Since the 2008 ruling instituted by the U.S. Securities and Exchange Commission (SEC) requiring all public company filings to be submitted in eXtensible Business Reporting Language (XBRL), there has been much grumbling from chief financial officers and other executives about adding yet another regulatory requirement to the list of those that affect public issuers. The quarterend process is difficult enough without adding more reporting requirements to the already heavy workload of busy finance and compliance professionals.
That said, the goals of the SEC and those behind the development of standards-based XBRL are aligned with these same companies: high-quality financial communication between companies and their investors.
And following the path familiar to most technical innovations, XBRL is just now turning a corner. It is leaving the early days when experience was scarce and supporting tools were immature and entering a time where professionals have gained enough experience to help them get the most out of their disclosure services provider or even bring software in-house to manage XBRL reporting themselves.
WORKING WITH SERVICE PROVIDERS
Over the past four years since the SEC mandate, most companies have chosen to seek outside help with their XBRL reporting. The depth of knowledge needed to properly "tag" SEC filings is not something that can be read in a book or conveyed in a training class.
With service providers willing to take on the burden of educating themselves on XBRL and the SEC's filing requirements--as well as investing in the technology needed to deliver XBRL services--outsourcing has simply been the most practical decision.
In fact, companies that have a service provider that delivers a high level of personalized service and a quality product have every reason to continue to outsource this work. The service provider is simply an extension of the company's finance and compliance team and brings a level of experience that is difficult to duplicate.
With so many clients to serve, service providers can afford continual education, keeping current on the latest requirements from the SEC, Financial Accounting Standards Board and the XBRL International Standards Board. These companies also can afford to invest in the latest supporting technologies, ranging from collaboration and workflow systems to improve efficiency, to validation and analytical tools to ensure they are producing high-quality XBRL that meets the SEC's...