From business accounting to statistics: Some experiences defining and using taxonomies

Transcription

1 From business accounting to statistics: Some experiences defining and using taxonomies Workshop: efficient ways of statistical data collection from enterprises Luxemburg, March 2012 Eurostat / ECB Manuel Ortega Head of Central Balance Sheet Data Office, Banco de España President of the European Committee of Central Balance Sheet Data Offices (ECCBSO) Member of the XBRL Advisory Council (XAC) of the IFRS Foundation CENTRAL BALANCE SHEET DATA OFFICE DIVISION

2 CONTENT 1. Taxonomy creation: best practice in the implementation of new statistics 2. The Spanish experience developing taxonomies 3. Data available. From business accounting to national accounts 4. ERICA database: an European case of use of IFRS extended taxonomy 5. Future needs

3 Taxonomies: best practice in the implementation of new statistics Ideal reporting process: the need of a well defined interface Taxonomy Sources of data Data users

4 Taxonomy creation: best practice in the implementation of new statistics Challenge: how to provide more details with less reporting burden Need to reduce the reporting burden in Europe: Diferent demanders of information: - Fiscal authorities, Mercantile Registers, statistical units, comercial banks, shareholders, university researchers, local governments, others. Diferent detail levels, deadlines and electronic standards But: incresing demand of more data / more homogeneous: Problem: diferent national GAAPS Hope: this is the first time in history that Europe has a common standard (IFRS for listed groups) How to face this challenge?: with more harmonization

5 Taxonomy creation: best practice in the implementation of new statistics Every new statistics should create a data model or taxonomy When possible, also mapped to a well known and extended used business (or accounting) standard: Advantage: harmonization Problems: Governance: who provides legality to the mapped elements? One single statistics but with different regulatory frameworks. Solution: multiple mappings / XBRL and the Data Point Model Three remarkable experiences: Experience of SBS taxonomy project (2009) Eurofiling (DPM), conecting supervisory and statistical needs Other Data Point Model taxonomy: Spanish CII

6 Credit institutions Pension funds Insurance corporations SBS taxonomy project (2009) Taxonomy of the financial modules of SBS Items in the module of which, optional of which, pilot study 19 Not of accounting nature Of Accounting nature Items in the taxonomy

7 SBS taxonomy project: main conclusions Taxonomy of the financial modules of SBS A taxonomy can help regulators to better assess the reporting burden of a set of statistics: 1. The modules for pension funds and credit institutions were sometimes quite detailed, but manageable in general terms. 2. The module for insurance corporations was very large and detailed, because: All items were split by activity: life, non-life, composite (often split in life and non-life), reinsurance. Too exhaustive breakdowns: Gross premiums written by country and by CPA product (around 1500 items). 7

8 Role of a Data Model reporting entity Data requirements + concepts definitions Data Model? Data exchange format: XBRL taxonomy supervisor analysis and audit data 13/07/2011 8

9 Structure of the Eurofiling project International standards Taxonomy Data Model JEGR common statistical requirements 13/07/2011 9

10 Comparison of reporting frameworks (I) FINREP COREP BSI-MIR Purpose Standardization of supervisory financial reporting based on IAS/IFRS for banks (framework is not intended to cover all the disclosure requirements of IAS/IFRS, nor solo reporting) Capital adequacy reporting. Check, If there is enough own funds to cover all the risk that institution face BSI: Regular production of balance sheet of the money-creating (issuing) sector in EMU (stocks and flows) MIR: Type of information collected is quite different than in COREP and FINREP Background IAS/IFRS Capital adequacy directive (based on Basel Accord and its amendments) Banking Accounts Directive 5 (BAD) ESA 95 and System of National Accounts (SNA 93) IAS/IFRS Stability IAS/IFRS changes every year but not all changes are very significant from banking supervision perspective. Should be stable for at least 5 years. Significant changes to the CRD (Basel II) in the future should not be frequent, but so far: CRD (2006), CRD II (2008), CRD III (2009), CRD IV (work in progress). Idea: Should be stable for at least 5 years. Quite stable, because time series analysis is crucial Structure Based on core and non-core templates, which are inter-connected and complementary Based on general (CA) and detailed (CR, MKR, OPR) information templates, which are inter-connected and complementary BSI is based on a set of five monthly and quarterly tables, which are interconnected and complementary 13/07/

