INTRODUCING XML AND XBRL IN AN ACCOUNTING INFORMATION SYSTEMS COURSE

This paper describes the introduction of Extensible Markup Language (XML) and Extensible Business Reporting Language (XBRL) in an Accounting Information Systems course at California State University, Fullerton (CSUF). XML and XBRL are anticipated to play an ever increasing and significant role in ERP systems that will provide data on the Internet. Of particular interest to the faculty is that SAP is XML compliant and future courses in the proposed new systems track at the CSUF are to be centered on SAP's Business Information Warehouse (BW).

XML is easy and flexible and provides a common language for the exchange of information and data over the Internet. However, the very ease of use of XML and its flexibility have led to the development of several languages in different industries causing problems of translation from one version to the other. Accountants have not generally participated in the development of these transaction level XML specifications by various industry groups. In the meanwhile a version of XML specification, XBRL, is being developed for use in financial reporting. The American Institute of Certified Public Accountants (AICPA) is leading the effort for the development of XBRL.

In Spring 2001, students in Professor Foote's Accounting Information Systems course were introduced to XML and XBRL concepts and applications. Students worked with XML and XBRL projects both by learning to program with XML and creating applications and taxonomies in XBRL. Nine teams of students submitted 18 entries in the First Annual XBRL Academic Competition (see: http://web.bryant.edu/~xbrl). This paper provides details regarding students, instruction, resources available, student participation in the First Annual XBRL Academic competition, and student projects completed.

1. Introduction

This paper describes some of the issues involved in the introduction of Extensible Markup Language (XML) and Extensible Business Reporting Language (XBRL) in an Accounting Information Systems course at California State University, Fullerton (CSUF). The development of XBRL, the new business reporting language based on XML, is considered to be one of the most exciting and important technologies of the decade [i]. XBRL will greatly benefit both the preparers and users of financial information. Participating in this development process can be an important learning experience for accounting students today. Learning to program using XML and XBRL should be specially relevant to accounting students who will be working in the future to integrate information systems between supply chain partners via the Internet. CSUF has been a member of the SAP University Alliance Program since 1999. Faculty members from various departments in the Mihaylo College of Business and Economics have used SAP software, SAP R/3, in their courses. The Department of Accounting and the Department of Information Systems and Decision Sciences are considering either the introduction of new Systems Tracks for their majors or a joint program. A critical focus of the new tracks will be the study of systems linked via the Internet. XML and XBRL are anticipated to play an ever increasing and significant role in ERP systems that will provide data on the Internet. Of particular interest to the faculty is that SAP is working to become both XML and XBRL compliant. Future courses in the new systems track are to be centered on SAP's Business Information Warehouse (BW) or on another data warehouse.

XML, a meta language, provides developers with a standard way to describe data containers and eliminates the need for custom translation code. In 1999, SAP added XML as a format for data interchange across its SAP Business Framework (http://ifr.SAP.com). Support of XML enables SAP R/3 to use the Internet to pass messages to receiving applications having no prior knowledge of the data formats contained in the messages. XML enables access to SAP’s Business APIs (BAPIs) without custom translation code. An example of a product using XML is SAP Business-to-Business Procurement, a web-based “requisition-order-payment” solution that can be used as part of R/3 or as a stand-alone component interfacing to R/3 or to legacy systems and provides real-time supplier integration. SAP’s goal is to make all IDOCS available in XML format. With IDOCS in XML format, it will be easier to integrate SAP R/3 with legacy and with non-SAP systems. However, while XML is easy and flexible and provides a common language for the exchange of information and data over the Internet, the very ease of use of XML and its flexibility have led to the development of several languages in different industries causing problems of translation from one version to the other. A description of these various versions can be found in the presentation made by Professor Foote at SAP's International Research Congress, San Diego, California, February 2001 (see: http://business.fullerton.edu/sap ).

