idaciti blog

An open letter to my fellow financial reporters: we CAN be consumers of our own data

· Financial Reporting, XBRL, Data Analytics

Guest blog by Monica Banuelos.

About 10 years ago, when publicly held US companies were architecting project plans for new processes and systems that were necessary in order to meet the SEC’s compliance requirements on XBRL reporting of quarterly and annual financial statement information, I was designated as the lead manager on our company’s XBRL implementation project and quite excited for this opportunity to step up and become the resident XBRL subject matter expert. Little did I know that, sadly, this was a task that no one wanted - Compliance reporting. At the time XBRL reporting was not viewed as ‘value add’ for the company and no one knew who would use it (specifically) or how they would use it (specifically).

Whatever. I had a job to do and I was going to do it well.

I jumped in fervently with the seriousness of a dedicated soldier, even though the objective of this mandate wasn’t initially quite clear to me. There was a significant learning curve and the XBRL implementation project was overwhelming; daunting at times. It took me away from my core ‘financial reporting’ duties. I missed the magic that I saw in the intersections and dependencies of the financial statements, the satisfaction of balancing roll forwards from period to period and in the aggregate, and the sense of achievement when all pieces of the puzzle are in the right place and fit together perfectly. I missed the fun of bringing the numbers alive with words. Now, all I had was data. Categorizing data. Defining data. Data, data, data. Soooo much data. So many ways to go wrong in defining the data. And no efficient way to compare your data to the data of others.

Nonetheless, time passed and eventually the implementation project was complete. My manager was doing the final review of our ‘XBRL tags’ and asked: “Can we look at other companies who use this tag for this footnote?” My manager didn’t wait for an answer before asking “Oh, and can you look up companies with our SIC code to see which tags are most frequently used for this line item?” My manager paused momentarily before continuing, “by the way, we may have a Subsequent Event footnote, can you find an appropriate tag and pull examples of the language used so that we don’t have to create one from scratch?” “Thanks. Looks OK, I guess.”

My silence was not a non-answer. It was the answer of no answer.

And then it hit me.

Epiphanies can reveal themselves at the strangest of times, and that’s if you’re lucky. It was at this moment when I caught a glimpse of the potential power of XBRL and it was beautiful. Revolutionary, in fact. It could transform our roles as financial reporters to roles of business advisors. It could create efficiencies that ‘add-value’ to our lives, not just our jobs. It could allow us to analyze data that was once too costly to obtain. Truly, I was actually excited again. That ‘data’ had magic too. The potential was there – waiting to be harnessed. However, this time creating that magic, the value and power of XBRL data, was beyond my skill-set, but faith in a plan for a bigger picture of XBRL capabilities was enough to keep me engaged in the responsibilities of XBRL compliance reporting.

It could transform our roles as financial reporters to roles of business advisors.
It could create efficiencies that ‘add-value’ to our lives, not just our jobs.
It could allow us to analyze data that was once too costly to obtain.

The XBRL landscape and mindset changed as financial reporters and users of financial reports became more comfortable with the aspects of XBRL. Companies have passed the pains of implementation and companies fell on one side or the other of the debate on ‘support in-house’ or ‘outsource to service provider’. The services market changed a bit as XBRL reporting became somewhat of a commodity and SaaS providers either dropped out, were acquired by larger multi-service firms, were acquired by larger software companies and folded into an integrated solutions platform, or strengthened to a level of independent viability.

See how XBRL data can help you dig deeper into data and see the why behind the data

Years Pass and Time Changes Many Things….

Somewhere along the XBRL road, momentum fizzled, leaving the vision of XBRL’s bigger picture to ‘process in the background’ and I’m not sure anyone really noticed. Perhaps, we were distracted by Rev Rec or Leases or were we Converging? As financial reporters, we’re used to doing just that – reporting on the past; explaining differences or trends we’ve modeled in Excel and complying with reporting requirements. We report data by nature, not consume it, right? Is that why we haven’t seen an explosion of platforms that harness the power of XBRL? Is that why there exist only a handful of companies in the US that mine, extract, utilize and provide XBRL data (and analysis thereof) as a service or software offering? We can only speculate, but what we do know is that we, as financial reporters are underutilizing XBRL data. OUR data. Sure, we look at our data every quarter, but we don’t see our data, and its story, framed as a picture that we can study, learn from and share. Nor do we look often enough at data from other companies to help us be better reporters or more efficient in our roles….But we can. We can do ALL of this and so much more!

My friends, we are so close - so very close - to that moment when, at the simple push of a button, all of our years of effort that we spent on perfecting our XBRL data - defining, refining, selecting tags, understanding the intricacies, nuances, and subtleties of abstract and multidimensional concepts - magically come together as OUR beautiful ‘value-add’. We build the data. We provide the data. Trust me, they’re coming for the data, but know this too….we CAN be consumers of our own data at the same time. And THAT is the power of our XBRL.

Sure we look at our data every quarter, but we don’t see our data, and its story, framed as a picture we can study, learn from and share. Nor do we look often enough at data from other companies to help us be better reporters or more efficient in our roles….But we can.

We CAN be consumers of our own data. And THAT is the power of our XBRL.

Monica Banuelos’ background includes 20+ years as an accounting & finance professional, with extensive experience in Compliance, Internal/External Reporting for publicly held companies.
With her deep knowledge of technical accounting, SEC reporting requirements and understanding of business issues, Monica has provided guidance to many finance professionals and assistance to companies in the areas of XBRL implementation. She is a graduate of UC, Riverside and earned her CPA and CMA in the State of California.

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