With XBRL starting to achieve momentum in the corporate world, the XBRL discussion turns the page to one that is focused on implementation issues.

Though the first two phases have already been put into effect, there is still a long way to go until full implementation of interactive data is complete. Only approximately 450 companies have filed detail tagged footnotes, approximately 1,200 companies began XBRL filing in 2010, and about 9,000 companies will begin filing this year after June 15.

For the few companies that have filed detail tagged footnotes, the process should get easier from period to period. However, the 2011 taxonomy is scheduled to be finalized in early 2011 and will be effective after July 15, 2011. But what is going to happen next?  Will companies research better elements to replace existing or custom ones? On top of that, the modified treatment of liability will end on the two-year anniversary of XBRL filing. What are companies doing to get ready for the end of modified liability?

For those companies that have just begun filing or are about to start this year, are you downplaying the additional workload that XBRL filing will demand? Have you begun planning? Will you outsource or attempt to bring it in-house? If you are about to start detail tagging, do you have a plan in place to address all four levels of tagging? Do you have a proper review in place to ensure accuracy?

So far, this blog has been primarily aimed at business professionals who want to learn more about XBRL and who want to keep current with key XBRL issues as they emerge. We’ve stayed on top of the literature and told you what’s worth reading, as well as letting you know about meetings, webcasts, and other events worth listening to.

As we move into 2011, we will be expanding our focus to discuss how companies are implementing XBRL. Our goal is to help every company, no matter where they are in the process. For XBRL, 2011 will become “The Year of the Company.” We look forward to bringing you new insights from the company's point of view.

by Scott Barta

This is the third installment of a four-part interview. The first part provides an overview of XBRL CH; the second discusses the unique Swiss environment for XBRL adoption.

6. Switzerland, with its impressive tradition of political independence, is not a member of the Committee of European Securities Regulators (CESR), which has proposed a cost/benefit analysis of an XBRL mandate for Europe’s listed companies that contemplates a five-year phase-in period. How does Switzerland’s unique position vis-à-vis Europe and her institutions affect the implementation of XBRL FR for Swiss companies, both short- and long-term?

For political reasons, it is unlikely that Switzerland will join the EU in the foreseeable future. Nevertheless, the country is tightly integrated with the EU, to the extent that it has many of the benefits of membership but is not involved in political decision-making. The default model is called autonomous re-enactment. This is what I expect to happen for mandatory XBRL reporting as well. It is generally not in the DNA of Swiss authorities to take a leadership role by imposing onerous new regulation unilaterally, without extensive consultation and consensus building. So, short of a sudden burst of pioneer spirit, we will watch what happens in the EU, and then copy.

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This is the second installment of a four-part interview. The first part discusses the basics of XBRL CH.

3. The Big 4 firm Deloitte describes the financial reporting framework in Switzerland as follows:

Switzerland is not a member of the European Union and, therefore, is not subject to the EU IAS Regulation or Accounting Directives. The Swiss Foundation for Accounting and Reporting publishes accounting standards (ARR/FER, or 'Swiss GAAP'). Compliance with ARR/FER is required by all companies. However, compliance with IFRSs ensures compliance with ARR/FER, and many large Swiss companies have, for a number of years, followed IASs/IFRSs.

Starting with annual reports for 2005 and interim reports for 2006, most Swiss companies whose equity shares are listed on the main board of the Swiss Exchange are required to prepare their financial statements using either IFRSs or US GAAP. Swiss GAAP will not be permitted. The only exception is for Swiss companies listed on the main board that are not multinational (that is, operate primarily in Switzerland). Those companies may continue to use the Swiss GAAP, or they may choose IFRSs or US GAAP.

What impact does this FR framework have on both the development and use of a Switzerland-specific XBRL taxonomy?

It’s a major factor, which is often misunderstood. For us as the Swiss XBRL jurisdiction, it means that we don’t have the same evident Unique Selling Proposition in a single local GAAP taxonomy. In other words, all major firms already have access to a taxonomy covering their reporting needs, be it IFRS or US GAAP. There simply is no local GAAP requirement that Switzerland-based multinationals have to comply with.

Consequently, Swiss GAAP FER is a niche standard for small- to medium-size public and private entities, which is derived from IFRS, but without most of the complexity and associated cost. That is what makes it attractive; indeed, a few industrial firms have recently switched from IFRS to Swiss GAAP FER. However, the new IFRS for SMEs standard might lure some privately held preparers away from Swiss GAAP FER thanks to its immediate global recognition, which may be an issue for international investors and creditors. There is no Swiss GAAP FER taxonomy available to date, but we are certainly interested in helping to create one, once the initial OR taxonomy is done.

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