Microsoft says it’s the first US company to file financial records using a newly released XML data standard this week, the GAAP (U.S. Generally Accepted Accounting Principles) taxonomy for XBRL (Extensible Business Reporting Language), according to a report by IDG News in London. XBRL is an XML standard that makes financial filings machine readable, potentially saving massive amounts of time formerly required for manual data analysis.
Just like any other data standard, XBRL could help in opening up significant analytical innovation on top of standards based information. Advances in adoption of XML based data standards are good news for everyone. This might sound like dry, but you will be glad it happened when free financial information is all the more available and 3rd party service providers are able to build more sophisticated analysis tools on top of well articulated, standardized financial data.
XBRL is being adopted all around the world, but here in the US a draft for the new GAAP taxonomy was just opened for public comment on Wednesday. That taxonomy would make financial reporting machine readable using tags based on GAAP financial terms. Presumably the GAAP standard will help make XBRL reporting make all the more sense for US based companies in particular by working with existing practices.
Microsoft filed a Form 8-K with the SEC this week using the new GAAP XBRL standard, as part of an initial SEC pilot program involving three dozen companies.
“We’ve been saying that interactive data is on the brink of transforming the review and analysis of financial information for the benefit of investors and public companies alike,” said David Blaszkowsky, Director of the SEC’s Office of Interactive Disclosure in the draft’s press release. “With the release of this taxonomy today, investors can now begin to visually see the progress being made, and so will every public company that uses GAAP. Interactive data is no longer merely an up-and-comer, it’s becoming reality.
Readers interested in learning more about this XML standard should check out its Wikipedia page.
