NYSSA nference focuses on interactive data in equity research

Allow too much extensibility in eXtensible Business Reporting Language (XBRL) and analysts won’t be able to mpare data from different mpanies. That was the message nveyed to the SEC at the New York Society of Securities Analysts’ fifth annual XBRL nference at Baruch llege yesterday in New York.

John Rogers, CFA Institute’s new president, led off the event, noting that 91 percent of his members want to limit the ability of issuers to add new fields in their XBRL filings.

Tom Larsen, head of investment research at Harding Loevner Management and chair of CFA Institute’s XBRL working group, directed some pointed remarks about taxonomy toward the SEC’s interactive data chief, David Blaszkowsky. ‘Extensibility is still not sufficiently restricted, so mparative analysis is limited and not mpletely reliable yet,’ Larsen said, adding, ‘There are multiple methods to tag the same ntent, which restricts standardized analysis.’

Larsen ncluded with a call for better ordination between the SEC and the investment mmunity.

There was no suggestion that mpanies are hiding anything when they create their own extensions. ‘The majority of issuers want to be mparable to their industry peers, so they want to use an official tag when one is available,’ says Edgar Online’s Elias-John Kies in an interview today. Kies was at the NYSSA nference demonstrating his firm’s I-Metrix product, which has over a decade of data from 13,000 US public mpanies tagged in XBRL. 

The official taxonomy has 3,500 tags for financial statements, Kies explains, and that number will grow. Another 12,500 footnote tags won’t be used much until 2010, when this year’s first 500 filers will tag footnotes in detail. In addition to the official tags, an issuer may create extensions to tag unique line items, like a specific product’s revenue, for example.

Blaszkowsky himself took to the podium with a status update. The SEC requires the first wave of 500 or so large US mpanies to begin after June 15. Already, 26 issuers have filed XBRL statements since the rule went into effect April 13. The first was CSX, the railway mpany, which filed its 10Q on April 15. Even smaller mpanies are on board, like Papa John’s, the pizza chain, whose XBRL 10Q went out May 5. With around $700 mn in market cap, Papa John’s wasn’t required to start until 2010.

The trend is expected to ntinue. ‘Many mpanies will choose to do it before it’s mandated,’ Blaszkowsky said. A mpany might file in XBRL earlier than required because its peers are already doing it, or because investors and analysts are asking for it. He also said XBRL uld help increase visibility for small caps.

In an indirect response to CFA Institute’s ncerns about too much extensibility, Blaszkowsky said that while filings so far ‘generally look pretty good,’ the SEC ‘will be evaluating the appropriateness of extensions.’