the non-adoption of xbrl by professional and government organisations in new zealand and its ...

314 Pages·2016·4.55 MB·English

THE NON-ADOPTION OF XBRL BY
PROFESSIONAL AND GOVERNMENT
ORGANISATIONS IN NEW ZEALAND AND ITS
IMPLICATIONS FOR STAKEHOLDERS

BY
JASMINE DAVID

A thesis
submitted to the Victoria University of Wellington
in fulfilment of the requirements for the degree of
Doctor of Philosophy

Victoria University of Wellington
2016

ABSTRACT

Technology adoption plays a significant role in changing the way business communicates its
financial information. One recently developed, technology-based language that can be used
for financial reporting is eXtensible Business Reporting Language (XBRL). Fisher (2008)
believes that XBRL is the future of business reporting and various XBRL stakeholders
internationally have been promoting the use of XBRL for almost two decades. However, the
widespread adoption of XBRL for business reporting has not happened in New Zealand.
Thus, the aim of this thesis is to investigate why business and professional organisations and
the New Zealand Government have decided not to adopt XBRL for use in business reporting
and the implications of that decision for XBRL stakeholders. The following research questions
are addressed:
a) What factors influenced the organisations’ decisions not to adopt XBRL for use in
business reporting?
b) What are the implications of the government decision regarding XBRL use in business
reporting for XBRL stakeholders?
To achieve the research aim and answer the research questions, this study developed a
research framework that utilizes the Technological, Organisational, and Environmental (TOE)
model of technology adoption developed by DePietro, Wiarda, and Fleischer (1990). A
longitudinal multiple-case study approach that analyses interview and documentary data
related to four key XBRL projects: LEAP+, Project First Step, e-GIF, and SBR, was employed.
The results suggest the non-adoption decision by New Zealand’s private and public sector
organisations was influenced by a combination of factors from the technological,
organisational, and environmental contexts. Twelve predicted and fourteen unpredicted
factors have a different degree of influence on the non-adoption decision. The factors of no
relative advantage, not being perceived as a problem solver, a lack of human capability, no
real championship, ineffective promotion, and communication, over-enthusiasm among
experts, a lack of stakeholder involvement and a knowledge gap are the critical influencing
factors and are common to all four XBRL projects. One-off factors in particular projects also
had a significant influence. These were the copyright issue in the LEAP+ project; a change of
laws, rules and regulations in Project First Step; a change of programme sponsor in the e-GIF
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project; and a change of government and the global financial crisis in the SBR programme. For
the earlier projects, under the auspices of professional organisations, the technological and
organisational contexts were the most important. However, the organisational and
environmental contexts were most significant during projects under the auspices of
government organisations.
The non-adoption of XBRL had different short-term and long-term implications for the XBRL
stakeholders. In the short-term, the government agencies are potentially unable to perform
specific reporting-related data analysis and have limited their ability to share data and
improve the efficiency of their processes. In long-term the government agencies have lost an
opportunity to detect more errors in financial statements, to get data and information for
policy-making purposes and to work in a connected manner. Accounting firms face a lack of
XBRL skill development in the short and long-term and have missed the opportunity to free-
up time for other purposes. Business organisations have lost the opportunity to improve
access and connections with government agencies or other businesses, to reduce their
compliance costs and potentially increase their long-term effectiveness.

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DEDICATION

To
Mom and Dad;

