Tap into XBRL's Power the Easy Way: The Microsoft Office Tool for XBRL Benefits All Financial Reporting Participants
Journal article by Jeffrey W. Naumann; Journal of Accountancy, Vol. 197, 2004
Journal Article Excerpt
Tap into XBRL's Power the Easy Way: The Microsoft Office Tool for XBRL Benefits All Financial Reporting Participants. by Jeffrey W. Naumann XBRL--a specialized form of XML (extensible markup language)--is becoming more familiar to creators and users of electronic financial statements, but few people have actual hands-on experience with it. So, to bring XBRL to a wider business audience, Microsoft Corp. has released the Microsoft Office Tool for XBRL--a free, but important, enhancement--for the 2003 versions of Excel and Word. Along with the AICPA and more than 200 other organizations, Microsoft is a member of XBRL International Inc. (www.xbrl.org), a nonprofit group that promotes use of the extensible business reporting language to improve financial reporting. This article explains how to obtain, install and use the tool to create an XBRL-compliant Microsoft Office file. It also explains what XBRL is and why it's important to CPAs, their clients and employers (see "XBRL: A Business Reporting Standard," at right, and "Why XBRL Matters," page 33). Users can download the enhancement from the Microsoft Web site (www.microsoft.com/office/solutions/xbrl) at no charge and easily install it. Immediately afterward, they can create or use worksheets and documents that employ XBRL to speed data input, ensure accuracy, eliminate ambiguity by specifying the precise nature of each data element and thus simplify the exchange of financial information. The tool benefits not just CPAs but all participants in the financial reporting process, including reporting entities, regulators, financial institutions, rating agencies and individual and institutional investors, and improves data sharing among the various systems--financial, tax and other--they use. An example of the growing support for XBRL was the 10-year, $39 million contract the Federal Deposit Insurance Corp. awarded in 2003 to Unisys Corp., which, with the assistance of PricewaterhouseCoopers, Microsoft Corp., EDGAR Online Inc. and other technology companies, will use XBRL and other tools to modernize and streamline federal bank regulators' collection, processing and distribution of banks' quarterly financial reports. BE A CREATOR, A USER OR BOTH The Microsoft Office Tool for XBRL enables users to both create and use documents formatted in XBRL. Many participants in the financial reporting process likely will employ one of these functions more often than tire other. For example, producers of quarterly earnings reports will benefit from the tool's creation functions, such as those used to characterize earnings data by "tagging" them with a contextual format--known as a taxonomy--that corresponds to a series of principles or definitions, such as U.S. GAAP. On the other hand, analysts of existing financial information will find it advantageous to use the tool to, for example, compare several of a company's earnings statements. Of course, both capabilities are available to everyone using the tool. Exhibit 1, below left, depicts the current way--without XBRL--electronic financial information flows from an organization's finance department to regulators, analysts, investors and other interested parties. Companies first submit plain-text financial reports to the SEC. They then convert those documents' data into hypertext markup language (HTML) format and post them on the Web for public viewing. Finally, companies reconvert those data into various formats that enable investors and financial analysts to scrutinize key performance indicators and other criteria. This fragmented process is both labor-intensive and error-prone. [ILLUSTRATION OMITTED] But exhibit 2, page 33, shows how--with the aid of the XBRL tool--companies can transmit their financial data accurately and directly from their enterprise resource planning software and other systems into XBRL-enabled worksheets that are more quickly available for review by third parties. [ILLUSTRATION OMITTED] In fact, with the tool automated processes pull these data from various designated systems directly into Excel-based and Word-based document summaries, such as financial statements that users can organize for analysis. These same documents also can be readily exchanged between disparate data repositories, such as finance and tax systems. It is easy to see the tool's advantages over the current, largely manual process of manipulating various data formats. ALL IT TAKES IS A FEW SIMPLE STEPS After downloading the tool and installing it on their PCs, CPAs can begin the process of "marking up," or converting, a document to an XBRL format that meets the requirements of the specific information with which they want to work. Gain access to required resources. To create an XBRL "instance document"--that is, an XML file containing financial data marked up with XBRL, or an XBRL-compliant Excel worksheet or Word document--a user of the tool must have access to the following resources: * A Word or Excel file containing data that are intended for the XBRL document.* ... |
End of free preview...
To continue reading this publication, you must have a Questia Subscription.
Try Us Today! Click Here
Questia provides the world's largest online library of scholarly books and journal articles, with integrated footnote and bibliography tools, highlighting, note taking and book marking. With a Questia subscription, you'll have access to the full text of more than 67,000 books and 1.5 million articles.
Already a subscriber? Login:
Sponsored Links
Free Newsletter
Get helpful how-to's, writing tips, search strategies, quizzes & more!
Search the Library
