The December 2008 announcement by the SEC has been reason for celebration in the XBRL community, especially among small software vendors who’ve been waiting for this reporting standard to be mandated for many years now. We ought to begin to see the big software vendors like IBM, SAP, Oracle, and Microsoft jockeying for position as their customers begin XBRL reporting rollouts. However, it will undoubtedly be a while before we see consolidation in this marketplace. Even though XBRL ‘s been around considering that the late 90’s, it’s only the recent SEC mandate and to a smaller degree, the roadmap for adoption of the IFRS standard, that’s fueling the current interest in XBRL reporting. In talking to CFOs, COOs, and Accountants of both public and regulatory companies, I’m finding that there’s still confusion about where in the first place an in-house XBRL implementation strategy, what the primary ingredients are, or when to jump on the bandwagon. Furthermore, the wants of public companies will vary from the wants of the organizations that regulate them. xbrl software
As a Technology-based Solutions Consultant advising and delivering ERP, e-commerce, and Business Intelligence (BI) solutions for large organizations in the last 20+ years, I have observed first-hand, how easy it is to act as all things to all people. A brand new technology evolves, vendors emerge in the room, and although each vendor has their particular strength, they often portray themselves as getting the silver bullet, as opposed to working in partnership with each other to be able to provide the very best value for the customer.
In the financial services community, prospective customers of XBRL products and services typically fall within 1 of 2 classes – 1. public or regulated corporations and 2. regulators and other organizations involved with data collection and consolidation. (Let’s leave the average investor on the sidelines for now. As their only requirement is to see company reports, they’ll have their needs met by free downloadable XBRL report viewers.)
In this firstly two articles, I will focus on the implementation needs of people or regulated company. My follow-up article will focus on the XBRL implementation needs of regulatory organizations.
For companies that have to comply with regulatory bodies, (or private companies that are often regulated and have to provide reports in XBRL format), the technology enablers for incorporating the XBRL reporting standard into their businesses are on the market on the list of XBRL vendors – UBMatrix, Corefiling, Fujitsu, ABZ Reporting, Rivet software, Coyote Reporting, Snappy Reports, to name a solid core. (NOTE: I’m not endorsing any of the companies I’m mentioning in this article. I’m just providing them as examples of the vendors in this marketplace.)
XBRL integration is fundamentally a three-step process. Import/extend a taxonomy (a business rules data dictionary) which creates the XBRL “tags” for the reporting structure; run your data through the tagging process, utilizing your taxonomy; finally, render the data in a user-readable format.xbrl filing software free download
The XBRL vendors have created three automated off-the-shelf products to assist you complete these steps with minimal pain:
1. Taxonomy Designer – which gives a user-friendly online interface to permit you to build, import, and extend reporting taxonomies. This really is your “tagging” tool. And there are certainly a wide range of those tagging tools out there. You can even find a free of charge one once you learn where you should look. I would suggest you acquire a Taxonomy Designer that’s drag-and-drop capability and lets you import and extend a base taxonomy that’s downloadable from the Internet or provided for your requirements by an associated company or regulatory body. Make certain this tool also includes built-in taxonomy validation at both the beds base and extension level.
2. Processing Engine – which uses your taxonomy to essentially map the conversion of reporting data from text, CSV, Excel, HTML, XML, etc. format into XBRL. I would suggest purchasing an engine that provides for two-way conversion. So beginning with XBRL, you are able to convert back to whatever source you began with, or to another standard format. Try to find an Engine with built-in data validation functionality or make sure that data validation comes bundled with your Report Builder (next step), i.e., to flag unbalanced accounts. This could save you a lot of manual effort and frustration.
3. Report Builder – lets you render (display) XBRL “instance” documents”, or individual financial reports in a user-friendly format for the web, in PDF, or even to MS Excel or Word formats, etc. Again, this calls for your taxonomy as input, combined with the report data, to be able to render the report in a format that individuals can read. These report builders differ a great deal with regards to functionality. Some provide web rendering capability only; some render in multiple formats including Word, Excel, and PDF; others provide parameter-driven comparison capability. Be clear on the functionality you need. This puts you ready to negotiate the price of the tool you finally select.