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Every year during the fiscal closing season, listed companies' disclosure teams are inevitably forced to work overtime. This is due to XBRL (eXtensible Business Reporting Language) disclosures, which require attaching specific electronic tags to every number, table, and footnote in audit reports.
XBRL means presenting financial information in a format that computers can read and understand. It involves attaching electronic labels (tags) to each number in an audit report, such as "this value is operating profit" or "this value is the acquisition cost of tangible assets."
However, with hundreds of thousands of tag types, errors frequently occur even when entrusted to professional accountants. If mistakes happen, companies must face correction disclosures and fines. A startup that has gained a foothold in the corporate accounting and finance market by automating this arduous, legally mandatory task using artificial intelligence (AI) is drawing attention.
That startup is Toggle Campus, which operates the XBRL disclosure automation solution "Invector." Bae Gyu-tae, CEO of Toggle Campus, pointed out, "All data in accounting teams' daily work starts in Excel. Existing solutions require using a separate editor, which actually increases the workload."
He explained, "Although audit reports in Korea are said to be standardized, companies use completely different notations even for the same concept. Invector overlays automation on top of the environment that practitioners already use, without changing it."
Invector's AI engine accurately grasps not only table structures, numbers, and context but also accounting meanings. For example, it recognizes percentage (%) units in a column as percentages for the numbers below or independently understands the calculation structure of total columns.
Notably, Invector incorporates the latest regulations from the Financial Supervisory Service (FSS), providing real-time error verification and automatic tag recommendation functions, while also verifying consistency across documents. Additionally, it references vast data including tax laws, accounting standards, and court precedents to answer complex tax and accounting inquiries and propose optimal tax-saving strategies or tax filing plans.
Bae Gyu-tae (CEO) emphasized, "Invector's AI engine demonstrates an average accuracy of over 97% in disclosure documents containing more than 1,000 cells," adding, "All major accounting firms have a history of correction disclosures, but we are the only ones with zero correction disclosures to date."
He stated, "Adopting Invector can reduce costs to one-fifth of previous levels and shorten tasks that previously took over 100 hours down to around 10 hours. In terms of preparation time, work that used to take two to three weeks when outsourced to accounting firms can now be completed in just two days when handled directly by the company."
Representative clients include Celltrion Pharmaceuticals, Jongro Pharmaceutical, and Megastudy. There are particularly many clients in the pharmaceutical sector. Bae (CEO) reported that "more than half of the top 30 companies by market capitalization in the pharmaceutical industry use Invector."
The XBRL disclosure market is still in its infancy. Among approximately 2,600 listed companies in Korea, only about 1,000 have implemented XBRL disclosures, as the government has been rolling out implementation gradually based on asset size. Bae (CEO) sees significant opportunities for the remaining companies where XBRL disclosure has not yet been applied.
He predicted, "Companies that need to start XBRL disclosures in the future will be those with smaller scales. Such companies find it difficult to entrust work to accounting firms due to cost burdens, so they are even more likely to choose Invector."
Toggle Campus was able to further enhance service security and safety through Google's startup support program, "Google for Startups Accelerator (GFSA)." Bae (CEO) stated, "The information handled by Invector is financial data that has not yet been made public to the world," adding, "Security is not an option but a condition for survival."
He continued, "Google's security experts reviewed Invector's architecture and provided feedback such as 'this part needs to be changed this way,' which we incorporated significantly. During this process, we also consolidated previously distributed systems into the Google Cloud environment, reducing operating costs by approximately 30%."
Toggle Campus aims for the entire advisory work (PA, Private Accounting) performed by accounting firms. Excluding areas that strictly require an accountant's qualification like "audit," the goal is to expand its foothold in the PA market, estimated at 2 trillion won.
Bae (CEO) said, "We have only entered a portion of the PA market so far," adding, "But we can handle the rest as well. There is ample room for us to contribute in areas that do not necessarily require an accountant's involvement, such as IPO (initial public offering) or M&A (mergers and acquisitions) advisory."
Regarding overseas expansion, the company takes a cautious approach and does not rush. Given that Workiva, the world's number one disclosure solution provider, abandoned its entry into Korea due to the complexity of domestic regulations, Toggle Campus plans to first secure the top position in the domestic market before pursuing global expansion.
Bae (CEO) remarked, "We have seen many cases where Korean B2B solution companies rushed overseas without proper preparation and failed to achieve meaningful results," stating, "It is not too late to go abroad after achieving maximum results domestically and building sufficient references."
His goal is to innovate the very way companies handle accounting tasks through Invector. Currently, a significant portion of disclosure, XBRL, footnote preparation, and verification is outsourced, which is costly and prevents internal know-how from accumulating.
Bae (CEO) said, "Tasks involving moving, aligning, and verifying data should be solved by technology, while people should focus on judgment and interpretation." He added, "Standardizing reports will make comparisons between companies easier and improve English translation quality. We believe this can contribute to increased foreign capital inflow and the activation of investment markets."
[MoneyToday startup media platform 'Unicorn Factory']
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