| The December 2008 announcement by the SEC has | | | | there are a wide range of these tagging tools out |
| been cause for celebration in the XBRL community, | | | | there. You can even find a free one if you know |
| especially among the smaller software vendors | | | | where to look. I recommend you purchase a |
| who've been waiting for this reporting standard to be | | | | Taxonomy Designer that has drag-and-drop capability |
| mandated for several years now. We should see the | | | | and allows you to import and extend a base |
| big software vendors like IBM, SAP, Oracle, and | | | | taxonomy that is downloadable from the Internet or |
| Microsoft jockeying for position as their customers | | | | provided to you by an associated company or |
| begin XBRL reporting rollouts. However, it will be some | | | | regulatory body. Make sure this tool also comes with |
| time before we see consolidation in this marketplace. | | | | built-in taxonomy validation at both the base and |
| Even though XBRL has been around since the late | | | | extension level. |
| 90's, it's only the recent SEC mandate and to a lesser | | | | 2. Processing Engine - which uses your taxonomy to |
| degree, the roadmap for adoption of the IFRS | | | | essentially map the conversion of reporting data from |
| standard, that is fueling the current interest in XBRL | | | | text, CSV, Excel, HTML, XML, etc. format into XBRL. I |
| reporting. In speaking with CFOs, COOs, and | | | | suggest purchasing an engine that provides for |
| Accountants of both public and regulatory companies, | | | | two-way conversion. So starting with XBRL, you can |
| I'm finding that there's still confusion about where to | | | | convert back to whatever source you began with, or |
| start with an in-house XBRL implementation strategy, | | | | to another standard format. Look for an Engine with |
| what the main components are, or when to jump on | | | | built-in data validation functionality or make sure that |
| the bandwagon. Furthermore, the needs of public | | | | data validation comes bundled with your Report Builder |
| companies are different from the needs of the | | | | (next step), i.e., to flag unbalanced accounts. This will |
| organizations that regulate them. | | | | save you a lot of manual effort and frustration. |
| As a Technology-based Solutions Consultant advising | | | | 3. Report Builder - allows you to render (display) XBRL |
| and delivering ERP, e-commerce, and Business | | | | "instance" documents", or individual financial reports in a |
| Intelligence (BI) solutions for large organizations over | | | | user-friendly format for the web, in PDF, or to MS |
| the past 20+ years, I have seen first-hand, how easy it | | | | Excel or Word formats, etc. Again, this requires your |
| is to try to be all things to all people. A new technology | | | | taxonomy as input, along with the report data, in order |
| evolves, vendors emerge in the space, and although | | | | to render the report in a format that people can read. |
| each vendor has their unique strength, they often | | | | These report builders differ quite a bit in terms of |
| portray themselves as having the silver bullet, rather | | | | functionality. Some provide web rendering capability |
| than working in partnership with each other in order to | | | | only; some render in multiple formats including Word, |
| provide the best value for the customer. | | | | Excel, and PDF; others provide parameter-driven |
| In the financial services community, prospective | | | | comparison capability. Be clear on the functionality you |
| customers of XBRL products and services typically | | | | need. This puts you in a position to negotiate the price |
| fall within one of two classes - 1. public or regulated | | | | of the tool you finally select. |
| corporations and 2. regulators or other organizations | | | | When speaking with the XBRL vendors, categorize |
| involved in data collection and consolidation. (Let's leave | | | | each one's strengths. Some may be better on the |
| the average investor on the sidelines for now. As their | | | | reporting side, while others may have more |
| only requirement is to view company reports, they'll | | | | feature-rich processing engines. Some products require |
| have their needs met by free downloadable XBRL | | | | more IT integration than others. As I evaluate these |
| report viewers.) | | | | tools I also consider how user-friendly they are and |
| In this first of two articles, I will focus on the | | | | who in the company is going to be working with them. |
| implementation needs of the public or regulated | | | | For example, Taxonomy Design tools vary greatly in |
| company. My follow-up article will focus on the XBRL | | | | terms of their ease-of-use. XBRL is pretty cryptic. |
| implementation needs of regulatory organizations. | | | | Finding an intuitive easy-to-use tool can make working |
| For companies that have to comply with regulatory | | | | with this XML-based language that much simpler and |
| bodies, (or private companies that may also be | | | | faster to implement, especially for end-users that don't |
| regulated and have to provide reports in XBRL | | | | have an IT background. |
| format), the technology enablers for incorporating the | | | | Along with the technology components described |
| XBRL reporting standard into their businesses are out | | | | above, you'll also need the glue to pull the pieces |
| there among the XBRL vendors - UBMatrix, Corefiling, | | | | together. I suggest you hire a reputable Systems |
| Fujitsu, ABZ Reporting, Rivet software, Coyote | | | | Integrator or consulting firm to help you develop a |
| Reporting, Snappy Reports, to name a strong core. | | | | roll-out plan, support you through the vendor selection |
| (NOTE: I'm not endorsing any of the companies I'm | | | | process, provide integration services, training services, |
| mentioning in this article. I'm just providing them as | | | | and help you test and deploy this new reporting |
| examples of the vendors in this marketplace.) | | | | standard. Many clients that I have worked with put risk |
| XBRL integration is fundamentally a three-step | | | | minimization at or near the top of their selection list - |
| process. Import/extend a taxonomy (a business rules | | | | the good integration companies have depth of |
| data dictionary) which creates the XBRL "tags" for | | | | knowledge in technology, have practical experience in |
| your reporting structure; run your data through the | | | | the financial services sector, and understand reporting |
| tagging process, making use of your taxonomy; finally, | | | | systems from a technical and end-user perspective - |
| render the data in a user-readable format. | | | | they'll help you mitigate your risk with this new reporting |
| The XBRL vendors have created three automated | | | | standard. |
| off-the-shelf products to help you complete these | | | | In my follow-up article, I'll continue with a discussion of |
| steps with minimal pain: | | | | the other class of XBRL consumer - regulators or |
| 1. Taxonomy Designer - which provides a user-friendly | | | | other organizations that collect reporting data and |
| online interface to allow you to build, import, and extend | | | | have to pull it all together. Their roadmap to success is |
| reporting taxonomies. This is your "tagging" tool. And | | | | quite different than that of individual companies. |