US Congress is Keen on XBRL

As an early champion of XBRL, the American Institute of Certified Public Accountants (AICPA) has developed a number of resources to assist those who create XBRL files, as well as those who review or use XBRL. The XBRL resource page provides the history of XBRL, links to articles and guidance.

XBRL.US also has useful tools and resources. It states that: “XBRL, eXtensible Business Reporting Language, is a royalty-free, international information format designed specifically for business information, also referred to as ‘interactive data’ by the SEC. The idea behind XBRL is simple: instead of treating business information as a block of text – as in a printed paper document or a standard Internet page – it provides a unique, electronically readable tag for each individual disclosure item within business reports.”

A recent article at AICPA Insights online notes that the “US Congress is Keen on XBRL” and has introduced H.R. 3339, the Standard Data and Technology Advancement Act, or the “Standard DATA Act.” The bill aims to establish consistent requirements for the electronic content and format of data used in the administration of key human services programs. Specifically, it calls for the incorporation of existing nonproprietary standards, such as XBRL. If enacted, this bill would improve the collection and dissemination process for the federal government by standardizing data and eliminating time-consuming and error-prone manual processes.

Another bill entitled the Digital Accountability and Transparency Act, or “DATA Act,” H.R. 2146/S.1222 is also under consideration in Congress. The DATA Act calls for the use of consistent government-wide data standards for all federal spending. This bill also calls for the use of a nonproprietary data reporting standard, such as XBRL. The DATA Act is currently awaiting debate and a vote on the House floor.

PwC’s “To the point: Current issues for boards of directors – Fall 2011”

As the title suggests, “To the point” addresses contemporary issues and is meant to be impactful, insightful and concise. Each quarter, PwC addresses select topics that are of immediate interest to directors. The Fall 2011 edition shares insights on several matters.

Next year's proxy season: The SEC's plan for proxy access was struck down by a US Court of Appeals decision in July, but directors should prepare for the possibility of private ordering proxy access.

A new discussion about mandatory auditor rotation: The idea of mandatory audit firm rotation has resurfaced in a recent PCAOB concept release, and comments are requested on the matter.

Technology in the boardroom: Directors are increasingly using electronic portals and tablet devices to access board materials and books, and the trend is likely to continue.

(Read PwC’s To the point: Current issues for boards of directors – Fall 2011.)

CICA/IFRS Foundation Conference - IFRS in North America 2010

The CICA/IFRS Foundation Conference - IFRS in North America 2010 will be held on November 23-24, 2010 (optional sessions November 22) at the Metro Toronto Convention Centre in Toronto, Canada. As the deadline for IFRS adoption looms, this informative two-day event, with optional workshops, is crucial for anyone involved in financial reporting with an organization that is moving to IFRS. It is a unique opportunity to hear the latest IFRS developments directly from the International Accounting Standards Board (IASB), the Canadian Accounting Standards Board (AcSB) and the US Financial Accounting Standards Board (FASB). The most recent regulatory developments from Canada and the US will also be presented.

Fraudulent Financial Reporting: 1998-2007 (COSO)

The Committee of Sponsoring Organizations of the Treadway Commission (COSO) has published a study, Fraudulent Financial Reporting: 1998-2007. It examines 347 alleged accounting fraud cases investigated by the US Securities and Exchange Commission (SEC) during that period. It also provides an in-depth analysis of the nature, extent and characteristics of the frauds and offers insights on new and ongoing issues to be addressed. Most of the frauds occurred before the Sarbanes-Oxley Act went into effect. (Read the COSO Press Release and also view a free Webinar and presentation slides that summarize the study's findings.)

US SEC Amendments to Rules Requiring Internet Availability of Proxy Materials

The US Securities and Exchange Commission (SEC) has amended rules under the Securities Exchange Act of 1934 and the Securities Act of 1933 to clarify and provide additional flexibility regarding the format of the Notice of Internet Availability of Proxy Materials that is sent to shareholders and to permit issuers and other soliciting persons to better communicate with shareholders by including explanatory materials regarding the reasons for the use of the notice and access proxy rules and the process of receiving and reviewing proxy materials and voting pursuant to the notice and access proxy rules.