While accountants have not dominated the development of XML, the American Institute of Certified Public Accountants (AICPA) was the leader in supporting the development of XBRL, a custom markup language based upon XML that is being added to accounting and financial reporting software. AICPA considers this development to be critical for the future of the accounting profession. SAP is a member of the XBRL Steering Committee, a not-for-profit corporation started by the AICPA. XBRL-compliant software will automatically and transparently translate numbers and words for viewing of segments in Web browsers, spreadsheets, and in other application software. It will lead to faster distribution of financial information, eliminate rewrites of financial reports, and will make Internet searches faster and better by finding desired XBRL-tagged data rather than thousands of useless “hits”. It will further enable the ability to drill down and minimize the need to reenter data. However, SAP has no current plans to build XBRL functionality into its applications, instead, all XBRL-tagged data will be collected in SAP’s Business Information Warehouse (BW) for use by applications. XBRL support will be provided in SAP’s OLAP Consolidation Tool (ConsTool), a tool built into SAP-BW. In the future there is a possibility that XBRL templates may be created for reporting, financial consolidation, modeling, simulation, planning, and budgeting.

2.0 Introduction of XML and XBRL in an AIS Course

In Spring 2001, XML and XBRL concepts and applications were introduced in a graduate course, Seminar in Professional Accounting Communication, and an undergraduate Accounting Information Systems course. There are multiple sections of the undergraduate course, and in the other sections’ instructors presented traditional AIS topics, using textbooks by James A. Hall[ii] and by Ulric J. Gelinas, Jr., et al[iii]. In the section taught by Professor Foote, the focus of the course was on "Accounting Information Systems as implemented by E-Businesses using SAP R/3, XML, and XBRL". The course was designed to teach students to program Web-enabled systems. The primary text used was "XML: How to Program" by Harvey M. Deitel, et al[iv] (Prentice Hall, 2001). In addition, a draft copy of the book "XBRL Essentials" by Charles Hoffman[v] was made available to the students. A major requirement of the course was participation in the First Annual XBRL Academic Competition, 2000-2001, sponsored by XBRL.org (http://www.xbrl.org), a worldwide consortium that is developing XBRL and is made up of the leading CPA firms, software developers and financial industry leaders(for details see: http://web.bryant.edu/~xbrl).

The stated purpose of the Annual XBRL Academic Competition was " to provide (1) a unique opportunity for students and faculty to participate in the development of the future of business and financial reporting modeling for the Internet and (2) a closer relationship between XBRL.org and the academic community." The competition was open to all students in accounting, accounting information systems, finance, information sciences and related fields. Student teams, advised by faculty had the " opportunity to demonstrate their knowledge of accounting, AIS, finance, and information sciences and related fields to:

develop conceptual models, taxonomy development for a particular industry, country, or specific area of financial reporting,
create applications that use XBRL, or
produce original research in how XBRL fits into the business, social and political environment." [vi]

An XBRL Taxonomy is described by XBRL.org as being "a 'vocabulary' or 'dictionary' created by a group, compliant with the XBRL Specification, in order to exchange business information" and an XBRL Instance document is described as "a business report, such as a financial statement prepared to the XBRL specification. The meaning of the values in the instance document is explained by the taxonomy."[vii]

There were four categories in which the students could compete and were permitted to participate in any or all the areas:

1. Taxonomy development – United States

2. Taxonomy development - International Accounting Standards (IAS)

3. Application development - XBRL in action, and

4. Research studies and papers

2.1 Students

The undergraduate class consisted of 21 accounting majors, typically in their senior year of study. There were 8 students in graduate courses, enrolled in the Masters in Accountancy program. The typical student had prior course work in MS Office applications but little or no exposure to computer programming. The undergraduate students formed 6 teams. The graduate students formed 3 teams. The lack of computer programming skills resulted in very few teams opting to participate in the applications development category and of those who did no team won in this category.

2.2 Instruction

Classes met for about half the time in the classroom for lectures and project assignments and for the other half they met in the computer lab/classroom for completion of computer assignments and presentations. Students were informed about the XBRL competition and required to submit by the second class meeting their preference for the category in which they would participate. Each team was required to design a strategy (see: Exhibit:A) and present and defend it in class. The criteria for judging, quoting from the competition were described as follows:

1. Relevance (will this work help further XBRL development or acceptance)

2. Completeness (will much additional work be necessary to take advantage of the results)

3. Accuracy (is the information correct and reliable)

4. Creativity (are the findings new or do they illustrate a novel approach to a problem)

5. Significance (can it be immediately incorporated into XBRL usage)

6. Use of and integration with existing taxonomies and the technical specification (will much work be necessary to conform the projects to what has already been delivered)

The March 15 deadline for the competition created some problems of scheduling as classes at CSUF start at the end of January, leaving only 6 weeks for the students to complete the work. Ideally, the syllabus would have covered the topics in the order of presentation in the text By Deitel et al, with XBRL assignments following the assignments on HTML and XML. These assignments, consisting of various exercises from the Deitel text, were however postponed until after the submissions were made to the competition. The text by Hoffman was used for background reading about the development of XBRL.

