XBRL: a multitalented tool: XBRL can save time and money and facilitate information analysis.CPAs have a rare opportunity to help the business world take a giant leap forward. The extensible business reporting language (XBRL (EXtensible Business Reporting Language) A specification for publishing financial information in the XML format. It is designed to provide a standard set of XML tags for exchanging accounting information and financial statements between companies and analysts. ) can vastly improve the timeliness, accuracy and flexibility of data in financial statements and other business reports. Many experts think it will boost today's commerce just as double-entry bookkeeping Double-entry bookkeeping Accounting method that records each transaction as both a credit and a debit in different accounts. led to clearer financial statements that attracted investors and stimulated the Industrial Revolution. To help their clients and employers reap the benefits, CPAs need to understand how XBRL can upgrade a variety of business functions, including the representative sample this article briefly describes. HERE'S HOW Put XBRL to work in * Fair value accounting. Tagging assumption disclosures in XBRL formats would make management's choices more transparent to users and easier to compare with those of other companies--and take away some observers' worries about the reliability, of corporate managers' fair value determinations. * Financial statement preparation. XBRL makes it easier to create and document financial information and reduce manual intervention. It can help CPAs integrate disparate systems and apply and monitor internal controls, reducing the burdensome costs related to the Sarbanes-Oxley Act See SOX. of 2002. * Mergers and acquisitions. Using XBRL as a universal standard will allow companies to integrate and improve information sharing See data conferencing. with regulators, investors and other external entities--and dig out of the morass of useless data that often accompanies corporate consolidations--without moving to uniform hardware or operating systems Operating systems can be categorized by technology, ownership, licensing, working state, usage, and by many other characteristics. In practice, many of these groupings may overlap. . * Compliance. New SEC rule amendments enable public companies to voluntarily submit XBRL-tagged information as exhibits to some required filings. Participating companies still must submit these filings in traditional electronic format, but the voluntary program will show how XBRL can help improve report quality and usefulness to investors and other end users. * Standard setting. XBRL complements the objective of a single set of high-quality, understandable and enforceable global accounting standards and makes it easier to accurately compare financial statements across borders. XBRL also could be a defining factor in the principles vs. rules debate, as seeing all the information in the same format simplifies validation of management's judgments and adjusts company-issued information to suit individual analytical purposes. * Investment and credit analysis. XBRL reduces research costs and makes it easier to create financial models and compare companies' performance and solvency. While virtually all company information is publicly available, few but professional analysts can locate and understand much of it. Tagging data in XBRL improves transparency without additional disclosures and makes more information available to everyone. Making information more accessible also benefits the capital markets, which depend on timely and reliable business data to allocate investments, and helps public companies meet accelerated filing deadlines. BOTTOM LINE XBRL benefits all members of the business information supply chain. It's time It's Time was a successful political campaign run by the Australian Labor Party (ALP) under Gough Whitlam at the 1972 election in Australia. Campaigning on the perceived need for change after 23 years of conservative (Liberal Party of Australia) government, Labor put forward a for companies, government agencies and firms to fundamentally improve business reporting by adopting XBRL. XBRL: A Structure for Business Data This article continues the JofA's coverage of how XBRL can help CPAs, their clients and employers, regulators, investors and other end users issue, obtain, analyze or translate into other formats--on any computer system--complete and accurate business information. RESOURCES XBRL International Inc. Resources The group's Web site (www.xbrl.org) provides * An overview of XBRL's functions and capabilities (www.xbrl. org/whatisxbrl). * Questions frequently asked about XBRL (www.xbrl.org/faq. aspx). * A technical information center (www.xbrl.org/technical information). * Details on how to create an XBRL-compliant financial statement (www.xbrl.org/specifications). * Description of XBRL-enabled applications (www.xbrl.org/ tools). * Descriptions of the benefits as well as the issues involved in adopting XBRL, with sections focusing on special interest groups (www.xbrl.org/xbrlandbusiness). AICPA AICPA See American Institute of Certified Public Accountants (AICPA). Resources * The AICPA Web site provides extensive XBRL-related information and resources at www.aicpa.org/innovation/baas/ xbrl/homepage.asp. * XBRL Essentials (# 093017JA), containing a tutorial and practical information, such as tips on using XBRL to meet business needs, is available at www.cpa2biz biz n. Informal Business. biz Noun Informal business Noun 1. .com or from the AICPA at 888-777-7077. * "XBRL--Real Solutions, Real Time" a free Web-based video (www.aicpa.org/video/xbrl). JofA articles on XBRL: * "XBRL Revisited" (Feb.05, page 64 or www.aicpa.org/pubs/ jofa/feb2005/hannon.htm) * "Tap Into XBRL's Power the Easy Way" (May04, page 32 or www.aicpa.org/pubs/jofa/may2004/naumann.htm) * "A Napster for Financial Data?" (Jan.03, page 66 or www. aicpa.org/pubs/jofa/jan200a/spec_zar.htm * "Finally, Business Talks the Same Language" (Aug.00, page 24 or www.aicpa.org/pubs/jofa/aug2000/zarowin.htm). Other Resources * The World Wide Web Consortium's site provides information about the extensible markup language See XML. (language, text) Extensible Markup Language - (XML) An initiative from the W3C defining an "extremely simple" dialect of SGML suitable for use on the World-Wide Web. http://w3.org/XML/. (XML XML in full Extensible Markup Language. Markup language developed to be a simplified and more structural version of SGML. It incorporates features of HTML (e.g., hypertext linking), but is designed to overcome some of HTML's limitations. ), of which XBRL is a subset A group of commands or functions that do not include all the capabilities of the original specification. Software or hardware components designed for the subset will also work with the original. (www.w3.org/xml). * The 11th XBRL International Conference will be held in Boston, April 25-29, 2005 (www.xbrl.org/upcomingevents). COLLEEN col·leen n. An Irish girl. [Irish Gaelic cailín, diminutive of caile, girl, from Old Irish. SAYTHER, CUNNINGHAM, CPA, is president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Financial Executives International. Her e-mail address See Internet address. e-mail address - electronic mail address is ccunningham@fei.org. |
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