XBRL Tips: Time Management and Comparison Documents

Process Improvement on Metal Gears.By Jen Stretch. Applying XBRL tags to your company’s financials is a time-consuming and complex exercise.  But there are a few ways to ease the pain. In this blog, Jen Stretch, manager of compliance services at Certent, provides insight into effective time management and the importance of incorporating compares into your XBRL process.

Time Management: Many preparers underestimate the time commitment and procedures involved to produce an XBRL filing package that is in compliance with the EDGAR Filer Manual and the various industry best practices.  Depending on the size and complexity of the filer’s financial statements and footnotes, the time commitment for a Form 10-Q or 10-K can average anywhere from 20 to 60 hours.  For this reason, it is important to plan out the process appropriately.  There are several steps that can be completed early in the process to mitigate risk including:

  • calendar roll forward
  • taxonomy updates
  • performing quality control procedures

Completing these steps early in the filing process will give you more flexibility during crunch time to address those last minute changes and file with the SEC confidently.

Utilize Compares:  Compares should be an important part of any XBRL filing.  Utilizing comparison documents creates efficiency and reduces risk.  There are a number of different compares that should be reviewed throughout the filing process.  Each of these compares should be reviewed at every process milestone as they can become more difficult to review as the number of changes increases.

  • Source Compare – This is a compare (usually Microsoft® Word®) of the source document (e.g., 10-Q, 10-K, 40-F, etc.). This compare will identify the changes needed in your XBRL such as additions, deletions, label changes, etc.
  • XBRL Rendering Compare – This document is a comparison report of two versions of the XBRL rendering. It is helpful to review this compare side-by-side with the source compare.  This allows the reviewer to easily identify whether the appropriate changes have been made in the XBRL to match the changes in the source document.
  • Taxonomy Compare – This is a compare of two versions of your company taxonomy. It indicates the changes that have been made to the taxonomy such as additions, deletions, label changes, balance type changes, etc.
  • Instance Document Compare – This report is comparison of two versions the instance document. An instance document compare would identify changes such as values, dates, additions, and deletions.

Early planning for peak is critical to successful time management when it comes down to filing time. The little steps you can take when you’re heads up can be instrumental in helping you manage any last minute changes in the eleventh hour. And developing a strategy for reviewing compares throughout your filing process will help to ensure you’re catching any discrepancies early. And be sure to download our XBRL Quality Checklist to help you stay on task!

Jen Stretch