XBRL stands for eXtensible Business Reporting Language. The Companies Act, 2013 has made it compulsory for certain companies to file their financials and documents in XBRL format with the Registrar of Companies (ROC). These companies are required to file their financial statements in e- form AOC – 4 (XBRL) with the ROC. As per the Companies Act, 2013, following companies are required to file their financials and other documents in XBRL format under section 137 of the Act:
- All public limited companies listed on a stock exchange in India and their subsidiaries.
- All companies with a turnover of Rs. 100 Crore or more.
- All companies with a paid-up share capital of Rs. 5 Crore or more.
- All companies which were hitherto covered under the companies (Filing of Documents & Forms in Extensible Business Reporting Language) Rules, 2011.
In order to convert Financials statements and other documents into XBRL format, a software is required which can be bought from vendors available in the market. The cost of software ranges between Rs. 8,000 to Rs. 12,000 at the time of installation. Renewal of the license is required every year. Renewal charges are around Rs. 6,000 – 8,000.
Following documents and information are required for XBRL Filing with ROC:
- Balance sheet
- Profit and loss statement
- Cash flow statement
- Schedule to accounts
- Notes to accounts
- Auditor’s Report
- Director’s Report with Annexure
- General information about the company and directors
- PAN of shareholders
In order to make a quick conversion, the aforementioned documents should be available in editable form. Editable versions can be copied and converted easily.
Conversion of financial statements into XBRL format includes both data entry and subject knowledge. Absence of any one component shall not solve the purpose. Subject knowledge is very important for proper tagging of information and correct date entry. The quality of XBRL document plays a very important role. Just filling the date and preparing the file will not be sufficient. Thus, peoper tagging and correct entry of data is very important.
Process of XBRL conversion of documents
In case of any error in validation in software or MCA tool, list of error will be provided by the system. You may check the list and rectify the data. Validation and scrutiny will be completed only when the file is error free.
After completing the conversion process, prepare e- form AOC – 4 (XBRL) and attack the XML file so created after conversion.
- Rs. 100 per day shall be charged from the due date of filing AOC-4 XBRL till the date of filing.
- In case of default:
If a company fails to file AOC-4 (XBRL) along with a copy of the financial statements before the due date, the company will be punishable with fine of Rs. 1,000/- (One thousand) for every day during which the failure continues up to a maximum amount of Rs.10,00,000 (Ten lakhs) .
Further, the Managing Director, Directors and the Chief Financial Officer of the company, could be punished with imprisonment for a term which may extend to 6 (six) months or with fine which will not be less than Rs.1,00,000 ( One Lakh) and upto Rs. 5,00,000 (Five lakhs).
At Mr.tax, we can help you in the conversion of financial statements and other documents into XBRL format. Contact us to know more about XBRL filing.
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