XBRL is the acronym for Extensible Business Reporting Language. It is a language for the electronic communication of business and financial data which is revolutionizing business reporting around the world. It provides major benefits in the preparation, analysis and communication of business information. It offers cost savings, greater efficiency and improved accuracy and reliability to all those involved in supplying or using financial data.
From 2010-11, MCA implemented filing requirements for various classes of companies to file their financial statements in XBRL format, to improve the quality of statements, enable greater transparency and comparability of data.
Applicability of Filing Financial Statements in XBRL mode with Registrar of Companies
Following class of companies are required to file their financial statements and other documents under section 137 of the Companies Act, 2013 with the Registrar in e-form AOC-4 XBRL:
- All companies listed in the stock exchange in India and their Indian subsidiaries.
- All companies with a turnover of Rs. 100 crores or more.
- All companies with a paid up capital of Rs. 5 crores or more.
- All the companies which are required to prepare their financial statements in accordance with the Companies (Indian Accounting Standards) rules, 2015.
Non-banking financial companies, Housing finance companies and Companies engaged in the business of Banking and Insurance sector are exempted from filing of financial statements under these rules.
The companies which have filed their financial statements in XBRL under section 137 shall continue to file their financial statements and other documents in XBRL only, though they may cease to fall under the class of companies specified above.
Filing of Financial Statements in XBRL mode
According to MCA Taxonomy, complete set of Annual Report is required to be filed in XBRL format. Major components of Annual report are as follows:
- Balance Sheet
- Profit and Loss Statement
- Cash Flow Statement (Direct or Indirect)
- Schedules & Notes to Balance Sheet and Profit and Loss Statement
- Significant Accounting Policies
- Statement of Change in Equity
- Independent Audit Report with annexures thereto
- Director or Board Report with annexures thereto
Preparing financial statements in XBRL mode for filing with the Registrar
The process for creation and filing of Financial Statements in XBRL mode is as under:
Step 1: Creation of XBRL instance document
Step 2: Download XBRL validation tool from the MCA portal
Step 3: Use the tool to validate the instance document
Step 4: Perform pre-scrutiny of the validated instance document through the tool
Step 5: Attach instance document to the Form AOC-4 XBRL
Step 6: Submitting the Form AOC-4 XBRL on the MCA portal