Testing XBRL, the financial reporting standard, requires domain knowledge in order to understand how to develop an effective test strategy. When we test XBRL, we need to first understand it’s specifications, taxonomy and instance documents:
1. XBRL Specifications
This defines specialized terms, indicates how to create financial reports based on XBRL Specifications, and how to create XBRL Instance Documents and XBRL Taxonomy.
2. XBRL Taxonomy
An XBRL Taxonomy is a collection of taxonomy schemas and linkbases. A taxonomy schema is an XML schema document. Linkbases are XML documents which follow the XLink specification. The schema extends the XBRL instance schema document and typically extend other published XBRL schemas as per the xbrl.org website.
3. XBRL Instance Documents
An XML document contains XBRL elements. The financial statements of a Company or any part thereof, expressed in XBRL, would be an instance document as would an HTML file that had various embedded XBRL items.
XBRL Testing points:
Based on understanding the specifications, taxonomy and instance documents, then we need to pay attention to XBRL specific testing issues:
XBRL is an open technology standard for reporting and analyzing business and financial information. After data is exchanged, the data should fit the uniform XBRL standard.
Software applications need to recognize information in an XBRL document – selecting, analyzing, storing, and exchanging it with other computers and present it in a variety of ways for users. When testing for this functionality, we must check that the XBRL data can be operated on and then be read accurately by receiving computers, operating systems and applications software.
When selecting, analyzing, storing and exchanging data as part of a business process, the data should be accurate. Usually, large quantities of data will lead to more problems not only due to volume but also disparities. For instance:
Data lost, such as Total Amount or other fields within individual records.
Data misplaced, such as some data that belongs to report A, but after analyzing and filtering, it is displayed in report B.
Data format error, such as currency format for a different country.
Meta data lost, such as in some financial report, there are some specification information to describe the meaning of the data in the report.
Cross platform compatibility
XBRL is a cross-platform standard. Therefore, for browsers that support XML, the data should work with different browsers across operating systems. In the different operating systems, such as Windows, UNIX, Linux and so on, XBRL files should be able to be used directly without any modification. So when performing testing, all functionality that uses data across the platforms should be tested.
Since XBRL is used to exchange information over the internet between financial institutions, information security is a critical and one of the most important aspects of testing. System and software security testing should be done extensively and include:
- Confidential Information: Any confidential information or any other proprietary data should not be disclosed without specific permissions.
- Data Integrity: Any information or any other proprietary data must be kept in integrity; any unauthorized person cannot make any changes or destroy the data.
- Effectiveness: Ensure the authorized visitors can effectively access the documents or computer resources according to their privileges.
- Authorization: Only authorized users can be access to use the resources.
So while testing XBRL is rather simple, you still need to have background knowledge of the data standard and how it is used in financial institutions. This will enable you to make specific test scenarios that employ the XBRL data format and test the application’s ability to use and access XBRL data.