XBRL Update: New Functionality for Interactive Data

June 27, 2012
by Nicholas Messing, XBRL Accountant, Business Wire New York
Nicholas Messing

Nicholas Messing

The upcoming filing season looks to be one of the busiest yet for XBRL preparers, with all US public companies submitting financial statements to the SEC required to include detail-tagged XBRL as of June 15, 2012. As the XBRL mandate reaches full implementation for SEC filings, the functionality of XBRL continues to expand through various initiatives including the DATA Act, corporate actions, and Business Wire’s Retail Report.

XBRL has increased its presence in the US Congress with the Digital Accountability and Transparency Act, which the House of Representatives unanimously passed on April 25, 2012. Known as the DATA act, this bill provides for a broader implementation of data reporting standards to track federal spending data. Following its strong bipartisan success in the House, the DATA Act has been referred to the Senate Committee on Homeland Security and Governmental Affairs. Similar to the Child and Family Services Innovation and Improvement Act, which was signed into law in October 2011, the DATA Act includes a significant reference to XBRL: “In designating reporting standards… the Commission shall, to the extent practicable, incorporate existing nonproprietary standards, such as the eXtensible Business Reporting Language (XBRL).”

XBRL US released the 2012 Corporate Actions Taxonomy for public comment on May 17, 2012. This is the second version of the Corporate Actions Taxonomy, designed to tag over 50 types of corporate actions announcements, including mergers and acquisitions, dividends, redemptions, tender offers, and stock splits. Approximately 200,000 corporate actions are released each year in the US, and these textual announcements require time-consuming manual steps to process as financial data. XBRL tagging of corporate actions releases would enhance the efficiency of downstream processing across the financial community. XBRL US has teamed with The Depository Trust & Clearing Corporation (DTCC) and The Society for Worldwide Interbank Financial Telecommunication (SWIFT) to promote the use of XBRL tagging for corporate actions in accordance with the existing ISO (International Organization for Standardization) standards.

On May 3, 2012, Business Wire became the first commercial newswire to map, tag and disseminate its own content in XBRL format. XBRL exhibits utilizing the US GAAP taxonomy now accompany Business Wire’s Retail Report, which is released monthly to Business Wire’s full national circuit. Published on the day that retailers announce sales figures for the previous month, the report tracks specialty apparel and general merchandise retailers’ monthly and year-to-date total sales with percentage comparisons across periods, alongside comparative stores’ sales growth data. To date, the April and May 2012 Retail Reports have been published with supplemental XBRL files, which may be freely downloaded and rendered through the SEC’s XBRL previewer, to facilitate analysis of retail sales data. Two members of Business Wire’s XBRL team, Senior XBRL Financial Reporting Specialist Belayneh Alemayehu and Junior XBRL Accountant Khondakar Moin, have provided their expertise to translate the Retail Report into XBRL. While Business Wire’s XBRL team has been proactively preparing for the final wave of the SEC’s XBRL mandate, we have also implemented a new innovation in interactive data.

Stuart Zatkow Appointed to XBRL US Committee Post

February 16, 2012
by Nicholas Messing, XBRL Accountant

Congratulations are in order for Stuart Zatkow, Senior XBRL Financial Reporting Specialist at Business Wire, who joined the XBRL US Domain Steering Committee in January 2012. This committee oversees the development of XBRL taxonomies, relying upon a blend of accounting and financial knowledge and technical proficiency. With more than 40 years of financial reporting experience in both the public and private sectors, Stuart (or “Stu,” as his colleagues know him) is looking forward to contributing his XBRL expertise to serve the community as a committee member.

As Zatkow explains, “I hope that [the Domain Steering Committee] can foster development of additional taxonomies for purposes of applying interactive data to more areas of reporting than the basic financial statements, notes and mutual fund prospectus summary information, especially those that would greatly benefit downstream consumption of XBRL data.” Zatkow added that he believes his relationships formed as a member of the US GAAP taxonomy team from 2007 to 2009 and through his XBRL consulting engagements will be helpful in achieving the committee’s objectives.

XBRL Update: U.S. XBRL Initiative Begins to Move Beyond SEC Reporting

October 21, 2011
by Nicholas Messing, Junior XBRL Accountant/Business Wire
Nicholas Messing

Nicholas Messing

A recent piece of legislation signed into law by President Obama has caused a flurry of excitement in the XBRL community. The Child and Family Services Innovation and Improvement Act (H.R. 2883) might at first glance appear to be unrelated to the financial data coding world of XBRL, since the bulk of the bill is devoted to extending child and family welfare programs from the Social Security Act through the year 2016.

