FHFA urged to explore XBRL for improved data collection efficiency
The US Federal Housing Finance Agency (FHFA) has been encouraged to embrace the use of XBRL and the LEI (Legal Entity Identifier) to facilitate the transition mandated by the FDTA (Financial Data Transparency Act) legislation. The FDTA mandated the use of machine-readable, open data standards for member agencies of the U.S. Financial Stability Oversight Council, including the FHFA. XBRL US outlined the arguments for the FHFA to select XBRL for this purpose in a recent response to a FHFA request for comment.
Currently, FHFA collects data in various formats such as CSV and text files, requiring users to review technical documentation and develop custom data extraction applications specific to each dataset. The lack of standardisation presents a significant burden particularly when data collection requirements change, meaning that each extraction application needs to be modified.
XBRL offers a solution to these challenges. By using XBRL taxonomies to record definitions in a highly structured manner, the use of off-the-shelf tools for data extraction and subsequent analysis becomes possible. If FHFA were to adopt XBRL the data model would be defined in an XBRL taxonomy rather than a PDF document allowing for automated analysis and seamless adaptation to changes.
Standardised data – and XBRL – is used by regulators worldwide. In the United States, the SEC, the FDIC and FERC already mandate XBRL across significant chunks of their reporting requirements. Data users have been benefiting from this structured, machine-readable XBRL data, which enables faster, more accurate and improved analysis. If FHFA were to follow suite, further benefits could be felt from extended, enhanced access to data.
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