To a lot people, the new XBRL format for financial information is yet another requirement that has to be met so a company can check off yet another box in the never-ending quest to meet compliance requirements.
But James Fisher, SAP vice president of marketing for enterprise performance management and finance solutions, says companies would do well to look beyond simply checking off another compliance box when it comes to XBRL. Once in place, Fisher says XBRL will provide a foundation for a new generation of collaborative financial management applications that will have a profound effect on business.
For instance, XBRL will greatly accelerate the financial disclosure management, which Fisher says should result in companies being able to close their books at the end of every quarter a whole lot faster. In addition, Fisher says SAP envisions leveraging XBRL to enhance the next generation of its enterprise performance management (EPM) and business intelligence applications.
Like most compliance-related technologies, there's a fair amount of grousing about having to implement a new technology at the behest of some outside regulatory body. But in the case of XBRL, Fisher says this new format for sharing financial data will actually serve as a trigger for a whole range of more sophisticated financial management applications that greatly enhance a company's ability to manage its finances.
So while to a certain degree XBRL may feel punitive, in reality it is the beginning of a major transformation in financial management that should occupy IT organizations for years to come.