XBRL to Help Track TARP Funds, Talent in Demand
XBRL, or eXtensible Business Reporting Language, could assist government auditors in monitoring spending under the more than $700 billion financial bailout plan. That’s the message Mark Bolgiano, President and CEO of XBRL US, delivered to Capitol Hill this month. According to Bolgiano, XBRL is “real, ready and relevant in the current financial crisis.”
XBRL is a language for the electronic communication of business and financial data which is transforming global business reporting with the promise of greater efficiency and improved accuracy. This technology involves computer “tags” similar to the bar codes used to identify groceries in the supermarket. According to the SEC, the tags uniquely identify individual items in a company’s financial statement so they can be easily searched, downloaded, reorganized, and put to any number of other comparative and analytical uses.
XBRL to Help Track TARP Funds
XBRL US - a local jurisdiction of the global not-for-profit consortium of approximately 500 companies and agencies working to build the XBRL language and promote its adoption – this month announced it reported to the Domestic Policy Subcommittee hearing of the Oversight and Government Reform Committee to assess the Treasury Department’s efforts at preventing waste and misuse of funds by financial institutions under the Troubled Asset Relief Program (TARP).
Testifying at the hearing, Mark Bolgiano, President and CEO of XBRL US, described how the interactive data tags would eventually be able to help regulators track the disbursement and use of TARP funds and enable more effective regulation by the government.
“XBRL is real. It is in use today for over 8,000 banking institutions that report to the FDIC and starting this summer, approximately 500 public companies will start reporting in XBRL to the SEC, with the balance complying over the next two years,” said Bolgiano.
“XBRL is ready. The market is equipped for even broader applications. And it’s relevant to the issues in today’s financial crisis and can be part of the solution to establishing better reporting systems and getting the markets back on track,” added Bolgiano. He went on to inform Congress about an XBRL standard for residential mortgage-backed securities (RMBS), which can describe various aspects of securitized assets, including their valuation on issuance, surveillance and bond remittance.
XBRL Looming
The SEC delivered its mandate that corporations start filing financial statements using XBRL technology in February 2009. The 500 largest public companies must start XBRL compliance on June 13th, followed by other large filers in 2010, and all remaining companies in 2011. The new rule requires public companies to begin filing their financial statements using the interactive data format, allowing investors to download them more easily into spreadsheets and other software. According to the SEC, the technology is “intended not only to make financial information easier for investors to analyze (across companies and industries), but also to assist in automating regulatory filings and business information processing.”
Now, as SEC rules bring XBRL usage by public companies closer to reality, Controllers and Chief Financial Officers must act early on how to handle XBRL tagging, according to SmartBrief. It’s true. New concepts like XBRL and enhanced business reporting are making real changes in the way business is being done.
XBRL implementation is a critical issue facing financial, legal, risk, audit and compliance officers at publicly held companies. For example, internal auditors can help implement XBRL and provide objective assurance on the implementation process, but they need to first understand the new interactive reporting format, the mandate requirements, and pros and cons of various implementation approaches.
Looking ahead, corporations must add the infrastructure to meet the filing requirements of the SEC. As a result, executive search firm, A.E. Feldman, reports that accounting jobs are opening up for Audit Managers and senior-level professionals with expertise in XBRL and the preparation and maintenance of financial, accounting and statistical reports.
Are you an accountant, CFO, Chief Audit Executive or XBRL specialist? If you want to grow your career or discuss your firm’s talent needs, contact A.E. Feldman’s President, Mitch Feldman today.
