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October 25, 2000 NIVRA de Accountantsdag 1
E-BUSINESS
JAMES M. SYLPHTechnical Director - IFAC
October 25, 2000 NIVRA de Accountantsdag 2
DEFINITION of E-BUSINESS
Any business that uses e-commerce and related technologies and processes to develop, expand or enhance its business activities.
October 25, 2000 NIVRA de Accountantsdag 3
And the Internet means…
• Small companies can act like large companies• Large companies can act like small companies• Every company is a “dot com” company, whether
you want to be or not• Fundamental change of infrastructure• Big opportunity, but also a big threat• Change
October 25, 2000 NIVRA de Accountantsdag 4
SUCCESSFUL E-BUSINESS
• NOT just posting information on web site
• find ways to– attract customers– drive down costs– deliver services
October 25, 2000 NIVRA de Accountantsdag 5
KEY ELEMENTS IN THE VALUE STREAM
• Investment in software
• Intangibles
• Intellectual capital
TRADITIONAL ACCOUNTING DOES NOT MEET THE EBUSINESS NEEDS
October 25, 2000 NIVRA de Accountantsdag 6
THE FINANCE FUNCTION
• Manage value creation
• Get the capabilities in place
• Consistency
• Consider TVC®
• Consider XBRL
October 25, 2000 NIVRA de Accountantsdag 8
Why XBRL ?
Enable business reporting that leverages the Internet & XML
Effective access and analysis of business reports
Improve corporate communications with stakeholders
October 25, 2000 NIVRA de Accountantsdag 9
XBRL and the Emergence of ‘e-Standards’
• HTML is the standard that enabled the web’s first ‘Big Step’
• XML is the web’s next ‘Big Step’– Over 200 XML-Based Specifications and Protocols
exist, including—• RosettaNet – computer company supply chain and trading webs• OBI - Open Buying on the Internet - retail e-commerce• FpML - Financial Products (Derivatives, Swaps, FX)• ACORD XML - Insurance industry information exchange standards
derived from EDI.
– UN/CEFAC = EBXML
• XBRL is uniquely focused on financial reporting
10NIVRA de AccountantsdagOctober 25, 2000
XBRL Multiple Uses
RegulatoryFilings
FinancialStatements
StatementsFor
FinancialPerformance
TaxFilings
CreditReporting
XBRL XBRL
Creditors
Other Parties
Investors
Systems Systems
Systems
Other Sources of Information
Other Sources of Information
Other Sources of Information
XBRL
XBRL
RegulatoryFilings
FinancialStatements
StatementsFor
FinancialPerformance
TaxFilings
CreditReporting
RegulatoryFilings
FinancialStatements
StatementsFor
FinancialPerformance
TaxFilings
CreditReporting
RegulatoryFilings
FinancialStatements
StatementsFor
FinancialPerformance
TaxFilings
CreditReporting
11NIVRA de AccountantsdagOctober 25, 2000
USEFUL REFERENCES
Journal of Accountancy article, “XBRL – How to Turn Data Into Strategy”
• http://www.aicpa.org/pubs/jofa/aug2000/zarowin.htm– CFO Magazines article, “How the Web was Won” about Online IR
• http://www.cfonet.com/html/Articles/CFO/2000/00FEhowt.html– Scientific American article, “XML and the Second-Generation
Web”• http://www.sciam.com/1999/0599issue/0599bosak.html
– FASB’s Electronic Distribution of Business Reporting Information• http://www.rutgers.edu/Accounting/raw/fasb
– IASC’s Business Reporting on the Internet• http://www.iasc.org.uk/frame/cen3_26.htm
– XBRL Website• http://www.xbrl.org
October 25, 2000 NIVRA de Accountantsdag 12
Example: XBRL Germany – September 2000
Deutche Bundesbank Dresdner Bank Deutche Bank HypoVereinsbank Postbank Rating Services AG Hermes Kreditversicherungs AG Haarman, Hemmelrath und Partner Bundesverband deutscher Banken Deutsche Verkehrsbank Savings & Loan Information Center Syseca Management Cons.
October 25, 2000 NIVRA de Accountantsdag 13
AUDITORS OF FINANCIAL STATEMENTS
• Web sites and internal auditors
• Knowledge of the business
• Documentation
• Understanding controls
• Confirmations and inventories
• Prospectus on the web
• Annual report
October 25, 2000 NIVRA de Accountantsdag 14
AUDITORS - NEW SERVICES
• Webtrust® and Systrust®
• On line shopping carts
• Penetration tests
• Vulnerability tests
• Contracts-PKIs and CAs
• ERP systems
• CRM systems