2.3 Projects:

Nine teams of students in the class submitted 18 entries in the First Annual XBRL Competition. The team projects are posted at http://business.fullerton.edu/xbrl. The different categories in which the students submitted their projects are listed below.

Category Graduate Undergraduate

I Taxonomy Development—US 2 6 (1 winner)

II Taxonomy Development—International 0 2 (1 winner)

III Application Development 2 4

IV Research Study 1 (1 winner) 1

The following three teams received an Honorable Mention in the competition:

Taxonomy - International: Consolidated Weekly Financial Statement of the Eurosystem - Created tags using a tentative global system of identifying accounts (see: Exhibit: B for a sample of the taxonomy)
Students: Erlinda Gutierrez, Robert Duncan, and Upumoni Laolagi

Taxonomy - U.S: Oil and Gas industry - Created standardized tags for the supplemental disclosure as required by FASB 69
Students: Eva Bi, Danielle Pippenger, Richard Dan, and Ryan Smith

Research Study: The Potential of Object-oriented XBRL for Accounting in China
Students: Albert Leung and Hanny Jahja

3.0 XML and XBRL Resources

A major resource for XML and XBRL specifications is the web site of the XBRL Steering Committee - http://www.xbrl.org. The site provides a list of tools and resources for general work with both XML and XBRL. Of special interest are the XBRL specific tools under the categories of Taxonomy creation, Taxonomy viewers, and Taxonomy builders. Also of interest are the tools available for Instance Creation, Instance Validation, and Instance viewers. Many of the tools can be found at the web site, http://xbrlsolutions.com, authored by Charles Hoffman. XBRL Solutions, Inc. provides a set of detailed training materials for developing taxonomies as well as a Microsoft Access 2000 based taxonomy builder tool. The XBRL.org also provides access to the web pages of the taxonomy created for Financial Reporting for Commercial and Industrial Companies and encourages "reverse engineering" of this taxonomy for the development of taxonomies for other uses. Other taxonomy creation and editing tools are available at dev.ekeeper.com, www.kpmg.com, and www.msdw.com/xbrl

4.0 Conclusions:

XML has become the de facto open data format for the network. XBRL is a custom markup language based upon XML that is being added to accounting and financial reporting software. XBRL-compliant software will automatically and transparently translate numbers and words for viewing of segments in Web browsers, spreadsheets, and in other application software. The AICPA is playing a major role in facilitating the development of the common specifications that will be used by the entire accounting profession to support XBRL. The AICPA's vision is for "CPAs to be the "Premier Knowledge Professionals" and to help companies understand and take advantage of technologies like XML and the Internet."[viii]

Learning to program using XML and XBRL should be specially relevant to accounting students who will be working in the future to integrate information systems between supply chain partners via the Internet. The introduction of XML and XBRL in an Accounting Information Systems course at CSUF was relatively successful with the students enthusiastically participating in the First Annual XBRL Competition sponsored by the XBRL Steering Committee in the spring of 2001. Of the twelve teams that submitted entries to the competition, 3 teams received Honorable Mentions. No other university had more than 1 team winning in any of the categories of the competition. Some in the profession have already noticed the work done by the students and this has opened up employment opportunities for them with one of the students receiving an internship with XBRL Solutions, Inc., Tacoma, Washington. Numerous suggestions have been made at xbrl - public at http://groups.yahoo.com for the Second Annual XBRL Academic Competition. A copy of the suggestions posted by one of the authors is presented in exhibit C.

There are opportunities for introduction of XBRL in other accounting courses, especially for those dealing with financial reporting issues. There are several valuable resources available at - http://www.xbrl.org and http://xbrlsolutions.com for creating taxonomies for external and internal financial reporting. Discussion of XML and XBRL can also now be found in Accounting Information Systems textbooks, for example, Gelinas and Sutton describe XBRL as "perhaps the most exciting technology-driven advancement in business reporting"[ix]. They advise use of the resources available at http://www.xbrl.org/demos/demos.htm [x]to gain an understanding of how XBRL works and how it can facilitate the reporting, reading, and analysis of financial information. Use of such exercises and available XBRL tools should make accounting and AIS courses more relevant for students today.

