It is all systems go for a new digital financial reporting system for CIPC, iXBRL, planned for roll out on 01 July 2018.
This new annual financial statement reporting system is linked to a bigger project of standardising business reporting across the country, where entities can ‘report once and reports shared more than once’ with other regulators.
The Companies and Intellectual Property Commission (CIPC) launched the mandatory Extensible Business Reporting Language (iXBRL) on 12 June 2018 and by 1 July 2018, all qualifying entities will have to use the new system when submitting their annual financial statements.
“Coming from a difficult period of state capture and corruption, iXBRL provides transparency and has the capacity to ensure there is integrity in financial reporting.”
Rob Davies – Minister of Trade and Industry
A six-week pilot programme was conducted where over 100 companies, listed and unlisted entities, were invited to test the system. We are satisfied with the results and believe the system offers users long-term benefits, especially if they integrate it with their back-end systems.
iXBRL will align the submission of annual financial statements with that of the global reporting standards for businesses.
The programme will also mitigate the administrative burden on businesses when reporting financial information to government for regulatory compliance.
iXBRL is replacing the PDF method of submitting financials.
This more structured format will ultimately reduce the burden of multiple submissions to different regulators and make it easier for government agencies to accurately and efficiently mine the financial data of companies.
Organisations expected to comply with the new standard include:
- all public companies
- private companies (qualifying and currently submitting via PDF)
- state-owned companies
- non-profit organisations
- close corporations (qualifying and currently submitting via PDF)
iXBRL reporting applies to about 100,000 qualifying entities in South Africa. This is out of a total of around 1.8 million entities registered with the CIPC.
Entities with public interest scores of less than 100 do not have to submit via iXBRL. However, low public interest score entities can submit a web based one pager form available on the CIPC website when filing Annual Returns, called a Financial Accountability Supplement. The objective being to confirm that entities comply with Financial Record Keeping Provisions prescribed in the Act.
CIPC has provided a list of 13 independent software service providers capable of assisting entities with the software and services they need to submit financials via iXBRL.
This is not an exhaustive list. Legal Entities can use their own service providers or conduct their own software development. The list was compiled to assist organisations in the sourcing of capable service providers.
Qualifying entities that fail to adhere to the new regulations when filing reports will be subject to the same enforcement provisions and penalties as before. We have not introduced iXBRL to punish companies and corporations, but rather to provide them with immediate and long-term benefits such as improved efficiency, access to industry insights and, ultimately, a platform that enhances their ability to compete globally.
Entities regulated by the CIPC can familiarise themselves with all the aspects of the iXBRL implementation on the CIPC website, www.cipc.co.za |
Queries can also be directed to XBRL@cipc.co.za |