Recently, we posted a blog about the importance of XBRL data quality. We noted with great interest the post last week by Wes Bricker (PwC Vice Chair, US and Mexico Assurance Leader and Vice Chair of XBRL International Board of Directors) with a similar message.
As digitization of data, and use of XBRL by regulatory bodies continues to grow, companies that have implemented strong quality review processes and controls, as well as governance and outside assurance, will be better positioned to reap its benefits and have comfort that the reports being filed in response to regulatory reporting mandates are high quality.
Wes Bricker, PwC Vice Chair, US and Mexico Assurance Leader.
Wes comes with a unique perspective on the XBRL landscape. Being a former Chief Accountant at the SEC, Wes has seen first-hand how regulators have used XBRL data for analyses as part of their enforcement activities. Now, serving on PWC’s US Leadership Team and the Global Assurance Executive Leadership Team, Wes sees how the requirement in the EU for auditors to opine on whether the financial statements comply with the European Single Electronic Format (ESEF) requirements will impact the auditing profession. At least in Europe, the auditors are activating to prepare for auditing the XBRL data underlying the financial statements. Finally, being on the Board of Directors at XBRL International, Wes understands the accelerating momentum of XBRL adoption and implementation globally.
Why Are We Excited?
At idaciti, we are passionate about financial and non-financial data quality.
We believe that easy accessibility to consistent, timely, and high-quality structured data is the pillar of the capital markets and economies' efficient functioning.
We also believe that it is essential that the regulators, standard-setters, companies, auditors, and investors come together as interested stakeholders to work towards the common objective of promoting XBRL data quality.
We have been at the forefront of promoting the demand for high-quality structured data and representing XBRL data users' perspectives. We have also worked closely with the companies themselves to help improve the quality of their XBRL filings.
With the incorporation of the XBRL-US's Data Quality rules into the 2020 US GAAP Financial Reporting Taxonomy, the FASB has publicly signaled the importance of tagging the XBRL data correctly. Companies appear to be responding. Anecdotally, there is evidence that companies are paying more attention to their XBRL data errors since XBRL US publishes a dashboard of each company's filing errors that is publicly visible. Reputational and risk concerns become top of mind.
In Data We Trust, In High-Quality Data, We Shine
With this recent PwC call for greater emphasis on XBRL data quality, we are truly encouraged that the auditors are now coming to the table and participating in this discourse. Will the SEC in the U.S. follow the European regulators' lead and require that the Inline XBRL financial statement (the single version of the company's financial statements) be audited? Only time will tell, but we remain hopeful that the changing tides is a sign of what is to come - XBRL data quality becoming front and center in digital financial reporting.