The Expected Effect of Using eXtensible Business Reporting Language (XBRL) on the Extent of Using Ordinary Financial Statements by External Users in Jordan

Abstract

In 2000, a freely available modern global framework to exchange and communicate business information among business systems has emerged and called the eXtensible Business Reporting Language (XBRL). The XBRL was designed to reduce differences in financial data presentation methods. The current study aimed mainly to find the feasibility of using the XBRL in Jordanian entities and the extent to which the ordinary financial statements can be replaced by the XBRL framework. A quantitative approach was used to collect and analyze data. Accordingly, 187 analyzable questionnaires were distributed and retrieved. The results showed that the majority of respondents are convinced that using the XBRL framework will provide them with relevant, reliable, comparable, timely, and required information. In addition, the coefficient measures showed that there is a significant negative relationship between using the XBRL framework and the use of ordinary financial reports at the significance level of 0.01. Conversely, the results indicated that there is a significant positive relationship between using the XBRL framework and the usefulness of financial information in the planning and decision-making purposes. The results imply that Jordanian companies should turn to use the XBRL framework to present and communicate their financial reports, which will be reflected on increasing the confidence and interest of various users of financial reports in the company's results and management. Further, using the XBRL framework will enhance the planning and decision-making tools of users, which will be reflected on the interest of companies, especially those with good performance.

Received: 6 May 2021 / Accepted: 16 August 2021 / Published: 5 September 2021