The Feasibility of Implementing eXtensible Business Reporting Language (XBRL) to Enhance the Quality of Financial Reporting in Libyan Commercial Banks: A Field Study on Commercial Banks Operating in the City of Sirte

Abstract

This study aimed to examine the feasibility of adopting the eXtensible Business Reporting Language (XBRL) to improve the quality of financial reporting in Libyan commercial banks. To achieve this objective, the descriptive-analytical approach was employed, and a questionnaire was used as the primary data collection instrument. The questionnaire was distributed to a sample consisting of 71 male and female employees working in the banking sector in the city of Sirte, Libya.

The findings revealed statistically significant evidence regarding the level of awareness and understanding among employees of Libyan commercial banks in Sirte concerning the importance of adopting XBRL. The arithmetic mean reached (3.82), indicating a positive inclination toward the feasibility of adopting this reporting technology. The results also identified several obstacles that limit the implementation of XBRL in Libyan commercial banks in Sirte, particularly those related to technological infrastructure, human resource qualification, and the availability of an appropriate accounting regulatory framework.

Furthermore, the findings indicated positive attitudes among respondents toward the expected benefits of implementing XBRL, including improving the quality of financial reporting and enhancing transparency and disclosure. This outcome represents a supportive indicator for banks’ orientation toward adopting this technology.

Based on these findings, the study recommends the development of a comprehensive strategic mechanism to support digital transformation and facilitate the adoption of XBRL. It also emphasizes the importance of coordination among relevant authorities, including the Libyan Association of Certified Accountants, the Central Bank of Libya, and the Libyan Accountants and Auditors Syndicate. Additionally, the study highlights the necessity for financial institutions to comply with International Financial Reporting Standards (IFRS) and calls for the establishment of accounting legislation that supports the adoption of XBRL to enhance financial reporting quality. Moreover, the study recommends mandating Libyan commercial banks to be listed on the Libyan Stock Market, as well as promoting awareness of XBRL through workshops and training programs, and incorporating it into accounting curricula in Libyan universities.