Getting started with iXBRL for SEC Compliance Filing

On June 13 2016, the US Securities and Exchange Commission (SEC) announced its plans to roll out a voluntary phase of filing in  Inline XBRL (also called iXBRL) format for all listed companies. Beginning 2019, the SEC has mandated companies to transition to iXBRL in a phase-wise manner.

With voluntary iXBRL filing underway, the main benefits it brings to the fore include efficient and reduced review time and improved data accuracy. Keeping this in mind, we have come up with a list of 5 important points filers need to know about this new mandate and how they can upgrade their filing process /system to transition smoothly to iXBRL:

Check the iXBRL readiness of your current solution/ provider

It is a good idea to start by checking if you existing accounting or filing solution already supports iXBRL or not. Other factors to consider are whether you want to handle your iXBRL tagging in-house or use external vendors / experts. Our recommendation: The ideal solution is to have a solution that gives you the flexibility to choose either. Look at a disclosure management platform where the tagging can be done either by you or by your service provider as you prefer. And where you can create, review, finalize and file the documents from the platform itself.

Budget some time to learn the XBRL technicalities

Learning the technical aspects of iXBRL filings, even at a high level, will help you in preparing and submitting greater quality filings with the SEC. Consider keeping aside half a day to get familiar with terms like tagging duplicate facts and transformation rules for the iXBRL reporting standard. There are also some validation warnings that iXBRL documents throw up if the transformation rules are not fully adhered to. These could needlessly faze you – in some cases making minor edits to the 10-Q or 10-K allows you to pass these transformation rules. So make sure your provider gives you a brief orientation session on these topics before you get started.

Create a calendar plan for your iXBRL transition

Though voluntary for some section of filers now, the SEC has already announced the timelines by which iXBRL reporting becomes mandatory for all issuers. It is best to create a calendar plan and transition in atleast a quarter before the mandatory filing begins for your company. In fact, given the advantages of iXBRL, you could even start by checking if your very next filing can easily be done in iXBRL, and what it takes to get there.

Work with Plan B in hand

If you still haven’t hit the mandatory iXBRL filing date, and you are experimenting with iXBRL, you may want to check if the solution or service provider you are partnered with allows you to switch back to XBRL quickly, if needed.

iXBRL Filing

When Does Inline XBRL Apply For Companies?

Inline XBRL is applicable to companies based on the filer type. Below is a handy guide which details when Inline XBRL will be compulsory for companies.

Type of Company

Inline XBRL Effective Date

Large accelerated filers

Beginning on or after June 15, 2019

Accelerated filers

Beginning on or after June 15, 2020

Smaller Reporting Companies and Non-Accelerated Filers

Beginning on or after June 15, 2021

Mutual Funds
(large funds assets > $ 1bn)

September 17, 2020

Mutual Funds
(large funds assets < $ 1bn)

September 17, 2021

Why voluntarily adopt iXBRL filings when it is still voluntary?

Companies have been given the option to voluntarily file inline XBRL until the dates provided in the above table. A voluntary transition to iXBRL will allow you to gain early benefits from the use of the standard – the biggest gain being a saving your review time and a better, more efficient reporting process that saves a lot of coordination and collective time.

“The reviewing time is substantially less than in the past with iXBRL, saving close to 1/3rd of my review time

GLEN MILLER
Chief Financial Officer, Ben Franklin Bank

It is best you don’t wait until the very end to begin your iXBRL implementation. Early adoption of the standard will also help to identify any process issues and challenges associated with creating the iXBRL document.

“We decided late in the first quarter of 2017 (Form 10-Q preparation calendar) to move forward with the use of iXBRL. I was impressed as a user with how smoothly this occurred in IRIS CARBON. It was really as easy or more easy than my prior effort with XBRL’’

LARRY DEGEN
Interim Chief Financial Officer and Secretary, MGC Diagnostics Corporation

IRIS CARBON®, our cloud-based, collaborative disclosure management platform is a single-source application that ensures your HTML and XBRL documents are always in sync. We always encourage our customers to transition to iXBRL to avail its multi-fold benefits through our platform. Our platform is backed by expert teams who have more than 10 years of experience with SEC filings.

With us, you are always assured that filings with the SEC is of the highest quality and standards.

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