notice: proprietary and confidential this material is proprietary to edgar online. it contains trade...
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NOTICE: Proprietary and Confidential
This material is proprietary to EDGAR Online. It contains trade secrets and confidential information which is solely the property of EDGAR Online. This material shall not be used,
reproduced, copied, disclosed, transmitted, in whole or in part, without the express consent of EDGAR Online.
© 2007 EDGAR Online, Inc. All rights reserved.
XBRL SEC Filer Experience
October 6, 2010
Eric EvansVP, Business DevelopmentEDGAR Online, Inc.
• Planning for XBRL reporting • Best Practices• Avoiding common errors• Results to Date from first XBRL filings• Resources Available
Agenda
2
Planning - Stakeholders involved
• External reporting – education and build in more time for review!
• Legal Counsel - (Internal or External)
• Audit committee - may need to alter meeting dates down the road
• Auditors – (Internal or External) - get them involved earlier if needed
• Investor relations – posting of XBRL on web site
• Information Technology – installing any software (self tagging)
• Special project team
• Consultants
• Others - Educate senior staff on timing and not to focus on SEC rendering
Considerations when choosing self tagging tool or outsourcing
• BOTH• Support – hours, what form • Training, FAQ’s, Webinars• Does block tagging• Does detailed tagging• Handling Edits/Changes• Provides rendering preview• Has a repeatable process• Security policies• Maintains user groups• Provides validation• Taxonomy handling or expertise
• In-house/Software tool only• Speed of taxonomy loading• Web based, ASP, PC-based?• File size if PC-based• Handling changes to taxonomy• Software updates • Processing times• Is Support time extra ($$)
• Outsource/Service only• Turnaround times• Quality Control levels• SAS70 certified• Level of mistakes or errors• Provides alternative tag options • Version control between EDGAR HTML
& XBRL process
Best Practices for SEC Filers – Start Early!!
• Prepare Primary Financial Statement s and Block Tagged Notes at least 1-2 quarters ahead of your mandated timeframe even if they are not formally filed with the SEC
#1 – On-boarding: Initial Template set up – take as filed 10-Q #2 – Dry Run XBRL: test timing & review with concurrent EDGAR filing#3 – Repeat above for 10-K if desired (some issuers have opted to do as well)
• Detailed footnotes:Examine the structure and presentation of your company’s financial disclosureCompanies are starting to decrease narrative and create data tables
• Focus on XBRL data creation and NOT on rendering issues, including the SEC’s site.• Fully review and don’t submit partial reviews (different from EDGAR process)• Iterative changes don’t save time = more rounds• Data vs. Print world = not EDGR, not typeset, XBRL requires more time for changes
Best Practices for SEC Filers – cont’d
• Extensions - where to extend or not extend?• SEC Staff Feedback published in May’09:
• When choosing between two US-GAAP Standard Tags (narrow vs. broad), narrow is preferred
• When choosing between an existing Standard and Custom/Extension Tag, every effort should be made to utilize existing US GAAP tag found in taxonomy
• Tags may cross industry classifications
• Clients could review their tags against peer tags for comparison
• Focus on the mapping and taxonomy extension - Element selection documentation and a well crafted custom company taxonomy will greatly simplify the XBRL document creation process
• Stick to the workflow - Jumping ahead often results in dead ends and rework. Avoid the idea of building the company taxonomy on the fly
• Create new relationship groups for your company financial statements, each disclosure, and parentheticals – this will provide a taxonomy that is easier to work with and validate
• Use existing elements from the XBRL US GAAP Taxonomies if it represents the appropriate financial concept regardless of its location
• Create company “standard labels” for all elements – use terse labels where needed for repeating captions. Labels should correspond to the filer’s “print” report
• Validate early and often – errors accumulate and are hard to fix
Best Practices - Instance document creation
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• Mapping DocumentThorough documentation and review of element selection and creation with intended associations
• Tagging Report or a Reviewer’s Guide Review ‘tagging report’ to assure proper financial statement fact to element association with correct attributes.
