Digital Financial Reporting

As someone put it, rather than "paving the goat path" and replicating existing inefficiencies related to old-school paper-based reporting in XBRL-based digital financial reporting software; we chose a different path.

One type of practical knowledge is know-how; how to accomplish something.

Creating a knowledge based system involves the transformation of machine-readable instructions in such a way as to explain to a machine how a system works and how to make a system work the way you want that system to work.

Then, brick-by-brick, much like building a house, business domain experts and software engineers can create tools that automate certain types of tasks in that process. Humans encode information, represent knowledge, and share meaning using machine-readable patterns, languages, and logic. That will be the way an increasing number of work tasks will be performed in the Digital Age of accounting, reporting, and auditing.  The result will be more efficient processes.

A software engineer and I tested the feasibility of creating an expert system for creating XBRL-based structured financial reports to prove the concept.  We are making that software available free of charge until March 31, 2018.

We also provided information about the techniques we used to create this working proof of concept.  The document, Putting the Expertise into an XBRL-based Knowledge Based System for Creating Financial Reports, provides this information.

We will be making this software available free of charge to filing agents, software vendors, accountants, and public companies as part of my Campaign to Improve Disclosure Quality of XBRL-based Public Company Financial Reports Submitted to the SEC.  This is an excellent opportunity to understand the explicit knowledge and the tacit knowledge needed, the know how, to build such a system and how that system needs to work in order to be considered useful by professional accountants.

The software engineer that is collaborating with me on this and his colleagues won the prize of 9th XBRL Global Academic Competition 2008-2009, which was held in Bryant University, USA.

In addition, another software vendor has implemented these ideas in a product that is commercially available.  This is explained in the document, Process for Verifying Quality of an XBRL-based Financial Report, which helps one understand how to create a reliable, repeatable process for creating quality XBRL-based financial reports.

We believe this will be an industry changing technology, disrupting the process of creating financial reports. Most people don't recognize this yet because they don't understand the paradigm shift that is occurring. But, we do.

If you don't want to follow the same old goat path, read PART 1 to understand the general approach to what we are doing and PART 2 to better understand the conceptual model of an intelligent XBRL-based digital financial report.