XBRL US submitted a comment letter responding to the SEC Concept Release on Harmonization of Securities Offering Exemptions.
The XBRL US letter noted that the Commission could more effectively meet its goal of simplifying and harmonizing the exempt offering framework by requiring all reporting entities to use the same consistent method to report the same disclosures. Commonly reported items such as financial fundamentals as well as company identifiers and addresses, should be reported using a single consistent standard. This approach would benefit the entire reporting supply chain:
- Analytical tool and database providers could leverage the same data collection methods to extract and use data from different reporting entities, which effectively reduces the cost of analysis for analysts and investment professionals. The availability of consistent data from exempt offerings, that can be extracted in the same manner as public company data, may encourage more tool providers to begin collecting and providing this data to investors, improving their services and expanding the options available to investors.
- The SEC could reduce the cost of data collection because there would only be one, rather than multiple, data collection methods; and there would be one, rather than multiple, taxonomies to be maintained. This would reduce the cost of revising and ongoing maintenance of the online forms and taxonomies.
- Reporting entities would face minimal disruption from their current process, and they would benefit because their financial data would be more accessible, timely, and functional to the investment community. For those entities that opt to transition from an exempt offering to a regular listing, for example, a Regulation A company to a NASDAQ listed company, they will already be reporting using the public company data standard, the US GAAP Financial Reporting Taxonomy. Exempt offerings could also benefit because their data becomes less expensive to process, which could encourage more data providers to offer up their information to investors.