Exhibit: A

Spring 2001

Professor Paul Sheldon Foote

Assignment 1 XBRL Team Strategy

Due: Tuesday, February 6, 2001, at the start of class

First Annual XBRL Academic Competition 2000 – 2001

A competition for student teams has been announced at:

http://web.bryant.edu/xbrl

By the November 15, 2000 deadline, I file a form of intent to enter student teams into this competition. The goal of this assignment is to give your team an opportunity to develop a strategy for competing in some of the four areas of competition. Teams of 2 – 5 students are permitted.

In preparing your strategies, please note that there is a FINAL submission deadline of March 15, 2001 to the judges.

Each team will present and defend its strategy in class. Each member of each team must be responsible for a major aspect of implementing the strategy. Pinpoint the responsibilities of each team member in your written strategies.

Prepare a present a written strategy for implementing an entry into the competition. Identify which categories you have selected and who will have primary responsibility for each category.

Category I: Taxonomy Development (United States GAAP)

“A taxonomy is a complete representation of the concepts necessary to express the terms for a particular financial document or area.”

Deliverables

1. “A partial or complete taxonomy file for a jurisdiction or industry sector in XML in a .xsd format; also in a standard database or spreadsheet format to demonstrate to judges how the taxonomy is mapped to the industry convention”

2. “A document explaining which jurisdiction or industry sector has been chosen and why, and offering the authority behind the elements included in the taxonomy. Be sure to clearly identify all source materials used in developing taxonomies.”

Resources for starting your project:

Eric E. Cohen’s “Building Taxonomies”

http://web.bryant.edu/~xbrl/taxonomySteps_files/taxcomp.htm

Sample Taxonomy

Commercial and Industrial Financial Reporting according to U.S. GAAP

http://www.xbrl.org/us/gaap/ci/2000-07-31/default.htm

Sample XBRL File

http://www.xbrl.org/Sample/Viewer.htm

Other Resources

http://xbrl.org/Resources.htm

Category II: Taxonomy Development (International Accounting Standards)

This is similar to Category I except that you would be developing the taxonomy for another country.

Note: All teams must develop either a United States GAAP taxonomy or an International Accounting Standards taxonomy, or both.

Category III: Application Development

Deliverables

1. “A copy of the script or executable program, or reference to a student-authored web site.”

2. “A document explaining the installation procedure and usage of the application and why it is useful.”

In general, you will be developing tools or models for XBRL. In particular, you will be applying XML and XBRL to show your knowledge of accounting, finance, and Web skills.

Examples of possible applications (all quoted from the competition announcement):

1. Web-based instance creator;

2. Financial statement generator;

3. An automated ratio-analysis web-site, which pulls information from a company’s XBRL financial statements and calculates and displays the results of the top 20 ratios used by analysts;

4. An automated loan approval form, where a rules-base will determine if a loan application (in an XBRL format) meets a good lending profile, fails to meet the profile completely, or requires additional human analysis;

5. An automated historical data evaluator, which pulls in a company’s XBRL data for multiple years and highlights trends and forecasts problems.

Note: All teams must compete in Application Development. This category will likely have the smallest number of entries and hence the greatest probability of winning.

Category IV: Research Study

Deliverables

“Research papers should be between 3,000 and 4,000 words, not including supporting materials, graphics and appendices. We can only accept two research papers per a faculty member.”

Examples of topics (from the competition announcement):

1. XBRL and the Law

2. What will drive international acceptance of XBRL?

3. XBRL and auditing

In general, you may write an original research paper on “…the impact of XBRL on business, politics, and society….”

Note: Most teams should not spend any time on this category. The rules of the competition limit me to the selection of only 2 teams to enter into this competition. This category will probably have the largest number of entrants because it is the easiest category. Hence, the chances of winning in this category are likely to be small.