The key section for XBRL, however, is Sec. 105, Data Standardization for Improved Data Matching. This section explains a new requirement for the Secretary of the Department of Health and Human Services to designate common data elements and reporting standards for state-submitted reports on federal child welfare funds. Here, XBRL makes a surprise appearance: “The Secretary shall, to the extent practicable, incorporate existing non-proprietary standards, such as the eXtensible Business Reporting Language.”

Needless to say, this “shout-out”  to XBRL in federal legislation has not been taken lightly; and XBRL US, the nonprofit consortium for XBRL standards, has been vocal in their support. Campbell Pryde, President and CEO of XBRL US, issued the following statement: “Data and technology standards are critical to ensuring accurate, timely and consistent reporting of information. The application of XBRL as outlined in H.R. 2883 would significantly improve communication between the States and social services programs. We commend the President and the leaders in Congress responsible for this Act which help the Department of Health and Human Services administer its child welfare programs and better serve children who need help.”

On October 12, XBRL US held a Town Hall conference call to discuss the new and pending XBRL-related legislation. Since the passage of H.R. 2883, the next bill up to bat for XBRL in the House and Senate may be the Digital Accountability and Transparency Act. The DATA Act would further extend the reach of XBRL by requiring federal agencies to adopt financial data standards such as XBRL in order to better monitor federal spending.

Hudson Hollister, Counsel at House Committee on Oversight and Government Reform, spoke in favor of the DATA Act by saying, “XBRL pretty much occupies the field when it comes to organizing financial data and disseminating it… The adoption of XBRL for federal spending information would have very beneficial long-term effects on the federal government’s ability to analyze and disseminate, in a transparent fashion, its own spending information.”  Amy Edwards, Performance Budgeting Specialist for the Senate Budget Committee, discussed her work toward building support for the DATA Act in the Senate, and Diana Deem of the American Institute of Certified Public Accountants described the AICPA’s grassroots campaign, which includes letters of support for the DATA Act and meetings to educate members of Congress on XBRL.

Echoing this sentiment, Brad Monterio, on behalf of The Institute of Management Accountants voiced the IMA’s support for both pieces of legislation in a press release which recently crossed our wire: “We urge members of Congress to pass the DATA Act and use XBRL as a tool to create transparency and accountability for government, much in the same way it did for The Child and Family Services Act.”

It is clearly significant that US lawmakers have begun to recognize the value of XBRL as a universal data reporting standard. These legislative developments suggest that future applications of XBRL are very likely to extend beyond the realm of SEC filings as the functionality of XBRL continues to expand and advance.

XBRL Update: July 2010

July 12, 2010

On July 8th, the SEC deployed updates to its official XBRL rendering engine (“Viewer” and “Previewer”) to address rendering issues for footnotes tagged at a detailed level. Below, learn more about this development.

Q2 2010 is the first quarter many Large Accelerated filers will begin filing footnotes tagged at a detailed level along with their face financial statements.  Unfortunately, preliminary rendering results with the old Viewer were not very promising. For example, our testing showed the following rendering errors for information tagged at the detailed level (to name a few):

  • Certain segment reporting information and dimension members did not render
  • Notes tagged at a detailed level with the words “Cash” or “Equity” in the group title did not render
  • Unrelated monetary elements, abstracts, data and time periods rendered repeatedly in multiple different notes, which lead to misleading information and made reviewing virtually impossible
  • Decimals and currencies did not render appropriately

To facilitate the first wave of XBRL filings with detailed level information, the SEC enhanced its rendering engine to eliminate certain rendering errors and issues.

What does this mean to my company?
The SEC’s enhanced Viewer fixes many “bugs” and minor rendering issues for both year one and year two requirements. Significant fixes primarily relate to:

  • Improved handling of mixed data types (units and decimals) within the same report.  The Viewer can now display different units of measure in each group
  • Updates to level iv detail tagged rendering to ensure complete display of all tagged data and improved rendering of column headings
  • Allows for the display of currency symbols to ensure currency symbols are not displayed in the rendering for non-monetary amounts
  • Improvements made to display non U.S. Dollar and other symbols
  • Enhancements to Statement of Stockholders’ Equity rendering and detailed reports to eliminate duplicated ending balances

However, one issue that is not fixed relates to the 2009 Commitments and Contingencies element.  Accordingly, we will continue to use the SEC prescribed workaround for this line item, where applicable.  Business Wire is already updating the source code on our rendering tool and we expect to have it running with the enhancements shortly.

