Adoption of XBRL in Malaysia: Beneficial or Not?
The XBRL initiatives in Malaysia are still in the infancy stage, with regulators taking the lead to mandate this financial reporting system country-wide.
Yes, this electronic reporting system is currently in the voluntary phase. As of March 8, 2021, SSM announced the mandatory adoption of online filing through the MBRS system in Malaysia, eliminating over-the-counter filing. However, different sources have revealed that the Companies Commission in Malaysia (SSM) is rigorously working towards mandating XBRL.
The establishment of XBRL will enable regulators and organisations to work together much more effectively in streamlining the reporting process. Furthermore, it will also improve the administration of business reporting and maintenance of data.
Consequences of XBRL Introduction in Malaysia?
- Business Reporting Will Be Automated
The implementation of XBRL will enable companies to file their annual financial statements and audited accounts electronically. In addition, it will allow SSM to capture accurate financial information from registered companies to provide analytical insights into the Malaysian business landscape.
- Improvement in Transparency and Efficiency of Data Analysis
Transparent Data = Better Analysis = Stronger Malaysian Economy
By allowing analysts to sift through high-authority data easily with automation of business intelligence, the new XBRL initiatives are expected to improve transparency and enhance the Malaysian capital markets’ efficiency.
- Enhancement in the Data Exchange Process
XBRL is a globally accepted standard that is used to exchange business information electronically. Several countries like Europe, South Africa, Singapore, and India have already realised the benefits of XBRL and adopted the reporting process.
In Malaysia, it will allow a better exchange of financial information and data among regulators, including the tax authorities, financial authorities, the central bank and the government, thereby enhancing the data exchange process.
Are These Changes Good?
- The automation of business data using XBRL improves data accuracy as the data can be verified and calculated easily.
- XBRL is much less time-consuming as compared to manual processes.
- The data produced by XBRL is reusable, which means it can be presented in multiple ways and formats.
- XBRL reduces inconsistencies in data formatting.
In retrospect, the XBRL mandate will be the best thing for the Malaysian financial market. SSM’s new XBRL platform will automate the data collection process, transform the submission of statutory reports, and allow data users to conduct company information easily.
So yes, these changes are good, and YES, XBRL is beneficial for the Malaysian economy.
Ready to Make This Transition?
Partner up with a reputable and efficient XBRL service provider like DataTracks and make this transition while it is still in the voluntary phase. Boasting 16+ years of extensive experience and prowess in XBRL, SSM taxonomy, and Malaysian accounting standards, the financial experts at DataTracks offer innovative solutions to produce error-free financial reports.
To make this transition smooth and make it NOW, please speak to a DataTracks expert @ +60-392-126-125.