SBR IN FINLAND SEMINAR ON STANDARD BUSINESS REPORTING (SBR) NOVEMBER 24, 2015 OTTAWA, CANADA Elina Koskentalo Project Manager and Taxonomy Developer, XBRL Finland Adviser, Finnish Information Society Development Centre (TIEKE)

02 Start of the Finnish SBR Population: 5.5 million Area: 338,424 km2 Offical languages: Finnish, Swedish Rebuplic, current president Sauli Niinistö Independence from the Russian SFSR on December 6th, 1917 GDP: $41,068 Registered companies: 300,000 About Finland

02 The Journey

02 Start of the Finnish SBR Real-Time Economy, a public-private development program started in 2007 – focus on improving purchase to pay and order to cash cycles – e-invoicing and related value-added services at the core Aim to reduce administrative burden on SMEs – government reporting identified as a pain point (payroll, financial statement, VAT reporting) A Standard Business Reporting program initiated in 2009 – working together with business register, tax office and statistics – data elements (accounts) required by the three government units  SBR code set Start of the Finnish Standard Business Reporting program

02 The Journey

02 Standard Business Reporting Code Set Listing all the reporting requirements set to the companies – Joint effort of all report receiving entities involved Can be used as a chart of accounts Mapping to tax forms and other reports Interaction between business people and IT people made possible In excel spreadsheet, inadequate for automated processing and transfer of reports >>The need for eXtensible Business Reporting Language Standard Business Reporting Code Set

02 The Journey

XBRL Finland - Operations Private-public collaboration with 20 members Private 12 Public 8 Working groups: 1.FAS taxonomy development 2.IFRS taxonomy development 3.Service providers 4.Mandatory filing WG 5.COREP/FINREP 6.Communication, education, research 7.Report receivers 8.Transactional reporting XBRL Finland – operations

02 XBRL Finland - Members Public Private Academics / Associations XBRL Finland - members

02 Company chart of accounts Standard Business Reporting Code Set Financial statements Tax returns Statistics reporting Government gateway Ecosystem of Finnish SBR/XBRL

02 The Journey

02 The Finnish SBR Taxonomy Applicability for different reporting scenarios in tandem and separately Financial statements -, statistics - and tax reporting Making use of the Standard business reporting code set (raportointikoodisto.fi) Applicability for different types of businesses Legal reporting requirements differ to some extent for different types of businesses Complying with XBRL international recommendations and best practices Usability Aiming to minimize the effects of versioning The Finnish SBR taxonomy

02 Automated generation of Tax reports Later on: Cash flow statement, Key business figures Enrich instance documents with aggregate level data ”extended financial statement” ”general financial statement” Formula processor Tax reports Standardized visualization of reports with Inline XBRL XSLT-templates shall be provided in order to transform the XBRL-instance documents into iXBRL format Making use of the Formula linkbase and Inline XBRL

02 The Journey

02 Moving towards XBRL based financial reporting Press release announced in January 2014 by Finnish Tax administration and business registry: “XBRL based financial reporting will be made possible from the beginning of 2016” At the first stage for limited and co-operative companies National government gateway for all XBRL filings Also for other legal forms in the following years (phased until 2020) Moving towards XBRL-based financial reporting

02 The Journey

02 Entries in XBRL GL format Encoding of entries Regulatory filings Auditing General Ledger (SBR code set) Finnish extension of XBRL GL- taxonomy Enables the automation of accounting processes Interoperability between systems Streamlines XBRL-based reporting (internal and external) Audit trail from financial statements to accounting entries Enables automated auditing Ongoing public discussion: ”National accounting data archive” What happens next – standardizing accounting entries

02 Lessons learned Maintainability …requires continuous deeper level collaboration across ministries and various organizations Adoption …requires better support from software providers and open mindness from the filers Support for filers …learning curve exists on both sides of the submission platform Future mandate …100% adoption rate requires changes in the laws Current challenges

02 Lessons learned Data contents before technology …is not to implement XBRL just for the sake of XBRL Keeping in mind the main goal …lowering the administrative burden for companies SBR is not just about standardizing the reported data …requires and integrated report submission architecture Public-private cooperation …the support of both is required Lessons learned

02 Questions? Elina Koskentalo Project Manager and Taxonomy Developer, XBRL Finland Adviser, Tieke Questions?