October / November 2019

Legislative and Regulatory News


About XBRL US and Membership

Legislative and Regulatory News
ROC of the LEI Seeks Comment on LEI for Government Entities

The Regulatory Oversight Committee (ROC) of the Legal Entity Identifier (LEI) is seeking comments on its consultative document on LEI Eligibility for General Government Entities. The ROC is an international standard setting body that provides oversight to the Global Legal Entity Identifier Foundation (GLIEF). The GLEIF sought guidance from the ROC about the use of LEIs for identifying government entities in the Global Legal Entity Identifier System (GLEIS). In May 2018, the ROC established a working group to clarify: 1) the criteria determining LEI eligibility for government entities, especially those that do not have legal personality but have a kind of autonomy or responsibility, and 2) the relationship type, either direct or ultimate, for government entities. Comments are due by Friday, December 6, 2019. .

Read the consultative document: https://www.leiroc.org/publications/gls/roc_20191025-1.pdf

SEC Proposes Inline XBRL for Fee Calculation Tables and Fee Footnotes

A new rule proposes that Inline XBRL tagging be required for all fee calculation table and fee footnotes in fee bearing filings, including Funds and Transactional 1933 Act filings, tender offers, and proxies (with fees). Comment letters are due 60 days after publication in the Federal Register.

Read the proposal: https://www.sec.gov/rules/proposed/2019/33-10720.pdf

Senate Passes GREAT (Grant Reporting Efficiency and Agreements) Act

On October 21, 2019, the Senate passed the GREAT (Grant Reporting Efficiency and Agreements) Act, which has now been referred to the Oversight & Government Reform Committee of the U.S. House of Representatives for further action. The bill requires the use of standards for grants related data which applies to grantees, including state and local governments.

The Senate version, which differs slightly from the House version, requires: 1) standard definitions to be established for federal awards; 2) data standards that render data fully searchable and machine-readable; are nonproprietary; incorporate standards developed and maintained by voluntary consensus standards body; are consistent with applicable accounting standards; include standards developed under FFATA; and are developed under consultation with Treasury, grants recipients, private sector experts, and auditors, 3) guidance to be issued to all agencies, disruption minimized and no increase in reporting burden on agencies or recipients, 4) guidance requiring audit data in standards.

Read and track the bill: https://www.congress.gov/bill/116th-congress/house-bill/150

SEC Proposes Update of Statistical Disclosures for Banks and Savings and Loan Registrants

The proposal would update the disclosures that investors receive, codify certain Guide 3 disclosures, and eliminate other Guide 3 disclosures that overlap with Commission rules, as well as US GAAP and IFRS requirements. The proposal also indicates that the Commission will relocate the codified disclosures to a new subpart of Regulation S-K and will rescind Guide 3. The Commission is not proposing that Industry Guide 3 disclosures be included in the notes to the financial statements. Therefore, these disclosures would not be required to be audited, nor would they need to be filed in XBRL format. The proposal states that they received limited feedback to their 2017 proposal on this point and believe that additional feedback would be useful.

Because much of Industry Guide 3 data is monetary in nature, it would be more efficient and effective if reported using financial data standards. XBRL US intends to submit a comment letter to convey that position. Comment letters are due December 2.

Read the proposal: https://s3.amazonaws.com/public-inspection.federalregister.gov/2019-20491.pdf

FASB Proposes Updates to 2020 Taxonomy

The Financial Accounting Standards Board (FASB) has published Proposed Accounting Standards Updates for public comment:

Proposed Accounting Standards Update (Revised)—Debt (Topic 470)—Simplifying the Classification of Debt in a Classified Balance Sheet (Current versus Noncurrent) (Revision of Exposure Draft Issued January 10, 2017). The proposed taxonomy improvements added elements for disclosures of debt in default, and debt with waivers.

Read the Exposure Draft: https://www.fasb.org/jsp/FASB/Document_C/DocumentPage?cid=1176173415838
Read the related release notes: https://www.fasb.org/cs/ContentServer?c=Document_C&cid=1176173441372&d=&pagename=FASB%2FDocument_

California Governor Vetoes State Senate Bill 598, Open Financial Statements Act

Senate Bill 598, which called for the creation of the Open Financial Statements Commission in the State Treasurer’s office, was vetoed by California Governor Gavin Newsom. The bill would have required the Commission to make recommendations regarding how and whether to transition financial reporting by state and local agencies to a machine readable format. Objections to the bill were raised by the State Controller’s Office related to timing of certain provisions and lack of funding in the bill. XBRL US intends to continue discussions with the State Controller’s Office to identify different approaches to bring standards to state government.