Finally, please keep in mind that although the SEC’s Viewer has been updated, differences between the HTML and XBRL filings will continue to exist.  Potential rendering differences expected for Level iv detailed tagging include:

  • Labels in the same group may not exactly match the expected footnote labels
  • Narratives and tables may be combined or split up to improve rendering and review

Business Wire is more than happy to review with you rendering changes and differences that apply specifically to your filing.

Have any XBRL questions or concerns?  Simply contact us at XBRL@BusinessWire.com.

The Ultimate Irony

July 1, 2010

— by Neil Hershberg, Senior Vice President, Global Media

Neil Hershberg

Neil Hershberg, SVP - Global Media

It is perhaps the ultimate irony: playing fast and loose with the facts to promote disclosure and transparency.

With online disclosure tools becoming an integral part of today’s expanding disclosure mosaic, the “window of opportunity” for web disclosure proponents to capitalize on their advisory services is closing fast.

The proliferation of newswire service providers offering web-based investor-relations solutions as part of their product portfolio has marginalized these reform advocates. The newswires have integrated the power of the Internet into an expansive multi-channel disclosure matrix that leverages a range of communications platforms. The swift and successful industry transformation has largely relegated web disclosure strategists to the sidelines; the need for their consultative services is drying up faster than a passing shower in the Sahara.

With a need to reinvent themselves to remain relevant in this revamped landscape, some have resorted to distasteful tactics that border on desperation. Business Wire’s most valuable asset is its reputation; it also prides itself on its commitment to full and fair disclosure for ALL market participants. We therefore cannot let gross misrepresentations and egregious arguments go unanswered.

Dominic Jones has long used his blog, IR Web Report, as a bully pulpit to sanctify his views. Jones finally confirmed last week what we have said all along: He is simply a vendor in blogger’s clothing, as opposed to an impartial observer. His latest offering is a new “Online Disclosure Model.” (The cost is $575 but, if you had acted before June 30, it would have been yours for only $488.75.) No word on whether he is throwing in a free set of Ginsu knives if you call within the next 15 minutes.

In touting his latest miracle disclosure tonic, Jones’ game plan is to sow seeds of doubt and fear among issuers, making a raft of unsubstantiated allegations that have absolutely no basis in fact.

It is time to separate fact from fiction, focusing on the most flagrant of Jones’ many misrepresentations:

The Claim: “New regulations and new web communications technologies are disrupting established practices. The old model is under pressure and increasingly incapable of meeting the needs of companies and their investors.”

The Facts: The SEC has not issued any new rules governing disclosure compliance requirements since Reg FD was enacted in 2000. The agency’s Interpretive Guidance Release, published in 2008, was just that – guidance, not a rule change. Recent changes in exchange listing requirements simply synched their disclosure guidelines with Reg FD’s decade-old compliance criteria.

The commercial newswire industry has adapted remarkably well to the changing regulatory environment. Business Wire, for example, recently launched InvestorHQ, which features comprehensive self-service content management tools, built-in search engine optimization, social media engagement features, and advanced measurement analytics. Business Wire releases are posted simultaneously on its hosted IR web sites, ensuring equal, real-time access across a range of platforms. Additionally, Business Wire has incorporated RSS feeds, XHTML and other web tools to provide even greater distribution, functionality and flexibility.

The Claim: “…companies have a false sense of security [re compliance] . . . Disclosure is fragmented . . . exposing companies to growing compliance risks.”

The Facts: The web-based disclosure model is the major contributor to the fragmentation that threatens our information infrastructure. The current disclosure system serves the information needs of ALL market participants in an equitable manner. Full-text announcements are readily available via a cross-section of traditional, online and mobile platforms, providing real-time, simultaneous access for institutional and individual investors, as well as allowing issuers to tell their story directly to the investor universe in their own words.

The current disclosure framework also is fully XBRL-compatible, which enables investors to digest data more intelligently and efficiently. Web disclosure hinders the seamless implementation of interactive data initiatives, creating a splintered data environment that limits the benefits of a universal financial reporting format.

