Israel
ISA's XBRL Mandate: Enhancing Financial Reporting in Israel
The Israel Securities Authority (ISA), Israel’s main regulatory body overseeing securities registration and corporate reporting, has introduced a mandatory requirement for companies to file their financial statements in eXtensible Business Reporting Language (XBRL) format. This initiative is part of the ISA’s broader effort to modernize financial reporting, improve transparency, and enhance data accessibility for all market participants, both local and global.
Mandate Overview and Objectives
The ISA’s XBRL mandate aims to modernize and standardize the process of financial reporting for Israeli companies, improving several key aspects of the financial reporting ecosystem:
- Increased Data Quality and Accessibility: By adopting a standardized digital format, the ISA makes financial data easier to access, analyze, and compare, allowing for more informed decision-making by investors, analysts, and regulators.
- Cost Reduction and Efficiency: XBRL allows for automation in data collection and reporting, significantly reducing the manual effort, errors, and costs traditionally associated with preparing financial statements.
- Enhanced Transparency: The use of XBRL ensures consistent, accurate, and up-to-date data, improving transparency for stakeholders across the market.
- Improved Regulatory Oversight: By streamlining the filing process and ensuring consistency in reporting, the ISA can more efficiently review and monitor corporate financial disclosures.
Who Is Affected by the XBRL Mandate?
The ISA’s XBRL reporting mandate applies to a variety of companies in Israel, including:
- Companies listed on the Tel Aviv Stock Exchange (TASE): These publicly traded companies must submit their financial data in XBRL format to the ISA.
- Companies meeting specific thresholds: Firms with total assets or annual revenues above a certain level, even if they are not listed on TASE, are required to comply with this mandate. This ensures that larger and more impactful entities contribute to the overall transparency of financial information in Israel.
The XBRL format is designed to accommodate Israeli Accounting Standards (IAS), ensuring that local accounting principles are adhered to in the reporting process.
The Transition to Inline XBRL (iXBRL)
In 2019, the ISA introduced a major enhancement to the reporting mandate by shifting to Inline XBRL (iXBRL) reporting. iXBRL integrates XBRL data directly into HTML documents, making it easier to view and interact with financial data on digital platforms. This move was part of the ISA’s broader strategy to modernize Israel’s capital markets and increase their appeal to global investors.
Key features of iXBRL reporting:
- Interactive Reports: Stakeholders can now access financial data within the context of a human-readable report, with XBRL tags embedded for easy extraction and analysis.
- Ease of Data Extraction: iXBRL enables machines and analysts to quickly extract financial data, making it easier to compare financials between companies and across industries.
- Compliance and Accessibility: Inline XBRL ensures that all the data is compliant with ISA regulations while also being more accessible to users who are not familiar with XBRL syntax.
Filing and Publication Process
The Magna portal, which is operated by the ISA, serves as the official platform for collecting and publishing iXBRL filings. Companies are required to submit both their annual reports and interim reports through this portal, ensuring real-time accessibility of financial data for investors, analysts, and regulators. The portal plays a central role in:
- Ensuring Accuracy: The Magna portal checks all iXBRL filings for compliance with ISA regulations before publishing them.
- Centralizing Access: It serves as a one-stop shop for stakeholders to access and analyze the filed financial data.
Benefits of XBRL Adoption in Israel
The implementation of XBRL reporting in Israel has resulted in numerous benefits, both for individual companies and for the broader financial ecosystem:
- Improved Financial Transparency: With XBRL, financial data becomes more accessible, allowing investors to conduct more thorough due diligence and analysis.
- Faster, More Efficient Filing: The automation and standardization of data submission reduce the time and effort required for both companies and regulators to process filings.
- Cost Savings: Automation leads to cost reductions in the filing process, benefiting companies by lowering compliance costs.
- Global Integration: As more countries adopt XBRL, Israel’s compliance with this international standard enhances its attractiveness to foreign investors and aligns the country’s reporting standards with global norms.
The Future of XBRL Reporting in Israel
The ISA’s implementation of XBRL has marked a significant advancement in Israel’s financial reporting landscape. As companies continue to adopt iXBRL, the efficiency, accuracy, and transparency of financial data reporting will only improve. Furthermore, the alignment with global reporting standards positions Israel as a leader in innovation and financial transparency.
The future of financial reporting in Israel looks promising, with the ISA’s mandate playing a key role in shaping a more open, accessible, and efficient capital market. The benefits of this transition will continue to ripple across Israel’s corporate ecosystem, making the country an even more attractive destination for global investors.
For further details and updates on the ISA’s XBRL mandate, [Read more here].
Israel XBRL Mandate Applicability:
The Israel Securities Authority (ISA) mandates the use of XBRL for the following reports:
- Annual Reports: All listed companies on the Tel Aviv Stock Exchange (TASE) and those meeting specific asset or revenue thresholds are required to submit their annual financial reports in XBRL format.
- Quarterly Reports: Companies must also file their quarterly financial statements in XBRL format, ensuring consistent and timely reporting throughout the year.
This requirement applies to ensure standardization, accuracy, and transparency in financial reporting across the Israeli market.
Israel XBRL Mandate applicability:
- Annual reports
- Quarterly reports
Our SAAS based disclosure management platform allows:
- Preparation of regulatory reports
- Automates the generation of XBRL
- Ensures accuracy and compliance
XOR a multi-user cloud-based online XBRL review platform allows:
- Review of ixbrl filings.
- Built-in validation reports
- Workflow management capabilities.
