Dragon Tag

Dragon Tag is an add-on to Word and Excel. Since most companies will already have their notes to the financial statements in Word, this is a very simple process. Simply find the correct element using our powerful taxonomy search engine (see Tag it Your Way! for more on “search”) and drag it to the selected note in the document. It’s as easy as 1, 2, 3 as shown in the following screen shots.

CrossTag

CrossTag is independent of Word and Excel but works nicely with both. For this example, we’ll assume the notes are in a Word document. The steps involve creating a template which can be re-used each quarter, so this part of the process only needs to be done once. After that, it’s just a matter of changing the date on the template and copying and pasting the text from Word into the source document. The steps are illustrated in the following screen shots.

Preview

In either Dragon Tag or CrossTag, the end result is the same: you’ll have nicely formatted notes. You can easily see the end result using the preview feature in either Dragon Tag or CrossTag. Preview lets you see what your filing looks like on the SEC site without actually having to upload your filing to the site. Rivet built the rendering engine used by the SEC so what you see in preview using our products is the same as what you would see on the SEC preview site. However, if you want to double check, the SEC allows you to preview your filing through the XBRL Previewer located at https://ideapreview.sec.gov/previewer/. Here’s a screen shot of what my instance document looks like there.

As a side note, if you don’t use Rivet products to create XBRL filings, you may be interested in Dragon View which is a tool you can use to preview your filing, compare your filing with others from the same industry or across all industries, and view detailed information about your filing and taxonomy (see http://www.rivetsoftware.com/Products/Dragon_View/Default.aspx). We work hard at Rivet, creating products that take the complexity out of XBRL so you can create professional filings yourself. But remember, if you do get stuck, we’re available to walk you through the process.

There are a lot of questions going around right now about when companies should be using the 2009 US GAAP Taxonomy for their XBRL filings. Per the Edgar Filer Manual located on the SEC website (http://www.sec.gov/info/edgar/edmanuals.htm), Edgar is anticipating being able to handle the 2009 Taxonomy in the third quarter of their fiscal 2009 year which is 6/30/09:

To assist with your planning it might be helpful to call the SEC personally to receive further guidance on when you should be looking at tagging your financials utilizing the 2009 Taxonomy.

2009 US GAAP Taxonomy Changes

GAAP Changes

The 2009 Taxonomy has been updated for the following:

• FAS No. 141 (R) – Business Combinations
• FAS No. 160 – Non-controlling Interests in Consolidated Financial Statements an amendment of ARB No. 51
• FAS No. 161 – Disclosures about Derivative Instruments and Hedging Activities an amendment of FASB Statement No. 133
• FAS No. 163 – Accounting for Financial Guarantee Insurance Contracts, an interpretation
  of FASB Statement No. 60

Other Amendments

• EITF 06-11 – Accounting for Income Tax Benefits of Dividends on Share-Based Payment Awards
• EITF 08-3 – Accounting by Lessees for Maintenance Deposits
• FSP APB 14-1 – Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)
• FSP EITF 03-6-1 – Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities
• FSP FAS 132(R)-1 – Employers’ Disclosures about Postretirement Benefit Plan Assets
• FSP FAS 133-1 & FIN 45-4 – Disclosures about Credit Derivatives and Certain Guarantees: An Amendment of FASB Statement No. 133 and FASB Interpretation No. 45; and Clarification of the Effective Date of FASB Statement No. 161
• FSP FAS 140-4 and FIN 46(R)-8 – Disclosures by Public Entities (Enterprises) about Transfers of Financial Assets and Interests in Variable Interest Entities
• FSP FAS 142-3 – Determination of the Useful Life of Intangible Assets

New Elements/Definitions

There have been changes to a number of definitions in the 2009 Taxonomy so please review all definitions to make sure they are still accurate for your line items. There have been 1,590 new elements added to the 2009 Taxonomy. The elements were added to the 2009 Taxonomy to capture newly issued generally accepted accounting standards, modifications to the same, or to amplify the financial reporting and financial data tags provided in the 2008 Taxonomy.

Removed (Deprecated) Elements/Dimensions

Approximately 350 elements/dimension members were removed from the 2009 Taxonomy. There is a complete listing of all the removed items in Appendix 6 of the XBRL-US release notes. You will also notice in the 2009 US GAAP Taxonomy there is a new report “999000 – Deprecated – Deprecated Concepts” that lists all the removed items too.

