This is the third issue of a monthly newsletter on happenings with XBRL and the SEC US GAAP Taxonomy Development Project.  Click here for background on XBRL and on the Project.

The XBRL US Project Team continues to forge ahead with development of the taxonomies and documentation while capturing input from critical constituencies.  Highlights this month:

- Content creation phase completed for Primary Financial Statements and 207 Disclosures
- Content integration phase begun
- Initial draft of Taxonomy Architecture document completed and distributed for review
- FAF/FASB review of topics initiated
- Software Vendor team and testing process established
- FREE educational webinar series on the SEC VFP continues to draw good attendance
- SEC announced Proposed Rule for Electronic Filing and Simplification of Form D; XBRL US submitted comment letter
- SEC announced members of advisory committee on improvements to financial reporting

Update

• The Project Team has completed the content creation phase which included the creation of 207 Disclosures, e.g., Inventory, Business Combinations, etc. and the expansion of the Primary Financial Statements.  The total number of elements or individual line items is approximately 15,000 versus 1500 in the previous version of the taxonomies.  The number of Disclosures increased by about 1/3 (from 154 to 207) after the Project Team did a coverage assessment reviewing all industries.  The disclosures are roughly modeled after the FASB codification code, but the list also includes disclosures covering common reporting practices. 
• The Content Integration phase of the project was initiated.  The Content Integration phase is the merging of the existing taxomonies (primary financial statement taxonomies) with the taxonomies developed for the notes to the financial statements, finding and removing duplicate elements (financial concepts), and evaluating the merged taxonomies for accuracy and completeness from a US GAAP perspective.
• Initial drafts of the Taxonomy Architecture document along with analysis papers covering specific features of the taxonomies were completed and distributed to XBRL US and XBRL International members for comment.  Key stakeholder groups including the SEC Voluntary Filer team and the CFA Institute’s XBRL Working Group were also asked to provide comments.  Feedback received during the comment period will be reviewed and evaluated for incorporation into the taxonomies.   
• The first topics were delivered to the FAF/FASB for review during July and initial discussions were held with the major accounting firms to establish the process and procedures for their review.
• The Software Team was established and initial conference calls held; the new team has a mission of informing and educating all XBRL US members and ultimately non-members about the features of the taxonomies that they need to incorporate into their tools for use in the SEC VFP.  Twenty-two companies are represented in the new Software Team, with providers of products ranging from instance document creation to mapping and integration tools.    The tools needed to try out new features of the taxonomies as well as a resource guide will be created for the Team to test out their software with the new taxonomies. 
• The XBRL US webinar series continued with the last two events playing to sold-out audiences.  In the last program, case studies from United Technologies, Microsoft and 3M Corporation were presented along with a real-world demonstration of XBRL tagging.  To sign up for one of the free bi-weekly events, email angela.rose@xbrl.us. 
• On July 9, the SEC published on the Federal Register a proposed rule change to mandate the electronic filing of information required by the Securities Act of 1933 Form D.  Form D is used by both public and private companies in the official notice of an offering of securities made without registration.  The SEC has proposed the simplification and restructuring of Form D and the requirement that information provided on Form D be filed through an online system accessible through the Internet.  XBRL US submitted a comment letter proposing that the form of interactive data used for the Form D filings be XBRL for three reasons:  1) Public companies are already beginning to file in XBRL format through the SEC’s Voluntary Filing Program, 2) XBRL-enabled software tools are already readily available, 3) XBRL is a global standard.  Read the SEC Proposal and the XBRL US comment letter.
• The SEC finalized the roster for the Advisory Committee on Improvements to Financial Reporting, headed up by Robert C. Pozen, Chairman, MFS Investment Management.  There are 17 members including Jeffrey J. Diermeier, President and CEO, CFA Institute, Greg Jonas, Managing Director, Moody’s Investor Service, Christopher Liddell, CFO, Microsoft Corporation, Peter Wallison, Senior Fellow, American Enterprise Institute, Thomas Weatherford, retired EVP and CFO, Business Objects S.A., David Sidwell, CFO, Morgan Stanley, James Quigley,  CEO, Deloitte Touche Tohmatsu, Edward E. Nusbaum, CEO, Grant Thornton, G. Edward McClammy, CFO and Treasurer, Varian, Inc., William H. Mann III, Senior Investment Analyst, Motley Fool, Joseph A. Grundfest, William A. Franke Professor of Law and Business, Stanford Law School, Linda Griggs, Partner, Morgan Lewis, Scott C. Evans, EVP, TIAA-CREF, J. Michael Cook, retired Chairman, Deloitte & Touche LLP, Susan Bies, former Federal Reserve Board member and Denny Beresford, E&Y Executive Professor of Accounting, University of Georgia.  The SEC also appointed five official observers including Robert Herz, FASB, Charles Holm, Federal Reserve Board, Phil Laskawy, International Accounting Standards Committee Foundation, Mark Olson, PCAOB and Kristen E. Jaconi, US Department of the Treasury.

What’s Coming Up?

Don’t miss our ongoing webinar series on how to participate in the SEC VFP, every other Tuesday at 4pm ET – upcoming events will be held August 21 (SOLD OUT), September 11 and September 25.  We are limited to 100 registrants so sign up early to reserve a seat!  For more information or to register for one of these events, email angela.rose@xbrl.us.

For more information about XBRL or the information in this newsletter, visit us at xbrl.us or contact Michelle Savage, Vice President, Adoption and Communication, XBRL US, 917 747 1714, michelle.savage@xbrl.us

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 Background on XBRL

• XBRL is an application of XML to business information and uses tags or structure to describe the information/data, making it immediately reusable, interactive and intelligent
• The XBRL standard as well as the US GAAP taxonomies (dictionaries of terms), was created using a transparent, market-driven, collaborative approach
• XBRL is an Internet based information standard that enables a seamless flow of information.  It is also “extensible” so it can be customized for unique situations and reporting concepts
• Because it is a standard, it allows information to be more easily accessed for comparative purposes
• XBRL touches every link within the business reporting supply chain, both for public and private organizations, and for internal and external reporting
• XBRL can be created once, used many times, allowing information to be used for many purposes, and in many formats
• XBRL is NOT an accounting standard although it can be used to represent reporting concepts and provide an explicit link from a reported concept to the relevant accounting standard
• XBRL is NOT a software program although it can be used to enable the seamless exchange of information between disparate software applications
• The core benefits of XBRL are improved information quality, reduced cost and increased productivity.

Background on the US GAAP Project

XBRL US is in contract with the SEC to build-out the US GAAP taxonomies, making them commercial grade.  The Project Team will expand upon the current US GAAP taxonomies, focusing on the primary financial statements and the notes to the financial statements, making them deeper and more robust.