• Technology
  • CFO.com | US

XBRL: The Inside Story

After years of development, data tagging seems little more than a minor financial-reporting requirement. Yet some now say it could transform internal finance operations. Is this XBRL's true calling, or just more hype?

But Van Decker adds that he suspects demand will start to rise as business growth returns and more funding for new projects becomes available. If a few companies were to establish themselves as pioneers with models for implementation that could be emulated, adoption levels would rise dramatically, he suggests. “We need more examples like Nevada,” he says.

Escape from Hell

Nevada’s Wallin referred to the state’s initiative using XBRL to streamline its debt collection, which is still in test mode, as its “spreadsheet from hell project.” And, she noted, “every company has some spreadsheet hell.”

State agencies turn over debts they can’t collect to Wallin’s office for transmittal to outside debt collectors. Historically, the information was provided on Excel spreadsheets, but in many different formats. “We had 71 different spreadsheets in the debt-collection area alone,” she said.

So the controller’s office would have to cut and paste data from certain spreadsheet cells into a master, single-format spreadsheet. Then as payments were received the process would have to be done in reverse, with information on the payments cut and pasted back into spreadsheets in the formats used by the individual agencies. “It was a lot of work and fraught with reconciliation issues, and also internal-control issues because we were manually manipulating the data,” said Wallin.

The XBRL project is eliminating all of that, she said. Spreadsheets from the state agencies containing debt data are tagged and sent to a repository containing a debt-collection taxonomy. From there, Wallin’s staff can generate XBRL-tagged reports on the debts and send the reports to the debt-collection agencies, which send back payment data on the same XBRL-tagged reports.

Data tagging is being used similarly to improve the reporting on state grants, which also formerly involved a laborious process of manually entering and cutting and pasting information.

 

Discuss

Your email address will not be published. Required fields are marked *