ACRA gets tough on filing quality
In January 2017, Accounting and Corporate Regulatory Authority (ACRA) announced major policy changes to compel corporates to file precise and quality financial reporting. (Read news). These reports include XBRL filing as well.
Accordingly, ACRA will be empowered to publicly name and list Directors who are directly accountable for “serious” and “less serious” financial reporting breaches. Alongside, ACRA could also direct such corporates to re-state, re-audit and re-file their financial statements.
The challenges occur in scenarios when the business transactions and accounting standards become more complex. It is important that companies pay more attention to the filing of their financial statements, including quality of XBRL reporting with ACRA. ACRA recognizes that more areas in financial reporting – such as revenue recognition, impairment and ad hoc gains – will be subject to estimates and judgment. ACRA has indicated that if the company refuses to comply, warnings, fines or prosecution leading to fines or imprisonment will be considered against the directors.
In the wake of ACRA’s strict code of conduct, we recommend that corporates take their XBRL filing seriously. XBRL tagging using ACRA’s free software require careful and professional selection of accounting tags from the taxonomy within the software. Failing to choose the right XBRL tags or omitting to tag an amount can result in financial reporting breaches.
We at DataTracks, can help corporates prepare professionally tagged XBRL files that can save them from notices from ACRA and embarrassment from public.