My daughters: Ann, Anna and Adeny; and

My husband, Zimran

Thank you so much
and I Love You All…

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ACKNOWLEDGEMENTS

Alhamdulillah means thanks be to God for letting me go on in this amazing journey. This has
been the most challenging journey I have ever experienced, from the top of the mountain to
the depths of the sea and yet, I survived. That was because I am in a circle of motivated and
supportive people with the genuine intention to help me complete my intellectual adventure.
Firstly, I owe an enormous debt of gratitude to my supervisors, Associate Professor Carolyn
Fowler, and Dr. David Johnstone. Their excellent supervision styles are like flying a kite, simple
yet effective. They gave me the freedom to explore my ideas, then they pulled me back to
provide guidance and show me the right direction. Their broad knowledge, experience and
expertise in research have developed my research skills. Their encouragement and sympathy
keep me going, even though I thought it almost impossible. Thank you for being there from
the beginning to the end of this journey.
I have benefited from a generous scholarship from Universiti Teknologi MARA and Ministry of
Higher Learning of Malaysia. They provided me with financial and administrative support
during my study leave. Without this support, the journey would not have been possible.
I am indebted to the academic and administration staff of the School of Accounting and
Commercial Law, Victoria University of Wellington, who provided on-going support. My
particular thanks to Professor Rachel Baskerville for her encouragement and moral support;
Associate Professor Carolyn Cordery for her input, inspiration and guidance; and to the late
Adjunct Professor Kevin Simpkins for his input and support of my research.
I am especially appreciative of the individuals that participated in interviews. As these people
were assured of anonymity for their contributions, they cannot be named and perhaps more
appropriately acknowledged. They were incredibly generous with their time and provided
extensive and in-depth information so this thesis could be completed.
My heartfelt gratitude to my family and friends. My husband, Zimran has been very
supportive. His patience, understanding, companionship, and commitment throughout this
journey have been key to its achievement. My special thanks to my wonderful daughters:
Ann, Anna, and Adeny. They are great children, they pray for Mummy. The best advice was
from Anna “Mummy, there is always a rainbow at the end of the corner.” It kept me going
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and made me smile, though it was hard. My profound thanks to my parents, David, and
Emeliah, for their unconditional love, support, and prayers that encouraged me to make this
journey. To my PhD colleagues, Arifatul Husna, Hien Hoang, and Francesca Lim; thanks for
your time and support during the course of the PhD. Finally, thanks to every person, who
prayed, gave me inspiration, or loved to see my achievement, God bless all of them.

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TABLE OF CONTENTS

CHAPTER 1: INTRODUCTION
1.0 RESEARCH BACKGROUND ...................................................................................................................1
1.1 BUSINESS REPORTING: PRACTICES AND REQUIREMENTS ................................................................................3
1.1.1 Internet Business Reporting ....................................................................................................4
1.2 XBRL AS A TECHNOLOGY FOR USE IN BUSINESS REPORTING ...........................................................................6
1.2.1 What is XBRL? ..........................................................................................................................6
1.3 A BRIEF HISTORY OF XBRL IN NEW ZEALAND ..............................................................................................7
1.4 RESEARCH MOTIVATION ....................................................................................................................... 10
1.5 RESEARCH AIM AND QUESTIONS ............................................................................................................ 11
1.6 RESEARCH FRAMEWORK ....................................................................................................................... 12
1.6.1 The Technological, Organisational and Environmental (TOE) Framework .......................... 12
1.6.2 XBRL Stakeholders ................................................................................................................ 14
1.7 RESEARCH METHOD ............................................................................................................................. 15
1.8 THESIS STRUCTURE ............................................................................................................................... 16
1.9 CHAPTER SUMMARY ............................................................................................................................. 18

CHAPTER 2: HISTORIES, STUDIES, AND ISSUES OF XBRL
2.0 INTRODUCTION ............................................................................................................................... 19
2.1 XBRL DEVELOPMENT AND USE AT THE INTERNATIONAL LEVEL (1998-2010) ................................................ 19
2.1.1 XBRL Specification and Taxonomy Development ................................................................. 20
2.1.2 XBRL Jurisdictions and the Spread of XBRL Worldwide ........................................................ 21
2.2 XBRL STUDIES AND ISSUES .................................................................................................................... 24
2.2.1 Factors Influencing XBRL adoption ....................................................................................... 24
2.2.2 Benefits and Challenges of XBRL Adoption .......................................................................... 30
2.2.3 Voluntary and Mandatory Adoption of XBRL ....................................................................... 34
2.2.4 XBRL Awareness among Adopter and Non-Adopter Countries ........................................... 38
2.3 XBRL AND RELATED STUDIES AND ISSUES IN THE NEW ZEALAND CONTEXT .................................................... 42
2.4 RESEARCH AIM AND RESEARCH QUESTIONS ............................................................................................. 45
2.5 CHAPTER SUMMARY ............................................................................................................................. 46