Reverse Sign (Negated Label Role) has Changed

The ‘Negated Label’ role has been removed from the base 2009 Taxonomy. To have this functionality back in your new 2009 company extended taxonomy you will need to import an additional schema file. This additional schema file will allow you to have the functionality of ‘Reverse Sign’ as you did with the 2008 Taxonomy. This additional schema file is http://www.xbrl.org/lrr/role/negated-2008-03-31.xsd which you will be able to add via ‘Import’ into your extended taxonomy in Dragon Tag or CrossTag. Rivet has created helpful FAQs for both products that are available on our website to help walk you through this process (http://www.rivetsoftware.com/Customer_Support/FAQ.aspx).

Creating New Reports in Your Extension Taxonomy

You may see companies create their own financial reports when submitting their XBRL filings. Instead of the standard name from the base taxonomy, such as “Statement of Financial Position”, their first report might be named “Condensed Consolidated Balance Sheets” which matches their HTML filing. In order to have your XBRL Statement report names match your HTML filing, you will want to create your own top Level reports.

Companies will also need to create top level reports to report any parenthetical information they may have within their statements. For example, amounts that are detailed in a label like Allowance for Doubtful Accounts, Accumulated Depreciation, Common Stock Par Value, Common Stock Issued, etc. would also now be in their own Top Level Report for just parenthetical information.

When you create the new top level reports the number convention you use will dictate what order the reports will display when rendered. So if your Income Statement is before your Balance Sheet in your HTML filing, make sure your report number for your Income Statement (i.e. 102000) is before your Balance Sheet (i.e. 104000).

What to Do Next?

I know some of you might be “overwhelmed” with the seemingly complex 2009 Taxonomy. Don’t be afraid! The Rivet Professional Services team has followed the development of the US GAAP Taxonomy closely and is available to answer your questions about the new taxonomy and what it would take for you to either start using the taxonomy to prepare your filing, or make a smoother transition from the 2008 Taxonomy.

Some of the companies that Rivet has been helping have decided to have a 2008 Taxonomy template & a 2009 Taxonomy template ready so they are well prepared when they have to file their 10Q with SEC.

Due to the number of changes that were made in the 2009 Taxonomy, companies might need to start fresh with the 2009 Taxonomy to begin their tagging process. You will not be able to pass EDGAR validation if you have a combination of 2008 & 2009 Taxonomy within the markup. To help our customers, Rivet is offering discounted services to help with this transition. If you are interested please contact our Rivet Support at support@rivetsoftware.com or 720-249-2181.

Helpful references:

US GAAP 2009 Taxonomy release notes: http://xbrl.us/Documents/XBRLUS-USGAAP-ReleaseNotes-2009-01-31.pdf
XBRL-US has added a FAQ page to their website to help preparers with the questions they may have regarding the 2009 taxonomy. XBRL-US is updating this site daily based on the questions they receive via email or phone. http://xbrl.us/taxonomies/Pages/FAQ.aspx

SEC posted FAQs regarding the interactive data program their website to help companies with their questions. http://www.sec.gov/spotlight/xbrl/xbrltechfaq.htm

Another resource to check out to help with all this fun is the Edgar Filer Manual (http://www.sec.gov/info/edgar/edmanuals.htm). Under Section 6 page 31 you can get an example of the types of facts (Values, Text Block, etc) that need to be tagged in different reports.

There’s a lot of talk out there about how difficult XBRL is and how companies should not try to prepare their own filings but instead outsource it. We at Rivet Software work hard to make products that take the complexity out of XBRL so that you can do your filings in-house. One of the ways we do that is by hiring people like me, a CPA who understands financial reporting and how to create tools that are easy for non technical professionals to use.

Another way we do that is by including a robust validation engine with both of our tagging products – Dragon Tag and CrossTag. What validation does is make you aware of any problems your filing has before submitting to EDGAR. Our validation engine incorporates the XBRL rules pertaining to SEC filings as specified in the March 2009 EDGAR Manual (Version 11) which means that we will warn you if you are doing something that is out of compliance with the latest rules (for users not filing with the SEC, don’t worry, we only apply SEC validation against SEC filings so you won’t be bothered with unnecessary errors).

When you create an instance document with Dragon Tag or CrossTag, there are many XBRL errors you’ll never encounter. So I’ll focus on a few of the errors and warnings you are most likely to see.

Please remember that I can’t possibly explain how to resolve all the errors/warnings you may encounter in this blog posting but I can point you to something better: our professional services team. If you get stuck, just give us a call and speak to an experienced professional.

