On January 30, 2009, the U.S. Securities and Exchange Commission (SEC) issued final rules¹ that require companies to provide financial statement information in periodic reports and registration statements in an interactive data format using the eXtensible Business Reporting Language (XBRL). Large accelerated filers using U.S. Generally Accepted Accounting Principles (GAAP) that have a public float of more than $5 billion must comply with the new rules beginning with their first quarterly report on Form 10-Q (or annual report on Form 20-F or Form 40-F) containing financial statements for a fiscal period ending on or after June 15, 2009. All other companies are phased in over two additional stages during the following two years as described below. Calendar-year companies that are large accelerated filers but do not exceed the $5-billion float threshold must comply beginning with their first 10-Q for the quarter ended June 30, 2010.

What Is XBRL?

Like HyperText Markup Language (HTML), XBRL is an electronic format that "tags" data using standard definitions. The tags provide a consistent identity structure for data that can be recognized and processed by a variety of software applications such as databases, spreadsheets, and financial reporting systems. For example, a data point of "$200,000" might be linked to an issuer and the accounting terms "U.S. Dollars," "Net Profit," "2nd Quarter," and "2008." The SEC has developed a standard list of tags necessary for financial reporting under U.S. GAAP and SEC regulations. Currently available tags address approximately 13,000 different data elements, and the SEC anticipates updating the list of tags sometime in February 2009. XBRL also permits the filer to create a company-specific tag, called an extension.

XBRL is intended to eliminate manual data re-entry and make it easier and more cost-effective for analysts, investors, and others to search and analyze financial information across companies, reporting periods, and industries. The SEC envisions investors downloading and analyzing interactive data through off-the-shelf software as well as through custom-developed investment software.²

XBRL Tagging Requirements and Filing Deadlines

The XBRL data file is required to be provided as an exhibit to periodic and current reports (Forms 10-K and 10-Q and certain Form 8-Ks) and registration statements (once the price or price range has been determined) as well as transition reports for a change in fiscal year that contain financial statements and financial schedules.

XBRL data tagging is required for a company's financial statements, including financial statement footnotes and required schedules. The XBRL data is required for all periods presented in the financial statements. Companies also are required to post financial statements in XBRL format on their corporate Web sites no later than the end of the calendar day that they filed their related registration statements or reports with the SEC, and must maintain the XBRL financial statements on their Web sites for at least 12 months. Companies are not required (or permitted) to use XBRL for their management's discussion and analysis, executive compensation, or other financial, statistical, or narrative disclosures not included in the financial statements or related footnotes.

The tagging requirements and filing deadlines will be relaxed for initial filings to give issuers a chance to become accustomed to XBRL, as follows: