XBRL-based Digital Financial Reporting

Imagine a system that combines a software application used for performing some task, a knowledge management system that contains machine interpretable knowledge related to performing that task, and a reasoner which understands how to interact with the knowledge base within the knowledge management system, the software application, and the human user of that software system. That is basically a knowledge based system . A conventional knowledge management system (KMS) is a platform that facilitates the capture, represent, storage, organization, sharing, and application of knowledge within an organization, enhancing decision-making and operational efficiency in support of organizational goals and objectives. A knowledge management system is basically a place where an organization keeps what it knows so people can actually use that knowledge. Basically, traditional KMS act like a library. Without a KMS, knowledge stays trapped in people’s heads or scattered across documents. With a KMS, th...

Just as I am reconciling three approaches to representing a conceptualization of a business report ; I am also endeavoring to reconcile several other "inputs" related to accounting, reporting, auditing, and analysis.  Here is an inventory of these different inputs: Conceptual Model (CM) of Business Report,  Seattle Method Conceptual Model of a Business Report Data Centric Accounting  (DCA) which was created by Semantic Arts, Dave McComb, and Cheryl Dunn and documented in  The Future of Accounting Reporting Framework  (will tie to each), Seattle Method Report Model and Report (will tie to each), Seattle Method Showcase of Capabilities (will tie to each), Seattle Method Accounting and Economic Ontology Terms , from  ISO/IEC Accounting and Economic Ontology Resources, Events, Agents (REA) which was created by Bill McCarthy and documented in The REA Accounting Model as an Accounting and Economic Ontology , published by the American Accounting Association an...

There is an elephant in the room. Accountants, auditors, and analysts have been performing work related to creating information, attestation related to the trustworthiness of that information, and decision making and other supporting services related to making use of that information for many thousands of years. The basis of that information, the medium used to convey that information , has been the "physical hard copy"; the physical paper-based document; the physical paper-based spreadsheet. These paper based documents were the sources of data used by accountants, auditors, and analysts for literally thousands of years.  Those physical paper based documents evolved from the earlier mediums which included physical objects, clay tablets, papyrus and other earlier forms of physical hard copies. Those physical paper based document oriented artifacts literally drove the universal technology of accountably  for thousands of years. The internetworked computer (a.k.a. the computer h...

There is one piece of metadata that is missing from general journal information.  I contend that that piece of metadata is missing because without that metadata it is impossible to reliably automate the process of generating a complete set of primary financial statements and with that missing piece of metadata then it is possible to automate that process.  Further, it is also impossible to use only the general journal information to manually create a complete set of primary financial statements without that piece of information.  And finally, it is impossible to effectively implement useful traceability such as "drill down" without that piece of information. By "complete set of primary financial statements" I mean balance sheet, income statement, cash flow statement, and statement of changes in equity. (i.e. the four core financial statements ) The missing piece of metadata is the " business event type ". The graphic below, which is a representation in XB...

Imagine being able to grab a smart financial statement , drag that smart financial statement into a smart analysis tool, and do your financial analysis tasks. Imagine being able to connect a smart analysis model to a smart financial statement and then also the smart closing book used to create that financial statement and the smart audit bundle that provided independent third party verification of that financial statement. Financial information wants to be free from imperfections.  Financial information wants to be connected. Traceability ; the ability to trace, track, walk, drill down, drill across find the origin of information or navigate to the information's ultimate destination. Imagine regulators with new types of capabilities. A new paradigm is not only possible, it is inevitable. People package this new paradigm using different words.  Here are the words that some use: MIT refers to this as Algorithmic Business Thinking   Carnegie Mellon University refers to ...

When I started as an auditor in 1982, the way a financial statement was created was that a typing pool in a room would type the statement into a word processor; I don't remember if we had laser, they may have been typed on on a type writer. Those in the typing pool who did the typing knew little or nothing about financial statements; they simply typed what was on a piece of paper. Word Perfect and then later Microsoft Word changed that. Now the process is very much different yet it is also very much the same.  Financial statements are still documents and the software application, the word processor, knows nothing about the financial statement that it is being used to create. Others continue to create make incremental improvements to the same old paradigm, a document oriented paradigm.  Artificial intelligence will struggle to use that traditional paradigm. Financial statements would work better as databases, rather than documents. I personally am personally completely rethinki...