Importance of using a single source Inline XBRL tool for SEC filing
Structure is an important aspect for any analysis of complex information.
Therefore, it is not surprising that the past decade has seen the financial regulators pushing for exponential shift towards standardizing traders to file their compliance in increasing structured formats. The era of digital filing of financial statement has catapulted the financial management to and regulation to ensure highest levels of integrity and accuracy of the filed statements.
While every iteration of digital tools used for filing financial statements has moved in this direction, XBRL in its most current format the Inline XBRL, has been at the forefront of ensuring data accuracy, simplification of process for filers and easy to use information for the consumers.
Being pioneers in regulatory reporting solutions, DataTracks offers a collaborative tool to review and sign-off securely on the iXBRL document – the Online Reviewers’ Guide (ORG). It is certified by XBRL International under the “Review and consumption” category. ORG allows issuers to preview iXBRL, execute validation, review tagging decisions, comment, suggest changes, compare between XBRL versions, and sign-off securely on the iXBRL document.
Another noteworthy feature of the ORG is the ability to compare XBRL tags between two different versions of the same document period and even between two separate document periods. If the reporting is done in two different languages, the ORG facilitates comparison of such documents effortlessly.
Importance of Inline XBRL (iXBRL) Tool for SEC filing
Inline XBRL has evolved to address several key moot points in filing and consuming financial statements. The objectives of achieving high quality, accurate data have been the driving force for this evolution. These changes brought have removed several bottlenecks faced by filers, thereby simplifying their process along with achieving the already mentioned objectives.
Duplication almost always leads to errors.
Especially when it comes to complex data sets like financial statements, syncing statements in one format with another inevitably leads to errors. Avoiding such errors takes multiple validations, costing time and money to filers. Unlike XBRL, Inline XBRL does away with duplicate disclosures. This means that there are barely any chances for data mismatch.
Also, the single-source Inline XBRL ensure that SEC filers no longer face challenges during tagging in an effort to represent the financial statements the same as its SEC rendering. This eliminates complex reconciliation of tagging to maintain data accuracy.
Simplifying the process to reduce errors
One of the main reasons for the data integrity using Inline XBRL is that ease of data filtration. To put it simply, the lack of IT expertise required to filter the financial data makes it viable for multiple scrutiny in significantly lesser time. This in turn reduces errors and leads to more accurate financial statements.
Similarly financial statements can be reviewed with relative ease when rendered using Inline XBRL. Since all the information of a financial data point is intuitively represented with a simple function of hovering the cursor over it, it no longer requires experienced personal with XBRL expertise to review them. This allows more people within the system to adopt XBRL without fear of a steep learning curve. The ease of use is not limited to the filer but also equally extends to its consumers such as investors, analysts, academics and most importantly SEC itself. SEC extensively uses Inline XBRL features to analyze the quality of data presented by filers and scrutinizes for inconsistencies.
AI with Inline XBRL is the highway for data accuracy
Keeping in line with the trend of its evolution, XBRL has built capabilities to automatically detect errors in filing. The extensive use of machine learning algorithms is working their way forward towards ensuring human intervention is minimized and thereby minimizing errors. This ensures that data quality and integrity is enhanced further. All of these advantages not only improve the quality of financial statements but also progressively require lesser resources.
To know more about how we can simplify your SEC compliance requirements, get in touch with iXBRL experts from our team or call +1 (609) 257 4232 .