NEW DELHI: Domestic mpanies may soon have to file financial statements in a mputerised format to enable easy flow of information between 

regulators and facilitate mprehensive financial data analysis.

In a letter to the ministry of rporate affairs, the Institute of Chartered Acuntants of India (ICAI) has asked the ernment to mandate all mpanies to file their financial statements in a format known as XBRL, or eXtensible Business Reporting Language.

XBRL enables electronic mmunication of financial and business data and stores information in a format that can be aessed by all stakeholders for fast and easy analysis. “If the financial statements are filed in XBRL format, not only will this ease the process of regulatory for both the mpany and the ministry but also provide benefits such as easier and effective analysis by various stakeholders who may aess the filed financial statements,” ICAI president Uttam Prakash Agarwal said in his letter.

The acunting regulator’s proposal is aimed at changing the process of regulatory filing of annual acunts by mpanies, which is physically filed with the Registrar of panies. The proposal, if aepted, will lead to the creation of a repository of electronically-maintained financial data that can be used for analysis by all stakeholders.

The strategy will benefit all those who llect business data, including ernments, regulators, enomic agencies, stock exchanges, financial information mpanies, and those who produce or use it including acuntants, auditors, mpany managers, financial analysts, investors and creditors.

Banks, for example, will benefit from an XBRL-enabled financial data management system in determining credit appraisal of their rporate borrowers, ICAI explained in its presentation before the ernment.

XBRL uses an electronic dictionary of business and financial terms for enabling such a transformation in the system. Indicating that the groundwork for the transformation was ready, ICAI informed the ernment that the taxonomy for preparing XBRL-based financial statements for mmercial and industrial enterprises was ready.

XBRL enables producers and nsumers of financial data to withdraw resources from stly manual processes that involve time-nsuming mparison, assembly and re-entry of data.

The mpanies can use XBRL to save sts and streamline their processes for llecting and reporting financial information.