other developments
DESCRIPTION
TRANSCRIPT
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XBRL Updateand
Corporate Websites
R.R. Donnelley SEC Hot Topics InstituteJune 5, 2008 ~ Seattle WA
Peter A. Kraus, Senior Attorney, Microsoft CorporationDavid M. Anderman | Vice President, Marketing | RR Donnelley | Financial Services Group
XBRL Update
• XBRL Mandate – Proposed Rule Summary• XBRL Technology Overview• XBRL Global Adoption• XBRL Progression In US
XBRL Update
• Microsoft’s experience• What does this mean for me?
– Get up to speed• SEC website: http://www.sec.gov/spotlight/xbrl.shtml• XBRL US: http://xbrl.us/Pages/default.aspx• XBRL International: http://www.xbrl.org/Home/
– Begin finance/accounting/legal/IR/vendor collaboration on implementation
– Submit comments on proposed rule
Corporate Websites
• SEC & CIFR vision– Tiered disclosure– Key performance indicators– http://www.sec.gov/about/offices/oca/acifr.shtml• Microsoft Investor Central– http://www.microsoft.com/msft/IC/default.aspx– Content and structure– XBRL-based– Feedback
Corporate Websites
• Legal issues– SEC interpretive guidance– Site design, content & disclaimers– Regulation G, Regulation FD
Other SEC DevelopmentsForm 8-K Interpretations
New “Compliance and Disclosure Interpretations”
- Part of on-going project by Corp Fin to update all interpretations
Move executive comp interpretations to Item 5.02 Elaboration on triggering events for director &
executive separations
- Effect on S-3 eligibility and requests for waivers
Interactive Data (XBRL)
Technology Overview and Summary of the SEC Proposed Rules
Agenda
• XBRL Mandate – Proposed Rule Summary• XBRL Technology Overview• XBRL Global Adoption• XBRL Progression In US
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SEC Proposed Rules Released – May 30th, 2008Summary of Requirements
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– Proposed rules require companies to provide to the Commission financial statements in interactive data format using eXtensible Business Reporting Language, or XBRL.
– Proposed rules would apply to domestic and foreign companies using U.S. GAAP and, eventually, to foreign private issuers using International Financial Reporting Standards as issued by the International Accounting Standards Board
– The required tagged disclosures would include companies' primary financial statements, notes, and financial statement schedules.
– The disclosure in interactive data format would supplement, but not replace or change, disclosure using the traditional electronic filing formats in ASCII or HTML.
SEC Proposed Rules Released – May 30th, 2008XBRL Phase-in Plan
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• Proposed three year phase-in schedule:– In year 1, the proposed rules would apply only to domestic and
foreign large accelerated filers that use U.S. GAAP and have a worldwide public float above $5 billion (measured as of 2nd Q of the fiscal year), estimated to cover approximately 500 companies.
– In year 2, all other domestic and foreign large accelerated filers using U.S. GAAP would be subject to interactive data reporting.
– In year 3, all remaining filers using U.S. GAAP, including smaller reporting companies, and all foreign private issuers that prepare their financial statements in accordance with IFRS as issued by the IASB would be subject to the same interactive data reporting requirements.
• If proposed rules are adopted, the first phase would begin with fiscal periods ending on or after December 15, 2008
SEC Proposed Rules Released – May 30th, 2008Data Tagging Details
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For each phase of implementation:
– The face of the financial statements would be tagged in each filer's first year of interactive data reporting.
– The financial statement footnotes and financial statement schedules also would be tagged in each filer's first year, but in block text only.
– After the first year of such tagging, a filer also would be required to tag the detailed disclosures within the footnotes and schedules.
SEC Proposed Rules Released – May 30th, 2008Submission Format
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• Interactive data would be required with a company's annual and quarterly reports, transition reports (for change of fiscal year), and Securities Act registration statements (including IPOs)
• Interactive data would also be required to be posted on the company’s corporate web site, if it maintains one
SEC Proposed Rules Released – May 30th, 2008Submission Timing
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• Interactive data would be required to be provided to the Commission, and posted on company websites, at the same time as the related report or registration statement, with two exceptions. – A 30 day grace period would be permitted for the first interactive data
exhibit of each filer, – A 30 day grace period would be permitted for the first interactive data
exhibit that is required to include the footnotes and schedules tagged in detail.
SEC Proposed Rules Released – May 30th, 2008Liability and Non-Compliance
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• Filers that do not provide or post required interactive data on the date required would be deemed not current with their Exchange Act reports.
• Data in the interactive data file submitted to us would be subject to liability similar to that of the voluntary program and, as a result, would be subject to only limited liability.
