Section Seven: XBRL Instance Documents

From the XBRL 1.0 Specification:

Instance document An XML document containing 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 XBRL items embedded in it.

An instance document is similar to the programming of a bar code reader*. It contains the "code" for the tags and the structure that belongs to the tagged data. Instance documents are built from a combination of XML specs and XBRL, structured to produce US GAAP financial statements. The document provides data plus structure for machine recognition, and human readability.

 *Bar code readers typically scan an item for a UPS, or universal product code. The UPS is a physical tag that provides a link to information about the item. Once scanned, information about the item can be relayed to other systems such as the inventory system. The scanner contains a map from the bar code to the product definition. The list of bar codes and their meanings is similar to XBRL’s taxonomy (the general list) and the instance document (the customized list). With the UPS data from the bar code reader, inventory systems can be updated, products re-ordered, management reports on sales created. Financial information, coded with XBRL tags can function similarly.

Data needs to be tagged with XBRL. To create an XBRL file, each piece of business data is matched with the XBRL concept describing that data. The data is surrounded by tags (information within angle brackets "<" and ">" containing the XBRL term). The tags can come from inside the financial system or can be applied by an add-on program or written by hand. A program can be developed using common programming languages such as Java, VB and VBA, and databases like SQL Server. The program could take either a chart of accounts and map it to a taxonomy or take a trial balance and map it to an instance document.

A taxonomy is the library of the financial terms used in preparing financial statements. An instance document is the taxonomy applied to business reporting data. The taxonomy for US Industrial and Commercial entities contains information on how individual tags are formed. For example, the XBRL tag, as defined in the taxonomy for Commercial and Industrial Companies, US GAAP for construction in progress is:

ID 156 Element Name: constructioninProgress

Element label: Construction in Progress Level: 7

If a company uses an account that does not appear in the Commercial and Industrial Companies, US GAAP taxonomy (see link below), they can add an account to their own customized taxonomy. Once added to the custom taxonomy, the new account must also be added to the company’s instance document. This provides all users of XBRL-coded information with the structure and context of the company-specific information.

The taxonomy schema's role is to provide the logic or the intelligence for the tags. Companies should validate or check an instance document against a taxonomy to see if the tags used are all terms from the taxonomy. An exception report would signify a problem with a tag not found in the structure of the taxonomy document. In the future, tools will automatically work with XML Schema, making this process a lot easier. XML Schema is a language that can be used to define a structure of an XML document for the purposes of validation. XML Schema has not reached final recommendation stage with the W3C and is subject to change. Right now, most XML tools only validate against a DTD, which is a set of document type definitions.

The only requirement for tagged data in an instance document is to check to see if it is in conformance with the taxonomy schema. Systems will not respond properly to tags that have not been identified in the instance document. Instance documents are shared among users of the tagged data to provide each application with the logic and structure of the specific XBRL application. This means that the instance document contains company data described by XBRL. The taxonomy document will contain the XBRL hierarchical vocabulary with names for concepts, plain English labels, mathematical weight, order of appearance and other characteristics.

One characteristic of XBRL that sets it apart from other XML-enabled applications is that once a specification is published, that taxonomy must remain exactly the same.   This is because financial statements need to be rendered as of a specific date in time.  The July 31, 2000 specification states:

Since financial statements created using a taxonomy must be available indefinitely, the taxonomy must be available indefinitely.  All updates will take the form of new versions of the taxonomy with a different date.  For example, the taxonomy "us-gaap-ci-2000-07-31.xsd" will never change.  New versions will be issued under a different name, such as "us-gaap-ci-2000-12-31.xsd".   This will ensure that any taxonomy created will be available indefinitely.

Individual companies who add company-specific XBRL extensions to the base taxonomy will also need to save their unique taxonomy.

Once the financial data is properly tagged, XML tools can be used to analyze data, create databases, reports, HTML rendering, and other functions. Once company data is in XBRL format, the information can be transmitted, consolidated, transformed, analyzed and more. Companies like Navision, Hyperion and FRx are developing XBRL-enabled application tools.

From the XBRL 1.0 Specification:

taxonomy An XML Schema that defines new elements each corresponding to a concept that can be referenced in XBRL documents.  The taxonomy is a classification system for business and financial reporting data elements.  XBRL taxonomies can be regarded as extensions of XML Schema.  (see below for XML Schema)

Articles for further Study: 

US Taxonomy, US GAAP, July 31, 2000, edited by Sergio de la Fe, Jr. CPA, KPMG LLP, Charles Hoffman, CPA, XBRL Solutions, Inc.,Elmer Huh, Morgan Stanley Dean Witter.   Includes complete introduction, purpose, terminology, updates, and links to taxonomy files in MS Word and Acrobat file formats.

XML Schema 1.0, draft recommendation of the W3C

Design of the XBRL Specification, by David Vun Kannon and Yufei Wang.  Abstract:  

Vocabulary design is driven by several factors, including business requirements, available technology and politics. XBRL, as the leading vocabulary for the global accounting industry, has been strongly influenced by each of those factors. The adoption and implementation of XBRL will enable great changes in many financial processes.

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Copyright 2008 Saeed Roohani, XBRL Education