FSS Unveils Soft Landing Plan for XBRL Disclosures by SMEs

The Financial Supervisory Service (FSS) has announced a comprehensive soft landing plan to guide the adoption of XBRL-annotated financial disclosures by over 1,800 small and medium-sized listed companies in South Korea, as part of its broader initiative to modernize and standardize corporate financial reporting.

XBRL (eXtensible Business Reporting Language) is an international standard for digital business reporting that allows for more accurate, accessible, and efficient analysis of financial information. Its introduction marks a significant shift toward digital finance, aligning Korean reporting practices with global standards, including those of the U.S. Securities and Exchange Commission (SEC).

Phased Implementation Strategy

The FSS plan outlines a gradual rollout of XBRL adoption beginning with semi-annual reports in 2025. To ease the transition, companies with assets under 500 billion KRW will initially be required to apply XBRL annotations only to business and semi-annual reports. For quarterly reports, a simplified “block tagging” approach will be permitted through 2028.

In line with a tiered compliance schedule, the timing of mandatory submissions will depend on company size:

• Firms with 200–500 billion KRW in assets must submit XBRL-annotated reports by March 2026

• Those with 100–200 billion KRW by March 2027

• Companies with less than 100 billion KRW by March 2028

Support Measures and System Enhancements

To minimize disruptions and market confusion, the FSS is launching pilot submission programs, expanding training efforts, and working closely with accounting firms to ensure proper quality checks throughout the transition period.

The FSS will also update the Electronic Document Submission Guidelines to reflect these changes and introduce user-friendly enhancements to the XBRL financial statement preparation platform.

Boosting Financial Transparency

This move is expected to enhance the accuracy, comparability, and transparency of financial information in the Korean capital market, facilitating better decision-making for investors, regulators, and stakeholders.

By adopting a phased and supportive approach, the FSS is helping Korea’s small and medium-sized enterprises navigate a critical leap into the era of data-driven finance and global reporting standards.

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