Here's an update on what’s new with XBRL and how it can actually benefit your organization versus adding extra time and costs to financial reporting. On February 29th (leap day) of 2012 I attended the XBRL and Financial Analysis Technology Conference at Baruch College in NYC. The event, which attracted over 300 XBRL gurus and fans was presented by XBRL US, The New York Society of Security Analysts’ Improved Corporate Reporting Committee, and Baruch College’s Robert Zicklin Center for Corporate Integrity. The event featured keynotes from the U.S. Securities and Exchange Commission (SEC), and the CFA Institute as well as panels covering alternative research tools and data, corporate reporting to stakeholders and a demonstration of XBRL analysis tools. The program culminated in a presentation of the finalists and the winner of the $20,000 XBRL Challenge.
Some of the key points made in the sessions included:
The focus of XBRL tools is moving from production to consumption.
As of February 2012, over 9000 companies are reporting in XBRL, with over 10 million facts filed to date
XBRL taxonomy extensions have dropped from 27% to 11% making comparisons easier
The SEC reports that XBRL makes it easier to analyze disclosures, focus on accounting issues
XBRL is helping standards-setters like the FASB speed their analysis of impacts of proposed accounting rule changes
Companies like Thomson Reuters report that XBRL is helping speed the delivery of data to clients
The most interesting part of the program though, was the session highlighting the 5 finalists in the XBRL Challenge competition and the winning solution. The XBRL Challenge was launched in 2011 as a means of spurring the development of more end-user tools to help with the consumption of XBRL-based financial information. Over an 8-month process handled by 5 judges, there were 84 registrants, 15 completed submissions, 5 finalists and one winner of the challenge. All of the solutions are open-sourced tools and most of them focus on consuming XBRL-based data. The 5 finalists included:
Advanced XBRL Processing from Oxide solutions – XBRL viewer for taxonomies, filings and company data with peer comparison capabilities.
Arrelle – API for XBRL processes, supports SEC Validations, RSS Feeds to access filings etc.
Calcbench – XBRL data analysis tool that can be embedded in other web applications. This tool can combine XBRL filings with real-time market data.
XBRL to XL – allows the importing of XBRL data into Microsoft Excel for analysis, comparisons. Users start on the web and populate Excel with XBRL data.
XBurble – allows users to search and view XBRL filings, export to Excel, merge for comparison, and includes a workflow interface.
The winner of the $20,000 XBRL Challenge prize was CalcBench. More information about the XBRL Challenge and the finalists can be found at www.XBRLUS.org/challenge
XBRL for Sustainability Reporting – other recent news on the XBRL front was the announcement by the Global Reporting Initiative (GRI) of an XBRL taxonomy for Sustainability Reporting. This taxonomy was co-developed by the GRI and Deloitte and is designed to make the consumption of data found in Sustainability Reports much easier. Although there is no government mandate to file Sustainability Reports in XBRL format, organizations that do use the GRI guidelines for Sustainability Reporting are encouraged to tag and submit their data voluntarily to the GRI – who will populate a database with Sustainability Reporting data and make this available to the public. For more information about this initiative, you can go to the GRI web site: www.globalreporting.org.
So how does all of this benefit corporate filers and investors? Since its introduction, the consensus in the market is that XBRL has mainly benefited the regulators and investment analysts who need to consume and analyze large volumes of financial data. But with the emergence of more end-user tools for consuming and analyzing XBRL-based data, and the ability to perform quick comparisons of one company versus its peers and competitors in an industry group, will soon accelerate the benefits to corporate finance staff, as well as individual investors. This could apply to financial results tagged in XBRL, as well as non-financial information such as Sustainability Reporting – which over the long-term will likely be integrated with financial reporting. And as multiple regulators and agencies in a country adopt the XBRL standard for corporate filings, more benefits will accrue as companies will be able to leverage one set of XBRL-based financial data for multiple regulatory filings.
For more information about the latest developments in XBRL, check out the XBRL US or XBRL International web sites: www.xbrl.org, www.xbrlus.org.
For more information about what Oracle is doing to support XBRL, here are some links:
http://www.oracle.com/us/solutions/ent-performance-bi/disclosure-management-065892.html
http://www.oracle.com/technetwork/database/features/xmldb/index-087631.html
Feel free to contact me if you have any questions or need more information:
john[email protected]