'XBRL-speak' no easy task for filers, revenue recognition standard to be re-exposed.

Author:Malonza, Lorainne
Position:FINANCIAL REPORTING
 
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Financial Executives International and its Committee on Corporate Reporting (CCR) have been supportive of developing a sustainable eXtensible Business Reporting Language (XBRL) reporting framework that can be consistently and cost-effectively applied by registrants of all sizes. But implementing XBRL has proven a challenge for many companies in relation to detailed tagging.

Some of the issues expressed are:

* Most member companies rely on third-party service providers to generate the required XBRL files. In the preparation of the XBRL submissions, service providers have told members that a 48-hour window is necessary to finalize a change to a filing and generate the XBRL files.

Due to the delay caused by this window and the additional steps necessary to produce an accurate and compliant detailed-tagged XBRL filing, almost half of the members indicate that this hinders an earlier filing.

* Member companies have a significant number of extensions used per filing. Although the U.S. Securities and Exchange Commission staff has observed cases of extensions where appropriate elements exist, and filers did not identify the appropriate element, many extensions are still needed. Hopefully, the release of 2011 Financial Reporting taxonomy will help alleviate the extensive use of extensions and increase the value of comparability.

* The level of cost and resources necessary to prepare XBRL filings varies widely. External implementation costs per quarter also varied significantly, from several thousand dollars at smaller companies to $500,000 at the largest filers.

In addition, due to the complex and technical nature of XBRL filing, companies have had to increase staff size to specifically handle XBRL reporting--an option that may not be easily available at smaller public companies.

* Tools and systems available to prepare and review the XBRL files are currently inadequate to identify errors in the filing. Specifically, verifying the accuracy and compliance of XBRL instance documents using the rendering tools available did not guarantee that there were no errors in the filing (e.g., the signing of particular data elements in the filing).

* No increased usage of XBRL information from the investor community. The number of hits has ranged between three and 20 hits per quarter and some of those may have been either employees of the company or the service provider verifying the accuracy of the final XBRL data posted on the websites.

Members have also voiced...

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