XBRL is now an accepted norm, if not a must, in every company in Singapore and in the world as a whole. For a simple reason: this language aids in circulating and processing information, in turn, making it easier for them to ensure regulatory compliance and communicate with other parties.
So what exactly is XBRL and why it is employed in financial reporting with such popularity?
1. What is XBRL in Singapore?
Digital reporting has long eliminated the need and use of the paper-based reports and manual record keeping. That being said, people used to employ different accounting tools and software, which did not really help stimulate communicating and comparing financial data between entities.
With an aim to minimize this inefficiency and therefore facilitate financial reporting, eXtensible Business Reporting Language (XBRL) came into play. First developed in 1998, this XML-based language has become a standard framework for filing records, and a more systematic approach to accounting.
If you are a layperson: XBRL simply works by letting you tag the figures and information that you feed into it. This volume of data would then be synthesized and extracted into a document written in XBRL, which can be read by most of the present-day spreadsheet programs.
And as we said, XBRL has been recognized as a global standard and everyone is using it, so it is easier than ever to communicate and compare financial data with your colleagues and external parties with the help of this language.
As a scheme to facilitates storage, retrieval, and usage of company financial data, XBRL was introduced into Singapore in 2007 and has been a must for filing financial statements ever since.
This old-age reporting language has paved the way for better intercommunication between companies and statutory authorities.
2. Who needs to file in XBRL format in Singapore?
Under the governance of the Accounting and Corporate Authority (ACRA), nearly all companies incorporated in Singapore, be it limited or unlimited by shares, are duty-bound to file their report and accounts in XBRL using the new BizFinx system.
Of these companies being obliged, some are required to file their full set of financial statements in XBRL format, whilst others are allowed to submit only their salient data in the form of financial statements highlights (FSH) prepared in XBRL format coupled with a PDF copy of their financial statements.
It should be noted that this requirement only applies to companies whose financial periods end after the requirement regarding XBRL took hold, that is, subsequent to 1 Nov 2007. If your company’s period of filing the financial statements ends before the above-mentioned date, it shall file in PDF format.
3. How do can my company be exempted from the XBRL filing requirement?
There are many types of companies for whom the XBRL format is unnecessary, and waiving this requirement altogether would help cut through some undesirable red tape and take out the hassle for these businesses.
A solvent exempt private company is allowed to dispense with the financial statement. Aside from this one exception, if your company falls into either of the following categories, you can seek the exemption from filing in XBRL format and instead, prepare and submit a PDF copy of your financial statement:
- A non-profit company limited by guarantee
- Foreign companies or branches of a foreign company
4. What to include in the XBRL financial statements?
ACRA also introduces the concept of the Minimum Requirement List, which lays out the bare essentials that companies are required to include in their XBRL-based financial statements. This is a real blessing as it helps trim off the redundant elements and ease the filing process.
According to ACRA, the minimum requirement list includes:
- A text block element which allows companies to submit their entire set of financial statements; and
- Detailed information elements which allow companies to submit additional information about each individual section.
On a side note, the minimum requirement list is only applicable to companies under the obligation to file a full set of financial statements in XBRL format.
5. What are the options for filing XBRL in Singapore?
There are typically 2 sets of options : (1) Full XBRL and (2) Partial XBRL
A full set of financial statements in XBRL format can be filed using FS Manager and includes the following:
- Balance sheet (Statement of Financial Position)
- Income statement
- Statement of cash flow
- Reports of Independent Auditors
- Director’s statements
- Notes to the Financial Statements:
All of the notes required of your financial statements are as follows:
- Corporate and general information;
- Trade and other receivables;
- Trade and other payables;
- Share capital;
- Government grants;
- Employee benefit expenses;
- Operating segments;
- Property, plant, and equipment;
- Selected income and expense.
A partial set of financial statements in XBRL format is required to prepare financial statements highlights accompanied by a PDF copy of the financial statements and include the following:
- Financial Statement Highlights of Income Statement and Statement of cash flows – i.e. Revenue, net cash flows from operating activities
- Financial Statement Highlights of Balance Sheet (Statement of Financial Position) i.e. total assets, total current assets…
- Independent Auditor’s Report
- Statement by directors
6. XBRL filing options for different types of companies
a) Public/private companies are required to file a full set of financial statements in XBRL format.
b) Certain specialized companies such as commercial banks, merchant banks, insurance companies, and finance companies that are under the regulation of the Monetary Authority of Singapore are allowed to file only salient financial data in XBRL format and submit a PDF copy of financial statements.
c) Exempted companies adhering to other accounting standards other than SFRS, SFRS for Small Entities, and IFRS are allowed to file only salient data in XBRL format and submit a PDF copy of financial statements.
d) Solvent Exempt Private Companies are exempted from filing financial statements
e) Insolvent Exempt Private Companies could choose between (1) filing a full set of financial statements in XBRL format, or (2) filing salient data in XBRL format and submit a PDF copy of the financial statements
f) Companies limited by guarantee could solely submit a PDF copy of the financial statements
g) Foreign companies or a branch of which could solely submit a PDF copy of the financial statements
7. How to do XBRL filing in Singapore?
The XBRL submission process could play out in 3 primary phases as outlined below:
Preparing: You could easily convert the financial statements to XBRL format using BizFinx preparation tool – an intuitive software developed by ACRA, or engaging in any 3rd party services you deem appropriate.
Uploading: You then need a CorpPass to log in to BizFinx Portal, wherein you could upload your XBRL-based financial statements
Submitting: You are required to attach the financial statements in XBRL format with your Annual Return when filing via the BizFile portal.
At the end of the first 2 phases, you are required to seek validation before entering the next one.
Should you have any questions regarding XBRL filing requirements, drop us a chat message or send an email via email@example.com