The Claim: “It is becoming increasingly clear that companies which continue to rely on full-text PR wire distribution for regulatory compliance are in fact exposing themselves to increased compliance risk and a potential backlash from investors . . . “

The Facts: The simple reality is that issuers and investors see the current system as eminently fair; Reg FD was widely perceived as ending many of the previous practices that favored select investors. There have been no torch-bearing investor insurrections that we know of where the levelness of the playing field was the incendiary issue.

Market observers worldwide agree that our disclosure model is the “best of all possible worlds.” (with apologies to Voltaire). After studying alternative options, international jurisdictions – including the European Union – have reached similar conclusions; the EU adopted the North American disclosure model as the backbone of its 2007 Transparency Obligations Directive.

Business Wire’s patented news delivery system delivers material news simultaneously and in real-time to ALL market participants. We have been awarded patents in the United States and Canada, and we anticipate a patent in Europe in the very near future. We will have passed muster in three major international jurisdictions, which subjected our applications to their own rigorous approval processes.

Jones’ latest rant was likely sparked by the conclusive findings of NIRI’s authoritative membership survey on web disclosure, which unequivocally confirmed that common sense still prevails in the investor relations community. The industry’s reaffirmation of its commitment to best practices was welcome news to investors–and a sharp rebuke to Jones’ one-dimensional crusade.

Jones was undoubtedly disheartened to see that a higher percentage of respondents today are relying on paid press release services as a primary disclosure vehicle than before the SEC issued its Guidance Release. The small percentage of senior IR professionals that have made changes to their disclosure practices have ADDED new distribution channels, a strategy that Business Wire has always advocated. The IR industry clearly signaled that it was not ready to jettison a proven disclosure system that is cost-efficient, effective and equitable.

The Claim: “. . . it may no longer be safe for companies to assume that PR wires satisfy Reg FD disclosure.”

The Facts: The important role of the press release in satisfying disclosure has been acknowledged by the world’s most prominent regulatory authorities. In addition to Reg FD itself, CIFiR, an independent advisory group appointed by the SEC to examine ways to improve the financial reporting process, specifically referenced the value of full-text press releases in fair disclosure.

“We do not share the concerns of some commenters that Regulation FD will lead to press releases being supplanted as a regular means of corporate disclosure. In many cases, a widely-disseminated press release will provide the best way for an issuer to provide broad, non-exclusionary disclosure of information to the public,” noted Reg FD.

Securities regulators and stock exchanges in other major financial centers – including the UK’s FSA, France’s AMF, and Canada’s TSX – specifically cite a broadly distributed press release as the key to regulatory compliance.

The Claim: “. . . the diminished primacy of the PR wires as disclosure tools.”

The Facts: As already noted, the NIRI membership survey shows that the use of paid press releases as primary disclosure vehicles has actually increased since the publication of the SEC’s Interpretive Guidance Release.

The Claim: Jones says that smaller, less followed companies are getting “little measurable reaction from investors” when they use a PR wire.

The Facts: Simple logic suggests that smaller, less followed companies are among the biggest beneficiaries of using a PR wire service. Their full-text announcements are carried full-text on a half-million Thomson Reuters terminals, some 300,000 Bloomberg terminals, and on the screens of virtually every other major financial information provider.

Additionally, their news is carried full-text on all major financial portals, including Yahoo! Finance, Dow Jones MarketWatch, and hundreds of other consumer, professional, and industry sites.

That’s tremendous bang for the buck for small companies seeking investor visibility. In my book, PR wires are an absolute must for smaller companies seeking to carve out an investor profile; Jones is grasping at straws in a desperate bid to discredit the news wire industry, which clearly provides outsized value for the distribution dollar.

The Claim: Citing a grossly inflated estimate of the “average” cost of an earnings release, Jones warns of the supposed “chilling effect that PR wire fees have on companies’ willingness to communicate relevant, but not necessarily material information to their investors.”

The Facts: When asked to rank the factors that influence their decision to issue a press release, versus an alternative channel, respondents in the recent NIRI survey ranked, on average, materiality as the most important factor, and cost as the least.

The Claim: “Inconsistent disclosure dissemination leads to uncertainty for investors.”

The Facts: Independent academic research provides strong empirical evidence supporting the value of broadly disseminated news releases. Dr. Eugene Soltes, a Harvard University business professor, has studied this issue exhaustively, concluding: “Research has shown greater dissemination improves stock liquidity and lowers volatility while enhancing a firm’s visibility; it can even lower the cost of capital. Thus, IR departments should be wary of making changes to news distribution that could diminish dissemination.”

The Claim: In his “Online Disclosure Model” synopsis, Jones writes: “[T]here is widespread uncertainty among investor relations and public relations professionals about how best to adapt their practices to this new reality. Principles-based regulations provide little certainty and vendors of competing services are at odds with one another over which approach is best. In such an environment, it can be hard for business communicators to know what to do.”

The Facts: Hello? Isn’t this what Business Wire has been saying since the SEC’s Interpretive Guidance Release was published nearly two years ago? We’ve said this from Day One . . . and have firmly stood behind our stance ever since.

Ironically, Jones was among the staunchest and most outspoken supporters of the SEC’s Interpretive Guidance Release; his zeal evoked images of Charlton Heston hoisting the Ten Commandments on Mount Sinai.

Either reality has finally set in, or Jones has concluded that it is in his commercial self-interest to now distance himself from the SEC Guidance Release. So much for the strength of his convictions.

While Jones pontificates about disclosure issues from his hermit kingdom north of the border, Business Wire brings a real-world, hands-on perspective to the disclosure debate.

We have proudly been at the nexus of the disclosure process for nearly a half-century, interacting on a daily basis with key stakeholders, including issuers, media, regulators, exchange officials, and leading marketplace infomediaries.

It’s time for Jones to leave the safety of his cocoon, and to practice true engagement – he needs to venture outside his comfort zone of like-minded followers. There is a much broader conversation underway that Jones would be wise to listen to.

Business Wire White Papers Now Available

June 15, 2010

– by Phil Dennison, Senior Marketing Specialist

Recently, Business Wire launched a series of white papers on a variety of public relations- and investor relations-related topics. The first two in the series are now available:  Engaging Global Audiences – Public Relations and Bridging Borders by Neil Hershberg (Senior Vice President, Global Media) and The State of XBRL – Rules, Regulations and Best Practices by Michael Becker (Senior Vice President, Financial Product Strategy).

To download these valuable information pieces, visit http://GloMoSoMe.BusinessWire.com.

How Much Does XBRL Compliance Cost?

May 11, 2010

— by Michael Becker, Senior Vice President, Financial Product Strategy

Recently, I had the chance to address a question that’s becoming more common, and wanted to share the answer with readers of this blog: What does XBRL conversion cost? While I cannot tell you what other vendors and software companies charge, I can share that costs (time and money) are in line with or less than the SEC prediction on pp. 132 – 142 of its final rule (http://www.sec.gov/rules/final/2009/33-9002.pdf).

This is very positive news for the U.S. SEC XBRL initiative. Remember the SEC’s prediction that SOX compliance would average roughly $34,000? We know how that turned out.

A June 2010 article in the Journal of Corporate Finance entitled, “How costly is the Sarbanes Oxley Act? Evidence on the effects of the Act on corporate profitability,” states that the SEC initially estimated that the direct cost of SOX compliance would amount to about $91,000 for the average firm; however, subsequent estimates from a survey by Financial Executives International place the costs of SOX closer to $2.9 million per firm for 2006 (FEI, 2007). A Charles River Associates International (CRA, 2005) survey pegs 2004 SOX costs for firms with a market capitalization greater than $700 million at about $8.5 million; and at about $1.24 million for firms with a market capitalization between $75 and $700 million (CRA, 2005). These costs are substantial, averaging roughly 0.10% of revenues (Asthana et al., 2009; Eldridge and Kealey, 2005; Hartman, 2005, 2006; U.S. GAO, 2006).

As for IFRS, according to a recent CFO Magazine article, the SEC predicts that the largest U.S. registrants that adopt IFRS early would incur about $32 million in additional costs for their first IFRS-prepared annual reports. Smaller companies likely will have a disproportionately higher cost to begin the conversion process, if regulators mandate that they, as well as their larger counterparts, move to IFRS.

Therefore, it is imperative to keep the cost of XBRL conversion in perspective. XBRL conversion costs a fraction of other current and proposed SEC initiatives and the benefit, when all issuer financials are mapped and tagged, should be immense.


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