When Validation is Performed — On-Demand and Just-in-Time

First, let me give you some added comfort by explaining when validation is performed. Both products give you the option to perform validation on demand. In other words, just click a button and the instance doc will be validated and a window will pop up showing the errors and warnings. But, we don’t just rely on the user clicking validation. We also perform validation before report preview is run and before a filing package can be created. So if there is a fatal error in your filing and you forget to run validation on your own, the products will automatically run validation and will not let you proceed without fixing certain errors. That should give you some peace of mind.

Validation Error Types

Let’s get into the types of errors you will see. There are three main types of errors: XBRL errors, SEC related errors, and calculation errors.

XBRL Errors

XBRL errors come about because something in the filing does not agree with the XBRL specifications. There is no need for a normal user to get into them – you’re better off leaving that geeky stuff to us – but when you see these errors, rest assured that they are easy for you to fix. For example, each fact must have a date associated with it to give it the proper context. If you don’t have a date, you’ll get a red error listing the element and the message saying “Cannot find a valid reporting period”. Another example is most elements require a unit such as USD or Share. If no unit type is specified, you’ll get a validation error saying so.

These more serious errors are shown in red and listed at the top of the validation error list. These errors pertain to a nonconformance with XBRL standards and must be fixed before a filing can be created. The less serious grey ones may or may not need to be fixed. But, to be on the safe side, it would be good practice to fix all errors and warnings that are consistent with your filing agency’s rules.

SEC Errors

SEC errors and warnings are the ones spelled out in the EDGAR manual. These errors will not prevent you from creating an instance document for filing, but you will be warned before creating a filing that there are errors in the instance document. The difference between SEC errors and warnings is that an SEC error will prevent the filing from going through the EDGAR system while a warning will not. Here’s a list of some common SEC related errors and how to resolve them (I have not included any warnings on this list).

Calculation Errors

Another common error you’ll encounter is a calculation error. Let me provide some background on XBRL to explain this. The beauty of XBRL is that it is multi-dimensional. It’s not just used to report facts but it also is used to present those facts in the way the user intends and to verify the integrity of relationships within those facts. So if you are reporting sales of 100 minus cost of goods sold of 75 and gross profit of 25, XBRL can actually validate that these numbers add up.

This can be a blessing and a curse. A blessing because it ensures the integrity of the calculation relationships but a curse because you may see many errors that may not really be an issue with your filing. The problem is the base US GAAP taxonomy. It is very complex and includes many, many calculation relationships that may not apply to your financial statement. So you will get calculation errors. To resolve them, you have to change the relationships to be the way you want them. This can easily be done using our products and I’ll explain how below.

For example, say you get a calculation error that says “Calculation error for summation item Row 5 Column 2 – Accounts Payable and Accrued Liabilities, Current 650 does not match calculated total 850″

The first thing to do is switch to Calculation View so you can see the calculation relationships. At first, you may find it awkward looking at the taxonomy this way. But there are just two things you need to understand.

1. The parent is supposed to always equal the sum of its children.
2. A calculation weight exists for each element telling the system whether to add or subtract that particular element in calculating the total.

The screen shot below shows the calculation view of the balance sheet. From it we can see that the element that has the error, “Accounts Payable and Accrued Liabilities, Current”, is parent to “Taxes Payable, Current”. For this filing, we have made the decision that we don’t want Taxes Payable to roll up into Accounts Payable and Accrued Liabilities. We just want it to roll up to current liabilities.

To fix this, simply drag “Taxes Payable, Current” on top of “Accounts Payable and Accrued Liabilities, Current”. You’ll then get a prompt asking if you want this element to be “after”, “before” or “a child of” the Accounts payable element. Elect to put it after the element. The below screen shot shows what the taxonomy tree looks like after making that move. It shows that “Taxes Payable, Current” is no longer a child of “Accounts Payable and Accrued Liabilities, Current” but is still a child of “Liabilities, Current”.

Once you’ve made that change, you will no longer have that calculation error. I hope this discussion on validation helps make your XBRL tagging and filing experience smoother and remember we are available for questions through our response line. Go to http://www.rivetsoftware.com/Customer_Support/Default.aspx for contact information.

So, you can think of CrossTag being on the market for 2 years, but with 5 years of product development behind it.

How we started CrossTag in early 2007

It was spring 2007, and Rivet was contacted by ICI (Investment Company Institute) regarding a conference that would be held in Boston to introduce the newly published XBRL taxonomy designed for reporting risk & return information to many mutual fund companies. ICI wanted to see if Rivet was interested in presenting at the conference, showing mutual fund companies how to use software to “tag” a prospectus (mostly in PDF) and produce the equivalent XBRL instance document.

