Tuesday, August 11, 2009

XBRL-US Issues Codification Patch- UPDATED

Last week, as an interim measure to provide companies with the ability to use XBRL data tags referencing the newly published FASB Codification, which became the single source of U.S. GAAP on July 1, XBRL-US issued a patch of sorts (technically, a "taxonomy extension file" or "taxonomy reference linkbase") to enable referencing to the Codification. This is an interim step pending full incorporation of Codification references in XBRL-US' U.S. GAAP Taxonomy in 2010, as explained on the XBRL-US website under FASB Codification and U.S. GAAP Taxonomy. Further information is available in FASB's Project Update, and the XBRL-US Aug. 4, 2009 press release. See also UPDATE at the bottom of this post for additional information from Neal Hannon of The Gilbane Group on this subject.

XBRL, or eXtensible Business Reporting Language, is a system of tagging data with interactive tags based on a dictionary of tags, or taxonomy, developed by XBRL-U.S. The XBRL-US taxonomy is written for companies that report under U.S. GAAP. A separate taxonomy is being developed by XBRL-International for companies that report under International Financial Reporting Standards issued by the International Accounting Standards Board.

Beginning this year (phased in over a three-year period based on company size), public companies must begin including XBRL-tagged information with their financial reports filed with the U.S. Securities and Exchange Commission. See SEC Final Rule: Interactive Data to Improve Financial Reporting, published on Jan. 30, 2009.

In related news, see information published by FEI's research affiliate, the Financial Executives Research Foundation, http://www.ferf.org/, on the topic of XBRL (and a wide range of other topics), including FERF's July 23, 2009 Issue Alert: The XBRL Exhibit: A Checklist of Things Not to Miss.

Other XBRL Commentary: Hitachi XBRL Blog
An interesting item appears in the Hitachi XBRL Blog, Data Interactive, today. The post, entitled XBRL and Retail Investors: Where are the Missing Masses? is written by Joanne Locke, a senior lecturer at the University of Birmingham (UK), and a member of the International Accounting Standards Committee Foundation’s XBRL Advisory Council. (IASCF is the parent body of the IASB. As noted above, XBRL-International is developing data tagging for use by companies that report in IFRS as published by the IASB.)

Locke's post addresses the questions: "Are Retail Investors Important?" and "What Is Needed to Provide Retail Investors with Interactive Data in a Useful Format?"

Scroll down to view other recent posts on the Data Interactive blog for more insights on XBRL.

UPDATE: Info on XBRL and Codification from Neal Hannon, The Gilbane Group
Neal Hannon, Senior Consultant, XBRL Strategies at The Gilbane Group, provides some further details on this subject today in an item published in Compliance Week’s Remediation Center entitled, Filing in XBRL Using the New Codification, at www.complianceweek.com (sub req’d).

In the Compliance Week article, Hannon states:
The new extension taxonomy provides pointers only to the public sections in the Codification. In other words, if you are in an XBRL tool (which almost everyone will be when working with XBRL) and want to see the authoritative literature, the hyperlink takes you out of your XBRL software and asks you to log into the FASB Codification to see the results. This inconvenience should be rectified in the SEC’s next release of a taxonomy, slated for sometime early next year.

Meanwhile, those looking to discover a direct link from XBRL elements to the underlying authoritative literature will have to do some discovery work on their own or wait for further XBRL software developments to make the linkage easier to use.

For the remainder of 2009, use all available resources to choose the closest accounting fit between your company’s accounting and the XBRL element in the 2009 taxonomy. That should include tracing the links back to the Codification to ensure there are no accounting conflicts. Once we move into 2010, the official taxonomy reference linkbase will contain FASB Codification references only.

...The only additional step that could be taken at this point is for the SEC to create a new reference database with Codification references only and modify EDGAR to accept the new linkbase.

That will happen with the 2010 release, although it would be nice to have it in place by the time third-quarter 2009 filings are due.

Hannon shared with the FEI blog the following additional information, and noted he will be posting further details in a blog post later today at http://gilbane.com/xml/:

Meanwhile, [pending the upcoming modification to EDGAR noted above] there are a few problems.

The new reference linkbase is unofficial and will not be accepted by the SEC's EDGAR system. URI links point to the proper places in the COD for FASB publications but require a separate log in and give you access to the public (high level) view only.

Firms and organizations with professional access to the Codification will not find this a problem, but individual practitioners will have to subscribe (at $850 per year) to get any views beyond the bare bones.

SEC literature stops at the top of the page for ALL SEC GAAP citations. For example, any XBRL element that has a regulation SX reference will point to exactly the same place, the top of the document. Not very useful. The SEC should address

So it appears we have three levels of accounting material to deal with, 1) the high level public access literature, which is official US GAAP in the Codification; 2) the professional view additional detail and explanations, and 3) and the non-GAAP material the FASB left out of the COD that is in their hard copy literature but didn't make the COD/US GAAP cut. ideally, all literature coming from the SEC or the FASB should be, in my opinion, easily accessible via the Internet.

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