The Financial Executives International’s (FEI) 34th annual Current Financial Reporting Issues (CFRI) conference took place last week at the Marriott Times Square in the heart of New York City. The CFRI conference provides preparers with the opportunity to build professional networks and hear from representatives across the SEC, FASB and PCAOB as they explore accounting and financial reporting hot topics. This year sessions included: Are You Ready for the Revenue Recognition Revolution?, SEC Comment Letters: Recent Trends and Best Practices, and Data Breach: What to Expect and How to Prepare.
Among this year’s speakers was Michael S. Piwowar, Ph.D., Commissioner U.S. Securities and Exchange Commission (SEC). Piwowar was appointed by President Barack Obama to the SEC and was sworn in on August 15, 2013. He was the lead Republican economist on the four SEC-related titles of the Dodd-Frank Act and the JOBS Act. Dr. Piwowar also worked on a number of important SEC-related oversight issues under the jurisdiction of the Committee, such as securities, over-the-counter derivatives, investor protection, market structure, and capital formation.
During his mid-day keynote on Monday, Piwowar focused on three main agenda items including remarks on interactive data requirements. Piwowar recognized that while he “strongly support[s] the Commission’s efforts to improve investors’ access to material information through the use of interactive data filings, [he] recognizes[s] that the move to XBRL reporting was not costless for public reporting companies.”¹
At this point in time all filers have been submitting their disclosures using interactive data for at least four years. Piwowar also pointed out that the SEC should look to retrospectively assess the XBRL requirements and examine how effectively and efficiently the required processes are meeting original intended objectives.
Piwowar also addressed and shared concerns about the quality and accuracy of XBRL filings. “One suggestion to address problems with the accuracy of interactive data filings is to move away from the current model of filing the interactive data as a separate exhibit and move to in-line XBRL,” ¹ he said.
According to XBRL.org, inline XBRL, or iXBRL, provides a mechanism for embedding XBRL tags in HTML documents. By embedding the tags into a single electronic document, there is great potential for improved accuracy. Piwowar suggested that the Commission “move promptly to modify EDGAR to permit in-line XBRL and commence a voluntary pilot program to obtain more information about the costs and benefits of an in-line XBRL system.”¹