Must your FCA iXBRL compliance lead you to a compromise on how your annual report in the xHTML format appears in comparison to the highly attractive PDF document you’ve been presenting all these years? Not really.
However, in our close monitoring of a good number of early iXBRL filings this year, we were surprised to see that in several cases the xHTML versions of annual reports reflect none of the style elements of their well-designed PDF counterparts.
For many years now, companies have been publishing annual reports that are highly stylized and aesthetically pleasing. This is because annual reports serve two purposes. They are both legal documents for regulatory compliance purposes as well as a document that investors and analysts use to track companies’ financials and strategies. The appearance of a document counts to a greater extent when it is used by investors and analysts.
While helping companies prepare documents that comply with the ESEF mandate, several compliance solutions have not been able to effectively retain the stylized elements of a PDF annual report within an xHTML document.
Here’s an example that shows how strikingly different both versions look. In this PDF version of a company’s annual report, you can see that the graphs are attractively designed and placed.
Screenshot of a company’s PDF annual report
However, in the xHTML version of the very same company’s annual report, you would notice that the graphs appear as though they have been stretched horizontally. Some extra graphs and text have also been introduced.
xHTML version of the same company’s annual report
xHTML reports that have design elements missing run aground on two fronts.
Auditors’ dilemma about signing off on documents without the usual design elements
It is the duty of an auditor to provide an opinion about an annual report. In countries where ESEF filings need to be audited, it becomes hard for auditors to provide an opinion when the xHTML file looks completely different from the stylized PDF file. What do the auditors sign off on? Is it on an unattractive xHTML document or an enticing PDF?
An unattractive annual report can put off investors and analysts
When an annual report is unsightly, it may not garner as much attention from investors and analysts as the company desires. The whole idea behind the FCA iXBRL format is to increase the accessibility and comparability of annual reports. An xHTML report that falls short in the aesthetics department defeats that purpose.
Running into glitches during a first-time FCA iXBRL filing might be expected. However, issues stemming from a software’s incapability to effectively introduce style elements into an xHTML document are avoidable.
While preparing FCA iXBRL filings, companies must expect a lot more from your compliance software than a mere capability for XBRL tagging.