XBRL can be applied to a very wide range of business and financial data. Among other things, it can handle:
- company internal and external financial and business reporting;
- business reporting and exchange of information within all types of regulators, including tax and financial authorities, central banks, and governments;
- filing of loan reports and applications;
- credit risk assessments;
- authoritative accounting literature, providing a standard way of describing accounting documents provided by authoritative bodies.
What are the Benefits of using XBRL?
- By using XBRL, companies and other producers of financial data and business reports can automate the processes of data collection. For example, data from different company divisions with different accounting systems can be assembled quickly, cheaply, and efficiently if the sources of information have been upgraded to using XBRL.
- For AICPA members who serve in financial management, auditing, and information technology roles, XBRL will streamline the preparation of business and financial reports for internal and external decision making. XBRL will significantly improve the ability of CPAs in financial management to more precisely direct and publish financial information to investors, regulators, analysts, lenders, and other key stakeholders.
- XBRL is not just for reporting to the SEC. The possible future uses for XBRL include reporting to lenders, IRS and other regulating bodies.
- XBRL facilitates convergence of accounting standards by the ability to align financial concepts among public taxonomies.
- XBRL facilitates principle-based accounting because it reduces the need to worry about where the item is reported, but only that it is.
- XBRL drives transparency and improves the efficiency of capital markets by helping analysts and other users of financial and business information find relevant facts.
- XBRL improves the efficiency of the capital markets by reducing the cost associated with covering a company and making the market more accessible to small and mid-cap companies.
- XBRL better enables the CPA profession to proactively fulfill its primary mission to protect the public interest by improving investor access to the capital markets and increasing analyst coverage of both small and large companies through a reduction in the cost associated with covering a company.