Digital Financial Reporting

I provided a reading list for software engineers interested in XBRL-based financial reporting.

Here is a similar list for business professionals: 

• Essence of Accounting: Brings into conciousness certain things about accounting.  A logical description of the record to report process: accounting, reporting, auditing, and analysis.
• Computational Professional Services: Helps you understand the opportunities for automation that exist.
• Method Overview: Using this method, enterprises can reliably and effectively stream a high-quality machine-readable XBRL-based global standard knowledge graph of a complete, consistent, and provably correct general purpose financial statement. Further, an entire record-to-report process can be automated effectively. This method provides both the flexibility and the control necessary.
• Logical Theory Describing Financial Report: A general purpose financial report explained logically using axioms, theorems, and a world view.
• Mastering XBRL-based Digital Financial Reporting: Everything you would ever want to know about XBRL-based digital financial reporting.
• Video demonstration of Pesseract: This video shows the basic functionality of Pesseract which is a rules-based expert system for creating financial reports.

Things seem to be speeding up.  Stumbled across something interesting today: Xenett.

Xenett says that they are an ecosystem for accountants.  To understand what they might be up to, watch this YouTube video, What is Xenett?

They seem to have a cloud based practice management system.They seem to have some sort of enhanced import functionality related to QuickBooks and Xero.  They have some sort of automated review functionality that is supposed to save 60% of financial review time. Personally, I would have a different strategy in terms of review.  Avoid making the mistake in the first place (i.e. expert system for creating financial report) and then there is no reason to "review" because there will be no mistakes where the expert system is watching over the financial report being created.

GLEIF publishes Introducing the Legal Entity Identifier (LEI). LEIs are another piece in the digital financail reporting puzzle.

This article published by Coinbase, What is Cryptocurrency?, is one of the best explanations of cryptocurrency and what is going on with decentralized finance.

Per this list of cryptocurrencies provided by Coinmarketcap there are 6,115 different cryptocurrencies at this moment. (I kept pressing the "Load More" button until it did not show that button any longer.) Of that total, 2,598 had some sort of market cap and a circulating supply.

Here is a video that explains wallets. Here is another video that explains wallets.

The XBRL Data Point Model Methodology has become ISO 5116. There are three parts to this ISO standard which include: 

• Part 1: European data point methodology for supervisory reporting
• Part 2: Guidelines for data point modelling
• Part 3: Mapping between DPM and MDM

So what is the XBRL Data Point Model? The Data Point Model is described by EuroFilings thus:

Data Point Modelling is a methodology which intends to create a bridge between the functional design of a reporting framework – “the reporting templates” – and the technical design of an XBRL taxonomy. Over the years, this has resulted in the so-called “Eurofiling Taxonomy architecture” which is employed in the current taxonomies from EBA and EIOPA. The essence of this methodology consists of building a dimensional data model which is the foundation to the schemas and relationships in the Taxonomy.

Currently, the Data Point Model (DPM) is used throughout the European Union, the United Kingdom, South Africa, Moldovia, Israel, amoung other jurisditctions.  The DPM enables data understanding across banking, insurance, investment firms and other verticals of our economy.

I provided a high-level overview of the DPM in a prior blog post.  EuroFiling provides this introduction to the DPM. AReport is a tool for using the DPM

The origin of the DPM is the COREP and FINREP efforts which goes back to 2005 and were driven by the Bank of Spain.  This effort also led to the creation of the XBRL Table Linkbase among other XBRL standards.

Note that the DPM Methodology is different than my method which was gleaned from reverse engineering XBRL-based financial reports that used the US GAAP and IFRS financial reporting schemes.  The DPM and my method are different tools used for different approaches to reporting.

The Object Management Group (OMG) has undertaken a project, the Standard Business Report Model (SBRM), which could potentially formalize a generalized version of my method for general business reporting.  Note that my method fouses on financial reporting.

There is a third approach to implementing XBRL which is referred to as XBRL Global Ledger (XBRL GL). XBRL GL is more transactions oriented.

NOTE: If you are interested in the Data Point Methodology, you might also be interested in the Seattle Method which is another XBRL implementation approach.