SEC Announces EDGAR to be Succeeded by IDEA; Lutz Speaks on 21 Cen. Discl. Project

The SEC announced at a press conference earlier today (see related press release) that they have "unveiled the successor to the agency’s 1980s-era EDGAR database, which will give investors far faster and easier access to key financial information about public companies and mutual funds. The new system is called IDEA, short for Interactive Data Electronic Applications. Based on a completely new architecture being built from the ground up, it will at first supplement and then eventually replace the EDGAR system. The decision to replace EDGAR marks the SEC’s transition from collecting forms and documents to making the information itself freely available to investors to give them better and more up-to-date financial disclosure in a form they can readily use."
The press release noted the tie-in of the IDEA platform to SEC's proposal earlier this year that companies file financial statements using interactive data in the form of eXtensible Business Reporting Langauge (XBRL). (See related FEI comment letters on SEC's XBRL proposal filed on Aug. 1 by FEI's Committee on Finance and Information Technology and FEI's Committee on Corporate Reporting.)
SEC Chairman Christopher Cox said today, "IDEA’s launch represents a fundamental change in the way the SEC collects and publishes company and fund information – and in the way that investors will be able to use it.”
Lutz Speaks on SEC's 21st Century Disclosure Initiative
Also speaking at today's SEC press conference was Dr. William Lutz, who is leading the SEC's previously announced 21st Century Disclosure Initiative.
“If I were in Hollywood pitching this disclosure project to a producer or head of a studio,” said Lutz, he would describe the project as 'financial disclosure meets the matrix.’

Specifically, Lutz noted that developments in technology, in the U.S. and around the world, have enabled many processes in routine life, from renewing drivers licenses to credit cards, to be done online, with no paper forms required. He compared the existing EDGAR system, the forms based system, to a Model T car, which he said was “reasonable, reliable, dependable, and got you there… but we don’t want to drive a Model T today.”

Using the ‘matrix’ analogy, Lutz said, “Forms are nothing more than a way of collecting information or data; once that data is entered into (the) matrix or cyberspace, all kinds of things happen to it.”

“What we’re going to do is not get rid of the forms,” noted Lutz, adding, “the forms will simply die.” The 21st century disclosure project, said Lutz, “will start from scratch, what if the SEC started today, what would it look for,” and how would it want it provided, to make it useful for investors..

“My team is going to lay out a plan for how the SEC can achieve that,” said Lutz, “and then we get to hand it off to an advisory committee, and I get to go home and let someone else do the hard work.”

Note re: updates: I did not catch the beginning of the SEC press conference today when they focused on the move from the EDGAR platform to IDEA; I will update this post periodically with further details later, or add links to other published summaries, e.g.:
"The SEC's Big IDEA? An FTAlphaville liveblog," posted by Stacy-Marie Ishmael (SMI) of the Financial Times, including live blogging coverage by SMI as well as Francine McKenna of Re: The Auditors and Dominic Jones of IR Web Report.
"Financial Data 'on Steroids,'" by Christopher Twarowski, Washington Post Aug. 19. "A Midsummer Review of Recent XBRL Developments," by Bob Schneider, Hitachi Data Interactive Blog, Aug. 15. This post predates today's announcement, but provides many useful links to XBRL-related information. Also filed under Updates: Even the SEC’s press release issued today had almost an interactive-type element, by means of a taped voice-over intro that pops up when you open the press release. (The commanding voice sounded to me at first like that of Erik R. Sirri, Director of SEC’s Division of Trading and Markets; a reader subsequently told me they believe it was Ethiopis Tafara, Director of SEC's Office of International Affairs.) ] If you received this blog post from 'a friend' and would like to receive FEI's blog by email, enter your email address here.

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