XBRL in the US
Careful readers of XBRL News will be aware that there have been repeated efforts by a group in the US Congress to try to exempt smaller companies from having to file their financial statements in XBRL.
Undeterred by previous failures, what was previously known as the “Hurt Act”, is back again. At XBRL International we will admit some small bias in this field, but in our view this legislation is an effort to reduce transparency in public markets and would be harmful. Harmful to users, because they couldn’t access data in structured, digital form. Harmful to companies because although it has taken time, there is absolutely no question that users already rely on XBRL data, and if users can’t see (with their digital eyes) the smaller end of the market, then those companies won’t be analysed, and therefore will lose investors and liquidity, raising their cost of capital.
The US’s proposed shift to Inline XBRL will accelerate the reliance of users on structured digital data, underlining the importance of ensuring that XBRL filing covers the entire market.
But we can’t describe the situation, or the details, any better than Matt Kelly, former Editor in Chief of Compliance Week, in his blog item this week. Please read his piece for more, including why it is unlikely that this legislation will pass. Kelly’s piece raised a smile with this quip: “We should also note that both measures were supported even by stalwart Republican commissioner Michael Piwowar, who doesn’t like anything. If Piwowar supports a new requirement, it’s a good requirement.”
Read Matt Kelly’s item here.