Judging

Criteria (quoting from the competition announcement):

7. Relevance (will this work help further XBRL development or acceptance)

8. Completeness (will much additional work be necessary to take advantage of the results)

9. Accuracy (is the information correct and reliable)

10. Creativity (are the findings new or do they illustrate a novel approach to a problem)

11. Significance (can it be immediately incorporated into XBRL usage)

12. Use of and integration with existing taxonomies and the technical specification (will much work be necessary to conform the projects to what has already been delivered)

Awards

In each of the 4 categories, winners will be recognized for: 2-year schools, undergraduate programs, and graduate programs. Grand prize winners will be recognized and will present their findings June 2001 in New Orleans at the Institute of Management Accountants’ Annual Conference and the XBRL.org meeting.

Format

Submit a printed copy of your XBRL Team Strategy using 14-point font. Be sure to use Microsoft Word’s spelling and grammar checkers.

Exhibit: B

Sample Taxonomy

<?xml version="1.0" encoding="utf-8" ?>

- <!--

 Created: 3/6/01 2:35:19 AM --> - <!--

 targetNamespace names what we are defining

--> - <!--

 schemaLocation pairs up namespaces with actual files (URLs)since we are using the metamodel namespace, we use the schemaLocation to point to the metamodel file.

     If there were an XHTML schema, we could have put in another pair of entries for the XHTML namespace and its file.

     The extra whitespace characters in the schemaLocation content should improve readability and will not bother applications.

-->

- <schema xmlns="http://www.w3.org/1999/XMLSchema" xmlns:html="http://www.w3.org/1999/xhtml" xmlns:xbrl="http://www.xbrl.org/core/2000-07-31/metamodel" targetNamespace="http://www.xbrl.org/us/gaap/ci/2000-07-31">

- <element name="statements" type="string">

- <annotation>

- <appinfo>

<xbrl:label xml:lang="en">Statements</xbrl:label>

</appinfo>

</annotation>

</element>

- <element name="statements.oilGas" type="string">

- <annotation>

- <appinfo>

<xbrl:rollup to="statements" weight="0" order="13" />

<xbrl:label xml:lang="en">Oil and Gas</xbrl:label>

</appinfo>

</annotation>

</element>

- <element name="oilGas.accountingMethod" type="string">

- <annotation>

<documentation>Method of accounting for costs incurred and the manner of disposing of capitalized costs relating to oil and gas producing activities</documentation>

- <appinfo>

<xbrl:rollup to="statements.oilGas" weight="0" order="1" />

<xbrl:label xml:lang="en">Accounting Method</xbrl:label>

</appinfo>

Exhibit: C

Suggestions for the Second Annual XBRL Academic Competition

Paul Sheldon Foote

April 22, 2001

First Annual XBRL Academic Competition

Until now, tax accounting students have had the opportunity to compete in national competitions. The First Annual XBRL Academic Competition has provided an opportunity for other accounting students to compete in an international competition. Sponsors (current and future) should be aware that such competitions are excellent ways to improve the quality of accounting education. The sponsors’ investment in this competition has had more impact upon improving the quality of accounting courses and upon students’ enthusiasm for accounting courses than any other investment I have witnessed during my career. I encourage all current and future sponsors to invest in this and similar competitions.

Of the approximately 30 entries in the First Annual XBRL Academic Competition, 18 entries came from California State University, Fullerton:

Category Graduate Undergraduate

I Taxonomy Development—US 2 6 (1 winner)

II Taxonomy Development—International 0 2 (1 winner)

III Application Development 2 4

IV Research Study 1 (1 winner) 1

Suggestions for the Second Annual XBRL Academic Competition

The purpose of the following suggestions is to encourage other competitors (current and future) to make suggestions to XBRL.org, the IMA and other sponsors before the announcement in August of the new rules for the Second Annual XBRL Academic Competition. Having completed the first annual competition, all of us should have some ideas on how future competitions can be improved.

1. Disclose the names and credentials of the judges. As any professor knows, the grading process measures both students and the abilities of professors to grade. As an accounting professor who stresses full disclosure, I need to be able to convince my future students that the judges in the competition know XBRL well. So far, there has been no disclosure of the names of the judges in the first annual competition.

2. Disclose all entries by division and by category. As I have illustrated above for CSUF’s entries, competitors need to know how many entries were in each category for all of the approximately 30 entries. This should have been done on March 16.

