CFOs often view eXtensible Business Reporting Language (XBRL)as a bothersome step in the disclosure process that merely allows them to fulfill a regulatory requirement.But finance chiefs should want to have their tags and detailed footnotes rrect,and for reasons beyond just checking the box on a regulation.

In fact,as my lleague Kristine Brand points out in “XBRL is Not Just Another pliance Burden,”proper XBRL data formatting is essential as the Securities and Exchange mission rolls out the Acunting Quality Model (AQM),which will ensure all data is aurate.

CFOs benefit also from rrectly tagging information because the data is used by investors to gauge a mpany’s market value and determine if it is a smart investment.Finally,the board of directors and senior management team can and should use the data for ernance,risk and mpliance (GRC)measures and value-based decision-making.

To further drive enthusiasm for rrect XBRL filings for reasons beyond just SEC mpliance,CFOs must look at the role XBRL filings play within the business knowledge circle.This circle nsists of data creation,data dissemination and data analysis.

As information is analyzed,users provide feedback about which data points are useful,which affect data creation and mpilation,and so forth.CFOs and the mpanies they represent will benefit from understanding how each part of the circle influences every other part.

Right now,finance chiefs are fulfilling the first and send part of the circle by creating XBRL filings to meet SEC requirements and then disseminating data through the disclosure filing process.But for these data points to be useful,CFOs and their staffs must create quality footnotes and tags,and then cate nstituents,inside and outside of the anization,about how this data can be properly analyzed and used.

As the internal XBRL expert,the CFO must provide clear cation on the value of this business data at all levels across the anization,not just among the financial and acunting staff.XBRL filings are a rich source of data that all departments can use to make operations more efficient and to nduct mpetitive analysis.

For example,a CFO uld quickly benchmark capital spending for peer mpanies in his or her industry by selecting a standard industrial classification (SIC)de,the element from the XBRL taxonomy and the time periods,and then downloading the result into an Excel spreadsheet.It is through using the data that CFOs show how aurately mpiled data can be leveraged to drive further adoption internally and champion its use among investors.

There are those that argue that the quality of XBRL filings is not at the level needed for effective GRC analysis and use by the executive team.They say that if the XBRL data from your firm or that of your mpetitors is inaurate,then the analysis of these figures will be erroneous and lead to invalid decisions.

The SEC is taking steps to analyze disclosures and track for acunting fraud and financial disclosure issues with the introduction of the AQM.The use of XBRL-standardized data is bringing about tighter regulatory ntrol to avoid scandals like those that stemmed from Enron and World in 2002,as the AQM uses a set model to examine disclosures to find any abnormal issues.

As Craig Lewis,chief enomist and director for the division of enomic and risk analysis at the SEC,said during the XBRL US 2013nference in September,the AQM creates a structured analytical model that examines filer information and identifies outliers.This model and resulting analysis uses submitted XBRL filings with the intent to improve the overall quality of financial disclosures.

A Crucial Missing Link

Even once the market and internal nstituents are cated on the value of XBRL data and CFOs are spending time ensuring that data is properly tagged and referenced,we still have a missing link in the equation between business data and its value.

Right now,a CFO cannot tell who is aessing the mpany’s XBRL filings,what information is being selected or how it is being used.This is a crucial missing link in the business knowledge circle.Without insight into how and what data is being used,CFOs cannot create the right data points.There needs to be a nnection between what data points are being aessed and how they are being analyzed to tell executives what information investors need to know.

Armed with the knowledge of how certain data points are being aessed,CFOs will place a greater value on choosing the rrect tags and creating financial disclosures.This information will also lead the financial team to take greater care with these numbers and the associated detailed footnotes,ensuring that the information is clearly nveyed and extensively detailed.

Building out this knowledge chain of how and what information is being aessed from XBRL filings should be the first step in bringing a llaborative process between the analysis and filing sides of the market.

The value of XBRL data lies in how it will be used internally and by investors.CFOs can only cate and use XBRL data to a certain extent.Without the insight into what and how the data points are being used,there is little guidance on where to place the emphasis with the detailed footnotes and tags.

By mpleting the business knowledge circle with the information on which data points are being aessed and how they are being analyzed,tagging and disclosures will have greater importance and will drive people to rrectly file information.

As XBRL filings and disclosure management solutions evolve,CFOs must determine how they can easily track and identify these major data points for greater insight into the ics that matter to their nstituents.

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