11 Comparison of reporting frameworks (II) FINREP COREP BSI-MIR Reporting population Goal: all EU credit institutions and other supervised financial corporations Practice: All listed EU credit institutions Credit institutions and investment firms across EU BSI: EMU resident MFIs MIR: Comparing to BSI reporting population does not include central banks and money market funds (MMFs) Consolidation scope Mostly CRD scope of consolidation but IAS/IFRS scope of consolidation is also possible in some cases CRD scope of consolidation. In practice insurance undertakings, investment funds and other less relevant financial institutions as well as non-financial subsidiaries are not consolidated. Consolidation of business of all banking offices (registered or head office, and/or branches) located within the same national territory (the host principle). Nonbanking subsidiaries are not consolidated Valuation concepts Fair value or cost/amortized cost (IAS/IFRS) Risk, not the value is cruicial, so for credit risk value adjustments and provisions, as well as credit risk mitigation technics are taken into consideration BSI: In general: Deposit liabilities and loans shall be reported at their principal amount outstanding at the end of the month (write-downs shall be excluded from this amount). Items other than Deposit liabilities and loans can be reported according to IAS/IFRS Accrued interest of loans and deposits to be reported under remaining assets/liabilities MIR: Nominal amounts; Bad loans are excluded 13/07/

12 Reuse of breakdowns FINREP rev 2 Market FINREP Fair value level Portfolio Comprehensive income Controling/ Non-controlling Transfer ECB Statistics Loan type Amount interval Minimum reserve Main categories Amount type Risk type Impairment Currency Geographical areas Collateral Sector Percentage Intervals Entity code Time intervals Approach Exposure type Securitization type COREP chronologically FINREP created first (FINREP rev2 extends FINREP with 1 breakdown) ECB statistics (BSI-MIR) reuses 9 breakdowns of FINREP draft COREP reuses 8 breakdowns of both BSI-MIR and FINREP, one with BSI-MIR and two with FINREP 13/07/

13 FINREP rev 2 Market Extension for a new framework: Solvency II FINREP Fair value level Comprehensive income Controling/ Non-controlling Transfer Loan type ECB Statistics Amount interval Minimum reserve Main categories Amount type Portfolio Risk type Impairment Currency Geographical areas Collateral Sector Percentage Intervals Entity code Time intervals Line of business Exposure type Type of business Approach/Mode l used Securitization type Diversification Type of contract COREP Change in basic own funds Type of claim SOLVENCY II 13/07/

14 Taxonomy Layers Dictionary Concepts declarations, labels and references Dimensional relations Complete model of data requirements Presentation relations Current data requirements design and stability of mapping flexible views Data warehouse User interface 13/07/

15 Integrated reporting: integrated scoreboard (CII) A Data Point Model taxonomy developed by AECA (Spanish association of Accounting and Business Administration), vicepresidents of XBRL Spain * 29

16 Integrated reporting: integrated scoreboard (CII) 29

17 Integrated reporting: integrated scoreboard (CII) 29

18 Integrated reporting: integrated scoreboard (CII) * 29

19 CONTENT 1. Taxonomy creation: best practice in the implementation of new statistics 2. The Spanish experience developing taxonomies (XBRL) 3. Data available. From business accounting to national accounts 4. ERICA database: an European case of use of IFRS extended taxonomy 5. Future needs

20 Taxonomy development in Spain (XBRL) Strategy Collaborative work, under the presidency of the key actor : Examples: Spanish GAAP taxonomy/ National accounting setter Financial institutions taxonomy / Bank of Spain Providing assistance when necessary: regulators without XBRL staff only has to approve the presentation and definition link base Accepting the collaboration of private companies (software vendors, and commercial data providers) XBRL Spain acts as umbrella in those taxonomies without a regulator empowered (General identification data, GDI taxonomy) First efforts in the development of the basic taxonomies (GDI, National GAAP) Main problem faced: real cases (test) doesn t exist normally

21 Taxonomy development in Spain (XBRL) Strategy Development of prototypes (i.e.: in 2007 the accounting plan changed / we prepared a taxonomy with the old one, with real cases) Modular approach: Develop first the core data (i.e.: Balance and Income statement / in a second phase, the notes) Each regulator its own taxonomy: don t try to extend from the beginning (bad practice, but it works quickly!!) Engage the regulators (SEC/Ministry of Justice/Bank of Spain): Official approval of the taxonomies Compulsory use: companies will not use them voluntarily

