XBRL and internal auditors (part 1)

XBRL in the United States is currently most visible in regulatory reporting to the SEC. Many organizations have assigned the responsibility for XBRL to the financial reporting department, but is that the only area that should be involved? Is there a role for internal auditors in complying with SEC XBRL requirements and utilizing XBRL to gain internal reporting efficiencies? Let’s explore the internal auditor’s potential role in XBRL.

The management of an organization is responsible for ensuring that accurate and complete financial statements are produced. In this context, management is also responsible for XBRL formatted financial statement accuracy and completeness. The internal auditor can play an important role in providing some oversight to the XBRL financial statement preparation process including:

·         Providing comfort that internal controls over the XBRL process are adequate

·         Validating that business and financial data is tagged to appropriate US GAAP Taxonomy elements

·         Confirming that XBRL rendered financial statements are proper and agree with printed financial statements

·         Verifying that the SEC’s XBRL filing requirements are met