Opinion: Online filing? What a waste of OUR money. By Simon Hurst

The value in doing it is that you don't get fined - it will mandatory in 2011

I agree with Simon's view of the importance of governments saving money from the efficiencies that eFiling can provide. At Sage, we are doing all we can to help and in fact, since March 2007, our customers using Sage Accounts Production Advanced have been able to lodge accounts electronically with Companies House. We put this in place despite the fact there was actually quite a low demand from our Accounting Practice users and that it did not represent a 'commercial' opportunity to us. But we wanted to make sure we had a fully working solution in place well before mandatory eFiling was required.

There are barriers to volume filings of accounts. Firstly the definitions of accounting data in the XBRL "taxonomy" are not up to date with the "flood" of compliance changes over the last few years. Secondly the visual output of the accounts out of the XBRL data files is defined by Companies House and not by ourselves. Feedback from practicing accountants is that whilst some practices are satisfied with the presentation, the majority want to retain the high standard of printed output from Sage Accounts Production Advanced (and other quality Accounts Production packages) give them.

Since mid-2007 we've been working with Companies House and within a working party of interested parties to solve these problems. We're also working in various forums with the HMRC to assist the definition of data for tax returns, accounts and computations. This has the added complication of needing to handle all company sizes, types and special cases within any company.

Finally there is the possibility of joint filing for Companies House and HMRC.

In summary, eFiling is a different world where software developers no longer have a free rein to meet compliance requirements in the way that their accounting practice customers indicate. We have CH and HMRC right in the middle of the process. Software developers like Sage now invest considerable resources in working closely with these bodies as well as our customers to provide workable eFiling solutions. We will continue to meet and solve these problems.

We need to see a resolution to the challenges of data definition and presentation before imposing or forcing mandatory eFiling.

Tony Hall
Senior Financial Reporting Analyst

The market is imperfect, that’s why it isn’t working.

The profession sees the XBRL standard as an imposition, with no obvious benefits. It (wrongly) perceives the Government (HMRC/Companies House) as the only beneficiaries – so why change.

Like it or not, the major accounting software houses are, thus, in no hurry to implement XBRL software filing in products for a customer base that hasn’t yet ‘got it’ (@DennisH).

Of course, XBRL/e-filing will happen when Lord Carter’s 2011 “mandation” deadline arrives. But if HMRC/Companies House want to see a much faster take-up between now and then (as they do), then they will have to incentivise end users. (Past experience of e-filing PAYE returns and Companies House annual returns clearly demonstrates how effective ‘bribery’ can be). @SimonH forecasts it won’t happen. I think it will.

@PhilipH is wrong on 2 counts. We do have Companies House on-line filing AND with XBRL NOW. And our TDF software automatically converts standard accounts data into XBRL code, which can easily be formatted/read (one click) in a browser against the CH stylesheet.(DCA, Abbreviated & Full formats).

Howard Myers
TrueData Limited (Developers/Vendors of TrueData Filer)

@David - sorry misread.

@Howard - has it come to this that vendors have lost all imagination in what they do? C'mon - I thought we lived in the land of uber geeks who are not only smart but inventive. Or maybe they've all gone to a start up/Google.

@Dennis - my point was even simple cases need tax software - to calculate even that trivial example would have taken me 2 or 3 minutes by hand (an have probably been wrong). Substantially more than the 14 seconds it took using software.

@VT - if a government dept has decided it wants XBRL, then by allowing pdf submission, as the HMRC did, postpones matters. No doubt if the HMRC had not accepted accounts as pdfs we would all be XBRL filing to the HMRC now. Perhaps there is an argument for allowing exclusion cases - those that cannot yet be filed as XBRL, to be filed as pdf until XBRL can do the job, but not those cases that could be and just aren't because the particular package does not yet support it.

Howard

I know you can file abbreviated accounts in XBRL, but hardly anyone is doing it, and what about full accounts, charities and LLP's. If pdf's had been accepted as an interim solution the uptake would have been much greater.

Is there really a stylesheet available for full UK-GAAP XBRL? That certainly was not mentioned at the ICAEW conference that I attended recently, where the rendering problem was discussed in detail.

David - if only the world was that simple we'd all do it that way. As you very well know, it isn't.

Simple case
20000 dividend income (net of tax credits)
20000 profit from self employment
student loan repayments

tax and ni is therefore 7556.30

Took me 14 seconds from clicking on our icon to filling the 2 figures and the one tick box on the return and producing the calculation. With practice I reckon I can get it down to under 10.

Do you want a race !

David Forbes

We could have on-line filing today if Companies House would accept pdf's (as HMRC currently do but say they will not in future).

It struck me at the ICAEW meeting that filing accounts in XBRL is not yet practical. Yes, you can code up your accounts in XBRL, but no-one can turn that data into a human readable form (except for abbreviated accounts).

@PeterT - you are indeed an neanderthal and a luddite to boot. You'll be out of business if you don't wake up

@DavidF - keep bashing away. The profession just has to wake up or be left in the dirt by those who 'get it.' Those of you who are engaged with ICAEW IT CPD will see a LOT about this kind of thing in the coming months. Those who read my blog will also see plenty said.

I have previously remarked in a professional journal that I can complete a paper Return much quicker than an on-line one in most cases, but was put down as being neanderthal. However I stick by my view that the option ought to remain, whilst I am happy to file on-line as far as possible if only to save the rainforests

I feel at least partially to blame for the "lively and robust" nature of the ICAEW IT meeting.

At present you can electronically file a CT600 with accounts attached as pdf. You have been able to do this for a number of years ....since it was first made available in Forbes ProTax. Back in 2005 Companies House received their first XBRL transmission ... from Forbes Accounts. I can see the benefit in filing XBRL to companies house, but to the HMRC what advantage is there to the accountant over the existing efiling route ? We can make software available but it is accountants adopting early that need to be incentivised. This need not be a financial incentive (as HMRC have splurged this all on paye !) - for instance the HMRC could provide a list on their website of xbrl enabled accountancy practices - which could indirectly bring in fee income for those practices.

The other issue is that the HMRC is still not ready to receive XBRL accounts - though they have received XBRL CT computations (that would be us again!). They are not far off, but need to get things finalised and start accepting XBRL accounts - even if only simple ones to start with.

As for selecting a simplified subset of the taxonomy to use this is surely down to individual suppliers or organisations. BASDA has started work on facilities for mapping data from management accounts packages through to final accounts to allow XBRL required data to be indentified at source. This received enthusiastic backing from the large part of the industry represented as the BASDA Financials SIG.

XBRL is happening, it is mandatory from 2011. The HMRC need to sort out any remaining technical issues and start incentivising people to adopt early.

David Forbes

I find the attitude of the software vendors little short of egregious. Unless there's money in it they don't want to know and the excuse given? No-one asks for it. Of course they don't because the vendor community has done almost nothing to learn about the potential benefits or to use their collective imaginations to find business case solutions.

I'd recommend anyone and everyone to get hold of a copy of XBRL for Dummies. It's free, it's easy to read and it makes a series of perfectly sensible use case arguments. Oh yes - even software vendors might learn something from it. If only they have eyes to see and ears to hear.

What Simon's really saying is that markets don't work as they should. So the government has to step in.

He's right.

Richard Murphy