The Inline XBRL requirement has the potential to benefit investors and other market participants while, over time, reducing the costs of preparing information for submission to the SEC by registrants. In 2009, the SEC adopted rules requiring operating companies to provide financial information both in periodic and current reports by submitting an XBRL interactive data file. Also in 2009, the Commission required mutual funds to submit risk/return summaries in XBRL as interactive data files and post these data files on their corporate websites as applicable. XBRL is widely used by a variety of people, including investors, economic research firms, data aggregators, and the Commission staff itself. It provides a “machine-readable” version of financial information that can be used in any number of analyses and is particularly powerful when large amounts of data are involved.

XBRL is not without its potential issues, however, including the cost of compliance to operating companies. Acting Chairman Michael Piwowar stated, “While XBRL technology has made disclosures easier to access for investors, there are legitimate concerns about the burdens smaller companies face when preparing their filings.” The proposed changes aim to streamline the process of using XBRL both by ensuring data integrity and utility for the public and by reducing compliance costs for filers.

Currently XBRL data must be submitted as attached exhibits. Inline XBRL provides a way to directly integrate XBRL data with traditional filings by allowing filers to embed XBRL data directly into their filings. The use of Inline XBRL gives the preparer better control over the presentation of XBRL disclosures within the HTML filing. Also, the open source XBRL Viewer provided by the SEC on SEC.gov can be used to review XBRL data more efficiently. In terms of mutual funds, the proposed amendments would facilitate more efficient filings by allowing the concurrent submission of XBRL data files with certain post-effective amendment filings. By eliminating the current 15 business day filing period accorded to all filings containing risk/return summaries, the new amendments will also improve the timeliness of the availability of those summaries.

These changes would be phased in over a three-year period for operating companies. For mutual funds, they will be implemented over a two year period. Filers will be permitted submit EDGAR filings using Inline XBRL prior to the compliance date for each category of filers.

The SEC is seeking public comment for the next sixty days regarding the proposed rules.

GoFiler Complete already supports the creation and filing of Inline XBRL (iXBRL). Clients of Novaworks have also successfully filed iXBRL using GoFiler. If you would like more information on the XBRL and iXBRL tools available within GoFiler, please contact sales@novaworkssoftware.com. You can also download a free fact sheet about iXBRL from our blog.

Additional programs and webinars will be available from Novaworks to help you learn more about Inline XBRL and to prepare you for this proposed change, so check back soon!

Sources:

SEC Proposes Inline XBRL Filing of Tagged Data (www.sec.gov)

Interactive Data to Improve Financial Reporting (www.sec.gov)

Interactive Data for Mutual Fund Risk/Return Summary (www.sec.gov)