US – SEC chairman hits back at international accounting convergence myths

The head of the US markets watchdog has sought to put to rest myths and rumours about the US commitment to International Financial Reporting Standards (IFRS). Mary Schapiro, chairman of the US Securities and Exchange Commission (SEC), told an audience of accountants at the US CFA Institute’s annual conference, she was committed to international standards, but was equally committed to protecting US investors from possible side effects. (Read the article “Schapiro hits back at international accounting convergence myths” at Accountancy Age online.)

IASB - Call for interest to Public Companies listed in the US who file in IFRS

XBRL (eXtensible Business Reporting Language) is rapidly becoming the global standard for electronic financial reporting. The IASC Foundation has played an important role in encouraging the development of online financial reporting using XBRL. In December 2008, the US Securities and Exchange Commission (SEC) adopted rules that require all US-listed Foreign Private Issuers (FPIs) to submit their financial reports, including their periodic reports, in Interactive Data format, and specifically in XBRL. FPIs, which will be mandated to file with XBRL in IFRS from June 15, 2011, are invited to participate in a pilot initiative being coordinated by the IASC Foundation. The pilot will focus on FPI use of the IFRS Taxonomy 2010 to tag SEC filings in XBRL. (Read the Call for interest to Public Companies listed in the US who currently file financial reports with the US SEC in IFRS.)

US Executives want earlier implementation of IFRS

A survey of 2,500 executives by accounting firm KPMG found that 49% of US executives want to move to International Financial Reporting Standards (IFRS) earlier than the Securities and Exchange Commission (SEC) tentative 2015 potential adoption date. The desire for an earlier shift comes even before US regulators have made a formal decision to adopt IFRS. In February 2010, the SEC said US companies would not be able to use the standards until 2015 at the earliest. (Read the article Half of US execs want to use IFRS early-survey at Reuters online.)

SEC rules require more disclosure on risk management

The US Securities and Exchange Commission's new proxy disclosure rules may assist audit committees from taking on too much risk. The new rules require disclosure about how risk supervision is divided among boards and board sub-committees. To learn more about how senior executives can work with their boards on risk oversight, read the COSO report Strengthening Enterprise Risk Management for Strategic Advantage as well as the online articles Who's Minding Risk? and Internal Auditors Urged to Heed New SEC Proxy Disclosure Rules.

US - SEC Approves Statement on Global Accounting Standards

The US Securities and Exchange Commission has voted to issue a statement that lays out its position regarding global accounting standards and makes clear that the Commission continues to believe that a single set of high-quality globally accepted accounting standards would benefit US investors. (Read the SEC Press Release, which includes the Commission Statement in Support of Convergence and Global Accounting Standards, Text of Chairman's Statement and the related video - Chairman Schapiro Discusses Global Accounting Standards.)

SEC Comes Clean on Climate Disclosures

New guidance from the US Securities and Exchange Commission (SEC) will prompt companies to reexamine how they explain the effects of climate change on their business in regulatory filings. The clarification from the regulator arrives just as companies with a calendar year-end are putting together their 10-Ks. Investor groups have been critical of companies for their lack of candor about climate-change risk, and of the SEC for allowing them to get away with it. (Read the SEC Press Release and the article SEC Comes Clean on Climate Disclosures at CFO.com.)

US - FASB adds new XBRL functionality

Current changes to the US Financial Accounting Standards Board (FASB) Codification follow the Securities and Exchange Commission (SEC) rule effective April 13, 2009, that requires all public companies to begin providing XBRL versions of their SEC filings over a three-year phase-in period. Approximately 500 of the largest public companies, each with a worldwide public float greater than $5 billion, began filing for interim financial statements with periods ending on or after June 15, 2009. The new XBRL functionality provided by the FASB Codification Website will help entities as they prepare or plan to prepare XBRL financial statements using the US Financial Reporting Taxonomy. Users will be able to very easily identify the XBRL elements associated with specific Codification paragraphs. (For more information, visit the FASB Accounting Standards Codification Website.)

US - Strategic Plan for Fiscal Years 2010–2015

The US Securities and Exchange Commission (SEC) has released its Draft Strategic Plan for Fiscal Years 2010–2015, which includes a continued commitment “to promote the establishment of high-quality accounting standards by independent standard setters” and support for “a single set of high-quality global accounting standards.” The draft Strategic Plan is a statement of the SEC’s mission, vision, values, strategic goals, planned initiatives and performance metrics.

