Bob Schneider is a Partner in 
Wilson So is the Director of Hitachi Consulting Corporation XBRL: Living Up to Its Name
Written by David vun Kannon Posted January 2, 2007
David vun Kannon was one of the first Co-Chairs of the XBRL Specification Working Group and has been an Editor of every version of the XBRL Specification. He is a Director for PricewaterhouseCoopers, LLP.
For many people, interactive data is too difficult to say, so we invented the simpler term XBRL. Not!
OK, I’ve been involved in XBRL long enough that the acronym trips off the tongue. But what does it mean? Right, eXtensible Business Reporting Language. That’s a language just for 10-Ks and Call Reports, right? Wrong!
XBRL should live up to its name: it’s not financial reporting, but business reporting. There is enormous untapped potential for XBRL still to be realized, which is hinted at by the difference between business and financial reporting.
Let me make two arguments for this. The first is revealed by a typical magic quadrant diagram. In one quadrant is financial, numeric data (eg, assets = $724,632 ). This is the sweet spot of XBRL today. Next is financial, non-numeric data. This is less common, but could include text paragraphs or specific concepts (bond rating = Baa).
In the non-financial, numeric quadrant is operational data (electricity produced = 700 megawatts). The Enhanced Business Reporting initiative, the Global Reporting Initiative, other kinds of �triple bottom line, and management-targeted KPI-based dashboards can use XBRL in this way.
The final quadrant is non-financial, non-numeric. My favorite example of this kind of data is the assessment of an internal control — is it effective, ineffective, significantly or materially weak, or is it untested? The important commonality is that all of the above are business measurements that can be taken of an entity at a point in time or over a duration. That makes them fair game for representation in XBRL.
Now the previous examples are of (in XBRL jargon) instance data. If separation of duties for cash disbursements was ineffective on Dec 31, 2005 is an instance fact, what is the taxonomy?
This leads me to my second point: sharing the metadata is often more important than sharing the data. So a big opportunity for XBRL is organizing pools of metadata in ways that can be exploited for further data sharing. Here is an example. The implementation of XBRL in the FFIECs Call Report Modernization project is justifiably well known as a successful use of XBRL. (Full disclosure I was involved in Phase I of the project.) What was the big innovation (IMHO) provided by XBRL that made it a success?
It wasn’t the ability to transfer data in an electronic format (ie, the instance document). The FFIEC already had a format for electronic data transfer. Instead, the big win was upgrading the metadata so that it could be understood and used by banks (and their supporting software vendors) more easily. Using XBRL taxonomies, and including a formula linkbase to represent validation rules and sanity checks, to share metadata was the real innovation. It was the enabler of the other breakthroughs, such as self-checking by the bank before the call report is sent.
These areas of business reporting non-financial reporting and metadata sharing are huge opportunities for XBRL to be applied to new problems. As people become accustomed to XBRL for financial data, I hope to see a growing awareness of what can be done elsewhere.