Do you recognize the following? Nowadays, you as an entrepreneur are confronted on a regular basis with more and more requests from all kind of agencies to provide financial data.
Accountants, banks, tax authorities, Chamber of Commerce, etc. They all want to have financial data from you. And they all want to have it at different times, in different formats, sent to different kinds of portals. And if you’re unlucky, these agencies will ask for more data/details after the initial request was answered.
This phenomenon is becoming a real headache for many, costing people more and more time and money. You’re left with less and less time to do what you are really good at: Being an entrepreneur, running your business and earning money!
Well, the good news is that the financial software industry, together with the above mentioned agencies, has been busy trying to introduce and promote industry standards for a while: Standard formats, standard portals, etc.
These should make your life less stressful and reduce your costs.
The ultimate idea is that your financial software will automatically provide the correct requested data in a standard format to the appropriate agency at the right time – without any further hassle for you.
Of course, this is only after your approval – you’re still sitting in the driver’s seat. The financial software is just the gearbox to help you to drive in top gear.
The less good news is that this ultimate idea is not yet fully implemented. But be a little patient. We are on the way.
The current situation in The Netherlands is as follows:
Existing standard formats:
- For detailed financial information:
Auditfile financial (XAF) – Mostly requested by Tax authorities and accountants
XBRL-GL – A worldwide standard which is expected to replace the auditfile in the future.
- For financial reports:
SBR – Standard Business Reporting. A worldwide standard formally known as XBRL.
Mostly used for credit reporting requested by banks, annual statements requested by Chamber of Commerce, tax returns requested by the tax authorities, etc.
Existing standard Portals:
A portal for delivering the financial reports requested by Chamber of Commerce, tax authority and other government agencies.
A portal for delivering the credit reporting requested by banks.
Regarding the standard format Auditfile:
This format was already available a few years back. Since then it has been regularly improved. The latest version of the auditfile is version 3.1. This version contains extra information in comparison to the previous version (version 2.0). Namely:
- Sub ledgers Accounts receivable and Accounts payable
- Opening balance
By using this format instead of the previous version, you can provide more data to the requesting agency. As such, the chance that they will come back to you with a request for more information will be reduced.
Since 16-06-2010 Exact Online supports both version 2.0 and 3.1 of the Auditfile.
So, to come back to the question from our title: Do you want to drive in top gear? I assume you do. One little step in the process of getting there is to already use Auditfile 3.1 – when, for example, the NL tax authority or your accountant is requesting financial data. It will save you time.
Regarding the other standards mentioned above and other developments around this ultimate idea: I will come back to them in future blogs. So stay tuned!