By Jason Bramwell
In a letter sent to US senators Tom Carper (D-DE) and Tom Coburn (R-OK) on November 4, the American Institute of CPAs (AICPA) encouraged the Senate's support of legislation that would include a provision calling for the establishment of government-wide financial data standards for federal funds.
The Senate Homeland Security and Governmental Affairs Committee, in which Carper is chairman and Coburn is a ranking member, is scheduled to mark up the legislation, the Digital Accountability and Transparency Act of 2013 (S. 994), on November 6.
The bipartisan bill, cosponsored by senators Mark Warner (D-VA) and Rob Portman (R-OH), is designed to improve and expand federal fiscal accountability by requiring standardized reporting of federal spending to be posted to a single website, which will enable citizens to track spending in their communities and agencies and identify improper payments, waste, and fraud.
In the letter sent to Carper and Coburn, AICPA President and CEO Barry Melancon, CPA, CGMA, said reporting federal spending using nonproprietary, platform-independent data standards will enhance transparency for both policymakers and citizens.
"Gone are the days of sole-source computer software that require substantial investments in equipment and payments to vendors to access information", he wrote. "This legislation will allow Congress, federal agencies, and the American public to understand, analyze, and communicate where taxpayer dollars are spent using low-cost, readily available tools."
While the legislation does not specify the data standard that would be developed, the AICPA believes the best nonproprietary standard now available is eXtensible Business Reporting Language (XBRL).
XBRL is an open-source computer language that allows companies to tag precisely the thousands of pieces of financial data 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 benefits of using data tagging for federal financial and performance information will enhance the accuracy and transparency of that data, resulting in better, more informed decisions", wrote Melancon, who added that the AICPA believes the bill "is another critical step forward to improving decision making around effective government spending."