On December 30th, the SEC massively expanded its use of the XBRL data provided by public companies with their 10-Q and 10-K filings. The SEC announced and launched a pilot program designed to “facilitate investor analysis and comparisons of public company financial statement data” by consolidating the “data that companies provide in structured formats” into data sets that will be “posted for bulk downloads on the SEC’s website.” The program will begin using only the information provided in the base financials, but it will soon include data from the footnotes as well. The purpose of this program is to promote and expedite the use of XBRL data by investors and academics.
This program is the most significant expansion of the availability public companies’ financial disclosures since the advent of the EDGAR system in the 1990’s. For the first time, every public company’s base financials will be available in one data set, which means that investors and academics will no longer have to manually cobble together usable data from the information available in the archaic and individual EDGAR filings.
This announcement made on the penultimate day of 2014 capped off what was a big year for XBRL. This announcement put an exclamation point on a year in which the SEC dramatically increased both its use of XBRL and the attention it pays to structured data. Earlier in the year, the SEC conducted a staff assessment of the use of custom tags. In 2014, the SEC also began sending ‘Dear CFO’ letters to companies regarding required calculations in their XBRL exhibits.
With this move, the SEC has positively affirmed that XBRL is the present and the future of financial reporting. They have also sent an unmistakable message that public companies should take the necessary steps to ensure their XBRL data is well structured and properly usable. These public data sets are based on the XBRL only and are not verified against the content of the EDGAR document, so poorly constructed XBRL data will not provide an accurate depiction of a company’s financial disclosures. It takes an expert to create quality, compliant, and truly usable XBRL data.
XBRL is the future of financial disclosure, and RDG can help public companies create excellent and usable data. Please contact us to learn more about our Full Service Tagging Services and our XBRL Quality Assurance Services.
Feel free to contact me any time.
Stewart Walker – SVP, Director of Sales