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Internal Control and IT Control in XBRL GL

Internal Control and IT Control in XBRL GL. Akira Matsuo JICAP IT Committee akira.a.matsuo@jp.pwc.com 12 th XBRL International Conference Tokyo November 2005. Background. This far, you have heard about XBRL GL and Internal reporting Internal controls

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Internal Control and IT Control in XBRL GL

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  1. Internal Control and IT Control in XBRL GL AkiraMatsuo JICAPIT Committee akira.a.matsuo@jp.pwc.com 12th XBRL International Conference Tokyo November 2005

  2. Background • This far, you have heard about XBRL GL and • Internal reporting • Internal controls • In this session, you will learn about • Business Process Management and XBRL GL • Internal Control over XBRL GL in BPM environment • IT Control over XBRL GL in BPM environment

  3. Scope and role of XBRL XBRL GL, the Journal Taxonomy XBRL Financial Statements Business Operations Internal Financial Reporting External Financial Reporting Investment, Lending, Regulation Economic Policymaking Processes Companies Financial Publishers and Data Aggregators Investors Central Banks Participants Trading Partners Auditors Regulators Management Accountants Software Vendors

  4. XBRL GL works on financial transactions ◆Budget plan ◆Request approval ◆ Monitoring ◆Disbursements ◆Settlements ◆Request Web Browser ◆Plan ◆Report Web Server BPM server Process m m m ◆Disbursements ◆Settlements ◆Request ◆Monitoring ◆Plan ◆Request ◆Report = Message/Vouchers m = Adaptor ERP HR Server ERP FI Server

  5. Standard sets of data fields for financial transactions (Taxonomy) • CORE (COR) • Advanced Business Concept (BUS) • Multicurrency (MUC) • Tax Audit File (TAF) • Concepts for the US,UK,etc

  6. Instance Samples • Customer Order • Purchase Order • Accounts Receivable • Accounts Payable • Invoice • General Ledger • Journal entries • TB • Tax reports (Book to Tax Reconciliation) • Payroll • Fixed Assets

  7. XI NetWeaver XI BPM, Data Transformation Avai- lability Transfer Ad Y N Business Process Control Error Prod Order Shipping Adv Order Edit N Y Avai- lability Y N Data Transformation Adapter IDOCAdapter FileAdapter JMSAdapter RFCAdapter SOAPAdapter HTTPAdapter JDBCAdapter IDOC XML XML MQ SQL BAPI File SAP ERM Outsourcing SAP SCM Legacy Different Applications

  8. Data Transformation Various Applications UI Adapter Data Transformation GL Taxonomy GL Instance BPM Flexibility of Data

  9. Internal Control Interest for Financial Information (GL) • Completeness • Accuracy • Validity • Authorization

  10. Taxonomy and Instance • Provide • Trust • Accuracy • Validity • Static by creating instance • Dynamic by matching with transactions

  11. Formula link/requirements • Flexible additional edit requirements • Completeness • Sequence numbers handling, etc • Accuracy • Matching with other records • Logical Check • Validity • Matching with other records • Logical Check

  12. Extension • Flexibility • Weaken Trust • How inheritance can be maintained ? • Standard Procedures for: • Extension/Harmonization/Localization

  13. Authorization • Easily duplicate transactions • Need additional consideration for security • Single sign on

  14. Single sign on HR Registry (Authentication , Authorization） Application Portal ID Password Pass ID LDAP

  15. The Seamless Audit Trail • From initial transaction • Through the system, monolithic or virtual • To reporting • Every system as XBRL GL

  16. Flow: XBRL GL Can Represent 1. Trigger: a source document is represented electronically 2. Source Journal The document is entered and posted, creating a source journal. 3. Journal entries: The accounting implications are gathered and prepared for the GL. 4. GL Entries: the journal entries are prepared for posting to the GL. 5. Journal History: The entries are posted to the Journal History. 6. Consolidation: The data at journal entry or trial balance level are brought together. 7. Reporting: Consolidated numbers combine for eventual reporting. Invoice Posting Journal Source Journal Distribution To GL Report General Journal Transaction Posting Journal History Report Consolidating/ Consolidated

  17. What about information supply chain environment ? • Authorization • More complicate issues • VPN • Certification authority • Non repudiation • Time stamping

  18. Security in Information Supply Chain • Security Framework • Risk Resource Management • Access Control • Operations and vulnerability management • System Acquisition /Development, maintenance and Change • Availability and Continuity • Compliance Monitoring

  19. EHPA Appl. Data Mart Data Mart Data Mart ASA Appl. Comb. Appl. EHPA Tool ASA Tool Comb. Tool EPA’s Application Architecture Use Portal Metadata Registries I d e n t i t y M a n a g e m e n t A c c e s s M a n a g e m e n t Internal and External Users Admin Applica- tions Catalog Store for Use (Business Warehouse Framework) Mgt, Tools Catalog Science EHPA Data Registries Process and Stage Others Other Data Sets Enterprise Staging Enterprise Integration Warehouse Enterprise ODS Connect and Exchange Portlets CDX Business ODS Exchange Partner Business Area Warehouse Business ODS Admin Data Registries EAI Admin. Partners Administrative Warehouse Admin ODS E-Gov Portals Admin ODS

  20. Thank you • Questions？　Please Contact • akira.a.matsuo@jp.pwc.com

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