Market Acceptance Testing with Key Stakeholders Initiated
New York, September 25, 2007 — U.S. Securities and Exchange Commission Chairman Christopher Cox announced a major step forward in fulfilling a vision for interactive data and more transparent financial reporting with the completion of all development work on data tags for financial reporting in accordance with U.S. generally accepted accounting principles.
The elements or “tag”, each mapped to a unique accounting concept, will make standardization and comparability of even complex corporate financial statements possible. The more simplistic taxonomy being used for current filings on the SEC’s EDGAR system, with approximately 2,500 tags, required many companies to write their own custom extensions to accurately represent their financial statements.
The new taxonomy is designed so that public companies can easily navigate through the taxonomy when creating their financials in XBRL format by relying on different views to the taxonomy and it will improve the ability to do comparative analysis of financials from one company to the next.
“This was truly a collaborative, market-driven effort”, said Mark Bolgiano, President and CEO of XBRL US, Inc., the consortium that brought together accounting firms, corporate preparers of financial statements, financial analysts, and software providers to participate in the development effort, “Many organizations have provided significant resources to bear including the major accounting firms, the Financial Accounting Foundation (FAF) and the Financial Accounting Standards Board (FASB), and XBRL US members, including key data aggregators, software firms and association partners.”
A review for GAAP compliance by the FAF (Financial Accounting Foundation) is nearing completion, and critical stakeholder groups including analysts, public company preparers and software providers will be reviewing the draft taxonomies first, before a broad-based public review is initiated.
“This is a great step toward making SEC reporting easier for registrants and easier to understand for every investor,” said SEC Chairman Christopher Cox. “I commend the remarkable efforts of the XBRL US project team for their leadership in the private sector in perfecting this globally accepted technological means for exchanging financial data, and also the Financial Accounting Foundation and the Financial Accounting Standards Board for the expertise in U.S. GAAP that they contributed to this project.”
By moving to interactive data using the XBRL computer language, the SEC will be joining the FDIC, the Federal Reserve, and the Comptroller of the Currency, which has created a repository of XBRL formatted data for banking institutions. For the last year, approximately 8,300 U.S. financial institutions have been using XBRL to submit their quarterly Call Reports to U.S. banking regulators.
The development of the draft taxonomies and the initiation of full market acceptance testing will pave the way for more universal usage of XBRL.
About XBRL
XBRL (Extensible Business Reporting Language) is a royalty-free, open specification for software that uses XML data tags to describe financial information for public and private companies and other organizations. XBRL benefits all members of the financial information supply chain by utilizing a standards-based method with which users can prepare, publish in a variety of formats, exchange and analyze financial statements and the information they contain. The world’s leading accounting, financial, government and software organizations are involved in the adoption and use of XBRL in the U.S.
About XBRL US
XBRL US, the US jurisdiction of XBRL International, is a non-profit consortium representing the business information supply chain including accounting firms, software companies, financial databases, financial printers and government agencies. Its mission is to support the implementation of XBRL through the development of taxonomies relevant for use by US public and private sectors, working with a goal of interoperability between sectors, and by promoting adoption of XBRL through the collaboration of all business reporting supply chain participants. XBRL International is a non-profit consortium of approximately 500 organizations worldwide working together to build the XBRL language and promote and support its adoption.
Source: XBRL US, Inc.
Contact: Michelle Savage, vice president, adoption and communication, XBRL US, Inc., michelle.savage@xbrl.us, 917/747/1714
