As noted in today’s SEC News Digest, the SEC posted today its final rule on XBRL, formally titled, “Interactive Data to Improve Financial Reporting.” This is the final rule that the Commission approved on Dec. 18, 2008.
As described in today’s SEC News Digest, the rule is aimed at “improv[ing] the usefulness of financial information to investors by requiring domestic and foreign companies to provide to the Commission a new exhibit with their financial statements, including the footnotes and schedules to the financial statements, in interactive data format. Interactive data will supplement, but not replace or change, disclosure using the traditional electronic filing formats in ASCII or HTML. Interactive data will be required with a filer's annual and quarterly reports, transition reports, and Securities Act registration statements, and on its corporate web site, if it maintains one. The requirements will be phased in, beginning later this year with approximately 500 of the largest companies.” As specified in the final rule, the three year phase-in period, based on company size and filing status (US GAAP vs. IFRS) is as follows:
- Domestic and foreign large accelerated filers that use U.S. GAAP and have a worldwide public common equity float above $5 billion as of the end of the second fiscal quarter of their most recently completed fiscal will be required to provide the required XBRL data in an exhibit to their SEC filings [and to be posted on their corporate websites in accordance with the final rule] beginning with a periodic report on Form 10-Q, Form 20-F or Form 40-F containing financial statements for a fiscal period ending on or after June 15, 2009.
- All other domestic and foreign large accelerated filers using U.S. GAAP will be subject to the same interactive data reporting requirements the following year, beginning with a periodic report on Form 10-Q, Form 20-F or Form 40-F containing financial statements for a fiscal period ending on or after June 15, 2010.
- All remaining filers using U.S. GAAP, including smaller reporting companies, and all foreign private issuers that prepare their financial statements in accordance with IFRS as issued by the IASB, will be subject to the same interactive data reporting requirements beginning with a periodic report on Form 10-Q, Form 20-F or Form 40-F containing financial statements for a fiscal period ending on or after June 15, 2011.
For a summary of the main provisions of the final rule, refer to the 9 page Summary of Adopted Amendments in Section I. D. (pages 20-29) of the Final rule on XBRL.
In my personal view, the SEC's action of posting the final rule on XBRL after SEC Chairman Mary L. Schapiro has taken office - since she is President Barack Obama's appointee - would appear to quell any potential challenges by the Obama administration to the final rule, which was voted on at the tail-end of the Bush administration, for those thinking about that question in connection with the Memorandum for the Heads of Executive Departments and Agencies (Fed. Reg. link) issued by White House Chief of Staff Rahm Emanuel on Jan. 20. In addition, by framing the effective date of the final XBRL rule as 60 days after publication in the Federal Register - that would appear to comply with the request in the above-linked memorandum to consider delaying the effective date of new rules (specifcally, rules that had been publised in the Fed. Reg but not yet effective) by 60 days; it would also put the effective date at the end of the 60 day review period provided under the Congressional Review Act.
In related news, XBRL-US announced they are holding SEC Filer Training Workshops in:
- Los Angeles, Wednesday, March 11
- New York City, Wednesday May 20, and
- San Francisco, September 16, 2009
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