XBRL US advocates for iXBRL in SEC data collection

Posted on May 12, 2024 by Editor

In a recent comment letter to the US Securities and Exchange Commission (SEC), XBRL US advocated for the adoption of the Inline XBRL format for Rule 17g-3, on annual financial and other reports by nationally recognised statistical rating organisations (NRSROs). XBRL US emphasised the importance of aligning these reports with the requirements of the Financial Data Transparency Act (FDTA). Combining human- and computer-readable layers in these reports will also ensure the consistency, comparability, and accessibility of reported data.

In the letter, XBRL US urged the SEC to require Form NRSRO and supporting exhibits to be prepared in computer-readable XBRL format.

The FDTA, which was signed into law in 2022 and is due to be implemented within the next three years, requires NRSRO annual financial statements and other reports to be prepared in a structured, standardised data format such as XBRL. In the letter, XBRL US urge the SEC to take the opportunity of this current review to implement the upcoming FDTA mandate and require XBRL for all NRSRO documents prepared under Rule 17g-3.

With NRSROs already accustomed to preparing data in the XBRL standard, the transition should be relatively smooth. The change would also facilitate the consumption of high-volume data and improve overall data quality in this area.

XBRL US also recommended other changes related to Rule 17g-7, suggesting a transition from xBRL-XML to xBRL-CSV for credit rating actions. This move would enhance data preparation efficiency and extraction ease. Additionally, they propose for credit rating data to be submitted through the SEC EDGAR system, ensuring data integrity and accessibility.

Read the letter here.

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