XBRL%201 - TECHNOLOGY A boon to financial planners and...

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TECHNOLOGY A boon to financial planners and individual investors. A Napster for Financial Data? BY STANLEY ZAROWIN
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EXECUTIVE SUMMARY IN THE NOT-TOO-DISTANT FUTURE, you may be able, with just a few mouse clicks, to access any public company’s financial reports in extraordinary detail and for any period. In addition, you may be able to perform an array of instant analyses of those data. THE UNDERLYING TECHNOLOGY is available now—XBRL (Extensible Business Reporting Language). All that’s missing is a standardized protocol to implement it—and the first steps for creating such a system have just been taken by Nasdaq, Microsoft and PricewaterhouseCoopers. THESE ORGANIZATION HAVE JUST LAUNCHED a test project designed to explore whether the concept is feasible, practical and sought by financial professionals, investors and regulators. THE OBVIOUS WINNERS from such a system will be financial planners and individual investors, who will have at their fingertips a huge amount of verifiable and easy-to-analyze financial information. COMPANIES ALSO WILL GAIN: They will appear more forthright in providing financial information to stakeholders and have an easier time conducting internal data analyses. XBRL-FORMATTED DATA WILL ENHANCE lender relations with companies seeking credit; banks no longer will be inundated with reams of paper financial reports. ACCOUNTANTS MAY BE ABLE TO MOVE XBRL forward by prodding their accounting software vendors to include it in their applications. STANLEY ZAROWIN is a senior editor on the JofA . Mr. Zarowin is an employee of the AICPA, and his views, as expressed in this article, do not necessarily reflect the views of the Institute. Official positions are determined through certain specific committee procedures, due process and deliberation. magine this: At any time of the day or night, and with just a few clicks of the mouse, a financial planner or an individual investor can access a company’s present and past financial reports in extraordinary detail. In addition, an array of instant analyses of those data can be performed, which displays them either graphically or as conventional financial statements. Within seconds a user can compare a company’s balance sheets with those of several competitors, examine an enterprise’s debt- to-equity ratio in any fiscal period, chart its stock price history and download an audit client’s major nonfinancial news. As if that’s not
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enough, the same range of analyses can be performed for any public company worldwide and the information even can be converted into any
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This note was uploaded on 10/02/2010 for the course ACCT 5457 taught by Professor Polm during the Fall '10 term at Rensselaer Polytechnic Institute.

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XBRL%201 - TECHNOLOGY A boon to financial planners and...

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