US GAAP Financial Reporting Taxonomy Green-Lighted by SEC

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By Jason Bramwell

The US Securities and Exchange Commission (SEC) has adopted the 2013 US GAAP Financial Reporting Taxonomy, which allows companies to use eXtensible Business Reporting Language (XBRL) in reporting financial statements.
The Financial Accounting Foundation (FAF) and the Financial Accounting Standards Board (FASB) are responsible for the ongoing maintenance of the taxonomy applicable to public issuers registered with the SEC.
The US GAAP Financial Reporting Taxonomy is a list of computer-readable tags in XBRL that allows companies to tag precisely the thousands of pieces of financial data that are included in typical long-form financial statements and related footnote disclosures. The tags allow computers to automatically search for, assemble, and process data so it can be readily accessed and analyzed by investors, analysts, journalists, and regulators.
The 2013 US GAAP Financial Reporting Taxonomy contains updates for accounting standards and other improvements to the 2012 taxonomy currently used by SEC issuers (see sidebar). The 2013 taxonomy went into effect May 20.
"The 2013 taxonomy has been revised to accommodate common reporting practices and changes in US generally accepted accounting principles (GAAP)," John Pappas, FAF spokesperson, told AccountingWEB. "It has also been updated to incorporate new modeling within the US GAAP Financial Reporting Taxonomy. The changes are made with the intent of minimizing the impact on instance documents prepared using prior versions of the taxonomy, as well as the impact on users and systems that consume these instance documents, while addressing required accounting standard changes and common reporting practices."
In early 2010, the FAF assumed maintenance responsibilities for the taxonomy and, along with the FASB, assembled a team of technical staff dedicated to updating the taxonomy for changes in US GAAP, identifying best practices in taxonomy extensions and technical enhancements.
The FASB issued proposed improvements to the taxonomy in fall 2012, allowing users of the taxonomy to provide feedback on the updates and to provide SEC filers, service providers, software vendors, and other interested parties the opportunity to become familiar with and incorporate new element names for their filings.
On December 21, 2012, the FASB announced the availability of the 2013 taxonomy pending final approval by the SEC. However, some modifications have been made to the taxonomy since late last year, the FASB states.
Questions about using this taxonomy for creating and submitting XBRL tagged interactive data files in compliance with SEC rules should be directed to the SEC. SEC contact details and guidance are available at the SEC's portal on XBRL.
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