XBRL Cost-benefit analysis: In Theory and application

A definition of XBRL will be given, followed by a brief overview of the XBRL system. A timeline of events in the brief history of XBRL will be rendered and discussed. Based on the global perspective of the XBRL movement and the establishment of an international consortium, XBRL International, international and domestic analysis will be addressed. Standardization of coding for financial reporting information is the goal of the consortium and the required coding structure will transcend national borders in order to accomplish this goal. A prototype language, created by the early users of eXtensible Markup Language (XML), in the accounting industry, was created in 1998, and became known as eXtensible Financial Reporting Markup Language (XFRML). In 2000, an accounting industry specific language, eXtensible Business Reporting Language (XBRL), was released. Currently, this coding structure is becoming part of the financial reporting process, but is off to a slow start within the United States, in 2005. Starting in 2005, software manufacturers began release of software packages which allowed for the adoption and coding of financial information in XBRL form; thus allowing for electronic submission of financial reports to the Securities and Exchange Commission (SEC), on a voluntary basis in 2005. Originally, cash-flows were a concern to the software producers regarding XBRL software development and product marketing, but an endorsement by the SEC, regarding XBRL use and adoption, led to this historic move by American corporations regarding financial reporting, in 2005. The primary focus of this paper is to look at implementation of XBRL and any known costs associated with these procedures. The benefits of XBRL adoption, implementation, and use will also be examined. A cost-benefit analysis approach will be utilized to examine XBRL, as a working concept. Due to the infancy of the XBRL movement and the lack of quantitative data, qualitative data speculating on the cost savings associated with XBRL utilization will be examined. In theory, due to the removal of data entry repetition and standardization of financial data, costs should be greatly diminished. Reducing the likelihood of errors will also constitute a cost savings. This paper sets out to establish the benefits of XBRL use and promote the adoption and implementation of the XBRL system on a global level, crossing all user barriers

ERP systems facilitating XBRL reporting and regulatory compliance

Today, the global economic environment requires that information is readily available across the supply chain (SC) and value chain and that the information is available in a costeffective manner. The information must be accurate, credible, timely, cost-efficient, reliable, traceable, pertinent, and possess data transparency. The information must be available to members within a particular organization, its vendors and customers, and outside governmental and regulatory agencies. All associated stakeholders and stockholders are entitled to the availability of trustworthy financial information to aid them in decision making, therefore, the controls regarding the data are critical for the compilation of the data. The Securities and Exchange Commission (SEC) reviews the financial report data a company submits on a yearly basis and this aids in the validity and credibility of the data, so that the ultimate end-user, who is the stockholder has the afforded protection from deception which is mandated and provided by the government

XBRL: Origins, implementation and acceptance

A brief overview of the origins of modern accounting are examined with it’s genesis in the Italian Renaissance. During this time period, trade and commerce expanded and new methods for tracking and recording transactions became necessary. Double entry bookkeeping was first documented by Luca Pacioli in 1458. Innovative Italian merchants and scholars of this time period have become known as the fathers of modern accounting. eXtensible Business Reporting Language (XBRL) is currently the revolutionizing concept in the modern accounting world. Originally, known as Extensible Financial Reporting Markup Language (XFRML) in 1998, it was a prototype language created by the early users of eXtensible Markup Language (XML). The origins of XBRL will be examined in greater detail as the paper progresses, as well as, some of the underlying framework regarding the coding structure and technologies. The implementation of XBRL in industry will be addressed and how it is compared to any new technology in respect to market adoption and timeliness. The Technology Adoption Curve allows for one to estimate which stage and what time frame is associated with widespread acceptance and utilization. Taxonomies add complexity to the process, but cost savings and data accuracy and reliability are benefits derived via XBRL adoption and implementation. The acceptance of XBRL within the U.S. and throughout the world will be evaluated. The variance in accounting principles and the standardization of XBRL codes are vital variables to be examined. The XBRL movement is already underway throughout the world and certain data will be examined reflecting this trend of acceptance and usage. The XBRL progress within the U.S. will also be examined, including the SEC’s current view on reporting in XBRL format