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A guide to integrated accounts/CT iXBRL tools

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5th Nov 2010
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John Stokdyk went to the final event in HMRC’s series of Corporation Tax roadshows to see what software was available, or would be, in time to handle both accounts and CT efiling by April. This is what we found.

There is no doubt at this point that automation holds the key to dealing with the mechanics of filing accounts and tax computations online. HMRC and Companies House have both agreed to support the same inline XBRL (eXtended Business Reporting Language) standard and its accompanying UK GAAP taxonomy. For maximum efficiency, experts all agree that having the same program that produces your final accounts, and applies and outputs the iXBRL files needed to submit them is the best way to tackle this challenge.

AccountingWEB.co.uk has tracked the development of these integrated tools, but it's been a long wait. With the exception of completely new programs from Forbes/Absolute and QMS, established software houses have all invested huge sums in iXBRL accounts developments – and struggled with the task. We are now getting to the point where practitioners who handle large volumes of company accounts and tax returns won't have the time to put their systems in place and test them before Self Assessment returns start arriving for processing between now and 31 January.

This administrative squeeze is not good, but both HMRC and software suppliers are keen to reassure the market that the situation is not as doom-laden as it is beginning to appear.

"April is not a deadline, it's a trigger point," said Julian Hatt, who's responsible for customer and stakeholder engagement in HMRC's Business Tax Programme.

From the user's point of view, the developers of integrated tax and accounts software have indicated that their intention is to provide an extra button to output the iXBRL, he explained.

"If accountancy practitioners decide to be particularly creative and step outside of the software defaults, they will need to contemplate whether to do any tagging for themselves. They can avoid that if they stick to the defaults."

Tim Hervey from Sage's Accountants Division acknowledged that many accountants are "still on the upward side of the learning curve", but added: "If you've got software that does tagging as part of the accounts production process, that will lessen the learning curve."

Below is a listing of integrated accounts/CT filing applications recognised by HMRC. The listing itself and status of the packages is not definitive and will change as more developers make it through the recognition process. What follows after are updates from online sources and exhibitors at the 3 November event about the programs that will be capable of handling both ends of the CT exercise, and when they are likely to be available.

iXBRL integrated software application providers: what's available and when?

HMRC-recognised suppliers
iXBRL accts
iXBRL comps Accts avail?
Absolute Accounting Software Yes Yes Now
CCH Software No Yes November
Forbes Computer Systems Yes Yes Now
IRIS Software No Yes November
PTP Software No Yes November
Quality Management Software Yes Yes December
Thomson Reuters (Digita) Yes Yes November

Absolute Accounting Software
Absolute operates as a 'best of breed' practice software umbrella group, marketing and supporting tools from different developers under the Absolute brand. The integrated accounts production/CT filing system comes from Forbes Computer, the first such tool to hit the market and the first to file a full iXBRL CT600 submission pack online with HMRC. Available: Now. Cost: £100 (for up to 10 clients, £335 for unlimited use).

BTCSoftware/VT Accounts
BTCSoftware's Andrew Ross said that its Corporation Tax efiling module will work in tandem with VT Final Accounts, but it is also talking to other suppliers. VT Software is hard at work on the iXBRL implementation for its final accounts program. The developer's website promises that the December 2010 edition of VT Final Accounts will include a new toolbar button called 'Generate iXBRL File'. This will display the following dialog. Like many of the other suppliers of integrated tax/accounts programs, the schedule has been slipping and delivery is now expected in January.

CCH
CCH has developed a common iXBRL tagging engine for its three accounts production packages: the converged CCH ProSystem application as well as legacy Viztopia and PROcap systems. Some pioneering customers are already testing the software, which is also going through HMRC's recognition process, said CCH small firm account manager Simon Cooper. Like other integrated suites, ProSystem is able to handle the workflow from outputting final accounts in iXBRL to filing them online with HMRC along with the CT computations. "If you look at the smaller firm market, most have got accounts production packages. Their view is that they will get a quality tool from their mainline supplier," he said. Available: November. Cost: No extra fee for existing users. Price on application for new customers.

