Both the language and the concept of XBRL were in development prior to the recent global recession; but it has become increasingly evident that their relevancy has peaked. XBRL, an acronym for Extensible Business Reporting Language, refers to a newly refined programming language employed by the business world. Its focus will be in the financial industry, where governing agencies such as the SEC hope it can standardize financial statements in an effort to increase transparency and aid investors.
To do so there are a few basic initiatives that must first pass; primarily global acceptance and better enforcement of XBRL as the standard for reporting financial information. In the event this happens, which the SEC aims to mandate around 2010, then all publicly traded American companies will be required to present their financial statements in this format to not only the SEC but any potential investors. In doing so they’ll to host this information on their website in a standardized format that will promote ease of use and accessibility. The data will be mildly interactive favoring consistency and presentation, though the back end language is dynamic and adaptable (much like Windward Reports!).
So what does this mean to you and I? Well for one, we can hope XBRL will improve transparency and accountability in financial institutions and regulating agencies as recent trends such as derivatives and short selling have severely dampened my trust in them. Both of these methods have crippled and jeopardized our economy by profiting from others failures, buck passing on accountability and risk, and a number of other harmful practices that if highlighted would only detract our attention from this blog’s focus, XBRL!
Sorry for the diversion……XBRL and global acceptance will ensure the financial industry opens up to investors and casual observers. This reform is great and the companies that conform will benefit too as they’ll have a more efficient nature. This coupled with increased customer confidence is a sure fire way to help pull us out of the global recession.
Ok, sales pitch time! Windward Reports is an outstanding reporting software that can help companies prepare for this change by extracting XML data and presenting it in XBRL. Companies looking to gain an edge on their competition, or just prepare for the likely reform, can employ one of the easiest to use programs for a fraction of the cost of their competition. Check their website out; www.WindwardReports.com and consult their marketing department for more information (firstname.lastname@example.org) .
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