We gladly accepted the invitation and produced a prototype version of CrossTag in a few weeks and presented to the Boston ICI conference with users from 50+ mutual fund companies. It was the most fun I have ever had while presenting an XBRL tagging solution. The audience was fully engaged and, at the end, I believe they walked away thinking that XBRL was not so scary after all. XBRL tagging was easy enough for an accountant to perform.

This same solution that was used for the ICI Risk & Return taxonomy, also supports the US GAAP taxonomies (2008 and the new 2009 version), IFRS taxonomy and many other industry standard taxonomies.

So, what are the design principles behind CrossTag?

The design concepts behind CrossTag are quite simple:

vTrue Maturity = Built on solid, tested foundation of Dragon Tag – CrossTag employs a new and unique user interface, but most of its internal processing is powered by Dragon Tag. This solid foundation provides CrossTag with the maturity and stability of a widely used and well-tested product. CrossTag is currently at version 2.0, and has gone through rigorous release cycles for 1.0, 1.5 and 2.0 in the last two years. We had fun working on the product and gained a lot of knowledge by working closely with our customers. CrossTag and Dragon Tag still share the same foundation, so any enhancements made in either product is automatically carried to the other.

vIt takes two to tango, and sometimes it takes a team to tag – We created CrossTag believing that tagging is a collaborative process for a lot of companies. You have designers that create the “tagging forms”, you have preparers getting the forms populated with data; and you have internal/external reviewers that perform the checks to make sure the filing is accurate and valid. With a secured repository, task-based workflow, and convenient web-delivered application, now the team can confidently and effectively work together to produce the XBRL instance documents.

v Where is the taxonomy? – “Hiding” the taxonomy was literally one of the goals when we created CrossTag. If the user takes on the “preparer” role, he won”t even know there is taxonomy behind the tagging form into which he was dragging data. The preparer only sees his financial statement line items and they simply add the values. They do not even have to know how to spell “XBRL”, much less know the intricate details behind it.

v Model the “tagging form” based on the familiar components of the source documents – When I say familiar components, I mean a financial table in the Income Statement, a note block used to capture a footnote – including rich formatting, a bar chart table for capturing annual returns in the prospectus, etc.

Let”s look at two examples:

Tagging Form Example 1: This form is modeled after the performance data in a mutual fund prospectus. It includes the “annual returns” and the “quarterly average returns”. From the “rendered” view, you can see that the XBRL data is presented in the most natural format that the investors are used to seeing on the prospectus.

[Tagging Form]

[Rendered Report]

Tagging Form Example 2: This form is modeled after the Income Statement in a financial statement. From the “rendered” view, you can see that the XBRL data is presented in the most natural format that the investors are used to seeing on a published financial statement.

[Tagging Form]

[Rendered Report]

v Tag it once – CrossTag was built with automation in mind. The tagging forms are reusable. We currently have several ways of getting the data into the tagging forms for subsequent filings, and we have an integrated solution “CrossTag Connect” that eliminates manual work and make the tagging process integrate with the financial reporting process. In a future blog, I will describe in detail how “CrossTag Connect” can combine the power of XBRL-GL and XBRL-FR to help companies streamline the reporting process and harvest the full range of benefits from interactive data.

A Tested Solution

Dragon Tag is still the most popular desktop tagging solution in the market today, and we are very proud of it. CrossTag is relatively new compare to Dragon Tag, but it has gained a lot of usage and recognition in the last two years. We are committed to make both products better and easier, and may I say “fun” to use!

How product innovation is combined with feedback from customers – the evolution of CrossTag for XBRL tagging

In my last entry, I talked about how customer feedback was incorporated into the product. However, we try to balance feedback from customers in conjunction with product ideas that we think would benefit our users

In the spring release we have several new features that we would like to enhance (based you’re your feedback) over the next 6 to 9 months. We are introducing the following:

• Workflow

• Automation via import from Excel

• Hierarchies for dimensional tagging

• Tagging assistance features including comparisons of tags from other filers

• Enhanced search and help me tag

Now, we could follow the traditional way of developing software and think through all the possible scenarios for each of these features, develop these features, go through a process of cutting the items that we do not have time to complete, and finally deliver one (maybe two) of the above features sometime in 2010.

