
Detail Notes – Company to company comparability
Additional large accelerated filers - 20%
Face – Quality & consistency
Face – Company to company comparability
Detail Notes – Quality & consistency
Detail Notes – Company to company comparability
Remaining filers -70%
Face – Quality & consistency
Face – Company to company comparability
Detail Notes – Quality & consistency
Detail Notes – Company to company comparability
2009
2010
2011
2012
2013
2014
2015
Mixed
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Mixed
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Better
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Mixed