Big Data – Your New Assistant for Analysing Financial Reports
Data is the new oil.
The Role of Big Data in Financial Reporting:
Today, the world is producing almost 2.5 quintillion bytes of data every day. Of course, not all of this data belongs to the finance industry. But a massive portion of it does. Moreover, big data has become even more critical for executives and C-suites in the financial sector to stay ahead of the curve.
The Revolution of Finance and Big Data
Financial institutions and services are not new to the digital landscape. In fact, big data in finance has led to major technological advancements in recent years. It has also allowed the industry to develop agile, tailored, data-driven, and safe solutions. One of the most prominent creations in the finance industry has been iXBRL.
iXBRL is an open-source business/financial reporting language used globally. It helps standardize data reporting and makes it easier for organizations to process their data faster, enabling them to compare massive amounts of data more efficiently.
Big Data, iXBRL, and the CIPC
Since the introduction of iXBRL, the CIPC has started using big data analytics to monitor financial reports submitted by the issuers to detect any discrepancies in real-time. It helped the CIPC collate all transactions and financial activities data, so any fraud or inconsistencies can be detected early on.
Big Data – Its Power to Analyse Financial Reports
- More Detailed and More Accurate AFS
Simply put, the CIPC made it mandatory for entities to lodge their Annual Financial Statements in the iXBRL format to bring in standardization and transparency. This allows eligible entities to leverage the capabilities of big data and iXBRL to present more detailed and accurate financial reports that can help regulators, stakeholders, and potential investors to get a better sense of the financial health of an organization.
- Extract Valuable Insights
The users of iXBRL financial reports, i.e., the tax authorities, regulators, and investors, can utilize the capabilities of iXBRL to standardize it for the implementation of big data analytics, and use it to extract valuable insights related to the company’s bottom line.
- Comparable Statements
iXBRL ensures a standardized reporting format for all financial reports. What’s more? Big data combined with an agile iXBRL solution allows companies to compare financial reports from two separate periods easily, This gives a clearer picture of the profit/revenue earned along with other insights, including how much money the company owes, the capital influx, etc.
In its true sense, big data is powering the analysis of financial reports. The world is yet to unearth the full potential of big data but the financial reporting sector indeed has given it a kickstart.
To know more about big data and how it is streamlining financial reporting, explore the DataTracks blog @ https://www.datatracks.com/za/blog/.
