Digital Financial Reporting

Getting XBRL-based digital financial reporting to work effectively is not about solving one big "problem"; it is about solving lots of little problems.  Think about the problem in terms of a "template".

Here is a template within a ZIP archive. (Here is the human-readable information.) That is what a software application must manage, the successful creation of that template by a business professional.

Now, the template could take the form of any of the patterns in this proof. You need ONLY support those patterns. This is the architecture.  A rules engine watches over everything. Boundaries are well defined.

The templates might be for different reporting schemes: US GAAP, IFRS, IPSAS, MINI, FRF for SMEs, XASB. But every one of those templates would follow the same set of patterns in this proof.

An XBRL-based digital financial report is not one big thing; it is lots of little things.  The full report can be thought of as a stream of templates.  Each template must be sound and each template must interact with other templates.

Software must control the possible "impediments" to success.  Here are those: Impediments 1, Impediments 2, Impediments 3.  Those impediments are overcome using rules which prevent information anarchy.

This is how all of these examples work.

This video play list, Understanding the Financial Report Logical Model, explains the details.

HETS (the heterogeneous tool set) is explained as follows:

Hets is a parsing, static analysis and proof management tool incorporating various provers and different specification languages, thus providing a tool for heterogeneous specifications. Logic translations are first-class citizens.

There is a user guide.  BE SURE to watch this short video.  Frankly, I don't know exactly what this is, but it seems important. The interfaces are interesting.

There is a video, and in the video they use a tool called uDrawGraph.  That is likewise very interesting. This is a information related to using uDrawGraph. This description of uDrawGraph is important:

uDraw(Graph) is an interactive tool to visualize directed graphs.

Why is that important? Note the phrase "directed graphs".  As I have pointed out in the past, that word "directed" is critically important.  Also, the term "graph" is important as contrast to "tree".

Along these same lines is this paper which explains a safe extension of DATALOG.

More to come...

Pascal Bornet posted an insightful graphic that explains why most business professionals don't understand the changes that will be caused by artificial intelligence:

I taught an accounting information systems class at the University of Washington and there was not one student in the class that knew how to program, even Excel VBA.  It amazes me how many accounting students and business professionals that think they understand Excel but cannot even write simple VBA code.  Also, while Excel is an excellent tool, Microsoft Access is an even better tool for many tasks than Excel.  What really blows my mind is that you can have an entire team of accountants and not one person on that team can write VBA code!  If you know VBA and SQL you have an an excellent skill set.  Throw onto that XPath and XML and you can do even more.  Master XBRL to that and you can do even more.

Personally, I think my personal skill set is about three quarters of the way up that right side line toward the top.  I wish I could get my head around graphs better.  I don't think I can get my head around stuff good enough to be able to program complex stuff myself.  But, I understand enough to be able to talk to software engineers effectively.

I would really encourage business professionals to read and understand the information in Artificial Intelligence and Knowledge Engineering in a Nutshell.  AI is real. Get ready.  Heck, even better...help create the future of accounting, reporting, auditing, and analysis.  Why? As is said, "The best way to predict the future is to create it."

Pesseract is a working proof of concept that was created by Hamed Mousavi, a software engineer, and myself. Hamed and some of his colleagues won the prize of 9th XBRL Global Academic Competition 2008-09, which was held in Bryant University, USA. 

Pesseract is not a commercial product yet, but it is very robust software application that works incredibly well for a proof of concept.  It can help you understand what you should be asking other software companies for in terms of features and functionality.  Here are several ways to understand Pesseract: 

• Screen shots: About 30 screen shots that help you see the features.
• Videos: Several video play lists.
• Download: Download the application and try it out for yourself.
• Pesseract Testing: Download these files and try Pesseract locally. (Use this documentation to understand the steps you should perform. Helps you understand the method below.)
• Demonstration scripts: About 20 demonstration scripts that you can read, or walk through yourself (if you download the software.
• Method: Good practices/best practices based method for creating a process control mechanism that consistently yields high-quality XBRL-based financial reports where the model can be “reshaped” or “altered” by report creators explained as briefly as is possible. (Supported by Pesseract).
• Mastering XBRL-based Digital Financial Reporting: Try any of the 12 test cases that I have created to exercise XBRL-based digital financial reporting.  Pesseract was used to test and develop a lot of these ideas.

If you download the software and want a license, email me and I will get you a license and send you instructions how to install the license.

Set the bar high!  Don't settle for substandard software.  Push software vendors in the right direction by being an informed buyer.

Want to try creating XBRL-based financial reports? Try Luca.

EngineB says that they are about bringing the "digital revolution to professional services".  EngineB calls for a common data model.  There are three videos on their home page that explain what they are up to.  You can follow them on LinkedIn here.

This 30 minute video helps you better understand what EngineB is up to.  Seems like Microsoft is behind what EngineB is doing.  In the video, the CEO of EngineB says that "every accounting firm that you have ever heard of is involved".  He says that 69% of an audit can be automated and that we can move to "continuous audit".

EngineB is not trying to change what companies do internally.  Their focus is when you have to interact with an external party you can use a common format making information exchange more effective and efficient.