CHAPTER 3: RESEARCH FRAMEWORK
3.0 INTRODUCTION ............................................................................................................................... 47
3.1 ALTERNATIVE THEORIES FOR TECHNOLOGY ADOPTION………………………………………………………………….…………47
3.2 TOE FRAMEWORK: DEPIETRO, WIARDA AND FLEISCHER (1990) ................................................................. 49
3.2.1 Application of TOE framework for Technology Adoption in IS studies ................................. 50
3.2.2 Relevance of the TOE Framework for XBRL and Adoption Decisions ................................... 54
3.3 PROPOSITIONS DEVELOPMENT BASED ON TOE FRAMEWORK ...................................................................... 58
3.3.1 Technological context ........................................................................................................... 58
3.3.2 Organisational context .......................................................................................................... 63
3.3.3 Environmental context .......................................................................................................... 66
3.4 XBRL STAKEHOLDERS ............................................................................................................................ 71
3.4.1 Identification of XBRL Stakeholders ...................................................................................... 71
3.4.2 Roles and Involvement of XBRL Stakeholders ....................................................................... 72
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3.4.3 Implications of XBRL Adoption for XBRL Stakeholders ......................................................... 76
3.5 PROPOSED RESEARCH FRAMEWORK ........................................................................................................ 78
3.6 CHAPTER SUMMARY ............................................................................................................................. 80

CHAPTER 4: RESEARCH METHODOLOGY
4.0 INTRODUCTION ............................................................................................................................... 81
4.1 RESEARCH PHILOSOPHY ........................................................................................................................ 81
4.2 QUALITATIVE RESEARCH ........................................................................................................................ 84
4.3 CASE STUDY ........................................................................................................................................ 86
4.3.1 Elements of a Case Study ..................................................................................................... 87
4.3.2 The Justification for and Relevance of Using a Case Study .................................................. 89
4.4 REFLECTION METHODS ......................................................................................................................... 90
4.5 TRIANGULATION METHODS ................................................................................................................... 93
4.6 RESEARCH DESIGN ............................................................................................................................... 96
4.6.1 Data Collection ..................................................................................................................... 96
4.6.2 Data Analysis ...................................................................................................................... 104
4.7 ETHICAL CONSIDERATIONS ................................................................................................................... 108
4.8 CHAPTER SUMMARY ........................................................................................................................... 108

CHAPTER 5: XBRL INITIATIVES IN NEW ZEALAND: A HISTORICAL OVERVIEW
5.0 INTRODUCTION ............................................................................................................................. 111
5.1 AN OVERVIEW: XBRL INITIATIVES IN NEW ZEALAND................................................................................ 111
5.2 THE LEAP+ PROJECT (2000-2005) ..................................................................................................... 113
5.3 XBRL STEERING COMMITTEE UNDER THE AUSPICES OF ICANZ (2001-2006) ............................................. 113
5.3.1 Project First Step (2003-2005) ............................................................................................ 115
5.3.2 New Zealand’s Hosting of the 9th XBRL International Conference (2004) ......................... 116
5.3.3 Increasing Awareness in the New Zealand Business Community (2003-2004) ................. 116
5.3.4 The Struggle to Progress (2005) ......................................................................................... 117
5.4 SHIFTING THE INITIATIVE FROM THE PROFESSIONAL TO GOVERNMENT AUSPICES (2006) ............................... 117
5.5 THE E-GIF PROJECT (2003-2007) ....................................................................................................... 118
5.5.1 The Quality Regulation Review (QRR) and Financial Reporting Amendment Act 2006 ..... 119
5.5.2 The e-GIF Progress (2006-2007) ......................................................................................... 120
5.6 CHANGING THE IN-CHARGE GOVERNMENT AGENCY (2007) ..................................................................... 120
5.7 STANDARD BUSINESS REPORTING (2007-2010)..................................................................................... 121
5.7.1 The 2008 General Election and the Global Financial Crisis ................................................ 124
5.7.2 Resultant Funding and Budget Cuts (2009-2010) .............................................................. 124
5.8 XBRL DEVELOPMENT SUMMARY (2000-2010) ..................................................................................... 126
5.9 CHAPTER SUMMARY ........................................................................................................................... 128

CHAPTER 6: XBRL INITIATIVES UNDER THE AUSPICES OF PROFESSIONAL ORGANISATIONS
6.0 INTRODUCTION ............................................................................................................................. 129
6.1 OVERVIEW OF THE LEAP+ PROJECT (2000-2006).................................................................................. 129
6.1.1 Objectives of LEAP+ ............................................................................................................ 130
6.1.2 Classification of Stakeholder Involvement ......................................................................... 131
6.2 FACTORS ASSOCIATED WITH ACTIVE STAKEHOLDERS ................................................................................ 131
6.2.1 Ernst & Young ..................................................................................................................... 131
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