Spotlight on two key Prism’s controls
Today, we zoom on two key Prism's proprietary controls for sign and scaling errors.
Interview with Catherine Raphael, Group Director of Consolidation at Unibail-Rodamco-Westfield (URW), on the implementation of ESEF and our solution within her company. Between compliance, publication and innovation, discover how URW met the challenge of digitising its financial information, while transforming a regulatory constraint into a real opportunity for financial communication.
I started my career in an audit firm before moving into the corporate world, where I specialised in financial reporting and consolidation. Since 2015, I have been Group Director of Consolidation at Unibail‐Rodamco‐Westfield. Over the years, I have been able to observe the evolution of European reporting, especially with the introduction of IFRS, but also the regulators' recommendations on financial information and more specifically, the notes to the consolidated accounts. With the Transparency Directive introducing the obligation for listed European companies to publish their financial reports in the European Single Electronic Format (ESEF), new challenges have arisen, but also new opportunities for finance departments.
We took an interest in the subject very early on and approached the introduction of the ESEF of course as a challenge, but above all as an opportunity to improve.
We were one of the Groups that opted to file their 2020 Universal Registration Document (URD) in ESEF format in 2021. This allowed us to familiarise ourselves with the tagging process and gauge the expertise required. We were thus able to learn from this optional first year and continue improving the tagging over the following two years as we gained expertise. After three filings in this new format, we are now more comfortable with this process.
The challenges are multiple: the file must be technically compliant, present information so that it is easy to read, and include correct tagging that allows our data to be used accurately by external parties, especially investors or analysts.
However, for the financial year 2022, this process became more complex, with the tagging of all the notes to the consolidated accounts, in addition to the tagging of the accounts themselves.
Tagging the accounts and the notes is not a very intuitive exercise for financial accountants like us. Moreover, the instructions issued by the legislator remain quite abstract and general in nature and do not therefore necessarily cover all the specifics of the business sector, for example. In addition, the checks performed by some tools or players are calibrated for technical compliance, but do not systematically verify the relevance of the tags used. It is therefore essential to acquire XBRL technical expertise by training people in the team, but also to be able to compare our financial information with that of other industry players, and therefore avoid incorrect or inaccurate use of certain tags.
One of the challenges of this exercise was also to ensure the information provided was easy to understand. Indeed, notes to consolidated accounts typically include many tables, and current ESEF conversion tools struggle to present them in an easily comprehensible manner.
Lastly, it should not be forgotten that the electronic document must be reviewed by the auditors, and that time for this review must be incorporated into the timetable for preparing the URD.
Prism was a major asset for us throughout the tagging process and the preparation of the electronic file. We made extensive use of the comparison functionality, which enabled us to easily compare the document with the previous year’s version, as well as successive versions. We also benefited from all the other "Controls" and "Mandatory Marking" features to save precious time when checking our data.
Prism is therefore a tool which enabled us to improve our internal operational efficiency and significantly reduce the risk of non‐compliance. All in all, it enhanced the reliability of publication of our annual report in ESEF format. Prism has allowed us to break away from the 'black box' effect of the electronic format.
Getting started with Prism was quick, simple and effective. The detailed controls provided by the solution were a great help, and the messages were simplified so that all users could benefit from the data, regardless of their level of expertise.
We received a few hours’ training, and Corporatings' experts were always ready to assist, enabling us to quickly master the solution and streamline our process with complete peace of mind.
A technical check alone is not enough to deliver high‐quality information in an easily understandable and usable format.
With its dedicated features, a tool such as Prism is now essential in our electronic file preparation process, and in the way we communicate with our service providers and auditors. It allows us to save time in conducting our controls and goes beyond mere regulatory compliance. Being able to compare our publications, especially with other industry players, brings real added value.
We can already observe that, beyond the regulatory aspect, electronic data has opened up new avenues in terms of financial communication. It offers the possibility of rapidly benchmarking the accounting and communication practices of other players, especially those in the same business sector, which represents a valuable opportunity for all our teams.
In the future, with the publication of non‐financial data in ESEF format, the areas of analysis and comparison will be even wider and more strategic for us as issuers! What started out as a regulatory constraint has become a lever for more transparent communication with readers and analysts...