However, with Agile development, we include all of these feature in our CrossTag Spring Release. We try to deliver a feature that has enough functionality to solve some of your basic issues. For example, in this release, we provide tagging assistance to assist when you are tagging an element. This tagging assistance will include the number of filers who are also tagging using that element (patent pending). See the screenshot below:

Now we know and have discussed a number of other uses for this feature. For example, we could:

• Add peer group %’s

• Include this in the in-use elements

• Include this in the markup report (which we did)

• Include this in Dragon View

• Include this in Dragon Tag

• Drilldown to see what companies make up the 57.5% number

• Etc, etc

Instead, we keep this somewhat basic, but very useful. We then listen to our customers and, based upon this feedback, incorporate enhancements into the summer or fall release of CrossTag or our other products.

This results in a win-win situation for Rivet and for yourself.

Customers win in the short term because they have five new features that they can use immediately rather than one feature with all the bells and whistle that they can use in 2010.

Customers win in the long term because they can use the feature and thus provide better feedback. Only the development work that is going to have actual benefit is performed. You will see the features enhanced over the next few releases, thus making their experience in 2009 that much better.

Rivet software wins because we keep our development costs low as we did not develop every variation of the feature imaginable for a product. We might just discover that customers do not use the feature they way we had imagined (or worse yet, they do not like the feature at all).  If very little or no feedback is provided, or the feature is not as useful as we thought, we will not spend any more time on the feature and we can focus our efforts somewhere else that will provide customer benefit.

Rivet now puts out a feature and benefit table as part of the release notes. This is because every feature we develop must have customer benefit – or why do it?

Help us continue to develop and enhance the correct set of features. Please email me any comments or suggestions you may have at kevin.berens@rivetsoftware.com.

What is Agile development (using a Wikipedia reference):

Agile software development is a group of software development methodologies that are based on similar principles. Agile methodologies generally promote a project management process that encourages frequent-

Stop – Stop – Stop

As a customer, you could care less how Rivet Software develops software.

What you do care about (in addition to quality), is how exactly does a product feature get into the product? If you suggest a usability idea or a product enhancement, you want to know when you might expect this feature to get incorporated into the product (assuming that the idea will benefit all customers). If you hope to see this feature be incorporated into the product within 3 to 12 months, then you really do care that Rivet uses agile development.

At Rivet, we use agile development and it has been fun to see the CrossTag product morph in the last 6 to 8 months. We are working on our 3^rd release of the product in the last 8 months. The user interface for the CrossTag product has improved thanks to some great feedback from the customers during beta and after the product was released. Not all features get in. Sometimes even some really good ideas are not implemented immediately because of the cost to get these features into the product.

However, I would like to share with you some screen shots that show the morphing of CrossTag in the last 8 months. I will take you through CrossTag version 1 which was released to beta in June to CrossTag 1.5 which was released in September 2008 to the CrossTag Spring Release which will go beta near the end of this month.

Our initial release of CrossTag was June of 2008. The user interface looked like the following:

Some customer feedback we had included:

A)   The ribbon is not very useful to me.

B)   Search information in the taxonomy viewer was confusing.

C)   These options seem like they should be in the ribbon.

D)  Using the control properties to add or modify labels, confuses and scares me. The product looks too geeky to me.

E)  I have no visual cues to indicate which elements were used in my template.

F)  We need more room to do our tagging, the screen is just way too crowded.

G)  Re-arrange tabs is in a very odd place.

Based upon this feedback, we quickly shifted gears and produced a product that addressed many of these issues but not all of them.

CrossTag 1.5 was released in September of 2008. The user interface looked like the following:

This was an improvement over the initial release:

A) We moved the reports to the ribbon which gave you slightly more room to view elements.

B) We moved preparer permissions to the ribbon, which gave you slightly more room to tag.

C) We eliminated the need for the control properties and allowed in-line editing of the labels.

D) We added-in use stars so you could see the elements used in the template.

CrossTag Spring Release is due to be released in the spring of 2009, hence the product name. The user interface will look like the following:

This was a huge improvement over CrossTag 1.5:

A) We added entities to the selector panel and now you have more room to do your tagging.

B) We added uniview (markup properties) to the selector panel and now you have more room to do your tagging.

C)  We added-in use elements tab so now with a single view, you can see the elements used in the template   but without this view being cluttered by all the elements that you have not used.

D) We used Outlook like slider panels which makes the product easier to understand and use.

In my next blog, I will talk about how agile development helps drive innovations and complement this innovation with customer feedback, but I wanted to give you a preview.

In the spring release we have several new features that we would like to see morph over the next 6 to 9 months. We are introducing the following:

• Tagging assistance features including comparisons of tags from other filers
• Workflow
• Automation via import from Excel
• Hierarchies for dimensional tagging

As you use these features, we want to enhance these features over times, so please email me any comments or suggestions you may have at kevin.berens@rivetsoftware.com.