XBRL-based Digital Financial Reporting

A system is in effect “blind” to things not covered by that systems rules.  In the past I have said a similar sort of thing by explaining that rules provide "guardrails" or "bumpers" or "guiderails". The following graphic helps one understand the value of the Standard Business Report Model (SBRM) and the guidance of the Seattle Method .  On the LEFT are the “pillars of quality” that the FASB and SEC seem to be currently relying on: the XBRL technical syntax and some rules about the math in a report that tends to not be enforced.  On the RIGHT is how my Seattle Method sees a financial report and how I hope SBRM sees financial reports and business reports.  Again I say: A system is in effect “blind” to things not covered by that systems rules . ( Click here for larger image ) Think about that statement a minute. What exactly, if not system rules, is the software system relying on in order to understand information if not for the rules of the system?  Magic?...

Zen is a philosophy or a way of being based on a sense of having awareness and mindfulness. To me, Zen is about elegance, grace, and beauty. A general purpose financial statement tells a story.  A general-purpose financial statement is a true and fair representation of information about an economic entity following an agreed upon set of  basic accounting principles .  A financial statement is not the actual economic entity, it merely conveys fairly high-fidelity information about an economic entity that is generally of very high-quality. Consider the term "statement". A statement is a declarative sentence .  A statement declares information.  In logic and semantics, the term statement is understood to mean either: a meaningful declarative sentence that is true or false, or a proposition that asserts that something is true or false. Logic is a formal system that defines the rules of correct reasoning about logical statements.  Logical reasoning is about a...

The purpose of this article is to brainstorm what the definition of a "logical twin" or "logical digital twin" actually is.  I have heard the terms "digital twin" and "mirror world". Per IBM, a digital twin is defined as :  "A digital twin is a virtual representation of an object or system designed to reflect a physical object accurately."  IBM goes on to define types or categories of digital twins: Component twins or Parts twins : Component twins are the basic unit of a digital twin, the smallest example of a functioning component. Parts twins are roughly the same thing, but pertain to components of slightly less importance. Asset twins : When two or more components work together, they form what is known as an asset. Asset twins let you study the interaction of those components, creating a wealth of performance data that can be processed and then turned into actionable insights. System or Unit twins : The next level of magnification in...

The world is complex.  But sometimes humans can come together and agree enough to create something useful in meeting some important aim and satisfying some agreed upon set of goals and objectives. When trying to solve a problem, systems thinking is useful. Systems thinking is a discipline for seeing wholes. It is a framework for seeing interrelationships and patterns. Irreducible complexity (a.k.a. essential complexity) is a term used to describe a characteristic of complex systems whereby the complex system needs all of its individual component systems in order to effectively function.  In other words, it is impossible to reduce the complexity of a system (or to further simplify a system) by removing any of its component parts and still maintain its functionality objective because all those component parts are essential to the proper functioning of the system. So for example, consider a simple mechanism such as a mousetrap. That mousetrap is composed of several differe...

Below is an "inventory" of terminology I use to describe what I now refer to as "logical twin" or " logical digital twin " or " digital twin " of a financial report (a.k.a. financial report knowledge graph ).  After I complete the full inventory, I will synthesize this into a practical and useful resource for general business reports.  The point of this exercise is to create a description of a knowledge-based system (a.k.a.  knowledge graph , problem solving system ) that is understandable to business professionals who desire to make use of such systems. This explanation will evolve and improve. Fundamentally, this is driven by systems thinking  and systems engineering . * * * The objective of the system is the effective exchange of information.  Important to the system is the elimination of “wild behavior” by accountants when report model of report being created can be modified. Description of report (specification of what is permitted); created...

The EpiK Protocol seems to have done or is trying to do what I tried to get Auditchain to do. EpiK is briefly explained in the EPIK's Decentralized Knowledge Graph Manifesto .  EpiK is more thoroughly explained in the EpiK Protocol Docs . Personally, I believe that the Gamified Incentive Model  could work as a way to compensate accountants for creating metadata, software engineers to create software, and others to perform their role in getting a new approach to performing work up and running  and sustaining it long term. This blog post, The Economics of Digital for CPAs explains my past thinking on this.  Not sure how all this might turn out, but something will unfold. Additional Information : Auditchain Explained in Simple Terms

Creeping normality, as described by Wikipedia , is the phenomenon where a significant change becomes normalized through a series of small, gradual steps. What might be shocking or unacceptable if implemented abruptly becomes commonplace over time. This concept is particularly relevant to the issue of data silos within organizations. Year after year, quick fixes and short-term solutions lead to the integration of various applications in a piecemeal fashion. These 'point-to-point' integrations create isolated systems that ultimately hinder overall efficiency. The root cause often lies in prioritizing immediate gratification over long-term planning. Decision-makers are more likely to choose the readily available solution, even if it creates problems down the line. The tendency to 'kick the can down the road' is a major obstacle to effective data management. By resisting short-term expediency and focusing on long-term goals, organizations can avoid the pitfalls of creeping ...

 LodgeiT Labs has created what they are calling an open source RDF accounting engine . This YouTube video provides a glimpse .  Information that I have received says that you can get the code for this RDF accounting engine here . This YouTube playlist provides more information . ( When I asked Microsoft's Copilot to generate an image of an RDF accounting engine, this is what I got below. ) This open source RDF accounting engine, apparently called "Robust" is described as follows: "Robust is our LodgeiT experimental, open-source accounts-processing engine able to generate investment reports with realised & unrealised gain/(loss) as well as currency gain/(loss). Read more about it here - https://github.com/lodgeit-labs/accounts-assessor"  What I would be very interested to see is my "record to report" working prototype to be run through that accounting engine. My working prototype took the transactions from the Microsoft Dynamics "The World Onl...