Using XBRL to deposit financial statements in Saudi Arabia

1. Using XBRL to deposit financial statements in Saudi
Arabia
11th of March, 2015

2. Agenda
• What is Qawaem?
• Qawaem Objectives
• Qawaem Features
• e-Filing Workflow
• What is XBRL?
• Benchmark
• List of Achievements & Statistics
• Next Steps
2

3. What is Qawaem?
3

4. • Qawaem is a program to deposit and view financial statements electronically
using XBRL
• Financial statements validation
• View financial ratios
• User management with rights and responsibilities control
• Deposit companies information such as board of directors’ information,
announcements, and dividends
• Notifications services to firms and accountants
• Help MCI to supervise and control firms by applying business rules (governance
and compliance)
What is Qawaem?

5. Qawaem Objectives
5

6. Qawaem Objectives
• Support the credibility of financial statements to beneficiaries such as MCI,
DZIT, banks and others
• Speeding up the process of submitting financial information to relevant parties
• Preventing firms from issuing many financial statements for the same period for
the same client
• Conduct financial and economical analytical reporting to be used by analysts
and government researchers
• Benchmark reporting within a specific sector

7. Qawaem Features
7

8. • Define the fiscal year
Qawaem Features

9. • Accounting firm authentication
Qawaem Features

10. • Numbers validation across all statements
Qawaem Features

11. • Totals calculation
Qawaem Features

12. • MCI governance and compliance rules
Qawaem Features

13. • Financial Statement (Before)
Qawaem Features

14. • Financial Statement (After)
Qawaem Features

15. e-Filing Workflow
15

16. e-Filing Process (1) - Accounting firm
16
CompanyAccountingMCI
Signing
contract
Registration
user
Filing
Financial
Statements
Review
Save
Financial
Statements
Audit
Financial
Statements
Notify
Company
and Auditor
Start
End
NO
Yes

17. Filing process (2) - Companies
17
CompanyAccountingMCI
Signing
contract
Filing
Financial
Statements
Review
Save
Financial
Statements
Audit
Financial
Statements
Notify
Company
and Auditor
Start
End
NO
Yes
Review
No
Yes

18. What is XBRL?
18

19. • eXtensible Business Reporting Language (XBRL) is one of a family of “XML”
languages which is becoming a standard means of communicating
information between businesses
• XBRL is about electronic transfer of business reporting data.
• To able using XBRL we need to have both: Instance document & Taxonomy
• Three taxonomies have been developed: banks, insurance, and other
companies
What is XBRL?

20. Benchmark
20

21. 5 entities analyzed in the benchmark study
21
Country Entity Key highlight of benchmark
• Self sustained entity
• Revenues of $100+ M & operating income of ~$10M in 2013
• Enables New Zealand to rank world #1 for starting a business
and protecting investors (World Bank)
• Focus on the creation of a trusted business and regulatory
environment
• Focus on financial markets and regulations
• Focus on simplifying the interaction between businesses and
government

22. List of Achievements & Statistics

23. List of Achievements
• Launched the program on 1st of January, 2015. The implementation was less
than a year
• Migrated more than 10,000 historical financial statements of 2013, 2012, 2011
• Developed three main taxonomies: Banks, insurance and other companies
• Conducted workshops in Riyadh, Jeddah and Dammam to train the accounting
firms
• Developed access channels for banks, DZIT and other government agencies
• Developed all required business rules to apply governance and compliance

24. Business entities statistics
• Types of main business entities:
 Joint stock companies: about 1,100
 Limited liabilities companies: about 48,000
 Sole proprietorship: about 1,150,000
• Joint stock companies and limited liabilities companies are mandated by law to
submit their annual financial statements
• There are about 147 licensed accounting firms

25. Statistics of financial statements deposited in Qawaem
in 2015
# Legal entity Number of companies
1 Limited Partnership 6
2 Limited Liability Company with Mixed Ownership 22
3 General Partnership 5
4 Limited Liability Company 216
5 Joint-Stock Company with Mixed Ownership 2
6 A Branch of Foreign Limited Liability Company 7
7 A Branch of Foreign Joint-Stock Company 6
8 Foreign Limited Liability Company 10
9 Limited Liability Company with GCC Ownership 6
10 Joint-Stock Company 52
11 Foreign Joint-Stock Company 1
12 Joint-Stock Company with GCC Ownership 2
13 Sole proprietorship 100
Total 435
The total of Financial Statements that have been deposited in Qawaem
is 467

26. Next Steps
26

27. Next Steps
• Develop a new taxonomy to cover the non-profit organizations
• Develop a BI tool to do financial analysis and reporting among companies
• Develop ranking reports among business entities in revenue, cost and others
within the same sector
• Design customized financial reports for banks
• Establish a B2B credit bureau company to exchange trade credit information
among business entities