Companies complain about XBRL


Most companies have made their peace with XBRL, which the SEC has been requiring in stages since 2008, and are wrapping up year two requirements. These will result in more detailed tagging of footnotes and separate tables. Year three requirements loom.

So how is all this being perceived by issuers? Are they seeing the benefits?

Bloomberg BNA reports that, "The eXtensible Business Reporting Language (XBRL) process, rather than providing an added value, has caused a lot more cost than it is worth and has been of little use to companies."

This was the conclusion of a recent roundtable on the topic held at the Financial Executive International's 2012 Financial Reporting Issues Conference in New York.

"Asked if they thought that the XBRL process added value, the Controllers--General Motor's Nick Cyprus, Johnson & Johnson's Stephen Cosgrove, Best Buy Co.'s Susan Grafton, and McCormick & Co.'s Kenneth Kelly---all answered an emphatic: no! no! no!"

I've long noted that the standard does not seem to be enabling a new era of analytical tools for investors and others, which many thought would happen. At the same time, issuers themselves see little use for the standard.

One Comptroller was quoted saying, "We also don't see a lot of use for it. I think at some point [the SEC] felt that these things would be tagged by companies, but companies have more robust systems than that already existing, that have 100 times more data and information sitting among them than anything you're going to tag for XBRL."

The SEC says that it uses tagged data productively, and we hope that more applications arise soon. There is still innovation occurring around the standard, and XBRL skills remain in demand. It would be shame if more useful applications didn't emerge.

For more:
- here's the article

Related articles:
Changes proposed to 2013 XBRL taxonomy
XBRL apps continue to emerge

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