Taxonomy Testing Techniques Which Yield High-Quality Taxonomies

1. Taxonomy Testing TechniquesWhich Yield High-Quality Taxonomies Charles Hoffman, CPA – UBmatrix

2. Introductions • Who am I • Who are you?

3. Agenda • Introductions • Validation – first step in testing, but not sufficient • Issues validation will not catch • Testing – the key to a quality taxonomy • Testing techniques that work • Strategy to help taxonomy users, that also help test • Problems caused by lack of adequate training • Provided in taxonomy to help instance validation • Questions and discussion

4. Validation • Necessary, but not sufficient • Interoperability issues • Types of automated validation • Errors (MUSTS, MUST NOT) • Warnings (SHOULD, SHOULD NOT, MAY) • Best practices (not in XBRL specifications, but very, very good ideas) • Inconsistencies (calculations) • FRTA conformance • Types of validation requiring humans

5. Automated Validation • XML well formed (syntax checking) • XML Schema validation (syntax checking) • XBRL validation (syntax checking, some semantics) • FRTA validation (syntax) • Best practices • Inconsistency checking (for calculations)

6. Example of Inconsistency Which Causes Issues • Presentation/Calculation mismatch

7. Human Validation Required • References are the proper/appropriate reference • Labels spelling correct • Labels consistent (Proforma, Pro-forma, Pro forma) • Balance type appropriate • Relations appropriate (calculation, presentation) • Can actually express data you desire to express

8. Strategy to Help Taxonomy Users, That Also Help Test Taxonomy • Providing things in taxonomy to help instance user • Calculations, business rules, XBRL Dimensions for 100% of computed relationships • Providing user’s manual • Providing a comprehensive sample instance document, forces you to use your own taxonomy • Providing a 100% test of taxonomy coverage • Providing input template with mappings

9. Problems caused by lack of adequate training • Moving from… • Unconsciously unconscious (don’t realize you have problems) • Consciously unconscious • Unconsciously conscious • Consciously conscious (you are certain you don’t have problems) • Have you PROVED your taxonomy is correct?

10. Provided in Taxonomy to Help Instance Validation • Business rules • For example, for validating movement analysis calculations • Disclosure checklist type validations, “If you have PPE, you must have PPE policy and PPE explanatory disclosure…”

11. Conclusions • Automated validation necessary, but not sufficient • Software interoperability is not to be trusted at this point, cut the cards • Human validation requires substantial experience and training (not only training) • Having the proper tools is crucial • What have you done to PROVE (to yourself) your taxonomy works correctly? • Help taxonomy users; only one creator; but many, many users of taxonomy • No matter how hard you test, the “stress” of real use will always turn up additional issues

12. Questions and Discussion