SEC Proposed Rules Released – May 30th, 2008 Comment Period
• 60 day comment period ending August 1, 2008• Proposed rules include questions for feedback• Give SEC enough time to consider your comments
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“This is all about bringing investors better, faster, more meaningful information about the companies they own,”…."It would transform financial disclosure from a 1930s form-based system to a truly 21st century model that taps the power of technology for the benefit of investors….”
Opening Statement by SEC Chairman Christopher Cox
“This is all about bringing investors better, faster, more meaningful information about the companies they own,”…."It would transform financial disclosure from a 1930s form-based system to a truly 21st century model that taps the power of technology for the benefit of investors….”
Opening Statement by SEC Chairman Christopher Cox
XBRL Adoption Schedule for the US Timeline For Mandatory XBRL Filing
SEC Proposed Rules
SEC Final Rules
SEC mandate to file XBRL for Largest Accelerated Filers (Public float > $5B)
SEC mandate to file XBRL for remaining companies that report in US GAAP
End of May, 2008
Sept – Nov 2008
(for fiscal periods that end on or after 12/15/2008)
2009 / 2010 Results
Expected
Dates
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2008 Results
What Is XBRL?
What does it do?• Creates machine-processed data
for re-use and easy comparison
What is XBRL?• eXtensible Business Reporting
Language (Interactive Data)• Each line item is given data tag
standardized by US GAAP and different industries
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Key XBRL Terms to Know
Tag
• Machine-readable “barcode” that gives a standard definition for each line item in an income statement, SCF, or balance sheet
Taxonomy
A “dictionary” of tags for:• Specific accounting standards (US GAAP,
IFRS)• Industry segments (e.g., energy, REIT’s,
Broker-Dealers, Commercial)• Company-specific tags
Instance document
• Collection of tags that is the building block to viewing and analyzing data
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How Does XBRL Work?
FinancialStatements
XBRL-TaggedFinancial
Statements
SEC
Consumed by:
• Analysts / Research
• Investors (corporate & individual)
• Newswires / data aggregators
XBRL Taxonomy
TaggingSoftware
XBRL-TaggedFinancial
Statements
Sce
nar
io 1
RR
D E
Z
Sta
rt
Sce
nar
io 2
XB
RL
in G
L sy
stem
XBRL-EnabledFinancial Reporting
Software
XBRL Taxonomy
FinancialStatements
Internal External
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XBRL in Action
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XBRL Benefits Issuers, Rule Makers and Analysts
• XBRL is a worldwide standard for the exchange, process and analysis of business reporting information.– Improves the accuracy and quality of your information in the marketplace
• Analysts and Investors already have access to your XBRL data– Becoming the filing standard across the world – Is the main technology focus of the SEC
• Enables “Interactive data” and more comprehensive analysis• Intelligent data that can be:
– Reused– Repurposed– Exchanged/submitted– Machine processed– Compared/Analyzed
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XBRL Adoption Around the WorldExpected to be mandated in 75% of the World’s Market Cap by end of 2008
EUROPEBelgium -France – Bank de France, AMF
Netherlands -4 Major MinistriesNorway - Exchange
Spain - Bank of Spain Sweden – Companies House
UK – HMRC (Companies House)
ASIA/PACIFICAustralia – Government Wide
China – Shanghai & Shenzhen Exchanges, CSRC, SFC
India – Bombay & India National Exchange, Bank of India
Japan – Tokyo Exchange & Bank of Japan
Korea – KOSDAQSingapore - ACRA
Thailand – Thailand Exchange
MIDDLE EAST/AFRICAAbu Dhabi – Exchange
Israel - Securities AuthoritySouth Africa - Exchange
SOUTH AMERICAArgentina – Bank of Argentina
Bolivia - Government-wideBrazil – Bank of BrazilChile – Bank of Chile
Columbia – Bank of ColumbiaPeru – Bank of Peru
NORTH AMERICACanada – CSA, Toronto Exchange
Cayman Islands - CIMAUS – FDIC, SEC, IRS
World Bank – Micro Lending
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XBRL Progression in US
SEC gets involved in XBRL1999
2000SEC adopts HTML standard
FDIC adopts XBRL 2005
2006XBRL VoluntaryProgram for‘34 Act filers
2007XBRL VoluntaryProgram for‘40 Act filers
SEC mandates XBRL 2008
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RRD among first to file in new HTML Standard
RRD/EOL among the first to file XBRL in SEC’s Voluntary Filing Program
RRD/EOL the first to file XBRL mapped to new US GAAP Taxonomy