Structured data has evolved tremendously over the last decade. This is prominent in the way that Financial Statements are being standardized across the globe. As countries and agencies transition to the XBRL reporting standard at a steady pace, a new history is being set in tags. One of the major propagators for this movement is the U.S, with the SEC at its helm to ensure a progressive and carefully documented approach. Anything of such a comprehensive nature that’s executed on a national scale has its ups and downs. The last decade is a testimony to this and we can only understand, in retrospect, if an action was successful. Let’s explore how the SEC implemented and executed this global standard for business reporting across the United States.
The Conception And Initiation
- XBRL U.S published the first complete taxonomy for U.S GAAP
- SEC proposed a rule requiring public companies to file their financial statements in XBRL data
$50+ million investment for the infrastructure of Interactive Data Electronics Applications (IDEA) - On August 19, 2008, when SEC unveiled EDGAR’s successor, Interactive Data Electronic Applications (IDEA)
The Learning Curve
- Public companies started shifting to XBRL for their 10Ks and 10Qs
- Investors and regulators were also starting to gain access to data of public companies
- All filers were given a 3-year phase-in period and had to complete the transition in two stages
- In 2009, Large Accelerated Filers (companies with a public float > $700 million) filed their Primary Financial Statements in XBRL
- Non-Accelerated Filers or Small Reporting Companies in 2011 (public float < $75 million)
- All entities were filing their complete financial reports in XBRL by 2012
The Process Of Refinement
- On June 28, 2018, the SEC voted to transition companies to Inline XBRL, an evolved version of XBRL
- SEC proposed a rule mandating this transition to inline XBRL over a three year period (2018-2021)
- Inline XBRL made life easier by enabling the report to be both human and machine-readable
- Inline XBRL will also improve the data quality, by making the XBRL data more visible in a human-readable document
