NYSSA Webinar Now Online: A Must Watch!
A couple of weeks back the New York Society of Security Analysts’ (NYSSA) Financial Reporting and Analysis Group hosted a workshop on using XBRL to expedite and ease financial reporting and analysis.
That workshop is now online and we highly recommend it to:
- investors and analysts
- regulators
- standards setters; and
- XBRL professionals and vendors
Presentations from practitioners, data providers, standards setters and both securities and banking regulators outline the extremely significant benefits available today, as well as some of the issues that structured data can throw up and that still need to be solved.
The workshop, although US centric, provides important pointers on the way that XBRL data is getting used today by market participants as well as regulators. It highlights some of the different approaches, and it highlights some of the work that needs to be done to manage data quality and to constrain entity specific disclosures.
As one speaker says, in response to the question “Why isn’t XBRL data used by investors?”, the answer today is that it is being used by all kinds of investor groups, including the so-called “smart money”.
Highlights include:
Todd Castagno from Morgan Stanley highlighted the hugely competitive environment that today’s investment firms face and the increasing focus on data that investors now have in looking for an edge. Using Calcbench’s XBRL data set, Morgan Stanley is able to obtain extremely detailed data that throws up entirely new insights on a daily basis. Todd’s slides provide examples including accurate, industry-wide foreign unremitted (and untaxed) earnings figures, and accounting for excess tax benefits. He also shows what happens where commonly disclosed items are not contained in a taxonomy.
Pranav Ghai, CEO of specialist XBRL-based data provider Calcbench described the wealth and depth of insight that is available today from the US SEC filings, but equally pointed out the limitations that data discrepancies and appropriate as well as inappropriate entity specific disclosures create.
Hal Shroeder, FASB Board Member, described the significant change in approach that the FASB now takes in developing accounting standards since the advent of XBRL data from US SEC filings. Instead of providing a conceptual approach to a standards question, the Board now receives highly detailed analysis about the actual disclosure practices of companies in that country, providing a far more empirical approach to accounting standards questions. As more and more regulators have structured XBRL data available to them (including, before long, an extremely large number of IFRS filings) it will not be long before many other standards setters and policy makers can benefit from this empirical approach.
Mike Willis from the SEC’s Division of Economic and Research Analysis described the way that the US securities regulator uses XBRL. Two examples include firstly the Commission’s ability to examine text within XBRL disclosures for automated sentiment analysis, as well as thematic analysis of specific disclosures. Secondly (and very relevantly for US issuers) the Corporate Issuer Risk Assessment Dashboard provides company specific analysis for the SEC’s enforcement division to review developments in individual companies based on industry-specific models.
You can watch the workshop here.
At XBRL International we are very thankful to the NYSSA for hosting the workshop and to the CFA Institute’s Mohini Singh for moderating it and we hope that an international audience will find it helpful. In our view the workshop highlighted many of the positives associated with XBRL adoption while also demonstrating that there remain a number of areas that can be improved.
We recommend that investors, filers, standards setters and regulators all consider what needs to happen in their own environment to ensure that they maximise the benefit that can be achieve through this important area of data automation.
