Interactive data-tagging technology could assist government auditors in monitoring the spending done under the $700-billion-plus financial bailout plan.
Testifying at a hearing before the House Domestic Policy Subcommittee of the Oversight and Government Reform Committee on assessing the Treasury Department’s efforts at preventing waste and abuse of funds in the Troubled Asset Relief Program, Mark Bolgiano, president and CEO of XBRL US, described how the interactive data tags would eventually be able to help regulators track the disbursement and use of TARP funds and enable more effective regulation by the government.
The Securities and Exchange Commission has recently required that the largest public companies begin using the interactive data-tagging technology, known as Extensible Business Reporting Language, or XBRL, when filing their financial statements in June 2009 (see SEC Begins XBRL Mandate for First 500 Companies).
“XBRL is real,” said Bolgiano (pictured). “It is in use today by over 8,000 banking institutions that report to the FDIC and, starting this summer, approximately 500 public companies will start reporting in XBRL to the SEC, with the balance complying over the next two years. XBRL is ready. The market is equipped for even broader applications, and it’s relevant to the issues in today’s financial crisis, and can be part of the solution to establishing better reporting systems and getting the markets back on track.”
Bolgiano’s organization has been working on converting U.S. generally accepted accounting principles for various industries into a standard digital dictionary for more transparent reporting by publicly traded companies. He told Congress about an XBRL standard for residential mortgage-backed securities that his group helped develop. The standard can describe various aspects of securitized assets, including their valuation on issuance, surveillance and bond remittance. A working group to lead the RMBS initiative will be chaired by Edgar Online president and CEO Philip Moyer, who is a member of the XBRL US board of directors.
The controversial TARP program has been under scrutiny by a number of watchdogs, including special inspector general Neal Barofsky, who is looking into the influence of lobbyists on spending under the program, and Elizabeth Warren, who chairs the TARP Congressional Oversight Panel. Their analysis might be aided by the XBRL-tagged data.
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