Written by Derek Abdinor Posted on April 8, 2010
Derek Abdinor is a business communications consultant based in South Africa who writes often on XBRL topics. He wishes to thank the South African Institute of Chartered Accountants (SAICA) for their assistance in preparing this post.
Adoption of XBRL in South Africa has been characterised by a bottom-up approach. For this jurisdiction, the approach is highly effective in that it wins well-placed converts along the way and creates a well-knit apparatus that makes it attractive to regulators.
The various regulators (tax, treasury, bourse, etc.) have all indicated great interest, but stopped short of mandating XBRL in their various offices. IFRS was adopted in 2005, and the capital markets are efficient and sophisticated. Therefore, an organic growth of XBRL is well-suited to South Africa, where market participants are not (yet!) exhausted by compliance requirements.
The most successful XBRL projects to date include:
Voluntary Fling Program (VFP)
The Johannesburg Stock Exchange (JSE) is driving a voluntary filing program to the publicly listed environment, accepting the two compulsory periodic financial statements (interim and final), as well as particular JSE listing requirements and the SA Companies Act disclosures. They are marketing the VFP concept as “Digital Reporting” (XBRL is an acronym daunting enough in a country with 11 official languages!).
The JSE made its own statements available in XBRL early in the decade and is a key figure in the local jurisdiction. They launched a proof-of-concept of some entities that could be compared in the mining and financial services sectors and have taken this to the analyst community. Deloitte has been instrumental in assisting with this project, as well as creating consensus on taxonomy development within the different sectors.
Pension Funds
The Financial Services Board (FSB) is a major regulator and, amongst other duties, receives financial statements from pension fund administrators. These arrive in a variety of formats and were therefore deemed to present a perfect opportunity to experiment with XBRL. Along with a major administrator and a taxonomy developer, the interface and consumption have been very successful. Although wider adoption is planned for 2011, a phased approach is envisaged: key standards in pension administration are changing and most participants are on various technical platforms..
Marketing
South Africa is a full jurisdiction of XBRL International and celebrates five years of membership later this year. The jurisdiction is supported by the South African Institute for Chartered Accountants (SAICA), who lobby key regulators and bring them to international conferences. One could say the movement in South Africa is at that stage where the choir is well-versed in the sermon.
There are opportunities in the market for consultants, vendors, and taxonomy designers, and XBRL SA has been the recipient of interest from many African countries. We believe the VFP will increase the visibility of both XBRL and the companies involved, adding to the demand for in-depth reporting. This should pave the way for a mandate on the JSE and, with some back-office successes by the other regulators, should provide the impetus for XBRL to cross the chasm.
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