Read the bill: https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201920200SB598

Standards Development Guidance Published by XBRL US

XBRL US, the nonprofit standards organization, published an initial exposure draft of the Taxonomy Development Handbook (TDH), a comprehensive guide that directs regulators, industry experts, and businesses through a practical, consistent roadmap to building high quality data standards using XBRL. The handbook walks readers through the necessary stages of standards development, including: 1) building the appropriate transport data model, 2) assessing project scope, including identifying use cases and determining requirements, 3) establishing an appropriate governance structure, 4) documenting the standards program, and 5) the step-by-step mechanics of building the taxonomy. The TDH public review ends January 20, 2020.

Read the TDH and participate in the public review: https://xbrl.us/xbrl-reference/tdh

XBRL US DQC Publishes 11th Ruleset for 45-day Public Review

The XBRL US Data Quality Committee (DQC) has published its 11th Ruleset for a 45-day public review and comment period, which closes on January 3, 2020. The latest Ruleset contains automated checks that help users identify the correct tagging for deferred tax information and operating leases, two topics that have been impacted by new accounting standards that are now effective for most filers. In addition, IFRS elements that have been newly added for the 2019 taxonomy, are proposed to be added for the negative value rule.

Access the public review: https://xbrl.us/data-quality/rules-guidance/public-review

XBRL US CEO Joins SEC FIMSAC Panel on Structured Disclosures by Municipal Issuers

The November 4 meeting of the Fixed Income Market Structure Advisory Committee, addressed various issues related to municipal securities including the panel, “Structured Disclosures by Municipal Issuers”. Key messages conveyed by Campbell Pryde, XBRL US CEO during the panel, included how data standards can be used to improve the efficiency and effectiveness of municipal reporting. Other panelists were from the Municipal Securities Rulemaking Board (MSRB), Municipal Markets Analytics, the Securities and Exchange Commission (SEC), and Will County, Illinois. Duffy Blackburn, CPA and Will County auditor, addressed the county’s experience preparing an XBRL-formatted CAFR (Comprehensive Annual Financial Report), which is now posted on their county web site.

See the agenda: https://www.sec.gov/spotlight/fixed-income-advisory-committee/fimsac-agenda-110419.htm
Watch the webinar: https://www.sec.gov/video/webcast-archive-player.shtml?document_id=fimsac110419

XBRL US Comments on SEC Proposal Modernization of Regulation S-K

The Commission proposes various changes in disclosure requirements related to Item 101 for business description, Item 103 for legal proceedings, and Item 105 for risk factors. The proposed amendments are intended to improve the readability of disclosure documents, as well as discourage repetition and disclosure of information that is not material.

The proposed amendments did not address the use of standards to render data reported in machine-readable format. Given the importance of Item 101, 103 and 105 disclosures, and the Commission’s goal of improving readability, standardizing the data would be a logical step that would aid the Commission in its goal of improving the usability of disclosures. The XBRL US letter strongly recommends adopting financial data standards for information in Items 101, 103, and 105.

Read the letter: https://xbrl.us/wp-content/uploads/2019/10/XBRL-US-Response-to-Regulation-S-K-Modernization-File-S7-11-19.pdf
Read the SEC proposal: https://www.sec.gov/rules/proposed/2019/33-10668.pdf

XBRL US Supports the Financial Transparency Act (HR 4776)

XBRL US submitted a letter of support for the FTA based on the revised language in the bill. The FTA was reintroduced on September 24 by Carolyn Maloney (NY-D), Chair of the Subcommittee on Investor Protection, Entrepreneurship, and Capital Markets, of the House Financial Services Committee, and by Patrick McHenry (NC-R), Ranking Member of the Subcommittee.

Revised language in the bill calls for the use of a common, nonproprietary, open legal entity identifier; and for data standards that render data searchable and machine-readable, enable high quality data through accompanying metadata, are documented in machine-readable taxonomies, are nonproprietary or made available under an open license, incorporate standards maintained by voluntary consensus standards bodies and are consistent with applicable accounting and reporting principles.

Watch the bill’s progress here: https://www.congress.gov/bill/116th-congress/house-bill/4476
Read the XBRL US letter: https://xbrl.us/wp-content/uploads/2019/09/XBRL-US-Supports-FTA-10_15_2019.pdf

XBRL US Comments on SEC Concept Release on Harmonization of Securities Offering Exemptions

The Commission’s concept release noted “.. issuers and investors could benefit from a framework that is more consistent and addresses gaps and complexities. Therefore, we seek comment on possible ways to simplify, harmonize, and improve the exempt offering framework to promote capital formation and expand investment opportunities while maintaining appropriate investor protections.” XBRL US explained in its letter 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.

