German Financial Services Industry Focussing on XBRL Norbert Flickinger XBRL Deutschland e.V. Member, Steering Committee XBRL International [email protected]@xbrl.de

German Financial ServicesIndustry Focussing on XBRL

Norbert Flickinger

XBRL Deutschland e.V.Member, Steering Committee XBRL International

[email protected] – www.XBRL.de

November 2005

mailto:[email protected]

http://www.xbrl.de/

[email protected] 2

German Financial Services Industry Focussing on XBRL

Increasingly, the German Financial Services sector is making use of XBRL

Three typical examples Deutsche Bundesbank (the German Central Bank):

Data feed into an information pool for statistical assessments – supply chain with DATEV

Deutsche Börse (the Frankfurt Stock Exchange):Publicly accessible web based system for data collection, distribution, and assessment

Deutsche Bank (Germany's leading private bank): Data import into their credit risk analysis system

[email protected] 3

Some Background Information

XBRL Taxonomies mainly to be considered IFRS

Listed companies have to report their consolidated financials using IFRS, others may do so – this concerns up to 1000 entities

German GAAP (German Commercial Code) Every company has to apply German GAAP with non-consolidated figures, e.g. for tax filing – this concerns far more than 2 million entities

US-GAAPSome companies apply US-GAAP – global players, but a very low number

[email protected] 4


IFRS Taxonomy is available Prepared by XBRL workgroup under the lead of

IASCF XBRL Germany, in cooperation with the workgroup,

is in charge of adapting it to the use in the German market (extensions, translations, education)

German GAAP Taxonomy is available A spec 2.0 version exists since 2002 developed by

XBRL Germany Enhanced version complying with spec 2.1 is close

to completion

[email protected] 5


Software Vendors and Service Providers active in the German market Besides global players including SAP, Software AG,

Microsoft, Fujitsu, Hitachi ... Also German companies focussing on the local market

such as DATEV, Nuremberg – www.datev.de

Software & IT services, ERP system including data pool for financials of 2.4 mn businesses

S&N AG, Paderborn – www.s-und-n.de Standardised and tailor made solutions for banks, etc.

[email protected] 6

Three typical examples

Deutsche Bundesbank's Project

Deutsche Börse's Project

Deutsche Bank's Project

[email protected] 7


Project summary Data pool to collect financial statement data of

German companies Bundesbank has maintained such data pool for a

long time Phase of general technical reconstruction including

XBRL functionality completed The data pool is basis for micro- and macro-

economic analyses In addition, the results are fed back to the suppliers,

aggregated information is shared with the public

[email protected] 8


Highlights of the data pool project Cooperation with several partners (banks, etc.)

delivering data on a voluntary basis Processing of about 125,000 data sets a year Main focus on balance sheet & income statement

figures Calculation of 180+ ratios per data set Results grouped by industry, size, legal form, region,

year (hypercube of about 70,000 cells) Benchmark data delivered back to contributors

[email protected] 9

POOL

BundesbankPartner• Banks• Credit insurers• etc.

Financial statements of German non-financial companies

Statistics

Database

Ratios• Cash Flow• Profitability• Leverage• ...

... by legal form

... by sector

... by size

... by region

... by year

XBRL


Graphic: Deutsche Bundesbank

[email protected] 10


Challenges Harmonisation of data format (each contributor used

to have its own) Getting rid of manual data capturing (question of

time & cost consumption, information quality) Shortening the time to market period (quarterly

update of statistics) Filtering out duplicates (data are delivered in

anonymous form, i.e. without IDs or names)


<?xml version="1.0" encoding="ISO-8859-1" ?> <financialStatementDelivery xmlns="http://www.bundesbank.de/spool/datenlieferung/2003-01-01" xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance" xmlns:xbrli="http://www.xbrl.org/2001/instance" xmlns:t="http://www.xbrl.org/german/ap/ci/2002-02-15" xmlns:ISO4217="http://www.iso.org/4217" xsi:schemaLocation="http://www.bundesbank.de/spool/datenlieferung/2003-01-01 spool.xsd" partnerName="Testpartner" partnerId=“0000000" creationDate="2003-01-01" deliveryId="1"> <financialStatement companyId="1" yearMonth="2000-12"> <reportType>h</reportType> <reportStatus>e</reportStatus> <incomeStatementType>g</incomeStatementType> <currency>EUR</currency> <xbrli:xbrl> <xbrli:numericContext id="nc1" precision="8" cwa="false"> <xbrli:entity> <xbrli:identifier scheme="urn:www.partner.de/">3,1/3</xbrli:identifier> </xbrli:entity><xbrli:period> <xbrli:startDate>2004-01-01</xbrli:startDate><xbrli:endDate>2004-12-31</xbrli:endDate> </xbrli:period><xbrli:unit> <xbrli:measure>ISO4217:EUR</xbrli:measure> </xbrli:unit> </xbrli:numericContext> <t:bs.ass numericContext="nc1">1338066</t:bs.ass> <t:bs.ass.currAss numericContext="nc1">749385</t:bs.ass.currAss> <t:bs.ass.currAss.cashEquiv numericContext="nc1">259760</t:bs.ass.currAss.cashEquiv> …

