Imagine spending two years learning a new language. You begin to master the nuances of this language and become proficient enough to use it to communicate. You can eventually use it with confidence to express your thoughts and ideas with some precision. Then you wake up one day and learn the world around you is speaking a new language.
Such is the fate of those of us who labored to learn the 2009 US GAAP Financial Reporting Taxonomy. In total, more than 4800 XBRL financial reports have been submitted to the SEC using this set of rules and definitions. In 2011, the game twists with the introduction of a new taxonomy that includes more than 4000 changes of all shapes and sizes:
- Deprecation due to “essence-alias”
- Changes from “domainItemType” to “stringItemType” and from “stringItemType” to “textBlockItemType”
- “Dimensionalizing the effect of new accounting pronouncements”
These terms come directly from the FAF 2011 taxonomy draft release notes, though they read more like a foreign language or computer code. They can be confusing and intimidating, no matter how thorough the FAF documents the changes. The guidance and documentation are not easily consumable either. You can review the proposed changes HERE, where you will find six Excel files with at least four worksheets, each overflowing with a horde of element names. Overall there are 2200 definition changes, 1600 standard label changes, 500 deprecated elements, and 1900 new elements.
Analyzing and preparing for these taxonomy changes is not for the faint of heart. In fact, it’s probably not a great use of your time unless you happen to be employed by an XBRL vendor. At Rivet Software, there is an entire team of XBRL Compliance Managers (including myself) who have been analyzing and preparing for the 2011 taxonomy for months. Our goal? To make the transition as seamless and pain-free as possible for our clients.
Our technology team has also been pivotal in preparing our software for the transition. We will be able to direct our clients to the specific changes that affect their company’s taxonomy, and present choices in a very intuitive and user-friendly way. This is very much in line with our tech mantra of “making complex processes seem simple.”
Next week I will be presenting a webinar available to the public: “2011 US GAAP Taxonomy Appetizer” where I will go into further detail about how companies can prepare to transition their taxonomies for the upcoming changes. This event is free, and you can register for it HERE.
FAF 2011 taxonomy draft release notes – View »
Rivet Software – Go to website »
Webinar: 2011 US GAAP Taxonomy Appetizer – Register »
Follow Up Blog – Read »
Tags: FAF, GAAP, Taxonomy, XBRL
