Compliance Week, an online newsletter focusing on corporate governance, risk, and compliance, published the results of its research last week, finding that 55% of the 236 compliance and financial reporting executives surveyed have done little or no research on XBRL. (Haymarket Media, owner of PRWeek, acquired Compliance Week on July 1.)
There has been talk of XBRL implementation for years, but only in past months has the conversation included a start date. Newswires and XBRL US, the US arm of the global consortium that helped create the system, have been working to get information about XBRL to their audiences, but recognize a new urgency to getting filers ready.
“Yes, companies have been hesitant and, surprisingly, it's not just the small and midsized companies, but some of the larger Fortune 500 companies as well,” said Ira Krawitz, SVP of IR services at PR Newswire (PRN), which owns Vintage Filings, an EDGAR filing agent. “The main role for PRN and Vintage is educating customers [and] allaying concerns.”
The newswire has been conducting educational webinars for almost two years, but is now adding services. The company will work with a client using data that has already been filed in order to get them acquainted with the system. It will also add monthly webinars and regional meetings starting next month. Still, Krawitz advises filers to take it slow.
“A good first step might be to outsource [XBRL filing] to get comfortable with it, and then analyze the risk and reward of bringing it in-house,” he said.
Because fewer of Marketwire's clients are among the first wave of large company filers, the company and its customers feel a little less pressure to meet the initial deadlines. Nevertheless, the company has an existing relationship with Rivet, a “drag and tag” solution that will aid in XBRL filing. And for those large companies that are feeling the stress, the company is confident that SEC extensions will be forthcoming.
“You'll likely see lobbying from these large companies requesting time to get their XBRL house in order,” said Thom Brodeur, SVP of global strategy and development for Marketwire. “I wouldn't be surprised if the SEC accommodated. These are not simple changes.”
Despite extensions, it's important that companies get into “education mode” as Michael Becker, VP of global disclosure and financial reporting services at Business Wire, puts it. His company has already ramped up its educational efforts, staging a large videocast with the SEC at the New York Stock Exchange in recent weeks. The wire service has in-house XBRL capabilities and a joint venture with UK-based DecisionSoft to provide XBRL consulting through their CoreFiling services.
“Once they realize that this is a very simple concept, [companies] are very at ease with the XBRL initiative,” said Becker.
All of the newswire services have worked with the XBRL consortium to devise the system. For its part, XBRL US takes a bit of umbrage with the Compliance Week findings.
“Without understanding the methodology used in the CW survey (what were the demographics of the people who answered the survey? Legal? Finance? Large cap companies, small cap? Were they all public companies?), it's tough to respond to the statistics directly,” Michelle Savage, VP of communications for XBRL US, wrote in an e-mail.
Those feelings notwithstanding, the group has had a number of educational tools in place over the past year, including monthly webcasts that have reached over 2,000 people, according to Savage. Going forward, she continued, the group will also offer “XBRL Bootcamp,” and outside organizations like the SEC and the American Institute of Certified Public Accountants are offering educational tools and programs.
“In addition, the SEC has been building awareness about interactive data for several years now and hosts a special spotlight page featuring a podcast series, an RSS feed of XBRL formatted data, Webcasts, and roundtable discussions,” Savage added.
Becker agrees that XBRL and the SEC have done much to get people ready.
“More than any other initiative in my career, resources are widely available,” he said. “There's a tremendous amount of institutional knowledge out there.”