Forbes
The Forbes Accounts application was the first product able to handle online CT submissions when HMRC's CT filing mechanism went live during the summer. As well as being the first company to file a set of abbreviated iXBRL accounts with Companies House, Forbes was the first to successfully submit a CT600 with accompanying iXBRL computations and accounts to HMRC CT Online when the mechanism went live in November 2009. Available: Now. Cost: £335.

IRIS and PTP
Both the integrated IRIS practice software families will rely on the same iXBRL export engine. The new application demonstrated at IRIS World in October will be available with Version 10.4 of the IRIS Practice Suite and was scheduled for imminent delivery. The new iXBRL module is currently undergoing user testing, but the IRIS team at the HMRC event said the product will now ship in November. "One of the things we will make certain of is the quality of the product, and there will still be five months to April to give people enough time to have a look at the software," said IRIS product director John Pattenden. When it arrives, the IRIS/PTP accounts production programs will include standard iXBRL templates along with a tag editor that allows the user to add and adapt their own iXBRL definitions. The software has an integrated taxonomy browser which is aware of HMRC's minimum list. The editing tool opens a view of what the accounts look like on a printed page, and the accounting numbers on screen are ringed by small boxes. A blue box indicates an item that has been matched to iXBRL tags, and a red highlight box indicates that no tag has been assigned to a figure, with possible options displayed in an accompanying on-screen menu. The tags applied to one set of accounts can be stored for use with other sets. The final accounts are then finalised, locked and validated against HMRC's filing rules. The resulting iXBRL file can be saved externally, or the user can tick a box within the output menu to make the file available for the Business Tax module to submit along with its iXBRL computations file as part of the electronic CT600 pack. Available: November. Cost: No extra fee for iXBRL accounts output.

Keytime
Has submitted its Corporation Tax application to HMRC for listing on its list of recognised software, but has yet to do so for accounts production, said development manager Alison Ford. For the accounts production part, the developer is using Crystal Reports to generate a final accounts file, to which it then connects its own software to apply the iXBRL tags. In common with TaxCalc and QMS, Keytime took the decision to lock down its account templates. Ford quoted the end of November as the likely release date for the two integrated components. It will be a straightforward upgrade at no additional cost to existing users, she said. Available: Nov-Dec. Cost: On application

Quality Management Software
One of only two applications to actually be demonstrated at Birmingham, the QMS iXBRL package is based on an Excel accounts template that feeds into the SA2000 Corporation Tax return system. "[Designed for small company SA600], an enhancement to existing software," said QMS director Andrew Bolton. Being tested by some "friendly users" and will ship commercially before Christmas, he added. Not planning to allow any flexibility in template, though users can add material in free text notes sections. Every box populated in the accounts generates an iXBRL tag in a very similar way to HMRC's PDF-based tool, "but a whole lot easier to use", says Bolton. If accounts are supplied in iXBRL, it will be able to prepare a CT return. Includes notes. "Not an accounts production product as such, it's a template you can produce accounts with – as long as they are simple ones. Our target market are the millions of companies and their advisers who aren't doing an audit. That's the vast majority of small companies." Available: December. Cost: Around £250.

Sage
Sage's iXBRL mechanism is handled by an Interactive Financial Statements reporting engine that is currently going through beta testing with users. The same module will handle iXBRL output for Sage Accounts Production Advanced (SAPA), Sage Accounts Production and Sage Instant Accounts Production and existing customers should get a working version in January, said Tim Hervey, business taxation analyst for Sage's Accountants Division. "We're also suggesting people file accounts early to avoid having to file iXBRL," he added. Hervey admitted that re-engineering its tax and accounts production tools to cope with iXBRL has been "a software development nightmare" for Sage, and not just for accounts production and tagging up external accounts. "We've got to make it user friendly and look at the whole workflow process to see if it can be set up better," he said. Available: January. Cost: No extra fee for iXBRL accounts output.

