Because of this reason, many companies outsource the implementation of XBRL instead of letting in-house management information systems resources MIS manage the implementation.
Provides a standardized language for all companies reporting their financial data Allows investors and stakeholders to easily download and understand financial reports Provides a list of definitons taxonomies for the financial terms used Saves time in entering and reporting financial data and increases efficiency Is very cost-effective Is not used by all publicly traded companies as of now Tags may be wrongly assigned to financial terms There is still a lack of consistency in the use of standards Wrong definitions taxonomies may be given to certain financial terms It may pose security risks for companies publicly reporting their financial information Posted by.
The second problem is that today, extracting specified detailed information from a financial statement, even an electronic financial statement like an EDGAR filing, is a manual process.
And in this period of transition, accuracy and compliance have become more critical than ever.
XBRL documents can be prepared efficiently, exchanged reliably, published more easily, analyzed quickly, retrieved by investors simply, and enables smarter investments Potential XBRL applications: More efficient data collection lowers operating costs associated with custom, idiosyncratic data feeds and reducing errors while concentrating on adding value to the data and increasing transaction capacity Independent Software Vendors: This outsourcing leads to increased cost and defeats the cost-cutting benefits associated with implementing XBRL.
Companies who prepare financial statements: XBRL is not about establishing new accounting standards but enhancing the usability of the ones that we have through the digital language of business. Advantages and Disadvantages XBRL stands for Extensible Business Reporting Language, which is a language used for the electronic communication of business and financial data.
It assigns unique tags to different financial terms, categorizes themshows the relationship between them, and allows the data to be analyzed by the computer software.
The first problem is that preparing a financial statement for printing, for a Web site, and for filing today means that a company could typically enter information three times. If a financial statement is prepared using XBRL, computer programs can easily extract every piece of information in that statement.
There is a tremendous opportunity for firms that take the lead in XBRL fluency, whether in attracting new business or educating clients and other firms on the requirements within a consulting role. Enhanced distribution and usability of existing financial statement information.
This also includes Web browsers on the Internet.
Cost The largest disadvantage remains cost. Virtually any software product that manages financial information could use XBRL for its data export and import formats, thereby increasing its potential for full-interoperability with other financial and analytical applications.
XBRL solves two significant problems through efficient preparation of financial statements in many forms and reliable extraction of specific detailed information from the different forms of financial statements. More efficient preparation of financial statements because they will be created one time and rendered as printed reports, on Web sites, as Edgar filings, or as other regulatory filings.
XBRL uses an open-standard of creation and does not require licensing fees. Ami is responsible for providing information, tools and resources that enable members to provide valuable business reporting, assurance and advisory services.
Tablet image via Shutterstock. More accurate data makes XBRL a great tool, but it also means the data must remain secure. Listed below are some advantages and disadvantages of this language.
Now comes a powerful new form of data, one that speaks the language of business. More than 9, companies are now required by the SEC to submit quarterly XBRL files that include tagged financial statements, as well as detailed data in footnotes.
Analysts, Investors, and Regulators: Of course, on an individual level, XBRL is more than a component of financial reporting.eXtensible Business Reporting Language (XBRL) will provide them with a standardized method for preparing, publishing, and automatically exchanging financial information, including financial statements of publicly held companies.
Advantage 7 – SEC Compliance: An important variant of XML is XBRL (Extensible Business Reporting Language) which is recommended by the United States Securities and Exchange Commission (SEC) for reporting financial earnings information to the U.S.
Federal Government. Now comes a powerful new form of data, one that speaks the language of business. By the nature of its format, XRBL, or eXtensible Business Reporting Language, brings transparency to business information so investors can analyze data more easily and make informed investment decisions.
This research paper will discuss Extensible Business Reporting Language (XBRL). The SEC is now requiring companies to submit financial statements in the XBRL format. (XBRL) is a language for the electronic communications of all sort of businesses and the exchange of financial data that is transforming business reporting around the globe.
XBRL, or eXtensible Business Reporting Language, is an XML standard for tagging business and financial reports to increase the transparency and accessibility of business information by using a uniform format.
Extensible Business Reporting Language (XBRL) was designed as a language to electronically communicate business and financial data instead of the more traditional ASCII or HTML formats. The SEC mandated that as of June all public companies over $5 billion in assets must report financials using XBRL.Download