Chinese Extended XBRL Taxonomy Quality Evaluation

The concept of XBRL (eXtensible Business Reporting Language) was initially proposed on the basis of XML by an American accountant Charles Hoffman in1998. As compared to other financial reporting means XBRL has very distinct advantages, so XBRL quickly got focused and was regarded as an important means to accelerate the financial information technology.December16,2011, China’s Ministry of Finance announced the oil and gas industry’s extended XBRL taxonomy on the basis of general XBRL taxonomy. As the first domestic extended XBRL taxonomy, a timely evaluation has important significance.In this article, oil and gas industry’s extended XBRL taxonomy will be evaluated from its financial elements. Around this core, this paper introduces the principle of XBRL technology, the advantages and its development status at home and abroad. Then describes the theory of XBRL technology, especially those table elements in which most financial data information was carried. Relevant literatures are classified into three categories according to its theme:XBRL’s basic theory, XBRL’s extension and XBRL taxonomy quality evaluation. Finally three indicators (efficiency, integrity, consistency) are designed to evaluate oil and gas industry’s extended XBRL taxonomy from different angles. Simultaneously, a standardized process for XBRL taxonomy’s extension will be proposed.To make an industry extension on the basis of general XBRL taxonomy, we first need to ensure that most financial elements used by industries should be consistent, and secondly to consider whether there exists problem of elements shortage and redundancy, simultaneously consider comparability. This paper will make an evaluation on the oil and gas industry’s taxonomy from above four aspects, and designs efficiency indicator, integrity indicator and consistence indicator respectively to measure its redundancy degree, integrity degree, consistence degree and comparability degree. This paper obtains data by making an element match between annual report in PDF format and taxonomy manually, and elements matched just include table element, member element and monetary element from balance sheet notes and income statement notes.After in-depth research on above four issues, four conclusions about oil and gas industry’s extended taxonomy are made:(1) There exists no problem of element redundancy;(2) There exists problem of element inadequacy;(3) Four industries have a high degree of element consistency;(4) Financial information prepared on the basis of oil and gas industry’s extended XBRL taxonomy can be comparable.In the process of matching and evaluation, I found that making an element extension requires following steps:(1) Identify undefined elements;(2) Make a selection among those new elements,(3) Extend selected extending elements into the taxonomy. This paper attempts to put forward a concept of selection criteria for extending elements selection, and divided extension method into four categories according to the relationships between extending elements and elements has been defined.The main innovation of this paper includes:(1) Not only make a matching on monetary elements, but also on member elements and table elements;(2) Attempts to put forward the concept of selection criteria for extending elements selection;(3) Attempts to put forward a new evaluation indicator named "industry applicability";(4) Attempts to put forward four categories of element extension method according to the relationships between extending elements and elements has been defined.