US - SEC financial reporting issues facing smaller companies

During 2009 the US Public Company Accounting Oversight Board (PCAOB) hosted a series of Forums on Auditing in the Small Business Environment. At those Forums, the staff of the Division of Corporation Finance of the Securities and Exchange Commission (SEC) reviewed common financial reporting issues identified during their staff reviews of filings for smaller public companies. (View the SEC Staff Review of Common Financial Reporting Issues Facing Smaller Issuers (December 2009) and other SEC information for small businesses.)

US - SEC guidance on non-GAAP financial measures

The US Securities and Exchange Commission (SEC) staff has issued Compliance and Disclosure Interpretations (C&DIs) on disclosure of non-GAAP financial measures. Among other things, the new guidance clarifies that the SEC does not discourage registrants from disclosing non-GAAP financial measures in filings with the SEC. For example, one of the new Q&A clarifies that there is no prohibition against disclosing a non-GAAP financial measure that is not used by management in managing its business. (Read the SEC Guidance on Non-GAAP Financial Measures issued on January 15, 2010.)

US - SEC webcast on XBRL phase II and detailed tagging

Representatives from the US Securities and Exchange Commission (SEC) will offer tips on how to prepare for the detailed footnote disclosures tagging that is required under the SEC's second phase of the XBRL mandate at a webcast on XBRL - Preparing for Phase II and Detailed Tagging. Join this live video event on Wednesday, January 27 from 2:00pm to 3:30pm, ET and obtain the information needed to comply with the SEC's requirements.

XBRL: The story of our new language

XBRL (eXtensible Business Reporting Language) is a royalty-free, international information format designed specifically for business information, also referred to as “interactive data” by the US Securities and Exchange Commission (SEC). The concept of XBRL is that all individual disclosure items within business reports are assigned unique electronically readable tags (like a barcode). These tags are mapped to taxonomies that are being developed by market constituents and are publicly available on the XBRL website. Taxonomies are, in essence, dictionaries of financial concepts in which each concept is defined and assigned a relationship to other concepts.

XBRL has been a journey of high and lows that met with great success in 2008. Success is defined as (1) the acceptance of this new tool in the broad-based business and business-reporting community and (2) the use of this tool in areas broader than just financial statement information. Those two fundamental beliefs grounded some early decisions that the American Institute of Certified Public Accountants (AICPA) believes will make XBRL a critical foundation for business and government in the decades to come. (Read the AICPA publication XBRL: The story of our new language.)

US - XBRL tagging responsibility rests with filing companies

At the XBRL US National Conference in New York in mid-November 2009, panelists said the onus for Extensible Business Reporting Language (XBRL) tagging lies with filing companies and that efforts need to be made to outline tagging guidelines. Such best practices may prove tricky because many of the companies that outsourced the tagging on their early filings might not have documented their processes so they could be consistent in the future. (Read the article Panelists Advise Companies to Take Responsibility for XBRL Tagging—Even When Outsourcing in Journal of Accountancy online.)

Canada -XBRL Annual Conference 2009

The XBRL Canada Annual Conference was held on November 5, 2009 in Toronto, Canada. The presenters included Paul Cherry, Chair of the IASB Standards Advisory Council, who spoke about the IASB and Convergence, David Blaszkowsky of the US Securities and Exchange Commission (SEC) who explained The Roll-out of Interactive Data Reporting for US-listed Public Companies, and Andrew Lowe of the Ontario Securities Commission (OSC) who discussed XBRL and the CSA. The conference provided regulatory filers and potential filers with an up-to-date status report and concrete help in getting organized for the adoption of IFRS and XBRL. (The presentations are available at the XBRL Canada website.)

SEC's Schapiro says focus on investor needs will restore confidence

Mary Schapiro, chairman of the US Securities and Exchange Commission (SEC), said that while there were many causes of the global financial crisis, much of it boils down to risk. Investors, financial institutions, credit rating agencies, regulators and other market participants either did not know or did not understand the risks of many products. Schapiro said it is time for the markets to return to an era where everyone "can compete based on real services and results." She said to get to that point, the industry needs to focus on investor needs. (Read the online articles  "SEC head Mary Schapiro: Blame us for financial crisis too" and "SEC to begin scrutinizing risks related to retirement products".)