Factors Affecting the Choice Between iXBRL Software and iXBRL Service
Inline eXtensible Business Reporting Language or iXBRL is a global digital reporting standard for filing financial statements and annual returns. It boasts both human-readable structures and machine-readable data for every document.
The basic idea behind the development of iXBRL was to allow filers to retain the source document’s original formatting while preparing the XBRL report. This is why, from July 2018, iXBRL has been mandated in South Africa by the Companies and Intellectual Property Commission (CIPC).
Since the mandate of iXBRL in South Africa from July 1, 2018, until the end of June 2020, the CIPC has received 24,566 successful submissions of iXBRL tagging for the financial reports of publicly listed companies.
Companies have the option of preparing and filing their Annual Financial Statements and reports either using an iXBRL software or iXBRL service. But the most critical question is – How do you know when to choose an iXBRL software or iXBRL service? Let’s try and find out the answer to this question.
iXBRL Software or iXBRl Services, what to choose?
Factors to Consider While Choosing an iXBRL Software
Let’s understand the situations wherein choosing an iXBRL software can be an ideal choice.
Availability of In-House Experts
To use in-house iXBRL software, you require professional experts familiar with tagging documents & accounts and CIPC-mandated taxonomies. Moreover, they should be able to use the application and stay abreast with the latest regulations, taxonomies, and software updates. So, if the cost of training employees is not something you dread, choosing iXBRL software can be the ideal choice for you.
Complete Confidentiality and Convenience
As its users can only access the information uploaded on the software, iXBRL software provides complete confidentiality. In addition to the advantage of data privacy, it allows you to log in, prepare AFS and generate reports at any time.
Tax-Based iXBRL Softwares
Most iXBRL software available in the market is tax-based. This simply means that this software is regularly updated in terms of new tax policies and regulations, making it easier for the users to use and implement changes in their AFS preparation and filing of annual returns. However, this also means that the professional taking care of the conversion needs to stay abreast of such changes and can adopt them into the current filings.
Factors to Consider While Choosing an iXBRL Service
Let’s understand when iXBRL service is an ideal choice.
- Streamlined Filing Experience
An iXBRL service provider ensures effective conversion of AFS and generation of reports. They support your company throughout the conversion and filing process, ensuring successful submission with the regulator.
The best part? The experts providing these services are well-versed in all the technical requirements, liberating you from the need to train in-house professional experts. Moreover, even though your in-house team is not directly preparing and filing the AFS, these service providers have stringent data security measures, ensuring complete anonymity of your financial data. So when striving for a hassle-free filing experience, an iXBRL service is the ideal choice, no questions asked.
- Time and Cost
iXBRL services can be very helpful for you to save a large proportion of your time and costs. How do you ask? The answer is simple – By reducing the need for training in-house professionals with knowledge of the software.
For instance, in the case of iXBRL software, you need to invest in its updates and train people how to use it. However, if you outsource the preparation of iXBRL reports, you eliminate these costs. What’s more, the conversion and filing process is completed by the service providers, allowing you to save a lot of time and trouble.
- Possibility of Validation Errors
Validation errors are the warnings you see when submitting the converted iXBRL financial statements. And if you have an expert who has prowess in converting and submitting financial statements, this may not be an issue. However, the possibility of validation errors while submitting cannot be ruled out entirely. So if you want to rule out this possibility, an iXBRL service is your best bet.
What’s the Future for iXBRL?
One thing that can be said with absolute certainty about the future of iXBRL is that IT IS HERE TO STAY. With the growing relevance of iXBRL in CIPC filing, its recognition and popularity will not lose their touch, at least for the foreseeable future. When it comes to choosing iXBRL software or iXBRL service, it largely depends on your business requirements and resources.
However, by partnering with a global leader like DataTracks, you can avail the benefits of both iXBRL service and software, which aims to provide you with 100% error-free iXBRL reports, meeting the CIPC filing requirements. To learn more about the need and benefits of choosing an iXBRL service and software, speak to an expert at +27-10-446-9061 or email @firstname.lastname@example.org.