TaxCalc iXBRL
Like QMS, the TaxCalc-Arkk mechanism occupies the twilight zone between tagging and integrated accounts/CT return production, it relies on Excel templates that link the contents of particular cells to the correct iXBRL tags. You fill in the spreadsheets with trial balance figures and then upload it to TaxCalc's website, which converts it to iXBRL. The right data needs to be in the correct cell for the tagging system to work, but the Excel template approach gives users the ability to build in their own spreadsheet-based data feeds and validation checks, noted Simon Hurst in a hands-on review earlier this year. TaxCalc suggests adding a sheet to contain the client's trial balance into the Excel template. But TaxCalc iXBRL isn't intended to replace accounts production software. "If you already have a package that produces the accounts you need, and your supplier is going to provide an iXBRL-enabled update in good time to meet the HMRC requirements, stick with it. Nor is TaxCalc iXBRL a suitable product for a company that wants to present its accounts in a pre-existing, customised format," Hurst concluded. Available: Now. Cost: Conversion - from £25 per set of accounts; TaxCalc CT Unlimited £150.

Thomson Reuters (Digita)

Accounts Pro version 5.0, with iXBRL compatible templates will be ready by the end of November, the company says. With this software, the iXBRL file will be "just an output button", while a tag editor will enable users to add iXBRL tags not currently in HMRC's 1,500-item minimum requirement taxonomy. The tags are hidden behind the figures in final accounts report, but can be edited or added. Looking at a three-year ownership cycle, Digita MD Rihll estimated that using accounts production software was likely to be half the cost of tagging up the final accounts after preparation. The iXBRL templates for Digita's Accounts Pro application (and its ONESOURCE Accounts Production companion), would be "commercially available at the end of November", he added. Available: November. Cost: On application. No extra fee for iXBRL accounts output.

Twinfield
The Dutch-owned Cloud bookkeeping software house offers a new approach to the iXBRL challenge. It has broken with conventional wisdom that accounts production is a separate function to final accounts and is putting forward the argument that accounts data should be given iXBRL tags back at the invoicing and bookkeeping stage. "Accounts production is a data-driven process, so you should try not to break the data chain," argued Twinfield UK country manager Mark Davies. "Our philosophy is to work from a single source of data that's captured from day-to-day actions such as invoicing and purchase orders. If you get that data in, it drives everything: management reporting, credit management and accounts production." In the Netherlands, Twinfield is already used to exporting data from its program in the XBRL format banks demand and it is looking to transfer that experience to the UK market. "Our accountants portal includes a workflow tool so you can define the process and the people involved will know what tasks they need to fulfil – including the Corporation Tax bit," he said. For this final step in the efiling process, Twinfield is planning to partner with Corporation Tax developers, but was not able to confirm which ones yet.

The case for tagging
"To be honest, most smaller accountancy firms have got an accounts production package and their view is that the iXBRL solution will come from their mainline software supplier," said CCH account manager Simon Cooper. "But some of the larger firms with clients who do their own accounts production will also be looking for a tagging tool."

Sage's Tim Hervey saw the same trend: "Customers want both integrated iXBRL accounts and tagging. They’ve forced us to provide a tagging tool. A lot of accountants will produce accounts for clients, but a lot of companies produce their own Word/Excel accounts – up to 25-30% of clients for bigger firms. For these customers, accountants don't want to have to produce a whole new set of final accounts, so they want a tagging tool."

Ernst & Young director Kevin Huby predicted that XBRL data transfers are a long way off for many corporate entities visiting the HRMC event. "Looking at it as a two to three year objective, they recognise they will need a tactical solution to comply in year one, and then switch to automated accounts production," he said.

"Putting together a set of statutory accounts for a larger company requires a lot of skill and diligence, and finance directors do not like to outsource it."

For more details of tagging tool suppliers, consult HMRC's list of recognised suppliers and our previous guide to iXBRL-compatible software.

