Enter to open, tab to navigate, enter to select
SEC Proposes Inline XBRL Filing of Tagged Data
Practical Law Legal Update w-006-7334 (Approx. 4 pages)
SEC Proposes Inline XBRL Filing of Tagged Data
by Practical Law Corporate & Securities
| Published on 02 Mar 2017 • USA (National/Federal) |
The SEC issued proposed rules that would require operating companies to provide their financial statement information in Inline eXtensible Business Reporting Language (XBRL) format.
On March 1, 2017, the SEC issued proposed rules that would require operating companies to provide their financial statement information in Inline eXtensible Business Reporting Language (XBRL) format. XBRL is a computer language that provides information in an interactive data format. Companies use XBRL to tag, or code, each piece of data in their financial statements. With Inline XBRL, companies would be required to embed their XBRL data (also called the Interactive Data File) directly into their HTML filings instead of providing this data as an exhibit to those reports, as is currently required. Since June 2016, companies have had the option of voluntarily filing their financial statement information for their periodic and current reports in Inline XBRL format (see Legal Update, SEC to Allow Companies to Use Inline XBRL in Their Periodic and Current Reports).
The purpose of the proposal is to:
- Improve the data's quality, thereby benefiting investors, other market participants, and other data users.
- Decrease, over time, the cost of preparing the data for submission to the SEC.
The proposal would apply to all operating company filers that are currently required to submit financial statement information in XBRL, including:
Under the proposal, filers would be required to embed a part of their Interactive Data File within an HTML document using Inline XBRL and to include the rest in an exhibit to that document. The portion filed as an exhibit would contain contextual information about the XBRL tags embedded in the filing.
The timing for the submission of the Interactive Data File for operating company financial statement information would not change under the proposal. Operating company filers would continue to be generally required to submit the Interactive Data File with their filing.
The proposal notes that Inline XBRL is only compatible with HTML format and not the ASCII format, which a small number of companies still use. Therefore, filers that currently prepare their filings in the ASCII format would need to switch to HTML format. The proposal would also eliminate the existing requirement for companies to post their Interactive Data Files on their websites.
Under the proposal, the Inline XBRL requirements for operating companies would be phased in as follows:
- Large accelerated filers that prepare their financial statements in accordance with US GAAP would be required to comply with the requirements in the second year after the rule is effective.
- Accelerated filers that prepare their financial statements in accordance with US GAAP would be required to comply with the requirements in the third year after the rule is effective.
- All other operating company filers that are required to submit Interactive Data Files would be required to comply with the requirements in the fourth year after the rule is effective.
In addition to operating companies, the proposal covers in-depth Inline XBRL requirements for mutual funds.
The SEC is accepting comments on the proposal until May 16, 2017.
To learn more about XBRL requirements, see Practice Note, XBRL Reporting Requirements and XBRL Obligations and Deadlines: Chart.