Moving from "Document-oriented" to "Model-oriented" Mentality for Financial Reporting

In a prior blog post I introduced what I referred to as the world's first standards based expert system for creating financial reports.  As far as I know that description is precise, but it is not accurate as it really should be. What I really helped to create was a model-based financial report creation software application that was, in fact, a rules-based expert system .  That software application is called Auditchain Luca . You can try Luca (as of this writing) yourself.  This rather old video playlist shows you some of the capabilities of Auditchain Luca. Many newer features were added since those videos were created. Auditchain Luca is based on research, reverse engineering of thousands of XBRL-based reports submitted to the SEC and ESMA, other work done with XBRL Cloud  in the very early days of XBRL-based reporting to the SEC,  the working proof of concept Pesseract , constructing early version of both the US GAAP and IFRS XBRL taxonomies, building software while at UBmatr

Financial Report Pieces

"Paper is just an object that information has been sprayed onto in the past." Ted Nelson A financial report (a.k.a. financial statement, general purpose financial statement ) is a tool designed by humans. Financial reports are knowledge graphs . Financial reports have an extra-fancy global standard technical format used to represent those financial report knowledge graphs. The semantics, or logic, of a financial report is described by the Logical Theory Describing Financial Report . The following describes the logical pieces of a financial report and the logical patterns of how those pieces relate to one another as best as I can describe them: ( click here for dynamic model ) For the first time in 7,000 years , both humans and machines can reliably understand information, to a certain degree, being exchanged by these tools. Algorithmic regulation is really a thing. Additional Information : Puzzle Pieces of Digital Financial Reporting Simple Explanation of Logical System and

Representing SFAC 6 Using Wikidata

This blog post is to test representing SFAC 6 elements of financial statements on Wikidata and seeing how this works.  Here is my experimentation: Here are the terms defined by SFAC 6 in a human readable form. This is a previous representation that I created using XBRL  and is readable by both humans and machines.   Here is similar information on Wikidata for the terms defined by SFAC 6 . Here is a RESTFUL URL that takes you to the Wikidata Query Service and query information on Wikidata. Here is a RESTFUL URL that takes you directly to a web page that is generated from the query. And below is that same query embedded within this web page. This is cool and useful stuff. Think information Lego blocks.  Don't understand what I am saying?  Time to up your digital proficiency . Remember, this is an experiment; a prototype.  I had to trim the descriptions because of an apparent limitation on the number of characters you can provide within a description. Additional information: Se

See Future of Reporting Using Wikidata

On a conference call I was on the other day, someone mentioned Wikidata .  I knew that Wikidata existed, but I really did not understand what Wikidata really was, how it worked, or what you can do with Wikidata. And so I thought it was time for me to kick the tires of Wikidata and figure out what it actually was. To learn about Wikidata I modeled the accounting equation and SFAC 6 elements of financial statements using Wikidata. Seeing what I could do with Wikidata can totally changed my life. Wikidata calls itself a "free knowledge base that anyone can edit". But what Wikidata is is much, much more than that.  Wikidata is a well engineered cloud-based, web-based collaborative platform. Wikidata is free, anyone can read from the knowledge base or write/edit to add or change information in the knowledge base similar to how you can modify Wikipedia.  Not only can humans use the GUI/UX to create/read/update/delete ( CRUD ); so can machines. Another thing which does not seem to

Logical Theory Describing Financial Report

A logical theory describes the logical patterns that make up some logical conceptualization.   A logical theory enables a community of stakeholders trying to achieve a specific goal or objective or a range of goals/objectives to agree on a shared understanding of some area of knowledge.  A stakeholder is anyone that has a vested interest in a logical system. Foundational to arriving at harmony between the stakeholders of a system is having a common logical conceptualization for thinking about and discussing the system. The Logical Theory Describing Financial Report   is a document that I wrote to describe the logical patterns of a financial report.  I have represented that information in many forms including UML , a dynamic rendering in HTML , in XBRL (see the section Technical), a video playlist on YouTube , and other such representations. Now, I am going to describe that information using Wikidata . Here is a reference to the Logical Theory Describing Financial Report on Wikidata .

Accounting Equation on Wikidata

The accounting equation  (a.k.a. the balance sheet equation) is the foundation for the double-entry bookkeeping system and the cornerstone of the science of accounting. Here is the accounting equation on Wikidata . Fundamentally, Wikidata is a set of logical statements. Here is the accounting equation implemented in XBRL . Here is the XBRL referenced to the  Wikidata entry . Wikidata is cool!  Linking the Wikidata information to the XBRL-based information is even cooler.  Don't understand why this is cool?  Then you need to increase your digital proficiency . Additional Information : Accounting Equation for Beginners (Video) How to add a new item to Wikidata Wikidata: Introduction Wikidata: Tutorial: Introduction to Basics  (Video) Wikidata REST API Wikidata Data Access Financial Statement (Wikidata) Wikidata Query Service Query of accounting terms Query examples Embeddable query Wikidata Property Explorer Etherpad (Collaboration tool) SFAC 6 Term (Elements of Financial Statemen

Markets in Crypto Assets (MiCA)

The Markets in Crypto Assets (MiCA) is a comprehensive regulatory framework proposed by the European Union (EU) to govern the issuance and provision of services related to crypto assets. MiCA is part of the European Commission’s Digital Finance Strategy and due to take effect beginning in June 2024. Here are the MiCA regulations  in English. ( Here are the regulations in each of the official languages of the EU .)  The regulations cover crypto asset issuers, crypto asset offerors, e-money tokens, and asset-referenced tokens. Any company offering crypto assets within the block of 27 nations that make up the European Union will be subject to these regulations. The regulations require that a "whitepaper" be published by any company offering crypto assets to the public within the European Union.  The whitepaper is somewhat like a "management discussion and analysis" and does include financial information. Inline XBRL (iXBRL) format will be used for MiCA whitepapers. Th