Read the SEC Concept Release: https://www.sec.gov/rules/concept/2019/33-10649.pdf
Read the XBRL US letter: https://xbrl.us/wp-content/uploads/2019/07/XBRL-US-Response-to-SEC-Concept-Release-on-Exempt-Offerings-File-Number-S7-08-19.pdf

Replays of Recent Events

  • Municipal Finance Data Forum, Sponsored by XBRL US and Northern Illinois University, October 3, Naperville, IL https://xbrl.us/events/muniforum-20191003/
    Public sector and financial data standards experts discussed how standardizing reported data can improve the efficiency of disclosures by U.S. state and local governments. The forum featured speakers from the Bond Buyer, HData, the Illinois Office of the Controller (IOC), Northern Illinois University Center for Governmental Studies, Truth In Accounting, Will County, the Illinois government, and more. Use the link above to watch the webinar replay and download presentations.
  • XBRL US Investor Forum Featured Fintech, Standards & More, November 4, New York, NY https://xbrl.us/events/investor-forum-2019
    This year’s program covered blockchain, artificial intelligence, new reporting domains such as public utilities and municipal finance, as well as discussions about the future of quarterly financial results, and modernizing disclosures. The program featured a keynote presentation from Russ Golden, head of the Financial Accounting Standards Board, during which he addressed the value of data standards for the FASB in their standard setting processes, and for investors in conducting analysis.

    Other speakers came from Business Wire, Calcbench, CFA Society New York and CFA Institute, Donnelley Financial Services (DFIN), eBrevia, Global Blockchain Business Council, idaciti, Intrinio, Morgan Stanley Research, Muni Credit & Compliance Advisors LLC, Nutshell Associates, SavaNet LLC, Seatig, the Securities and Exchange Commission (SEC), S&P Global Ratings, Toppan Merrill, and XBRL US. The event was hosted by Baruch College Zicklin School of Business, and sponsored by CFA Institute, and CFA Society New York.

    Use the link above to watch a replay of the program. Read the speech by FASB Chair Russell Golden: https://fasb.org/cs/Satellite?c=FASBContent_C&cid=1176173690907&pagename=FASB%2FFASBContent

Recent Point of View Topics

  • How are we doing?
    Members of the XBRL US Center for Data Quality share their views on giving feedback to issuers on the quality of their XBRL filing, and how they can take advantage of freely available validation checks. Read the post: https://xbrl.us/how-are-we-doing

Upcoming Speaking Roles for XBRL US Staff

  • AGC (Associated General Contractors of America) 2020 Surety Bonding and Construction Risk Management Conference, January 29, 2020, Bonita Springs, FL

Register to Attend XBRL US Data Quality Committee Meeting, Wednesday, February 12, 2020 at 12PM ET

At this meeting, industry leaders will participate in discussions and plans for developing guidance and rules for use by public companies complying with the XBRL requirements of the US Securities and Exchange Commission.

Get information about the Committee and register to attend: https://xbrl.us/dqc

Upcoming XBRL US Member Meetings

XBRL US Members are invited to attend all sessions below, and get involved with our Steering Committees. Email membership@xbrl.us for details on the Steering Committee meetings listed below.

  • The Domain Steering Committee: Thursday, December 5, at 3 PM ET
  • The Communications Steering Committee: Tuesday, November 19, 2019 at Noon ET
  • Upcoming XBRL US Meetings: https://xbrl.us/membership

About XBRL US and Membership

XBRL US Members are committed to engaging and collaborating with other members, contributing to the standard through involvement of their teams, and striving to build awareness and educate the market. Members of XBRL US represent the full range of the business reporting supply chain. This organization recently joined XBRL US:

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Not yet an XBRL US member? Maybe it’s time to consider joining XBRL US for yourself ($55 – $500/ year) or your organization (fees vary). Find out more about the benefits of membership and how to become involved by visiting https://xbrl.us/benefits.

About Data Quality

SEC filers should all use freely available, Data Quality Committee rules to identify and resolve errors in XBRL-formatted financials for more consistent, better quality data.

Learn about the Rules & Guidance https://xbrl.us/rules-guidance
Find Data Quality Certified applications: https://xbrl.us/certification
Check data quality & results: https://xbrl.us/filing-results