XBRL, or eXtensible Business Reporting Language is a free and global standard used in business reporting. It’s based in XML and is used to help exchange data and information amongst business systems. XBRL can be a useful tool for CFOs and their teams when collecting and analyzing data involved in stocks, regulations, tax filing, and more.
Recent trends in handling XBRL for firms have relied on outsourced teams to complete any related work. This occurs because many CFOs (and the cultures of the companies they work for) believe in outsourcing what their firm is not really to be competent in. According to recent surveys however, this trend has been shifting from a focus on outsourcing to a focus on filing company financials with XBRL through internal organizations or departments.
The Financial Executives Research Foundation recently surveyed 416 finance executives from various-sized corporations and found the results showing that many executives are now favoring internal XBRL filings versus outsourcing the work.
Those executives not planning on outsourcing their XBRL filings went up 16% among those required to file XBRL in 2009. Additionally, 43% of executives surveyed stated that they are planning on completing their filings in-house and only 21% stated they planned to continue to rely on outsourcing.
One of the primary reasons behind this shift is a growing dissatisfaction with the XBRL services provided by those companies many firms outsource to. If there are last-minute changes to filings or other timely issues, companies are out of luck as there isn’t enough time for the outsourced firm to adjust their filings with the SEC or other agencies. This results in many firms with problems or issues at the last minute to be forced into a late filing, something all firms would like to avoid.
Lastly, concerns from finance executives about the value of XBRL have remained relatively steady since required by the SEC for many firms in 2009. 68% of respondents expressed concern in regards to the cost-benefit equation involved in mandating XBRL filing.
Does your company file with XBRL tagging to the SEC or use XBRL in any other way? Do you plan to outsource or insource your XBRL work?