22 Taxonomy development in Spain (XBRL) National Institute of Statistics: Statistical taxonomies? Work actively in several working groups (Spanish GAAP / General Identification Data) Doesn t produce XBRL statistical taxonomies Basic taxonomies used for statistical purposes IPP: business accounting of listed corporations and groups PGC 2007: National GAAP, for non financial corporations ES-BE-MIR / BIS: statistical taxonomies for financial institutions NOFCAC-2010: National GAAP, for non financial groups (non listed) DGI: general identification data CONTAEP: accounting of public institutions

23 Taxonomy development in Spain (XBRL) Taxonomies list XBRL SPAIN TAXONOMIES Updated as of 2012/03/03 ACRONYM DENOMINATION RESPONSIBLE FOR GOAL VERSION EDITION DATE / USE (a) USE / NOTES IPP Financial Periodic Information CNMV Financial periodic information of the issuing entities (CNMV Circular 1/2005) / / ,940 entities quarterly. Preparation of periodic public information models of the issuers of securities admitted to trading on stock exchanges IIC Undertakings for collective investment in transferable securities CNMV Financial Statments (Circulars 4/2008, 3/2009, 6/2010 and 4/2011) / / / / 2012 Preparation of the quarterly, semiannual and annual reports, described in the Annexes of the Circular 4/2008, 3/2009, 6/2010 and 4/2011 of the CNMV, that UCITS must provide to its members or participants and to the CNMV. FTA Asset Securitisation Funds CNMV PGC90 Taxonomy used to prepare annual accounts, financial statements and the confidential Statistical Information of Asset Securitisation Funds to be sent to the CNMV w ith different periodicity (quarterly, semiannual and annual). Circular 2/2009 of 25 March 2009 and 4/2010 of 14 October Spanish GAAP 1990 ICAC Annual accounts defined in the National Accounting and Auditing Institute of 1990, that Spanish corporations have to deposit in the Mercantile Registers / / / 2006 December 2007 / 2008 Currently, 8 managers have to send to the CNMV reports of over 600 funds Abbreviated format, Balance Sheet & Profit and loss account. In 2008 annex Normal format No effect. PGC2007 NOFCAC2010 DGI Spanish GAAP 2007 ICAC Annual accounts defined in the National Accounting and Auditing Institute of 2007, that Spanish corporations have to deposit in the Mercantile Registers Rules for Preparation of Consolidated Financial Statements 2010 Spanish Global Common Document for General Identification Data ICAC Mercantile Registry Consolidated accounts as defined in the rules for Preparation of Consolidated Financial Statements 2010, to be deposited by the Spanish non-financial companies in the Commercial Registries Common data used by different institutions to identify entities 2008 / / / / 2012 Use from 2009 to deposit annual accounts / 2011 Use from 2011, consolidated accounts / / / / / 2011 The 2006 version, w ith status of "acknow ledged" by XBRL International. Version 2007 w ith module selection tool. Versions 2008 and 2011 to provide support to PGC2007

24 Taxonomy development in Spain (XBRL) Taxonomies list ES-BE-TAS Appraisal companies Banco de España Public information sent by appraisal companies / / / 2010 ES-BE-PAC IAC.01 State of credit institutions Banco de España ES-BE-BSI States relating to the statistical requirements of the European Economic and Monetary Banco de España Make it easier for institutions to use the capital adequacy assessment process set out in Article 123 of Directive 48/2006 of the European Parliament and the Council on access to the business of credit institutions and exercise Modification of the Circular 4/2004 of 22 December, standards of public and confidential financial information, and financial statement formats / / corporations Esta taxonomía se basa en una versión preliminar de la taxonomía FINREP 2012 del proyecto Eurofiling ES-BE-MIR Information on interest rates for credit institutions Banco de España Statistics of interest rates w hich apply to deposits and claims on households and nonfinancial corporations / 2010 ES-BE-ECM Financial Information Exchange facilities Banco de España Amending Circular 6/2001 of 29 October on Holders currencyexchange / 2010 ES-BE-FINREP Financial reporting Banco de España Banco de España Reporting the declaration of states defined in the annexed Solvency of Circular 3/2008 of Bank of Spain / 2009 ES-BE-COREP COREP Banco de España Banco de España ES-BE-CB Central Balance Sheet Data Office, reduced, normal questionnaires Banco de España (Central Balance Sheet Data Office) This taxonomy is based in the states of solvency contained in Circular 3/2008 Bank of Spain, as amended by Circular 4/2011 Taxonomy extension of the PGC2007 taxonomy for contributing corporations on a voluntary basis / / / / / / / 2012 At the beginning of 2008 by 8 entities. In 2009, w ith 100% entities corporations in electronic questionnaire ES-BE-SGR States of mutual guarantee Banco de España States defined in the Ministerial Order EHA / 2010 This taxonomy is based in the States of mutual guarantee contained in the Ministerial Order EHA ES-BE-RPSGR Solvency States Mutual Guarantee Societies Banco de España States defined in Circular 5/2008 of the Bank of Spain / 2009 This taxonomy is based in the states of solvency of mutual guarantee companies listed in Circular 5/2008 of 31 October, from the Bank of Spain, to the mutual guarantee on minimum capital requirements and other information