3. Disclose all winning entries. While there were disclosures of the winning taxonomies and applications, there were no disclosures of some of the winning research studies. By disclosing all winning entries, the competition will: (a) improve the credibility of the judges to select the best entries (b) raise the standards for future entries.

4. Require the uploading of all entries to a single Web site by a deadline date. Charles Hoffman offered an example of how this could be done. All 10 of CSUF’s taxonomy entries were uploaded to his Web site by the March 15 deadline:

http://www.xbrlsolutions.com/Public/Competition/Directory/ListItems.asp

There should be no repetition of the postmark deadline.

5. Offer the option of an earlier deadline date if teams want their entries to be reviewed for completeness. This will eliminate the disappointments of any teams whose entries were rejected as being incomplete.

6. Have several deadlines throughout the year. The March 15 deadline in the first year represented a convenience for a sponsor who wanted students to appear in New Orleans at its annual national convention. Future sponsors need to consider different awards that do not require a single annual deadline. Some universities use semester systems. Other universities use quarter systems. Future competitions need to have different deadlines so that professors can use their entire quarters or semesters to work on entries in all categories. CSUF’s students had only 6 weeks to prepare entries to meet the March 15 deadline. As a consequence of the choice of the March 15 deadline, I had to ask my students to choose which categories they desired. My preference would be to have all students compete in all categories each semester.

7. Communicate changes to the rules at the competition’s Web site. While the rules for the first year required teams of 2 to 5 students, the judges selected one winner in the Research Study category from an entry authored by a single student. If I had known that 1 student could prepare a Research Study, I might have had more students choose that category. According to the rules for the first year, there should have been a maximum of 3 winners in the Research Study category, consisting of 1 winner each from 1 community college, 1 undergraduate team, and 1 graduate team. Instead, the announced winners were 1 graduate team from CSUF and 2 unidentified teams from Nanyang Technological University and from Bentley College. All announcements of winners should match the categories listed in the rules, such as: Taxonomy Development—U.S., Undergraduate Division.

8. Change the name of the “Honorable Mention” award. “Honorable Mention” reminds me of livestock judging at county fairs. I would not want that on my resume. Instead, I would want: “Best Undergraduate Taxonomy Development—U.S.”

9. Disclose why XBRL.org chose not to award a grand prize for a category. In the first competition, competitors were led to believe that the sponsors were willing to fund trips for winning students and faculty in all 4 categories. In the first year, XBRL.org chose to fund trips to New Orleans for only the Application Development category. In future years, it will be difficult for me to convince students to compete in any category other than Application Development. CSUF students uploaded to Charles Hoffman’s Web site 10 taxonomy entries (6 undergraduate U.S., 2 undergraduate international, 2 graduate U.S.). All 10 taxonomies were so good that Charles Hoffman has asked all CSUF teams for permission to include the taxonomies on an XBRL Jumpstart CD to be included with his XBRL Essentials book (to be published by the AICPA in June 2001). I have no explanation for my students why XBRL.org’s judges would not declare even 1 prize winner from the 18 CSUF entries.

10. Disclose which taxonomies have been selected for registration as official taxonomy projects at XBRL.org. Students should be able to serve as members of teams further developing the taxonomy projects they started.

11. Maintain an archive of all past entries at the competition’s Web site. For the first year’s competition, the announcement contained links to Web sites of some of the competitors. Those links might not remain over the future years of the competition.

12. Improve the description of the criteria for the selection of winners. For the first year, this description was vague. With the experience in dealing with approximately 30 entries, judges should be able to improve the list of criteria for each category.

13. Continue announcing the winners at the competition’s Web site. While the description of the first annual competition specified that winners would be notified by mail, the winners of an Internet-related competition need to be notified via the Internet.

14. Revise or eliminate the Intent to Submit form. Students are able to drop courses after the course has started. There is no way that a professor can predict exactly how many teams will be submitting entries in each category. The best that a professor can do is to predict the maximum number of entries in each category. If some students drop the course, then a professor will need to change the number and composition of the teams.

15. List or archive all publicity at the competition’s Web site. Some of the winning teams might be able to have newspaper or magazine articles written about them. Encourage all winning teams to submit copies of such publicity. This will provide ideas for all of us in obtaining publicity for our students.

Endnotes