SEC Begins XBRL Mandate for First 500 Companies

The Securities and Exchange Commission has begun requiring 500 of the largest companies to start filing their financial statements in an interactive data format.

The SEC wants 500 companies with a worldwide public float of more than $5 billion to begin filing their financials in Extensible Business Reporting Language, or XBRL, format by April 13. XBRL technology allows investors and analysts to compare financial statements more easily across companies and industries, as well as load the data into spreadsheets and other software. It will be the basis of the Interactive Data Electronic Applications, or IDEA, system that the SEC is readying to replace its old Edgar system.

The SEC recently posted the final version of its rule requiring XBRL on its Web site (see SEC Finalizes XBRL Requirements). It requires domestic and foreign large accelerated filers that use U.S. generally accepted accounting principles and have a worldwide public common equity float above $5 billion as of the end of the second fiscal quarter of their most recently completed fiscal year, to provide financial statements in XBRL format for fiscal periods ending on or after June 15, 2009.

On Tuesday, the SEC published the final rules in the Federal Register. The first required submissions will be for quarterly reports containing financial statements for a fiscal period ending on or after June 15, 2009. For calendar-year companies, this requirement will first apply to their June 30, 2009, quarterly reports filed on Form 10–Q.

Filers under the new rules will be required to submit their financial statements in an interactive data file using the list of tags for U.S. GAAP or International Financial Reporting Standards as issued by the International Accounting Standards Board, in either case as approved for use by the SEC. The submission also will be required to include any supporting files as prescribed by the Edgar Filer Manual. Interactive data will be required for the entirety of their financial statements, although tagging of the footnotes and schedules at a deeper level of detail will be phased in the following year.