Technology

SEC May Propose Mandatory XBRL Use

The commission could launch a plan in the spring and vote on it in the fall, a top regulator says.
Stephen TaubJanuary 23, 2008

Extensible Business Reporting Language, the computer language for financial-statement filing better known as XBRL, could soon be coming to a regulatory filing near you.

The Securities and Exchange Commission may propose the mandatory use of XBRL in the spring and vote on it this fall, SEC corporation finance division director John White reportedly told a legal conference at Northwestern University.

White granted that “a lot has got to happen” before the use of XBRL is required, including modifications to the SEC’s Edgar database and acceptance of recently issued common definitions for items to be tagged, according to the Associated Press. Nevertheless, White told his audience, “This is real, it’s happening,”

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Critics have called the introduction of XBRL, which has been called bar codes for financial data, a boon for consulting firms but a pain for practitioners. For its part, the SEC has asserted that it makes it easier to find and compare results.

So far, about 40 companies currently are voluntarily experimenting with XBRL, according to the AP.

Earlier this month, the SEC’s Advisory Committee on Improvements to Financial Reporting voted to ask the SEC to require the 500 biggest U.S. public companies to use XBRL-tagged financial statements for one year, followed by all large accelerated filers. After evaluating how those first phases went, the SEC would then consider whether to require other companies to also use XBRL.