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XBRL – The New Reality

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Last Wednesday, the Securities and Exchange Commission (SEC) adopted a proposal requiring that companies’ financial statements be filed with the agency in XBRL, otherwise known as eXtensible Business Reporting Language.

The SEC has outlined a three-year XBRL phase in schedule that begins for the largest accelerated filers in the fiscal period ending on or after June, 15 2009 and concludes with the fiscal period ending on or after June 15, 2001 for non-accelerated filers.

According to NIRI, the National Investor Relations Institute, the phase in schedule is as follows:
 


Year 1 Year 2 Year 3
U.S. (or non-U.S.) accelerated filers with a public float of $5B using U.S. GAAP (about 500 companies) All other accelerated filers All other filers, using U.S. GAAP or IFRS
Fiscal period ending on or after June 15, 2009 Fiscal period ending on or after June 15, 2010 Fiscal period ending on or after June 15, 2011

 

If you’d like to learn more about XBRL and what it means for your company, Business Wire recently hosted an informative webinar on the subject.  The SEC offers a host of information on its site at www.sec.gov/spotlight/xbrl.shtml and XBRL US, a local jurisdiction of XBRL International – a not-for-profit consortium of approximately 500 companies and agencies worldwide working together to build the XBRL language and promote and support its adoption, provides news and other information in an easy-to-use format.

XBRL is now a reality, so it’s time to take the plunge and begin planning for the inevitable.

 

— Laurie Berman, lberman@pondel.com

XBRL – It’s Closer Than You Think

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Within the next month or two, the SEC will finalize rules that mandate XBRL-based submissions for collecting financial reporting information for all domestic and foreign SEC reporting companies.  For those of you wondering, XBRL stands for Extensible Business Reporting Language.  Proponents of  XBRL believe it will allow for more accurate, relevant and scalable analysis of financial information, as well as create greater transparency that can result in a lower cost of capital.  To read more about the SEC’s phase-in plan, view Bowne & Co’s plain English summary of XBRL-based submissions to access Bowne & Co’s plain English summary.

— PondelWilkinson, investor@pondel.com


XBRL – SEC Asks for Public Comment

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The SEC’s office of Interactive Disclosure began asking for public comment on the use of eXtensible Business Reporting Language, commonly known as XBRL, in public company financial statements.  Several large, well-known companies have voluntarily adopted XBRL in their EDGAR filings with the SEC and the agency has committed more than $50 million to make its public company disclosure system compatible with XBRL, according to the National Institute of Investor Relations.  XBRL International, a not-for-profit consortium of approximately 550 companies and agencies worldwide working together to build the XBRL language and promote and support its adoption, reports that XBRL is an open standard, free of license fees that promotes the interactive sharing of financial data.
 
It is believed that XBRL will provide investors and analysts with more useful financial disclosures by allowing companies to present their financial information in a format that allows investors and analysts to more easily locate and analyze this information.  It is also anticipated that XBRL will provide greater efficiency, improved accuracy and reliability and cost savings to anyone involved in supplying or using financial data.
 
While there will likely be some growing pains when public companies are required to adopt XBRL in their financial statements, over the longer term its use should make it easier for the investing public to analyze a company’s financial statements and easier for public companies to get their story out into the investing marketplace.
 
The public comment period ends April 4, 2008.

 

— Laurie Berman, Senior Vice President, lberman@pondel.com