XBRL and IFRS
A Missed Opportunity?

One of the big reasons Canadian companies say they are holding off on XBRL is because they are caught in the throes of IFRS implementation. This is understandable, since IFRS implementation for most companies is a huge undertaking. However, the reason may also be somewhat fallacious in that there can be economies in implementing both simultaneously, even though this may not be intuitively obvious.

The thing is, when implementing IFRS, companies need to dig into the IFRS standards, and understand how it affects individual items in their financial statements as compared to Canadian GAAP.

In implementing XBRL, a roadmap showing the impact of IFRS on individual items is provided through the IFRS taxonomy. All major taxonomies contain reference linkbases, that contain references to the standards underlying particular elements in the taxonomy. The reference linkbase in the IFRS taxonomy contains the name, number and date of issue for the standards relevant to each particular financial statement item.

Those who are implementing IFRS may gain valuable insight into the effects of IFRS by using the IFRS taxonomy as a helpful aid.

Of course, the Canadian GAAP taxonomies also contain reference linkbases that refer to the relevant Canadian standards. Therefore, using both the Canadian and IFRS taxonomies, there is a cross referencing roadmap available for IFRS implementation enabling reference to the Canadian standards and comparison to the IFRS standards.

XBRL Canada is in process of building a convergence tool that is soon to go into testing phase. The prototype is available on the web, and will soon contain mappings from a common point (the giffe) to both the IFRS and Canadian GAAP taxonomies, and can be used to produce preliminary instance documents in both sets of standards for comparison.

Companies that defer XBRL implementation until after IFRS implementation may be missing an opportunity to achieve some real efficiencies for both projects.