More iXBRL resources
iXBRL coverage and expert guides on AccountingWEB.co.uk
CCH iXBRL website
Digita iXBRL website and whitepaper
IRIS iXBRL whitepaper
Keytime iXBRL guide - everything the practitioner needs to know
Sage iXBRL website and AccountingWEB article Preparing for iXBRL
XBRL International - UK reference site

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Replies (9)

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By GaryMc
08th Nov 2010 10:39

Recognised list seems to be missing a few

Hi John

Your list of recognised suppliers seems to be missing a few names when you compare it to the one on the HMRC website - http://www.hmrc.gov.uk/efiling/ctsoft_dev.htm

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John Stokdyk, AccountingWEB head of insight
By John Stokdyk
08th Nov 2010 10:41

Our list is not missing integrated tax/accounts prep suppliers

Hi Gary, this article is specifically about tools that link accounts production tools straight through to the CT software and for this purpose I have applied stricter criteria than HMRC on their list of integrated software applications, which includes three classes of iXBRL providers:

Integrated Software Applications Managed Tagging Services Conversion Software Applications

This piece is most closely aligned to the first "integrated" group. However Since Drummohr does not have a companion accounts production application, I dropped it off my list, but PTP and IRIS stay. The same with TCSL - they are on HMRC's integrated software list, but it was clear from talking to them and looking at the software at the Birmingham event that TCSL was offering an accounts tagging tool rather than an accounts production service. As the text indicates, the TaxCalc-Arkk approach is made up of two separate elements, based around an online tagging engine, but they squeaked into our list because of the way they present and manage it for users as a combined service. As new integrated accounts production/CT tools appear, we will update the list - as HMRC will do with its list of recognised suppliers.

What the listing of contenders on this page indicates is just how small the selection of available products is at the moment, and that February-March is going to be an ugly time for integrated suite suppliers and their customers as they attempt to implement and test their iXBRL-compatible systems. Sage's suggestion to file paper returns early to avoid the problem was telling.

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By proactivepaul
08th Nov 2010 11:07

My software is OK, but HMRCs?

I think the question that needs to be asked it why it took HMRC 6 months (until 31 Oct 2010) before they were able to accept a 30 Apr 2010 CT600 online?

Last week I submitted many CT600s for APs ending in the range 30 Apr 2010 to 31 Aug 2010 which we had prepared ages ago.

We can do the work promptly.

VT Software can write the software promptly.

Why can't the Revenue do it more promptly? It took them half a year to get things ready!

-- @proactivepaul the paperless accountant dot com

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By GaryMc
08th Nov 2010 11:08

Thomson Reuters

I was thinking more specifically about Thomson Reuters (being my employers and all).  I know that it is you have given us a section but we are missing from the list.  Digita Accounts Production links directly to Digita Corporation Tax and both products use the same tag editor that you mention above.

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By daveforbes
08th Nov 2010 11:11

Out of date info (possibly our fault will check the website)

re: The Forbes Accounts application will be ready to handle online CT submissions when the tax department’s new filing mechanism goes live in a couple of weeks’ time. That was almost exactly a year ago - November 2009.

David Forbes

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John Stokdyk, AccountingWEB head of insight
By John Stokdyk
08th Nov 2010 11:25

Sorry David!

The fault is all mine. Earlier this morning I had an unfortunate slip of the mouse that made me lose several last-minute corrections. Your entry was one of them. I'll be fixed very shortly!

@Gary - OK, OK, you've got me there and have done a fine PR job on behalf of your firm. I mentioned the ONESOURCE Accounts Production edition in the "informal" AccountingWEB.co.uk commentary, but dropped it from the HMRC listing. For the benefit of corporate readers who may not be as familiar with the Digita brand, I will reinstate it.

These are the advantages and pleasures of interactive publishing!

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By GaryMc
08th Nov 2010 11:58

Cheers John

Much appreciated.

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By sdphilpott
08th Nov 2010 15:25

iXBRL compliant packages

Good to know there is at least one package around that is not too expensive (still £100 though) for those of us who prepare and submit out own accounts and tax returns!

However I do get the feeling this whole thing could become a living nightmare - maybe cynical but only based on past experiences!!

 

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By ymistry18
04th Apr 2011 09:25

iXBRL

Thank you, very informative

Yash

iXBRL

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