25 Taxonomy development in Spain (XBRL) Taxonomies list CONTALOC CONTAEP Local Accounting: Financial statements Accounting business public sector entities and foundations: Annual accounts and other information to provide the Court of Auditors General State Comptroller (IGAE) General State Comptroller (IGAE) To report the annual financial statements of municipalities, local authorities and their affiliated organizations to the External Control Organizations To report the annual accounts and other information to the Spanish Court of Audit 2010 / / 2011 CONTAEPA Accounting accounting of public administrative entities: Annual accounts to submit to the Court of Auditors General State Comptroller (IGAE) To report the annual accounts and other information to the Spanish Court of Audit 2012 / 2012 LENLOC PENLOC Budget implementation for municipalities and local authorities Budget preparation for municipalities and local authorities General Secretariat for Regional and Local Coordination General Secretariat for Regional and Local Coordination Local Entities must bring to the General Secretariat for Regional and Local Coordination (Ministry of Finance and Public Administrations) the budget implementation. Local Entities must bring to the General Secretariat for Regional and Local Coordination (Ministry of Finance and Public Administrations) the budget preparation. March 2007 / / / / 2011 Official Bulletin of the State EHA/3565/2008 Official Bulletin of the State EHA/3565/2008 ICAL 90 Consultation of accounting statements Andalusia Audit Commission Publlic dissemination of accounting time series of local entities and related Andalusian companies / Dec ICAL90 Taxonomy is the technological w ay the Audit Chamber of Andalusia public offers citizens the historical financial information of local authorities and companies involved in XBRL format for optimum digital processing and a key to give support decision-making of economic and social XXI century. CGI-RSC General Table of Indicators (CGI-RSC) AECA CCI-RSC General Table of Indicators (CGI-RSC) is comprised of about 500 indicators derived from a selection made tw enty-five sources, national and international information on RSC: codes of good governance, sustainability indexes, codes of conduct, guidelines for reporting and certifications, etc.. Central Table of Indicators (CCI-RSC) AECA The Central Table of Indicators (CCI-RSC) is comprised of 27 key indicators (Key Performance Indicators) selected through an empirical study of best practices in leading international companies in the CSR report / / / 2011 Indicators (statement-data), qualitative and quantitative, are classified into eight major groups: General information about the company, governing bodies, employees, customers, suppliers, community, environment and competition. Indicators (statement-data) are only quantitative and fits into three main sections: economic (9), environmental (5) and social (13)

26 Taxonomy development in Spain (XBRL) Taxonomies list COREP FINREP CBSO-RF FLIPA CONTRIBUTION TO INTERNATIONAL TAXONOMIES Common Reporting CEBS (Bank of Spain) Common core information on financial entities solvency, included in pillar I of the Basel II accord and its transposition to the European regulation (recast Directive 2006/48) Financial Reporting CEBS (Bank of Spain) Creation of financial statements of credit institutions for supervising bodies, based on IFRS European Central Balance Sheet Data European Committee of Taxonomy based on the International Financial Reporting Standards Offices Central Balance Sheet (extensión of the IFRS-GP taxonomy) Data Offices (III WG) International Association of the Credit insurance International Association of the Credit insurance January 2007 / July 2007 In use for several CEBS countries. See w w w.corep.info September 2006 / May 2007 In use for several CEBS countries. See w w w.finrep.info / 2007 Creation real cases of IFRS accounts of consolidated quoted European groups. Additional details, see http: // w w w.iasb.org/xbrl/xbrl_lab/eccbsopub/index.html Services of Evaluation of Credit risks CRAS 2005 / 2007 In process of securing of consensus for end

27 CONTENT 1. Taxonomy creation: best practice in the implementation of new statistics 2. The Spanish experience developing taxonomies (XBRL) 3. Data available. From business accounting to national accounts 4. ERICA database: an European case of use of IFRS extended taxonomy 5. Future needs

