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Standard terminology is always an issue. This is hugely important with writing programs and interfacing automated systems.
There is no common format and taxonomy for business reporting data. Data must be reentered when transferring into other applications. Often this requires interpretation along the way.
XBRL is an emerging standard and subset of XML (eXtensible Markup Language). The Web browser that you are using is enabled with HTML, another subset of XML.
The idea is to make the data platform independent, whether being used in a spreadsheet analysis or financial statement. The data creators and users are best served by an open data format. "Open" means the standard is vendor-independent and is not bound to particular programming languages, authoring tools, and delivery engines. For example, an accounting report could be sent to a bank, creditor, or regulatory agency. The recipient's system could interpret and reformat the information without confusion.
The idea of a common taxonomy (shared vocabulary) appeals to most everyone. As an old programmer, I see where this could have saved me hundreds of hours over the years. Standardization reduces costs and misunderstandings. In the U.S., the primary corporate regulator for publicly-traded companies is the Securities and Exchange Commission (SEC). The SEC is very much interested in XBRL because of its path to reporting conformity and accessible information.
I just learned about XBRL in "The Brave New World of XBRL," by Neal Hannon, Strategic Finance, Dec. 2000, pp. 73-74. In his article he provides a link to an on-line article, "Looking at Business Reports Through XBRL-Tinted Glasses."
John Schuyler, December 2000.
Copyright © 2000 by John R. Schuyler. All rights reserved. Permission to copy with reproduction of this notice.