The Securities and Exchange Commission has launched a pilot program aimed at simplifying investor analysis and comparisons of public company financial statement data using Extensible Business Reporting Language, or XBRL, and other types of data.

Under the new program, data that companies provide in structured formats will be combined and organized into structured data sets and posted for bulk downloads on the SEC’s website for use by investors and academics. The data sets initially will contain financial statement data from XBRL exhibits as filed with the SEC. They will be expanded in 2015 to include data in footnotes to the financial statements.

The SEC announcement in effect means that the thousands of XBRL submissions it receives as separate files each quarter will, for the first time, be available as a single database.

The SEC requires U.S. public companies to structure the data in their quarterly and annual financial reports using XBRL, which is machine-readable. The structured data files are available in the SEC’s EDGAR database as exhibits to company filings. To facilitate the use of this information, the SEC’s Division of Economic and Risk Analysis will organize it into combined data sets on the SEC’s website in formats other than XBRL. The SEC said the data posted will be as reported by filers; no changes will be made to the information.  Each data set posted will include all of the relevant filings submitted for the particular quarter or year.

The pilot program builds on efforts related to the use of structured data in corporate reports, including a staff assessment of custom tag rates in XBRL exhibits issued in July.  SEC staff also sent letters earlier this year to certain companies regarding required calculations in their XBRL exhibits.

An industry trade group that promotes the use of XBRL, the Data Transparency Coalition, applauded the SEC’s announcement Tuesday and said it would knock down virtual walls and creating a tool that will eliminate a major hurdle for investors and other users of SEC financial data. The coalition said this is good news for investors, markets and companies because easier use of structured financial data means more use of financial data.

"The SEC's release of financial statement information as a single data set, rather than thousands of separate files, will make life easier for investors and the research data companies serving them,” said Data Transparency Coalition executive director Hudson Hollister in a statement. “It's a great way to ring in the New Year. Today's announcement caps off a year of incremental progress toward fixing longstanding problems in the quality, completeness, and accessibility of U.S. corporate disclosures. In July, the SEC started enforcing the quality of financial statement data for the first time, and in September, the agency's five-year strategic plan made data a centerpiece. This action is another step forward to data transparency in financial regulation but we’re not there yet. To truly modernize, the SEC should stop requiring companies to submit two duplicative versions—document and data—of each financial statement, and should adopt consistent data formatting throughout the hundreds of document-based forms it currently collects."

Previously, the coalition noted, the SEC published each of the submissions in separate files, which would require users to assemble the information into a database.

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