• RenderingUse SEC Submission Previewer: https://datapreview.sec.gov/previewer/
• Test Submission with SECThe final arbiter for validation
Best Practice - Key Quality Assurance Steps
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• Most common errors identified in submitted filings: • Negative value when should be positive• Value required to be reported when another
value is reported• Value reported when it should be zero• Value should be zero if another value is not
reported
* Stats provided by XBRL.US
Avoiding Common Errors
• 64% errors were incorrect negatives
• Example: Plastic materials and chemical company reported “DividendsCommonStockCash” as negative• Example: Insurance company reported
“InterestPaid” as negative and “PaymentsForOriginationOfMortgageLoansHeldForSale” as negative
Avoiding Common Errors
* Stats & Examples provided by XBRL.US
• Pitfalls to avoid in element selection and extension creation:
• New element created, but a standard element appears appropriate OR• Standard element used, but a new element should
have been created• New elements created by filers should not include
period-specific information in their name. • New monetary elements created for amounts
appearing on the balance sheet or income statement must have a “debit” or “credit” balance attribute. • All extensions must have a definition
Avoiding Common Errors
• Invalid ASCII characters – ‘smart quotes’ and other traps• Incorrect file names• Mixed decimal attributes in a group• Same standard labels on different elements• Elements in the extension but not in a presentation
group• Calculation inconsistencies
Avoiding Common Errors – Sample Validation Problems
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• 3,370+ XBRL submissions to date• Tier1:500 Tier2: 1,200 Tier3: 8,000 coming• More than 70% used a service provider• Companies submitting 2+ filings typically
used same service/provider• Average 8% of elements are extensions• Extensions range from 0 to 52%• DFN’s – not easy & complex, questions rose
significantly from dozens (PFS) to hundreds • Small group opted to use Grace Period 7%
Results to date
* Some Stats provided by XBRL.US
Results to date
Extensions as a % of concepts used
Finance, Insurance & R.E.
Trans., Comm., Electric, Gas & Sanitary Serv.
Mining
Construction
Services
Retail Trade
Manufacturing
Food and Beverages
Wholesale Trade
0% 2% 4% 6% 8% 10% 12% 14% 16% 18%
17.0%
12.9%
10.4%
10.3%
9.5%
8.5%
8.1%
7.8%
6.4%
Statistics provided by XBRL.US
• Extensions should be created to:• Aggregate elements not available in the
taxonomy – creating a new element that captures several elements added together• Develop new elements that are more specific
than what is available (i.e. MSFT Xbox revenue)• Comply with recent accounting changes/FASB
pronouncements not reflected in 2009 release• Reflect industry specific extensions not yet
covered in the taxonomy
Results to date
• Rendering XBRL data• “Filers should be aware that there is no
requirement that the rendered files appear identical to the HTML/ASCII filing . . . In addition, filers should not deviate from the guidance in the rule release and EFM (Edgar Filer Manual) (e.g., change, delete, or summarize information in the Interactive Data File) solely in an attempt to correct rendering issues.” -- U.S. Securities and Exchange Commission
Results to date
• Canada: Xbrl.ca, Xbrl.ca.blogspot.com, IFRS.org • US: Xbrl.us
• Brix – IPhone app by US labs: displays XBRL filer and # of tags. Search tags• Software and Services Comparison Matrix http://xbrl.us/Learn/Pages/ToolsAndServices.aspx• Taxonomy http://xbrl.us/taxonomies/Pages/US-GAAP2009.aspx • Case studies http://xbrl.us/Learn/Pages/CaseStudies.aspx• Newsletter signup http://xbrl.us/News/pages/newsletter.aspx
• US: SEC’s XBRL information portal: http://xbrl.sec.gov• View XBRL-formatted financial statements http://www.sec.gov/spotlight/xbrl/filings-and-
feeds.shtml• SEC’s XBRL Submission Previewer https://datapreview.sec.gov/previewer/• SEC’s Information for EDGAR Filers (EDGAR Filer Manual)
http://www.sec.gov/info/edgar/edmanuals.htm • Staff Observations from Review of Interactive Data Financial Statements
http://www.sec.gov/spotlight/xbrl/staff-review-observations.shtml
• Contact SEC: Email: [email protected] Ted Uhlinger
Resources
Takeaways
• Timing• FILERS NEED TO GET STARTED EARLY BEFORE
THEIR MANDATED LIVE FILING!!• Filings may take days not hours due to review & signoff• Filers need to build in more time for review• Educate all the stakeholders• Change Audit Committee or Filing date if needed
•Collaborative Process – no longer just formatting
• Start building teams and assigning responsibility
•Validate and Double Check
Questions
Eric Evans
VP, Business Development
EDGAR Online, Inc.
212-457-8203