On 28 June 2018, the US Securities & Exchange Commission voted to adopt amendments to its rules and forms to require the use of the Inline eXtensible Business Reporting Language (XBRL) format for the submission of financial statement information of operating companies and mutual funds. CFA Institute has advocated for this requirement to increase the use of XBRL and improve the quality of the data.
When Inline XBRL is used, all XBRL data are contained in ordinary, human-readable files. What this means is that the documents that analysts, investors, and our members read are also the ones that includes the data in a structured format.
The current dual filing of both PDF reports and XBRL filing is not helpful to investors, as errors and inconsistencies may exist between the two documents, leading to confusion over which is the official version. We have advocated that the solution to this issue is the implementation of Inline XBRL as it provides a means of viewing the XBRL filing itself in a human-readable, understandable, and familiar format. A human-readable version of an XBRL report is useful to both filers and users in ensuring filings are accurate, consistent, and complete. Furthermore, because a single Inline XBRL report can be viewed on screen and analyzed by software, no viewer is required to convert an XBRL filing into a human-readable form; this will lead to cost savings.
The SEC’s vote is a great illustration of our advocacy work in action. Beginning over a decade ago, former CFA Institute CEO Jeff Diermeier pushed for our support of XBRL, and CFA Institute became deeply engaged in the topic. We are now seeing the benefits of our efforts to ensure that XBRL fulfills its potential and meets the needs of our members and of investors.
Image Credit: © Stewart Sutton