The Securities and Exchange Commission has adopted rules requiring SEC reporting companies to provide financial statement information in XBRL (eXtensible Business Reporting Language). Over the past two years, the largest SEC reporting companies have begun submitting financial information in XBRL. All other public companies using U.S. GAAP, with only a few exceptions, are required to submit information in XBRL for periods ending on or after June 15, 2011. The SEC has recently offered suggestions relating to complying with the XBRL requirements for companies that will begin submitting information in XBRL for periods ending on or after June 15, 2011.

The XBRL rule requirements regarding what companies must comply with XBRL and what information must be submitted in XBRL are being phased in over time. For the first year that a company submits information in XBRL, each amount in the primary financial statements must be tagged in XBRL, and each note to the financial statements and certain financial schedules must be individually tagged as a block of text. For the second year that a company submits information in XBRL, each amount in the notes and financial schedules must also be tagged in XBRL.

Because large companies have been complying with the XBRL requirements for the past two years, the SEC staff has learned much about the process and has offered the following suggestions for companies just beginning to comply with the XBRL requirements:

  • Data quality — At the core of the XBRL tagging process, selecting the best tags to represent the information in your financial statements is the most critical part of the process. Carefully selecting the best tags is likely to be the greatest contributor to the quality of your XBRL submission. Some tips on how to select the best tags can be found in the Interpretive Guidance section on http://xbrl.sec.gov/.
  • Viewing submissions — The SEC’s free previewer allows you to view your submission before filing to see what it will look like on the SEC’s website. However, this rendering of your XBRL submission will NOT exactly visually match your corresponding HTML submission, and there is no requirement for it to do so. You should NOT make changes to your tagged data solely to achieve a particular visual effect. The previewer may be one of the tools used to help verify the completeness of your XBRL submission, but relying solely on the rendered document to review your tagged data will not identify all of the details necessary to assess potential filing errors. Your software vendor or service provider may be able to provide reports that will help you review these other aspects of your submission, including validation results.  
  • Validation — Although selecting the correct tags is the most critical aspect of the process, if your XBRL submission is not technically valid it will not be accepted by the EDGAR system. Consider using the validation tools from your vendor and the SEC test filing mechanism to make sure your submission is technically valid before filing.

The SEC staff has provided many resources to assist companies in understanding the XBRL requirements. You can review the information at http://xbrl.sec.gov/, and these links may also be useful:

You may also contact the SEC with XBRL questions by sending them an email at ask-oid@sec.gov or calling them at (202) 551-5494.