Peter Boritz is the architect and chief technical officer for Snappy Reports XBRL. He can be reached via e-mail.

Understanding Automated Data Management

It’s important to have a sense of perspective about XBRL: it is a means, not the end, of data reporting. An XBRL system is neither the beginning nor the end of a data point; instead, think of XBRL as a postal system. The starting point begins with an acunting/finance system or other data source and the endpoint is a data repository.

For regulatory filings in America, the starting point is the filer’s acunting/finance system and the endpoint is EDGAR.

EDGAR is a data warehouse that stores pertinent information for internal use and reporting purposes. It is fed from an XBRL-based receipt and validation system, and it is designed around XBRL. The data it stores is architected around US-GAAP. EDGAR’s purpose is processing and reporting filing data.

What lies between the starting point and EDGAR are the filer’s XBRL system and the XBRL receiving processes running at the SEC. Thus, the first task for each regulatory filer is to get data into an XBRL filing. Automated data management can play an instrumental role in this task.

Getting data into an XBRL filing uld be a manual drag-and-drop operation using an add-on to Microsoft Excel. This method does not save mappings, though. For your next filing, you would need to start all over again.

A better approach, therefore, is bringing data in from an acunting/finance system, using an automated process. This process is designed to be seamless. Mappings are stored permanently and reused. While setting up such a system requires up-front work for the first filing, the benefits well outweigh the sts.

Event Triggers

The process of getting applicable data from an acunting/finance system or other source into the XBRL filing is triggered by an event. (Generally this event is the closing of the books.) The event triggers a data transfer to the XBRL system, which may be in the form of a direct transfer; XML, character-separated, or fixed-format data file; or an Excel spreadsheet.

How the transfer is achieved is not material — all of the above can work equally well — but the data to be transmitted must be planned in advance.

First, we must determine what data is to be acquired and transferred. Send, we need to define how to map that data to the XBRL taxonomy. Once these determinations are made, we should be able to make the data transfer, then run reports through the XBRL system in order to verify that everything looks good and is close to filing.

After the first filing, this should be a fairly quick and painless process. The first filing requires setup, mapping, testing, and quality ntrol, but once these processes are set in place, life gets easier.

Security

Generally, an issue of data transfer is whether the origin system pushes data or the receiving system pulls it. In the case of XBRL, however, the only option is to push. The XBRL system has no basis of knowing when books have closed in order to procure a transmission. As well, it has no idea of how to go into an acunting system to get the data. There is a security issue in play: few businesses will allow a third-party vendor to reach into the guts of their acunting system to obtain information. It remains more secure, and more desirable, to prepare a push on one’s own terms.

nsistency

Here is a caveat with spreadsheets: typically, spreadsheets are embellished with reporting logic that makes them more readable, but these embellishments cause a mapping issue. What is easier for a human to read is not necessarily machine-readable.

nsider the following example. The element property and equipment may be embellished in a spreadsheet as property and equipment of aumulated depreciation of $x. That may be easier to read (to a human), but, upon export, the suffix of aumulated depreciation changes with each reporting period. Thus, we would no longer have a nstant — property and equipment — to map to.

Some reporting logic embellishments in spreadsheets can actually impede machine readability. nsider the following fragment of a spreadsheet that tracks changes in operating assets and liabilities: