XBRL US Conference Highlights

Back in early November I had an opportunity to attend the XBRL US National Conference in Philadelphia.  At the event, XBRL US announced that Oracle had joined the initiative, so I had a chance to participate in a press conference and attend a number of sessions.  Oracle joined XBRL US so we can stay ahead of the standard and leverage it in our products, and to help drive awareness with customers and improve adoption of XBRL.

There were roughly 250 attendees at the event, about half of which were vendors and consultants and the rest financial reporting staff from corporate filers.  Event sponsors included Ernst & Young, SWIFT and Fujitsu.  There were also a number of XBRL technology and service providers exhibiting at the conference. 

On Monday Nov. 8th, the XBRL US Steering Committee meetings and Annual Members meeting and reception were held.  At the Annual Members meeting the big news was that current XBRL US President, Mark Bolgiano, is moving to a new position at Howard Hughes Medical Center.  Campbell Pryde, who had led the Taxonomy Development for XBRL US, is taking over as XBRL US President.

Other items that were highlighted at the members meeting included:

  • The US GAAP XBRL taxonomy is being used by over 1500 SEC filers and has now been handed over to the FASB to maintain and enhance
  • 16 filer training events were held in 2010
  • XBRL Global Magazine was launched
  • Corporate Actions proposal was submitted to the SEC with SWIFT in May
  • XBRL Labs for iPhone, XBRL US Consistency Suite launched
  • ISO 2022 Corporate Actions Alignment with XBRL achieved
  • The XBRL Credit Rating taxonomy was accepted

Tuesday Nov. 9th included Keynotes, General Sessions, Innovation Workshop for Governments and Securities Professionals, and an Opening Reception.  General sessions included:

  • Lessons Learned from the SEC's rollout of XBRL.  More than 18,000 errors were identified in reviews of filings between June 2009 and September 2010.  Most of these related to negative values being used where they shouldn't have.  Also, the SEC feels there are too many taxonomy extensions being created - mostly in the Cash Flow Statements.  They emphasize using existing elements in the US GAAP taxonomy and advise filers not to  create extensions to improve the visual formatting of XBRL filings.
  • Investors and XBRL - Setting the Standard for Data Quality.  In this panel discussion, the key learning was that CFA's, academics and the financial community are not using XBRL as expected.  The issues raised include the  accuracy and completeness of filings, number of taxonomy extensions, and limited number of tools available to help analyze XBRL data.  Another big issue that was raised is the lack of historic results in XBRL - most analysts need 10 quarters of historic data.  On the positive side, XBRL has the potential to eliminate re-keying of data and errors here and can improve analytic capabilities for financial analysts once more historic data is available and more companies are providing detailed tagging of their filings.
  • A US Roadmap for XBRL Financial Reporting.  This was a panel discussion featuring Jeff Neumann(SEC), Campbell Pryde(XBRL US), and Louis Matherne(FASB).  Key points included the fact that XBRL is currently used by 1500 companies, with 8000 more companies coming in 2011.  XBRL for Mutual Fund Reporting will start in 2011 for 8000 funds, and a Credit Rating Taxonomy has now been submitted for review.  The XBRL tagging/filing process is improving each quarter - more education is helping here.  The FASB is looking at extensions to date, and potential additions to US GAAP taxonomy, while the SEC is evaluating filings for accuracy, consistency in tagging, and tools for analyzing data.  The big news is that the FASB 2011 US GAAP Taxonomy has been completed and reviewed by SEC.  The 2011 US GAAP Taxonomy supports new FASB accounting standards issued since 2009, has new taxonomy elements for certain industries (i.e airlines) and the elimination of 500 concepts.  (meaning they can't be used going forward but are still supported for historical comparison)  The 2011 US GAAP Taxonomy will be available for usage with Q2 2011 SEC filings.  More information about this can be found on the FASB web site.  http://www.fasb.org/home
  • Accounting Firms and XBRL.  This session covered the Role of Audit Firms, which includes awareness and education, validation of XBRL filings, and in-house transition planning.  The main advice provided was that organizations should document XBRL mapping process, perform peer comparisons, and risk assessments on a regular basis.

Wednesday Nov. 10th included more Keynotes, General Sessions on Corporate Actions, and XBRL Essentials Workshop Training for corporate filers.  The XBRL Essentials Training included:

  • Getting Started Once you Have the Basics
  • Detailed Footnote Tagging and Handling Tables
  • Quality Control and Trust in the XBRL Process
  • Bringing XBRL In-House:  What are the Options, What should you consider?
  • The US GAAP Financial Reporting Taxonomy - Overview of the 2011 release

The XBRL Essentials Training was well-attended with about 80 people.  This included a good overview of the SEC's XBRL mandate, limited liability issue, tagging levels, recommended planning process, internal vs. outsourced approach, and how to manage service providers.  I learned a lot from the session on detailed tagging.  This is the requirement that kicks in during a company's second year of XBRL filing with the SEC and applies to financial statements, footnotes and disclosures (it does not apply to MD&A, executive communications and other information).  The review of the Linkbase model, or dimensional table structure, was very interesting and can be complex to understand.  The key takeaway here is that using dimensional tables in XBRL filings can help limit the number of taxonomy extensions that are required.  The slides from this session are posted on the XBRL US web site. (http://xbrl.us/events/Pages/archive.aspx)

For me, the main summary points and takeaways from the XBRL US conference are:

  • XBRL for financial reporting has turned the corner and gone mainstream - with 1500 companies currently using it and 8000 more coming in 2011
  • The expected value is not being achieved by filers or consumers of XBRL data - this will improve when more companies are filing in XBRL, more history is available, and more software tools are available for analysis (hmm, sounds like an opportunity for Oracle)
  • XBRL is becoming the global standard for all business communications beyond just the financials - i.e. adoption for mutual funds, corporate actions and others planned for the future

If you would like to learn more about XBRL and the various training programs, services and software tools that are available check out the XBRL US web site and even better - become a member.  Here's a link:  http://xbrl.us/Pages/default.aspx


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