<?xml version="1.0" encoding="ISO-8859-1" ?> <financialStatementDelivery xmlns="http://www.bundesbank.de/spool/datenlieferung/2003-01-01" xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance" xmlns:xbrli="http://www.xbrl.org/2001/instance" xmlns:t="http://www.xbrl.org/german/ap/ci/2002-02-15" xmlns:ISO4217="http://www.iso.org/4217" xsi:schemaLocation="http://www.bundesbank.de/spool/datenlieferung/2003-01-01 spool.xsd" partnerName="Testpartner" partnerId=“0000000" creationDate="2003-01-01" deliveryId="1"> <financialStatement companyId="1" yearMonth="2000-12"> <reportType>h</reportType> <reportStatus>e</reportStatus> <incomeStatementType>g</incomeStatementType> <currency>EUR</currency> <xbrli:xbrl> <xbrli:numericContext id="nc1" precision="8" cwa="false"> <xbrli:entity> <xbrli:identifier scheme="urn:www.partner.de/">3,1/3</xbrli:identifier> </xbrli:entity><xbrli:period> <xbrli:startDate>2004-01-01</xbrli:startDate><xbrli:endDate>2004-12-31</xbrli:endDate> </xbrli:period><xbrli:unit> <xbrli:measure>ISO4217:EUR</xbrli:measure> </xbrli:unit> </xbrli:numericContext> <t:bs.ass numericContext="nc1">1338066</t:bs.ass> <t:bs.ass.currAss numericContext="nc1">749385</t:bs.ass.currAss> <t:bs.ass.currAss.cashEquiv numericContext="nc1">259760</t:bs.ass.currAss.cashEquiv> …

Non-XBRL header

XBRL spec 2.0


Source: Deutsche Bundesbank



Benchmark information delivered by Bundesbank

Sector Size Legal form Year Quartile 1 Quartile 2 Quartile 3

Car supplierSales > €25mn and < €50mn

Corporation 2003 11,00% 20,0% 36,0%

Own analysis of a consumer of benchmark information

Company Equity ratioCar supplier 1 23,0%Car supplier 2 17,0%Car supplier 3 41,0%

Equity funding below averageExcellent equity funding

Equity ratioGroup

Equity funding above averageAssessment

Example result

Source: Deutsche Bundesbank



Harvested benefits from implementing XBRL Embedding in an extended XML framework Concentration on just one technical and logical

format Support of strict quality checks

Significant enhancement of data quality Ability to validate data at the sender's side

Less waste And, of course, all other benefits XBRL does provide

In particular: Reduction of manual workload



Status of the project XBRL supply chain with DATEV as a supplier is

working Next steps

Building supply chains with other suppliers Extension to IFRS Taxonomy

Vision Up to 20,000 statements of German companies

based on SME-IFRS can be compared with their European peers








Motivation Increasing transparency trough greater comparability Breaking the impasse: no investor use / no issuers

provide Lead enables key determining influence and gains

meaningful experience Initiative supported by reputated partners Potential for increased small and mid cap coverage



Project summary Web based data pool Import of XBRL Instance Documents via Exchange

Reporting System (ERS) – secure data transfer Taxonomy derived from IFRS – high aggregation level,

adaptation to the German market Results publicly and free available Pre-defined reports including peer group analysis View/export as XBRL, HTML, Excel, PDF Phase 1, processing quarterly reports: running Extended version for annual reports: in preparation







Various export formats

Peer group analysis

Multiple reports



Wider benefits for the German capital market Provide a central database for listed company

financial reports Simplified access improves data quality and

confidence Enhanced coverage through electronic access Cost and time efficient data processing Data comparison / transparency








Deutsche Bank, like other banks, is affected by XBRL in several instances XBRL as a format to collect borrowers' data (Credit

Risk Management) Own disclosures to shareholders and the public Reporting to regulators Reporting within the group for internal controlling

including consolidation of data for external and regulatory reporting

"Lowest hanging fruit": data collection for CRM



Some figures about Deutsche Bank's Credit Risk Management About 3,000 employees in 20 countries around the

globe ... Process about 100,000 financial statements a year ... Use one unique model covering all accounting

standards to analyse financials as a core module in a comprehensive rating system – whereas ...

Information is held in one unique database communicating with many other systems in the bank's IT environment



Motivation Facilitate data exchange with customers, data

providers, and own addressees

Targets Replace today’s very heterogeneous landscape of

data formats by a global common standard Use potential for streamlining and enhancing

financial analysis of customer data Shift focus from input workload to analysis tasks Allow for a paperless process in future



Challenges Workflow mix for a

certain period: electronic data feed and manual capturing

Necessity to edit also electronically imported data for handling of technical and logical errors

Data Capturing & Transformation

Engine

Data Capturing & Transformation

Engine

TargetDatabase

TargetDatabase

XBRLInstance

Documents

XBRLInstance

Documents Paper based report

Paper based report

Also: DOC, RTF, XLS, HTML, TXT, PDF, …


Deutsche Bank's Project Challenges

Dealing with differing standards even XBRL based

Private & Business Clients(PBC)

Germany, Spain, Italy, Belgium, Poland

MidCap Europe

Multi-Nationals

(ICC)

num

ber

of c

usto

mer

s

dive

rsity

of a

ccou

ntin

g st

anda

rds

IFRS dominant

Local GAAPs prevailing

Mix of IFRS and local GAAPs

Graphic: Deutsche Bank



400 T EUR

150 T EUR

400 T EUR

German AP Taxonomy (HGB)

Deutsche Bank Accounting Model

Deutsche Bank's model can be seen as a private taxonomy

Rule-based transformation between taxonomies

Graphic: Deutsche Bank

550 T EUR



Project status Work ongoing, completion in 2006 scheduled Main focus in the start phase

GermanAP v2 (German GAAP taxonomy, based on spec 2.1)

Selected suppliers Dependencies

Availability of spec 2.1 compliant taxonomies Sufficient number of XBRL Instance Documents

available


Questions?

www.XBRL.org International

www.XBRL.de German

For further information on XBRL please refer to the web sites