28 Data available; from business accounting to NA Data available: non financial corporations databases CBA: Annual database CBQ: Quaterly database CBB: Database from the Mercantile Registries Number of companies % , ,3 40, ,5 33,9 31,6 30, ,6 30, ,7 19,3 20,1 20,0 14,9 13,1 13,8 11,2 13,8 12,3 11,6 13,7 15, , , I-10 II-10 III-10 IV-10 I-11 II-11 III ,0 NUMBER OF COMPANIES (left scale) COVERAGE: Gross value added at basic prices of the database w ith respect to non-financial companies total (right scale) 28

29 Data available; from business accounting to NA Grossing up process to total population (national accounts) MENF project: Multiplier of non Financial Corporations (grossing-up process) Purpose: obtain contrast data for FASE based on System of European National Accounts 1995 Steps (in brackets, year of beginning of the works): 1. ESA79/ESA-95 format : transition table(1989) 2. Annual accounts available (enough small firms): breakdown by sectors of activity and size (1991) 3. Relevant Adjustments (hierarchically with other sources: i.e. subsidies and capital transfers) (1994) 4. Valuation at market prices (1996) 5. Total Population (DIRCE) System of multipliers (1998). Grossing up process

30 Data available; from business accounting to NA Non financial corporations Balance-sheets Use of CBSO data for Financial Accounts Financial transactions FA L FA L Currency and deposits Currency (1) Currency (1) Debt securities Financial derivatives Loans Quoted shares Unquoted shares (2) Other equity (3) (3) Mutual fund shares Insurance technical reserves (4) (4) Trade credits (5) (5) (5) (5) Other advances

31 Data available; from business accounting to NA Use of CBSO data for Financial Accounts: structural ratios [1] Currency: cash ratio ( Currency/Transferable deposits) [2] Unquoted shares issue by NFCs Market value= NOR (Profits)/ [r (Discount rate)+3%] r= IRR from stock market 3%= illiquidity premium [3] Shares held by General government Book value or market value (for public liability companies) [4] Insurance technical reserves Actuarial criteria [5] Trade credits (aim: to maintain the same structure of balance-sheet) R1 = suppliers/ IFMs loans R2= clients/suppliers Information on commercial paper discounted on IFMs Ratio on loans granted/received from RoW

32 CONTENT 1. Taxonomy creation: best practice in the implementation of new statistics 2. The Spanish experience developing taxonomies (XBRL) 3. Data available. From business accounting to national accounts 4. ERICA database: an European case of use of IFRS extended taxonomy 5. Future needs

33 ERICA database: an European case of use of IFRS extended taxonomy A project of the European Committee of Central Balance Sheet data Offices (ECCBSO) Use of IFRS XBRL taxonomy, extended for statistical and risk assessment purposes Monitoring with real examples (over 150, from ) Creation of an extended version Definition of essential information, and creation of a common and reduced format Creation of a taxonomy: work in collaboration with IASCF- XBRL Team Extending the database to more than listed European groups

34 Contents of the extended format (R): also in reduced format General characteristics (R) Options IAS Business combinations (R) Consolidation (R) Employment (not required by any IFRS) (R) Balance sheet (R) Income statement (by function or by nature) (R) Statement of changes in equity (R) Cash-flow statement (direct, indirect or indirect alternative) (R) Notes

35 There is a note for each of the following items: Property, plant and equipment (R) Borrowings and payables Investment property (R) Borrowings movements Intangible assets (R) Income tax Biological assets Defined benefit postemployment plans Financial assets (R) Equity Current assets Related parties Provisions and grants (R) Segment reporting Hedging instruments and risk Assets held for sale

36 European CBSO: IFRS and XBRL working together Erica Database: the underlying format

37 The European Committee of Central Balance Sheet Data Offices (ECCBSO) Know more, about it and its databases (BACH, ESD and ERICA), in:

38 CONTENT 1. Taxonomy creation: best practice in the implementation of new statistics 2. The Spanish experience developing taxonomies (XBRL) 3. Data available. From business accounting to national accounts 4. ERICA database: an European case of use of IFRS extended taxonomy 5. Future needs

39 Future needs Immediate needs: Transition table between IFRS and SNA 2010 Collaborative work to this purpose? Creation of a permanent working team for statistical taxonomies development?: Mix composition (business accounting / statistical definitions) Multinational scope

40 QUESTIONS? STATISTICS DEPARMENT