"The goals were timely and accurate data, stronger internal controls, reduced costs, a standardized system of seamless data exchange, business processes and data elements. XBRL met all of those goals." -- Nevada Controller Kim Wallin (pictured)
States and localities have in recent years been engaged in developing financial Web sites, transparency portals, campaign finance disclosure and online checkbooks to open the process of government spending to a very interested and sometimes skeptical public. Recently, with the flood of federal stimulus money, that development has accelerated.
While a commitment to openness and transparency is commendable, tracking grants and other financial information -- across multiple agencies and departments running different software on incompatible systems -- is a tough job for jurisdictions, and the resulting information may be too late for real-time decision making, and too complex for anyone but a professional auditor to understand. Increasingly, XBRL is being heralded as a solution.
What is XBRL?
XBRL stands for eXtensible Business Reporting Language -- an XML-based open standard for financial reporting. "Instead of treating financial information as a block of text -- as in a standard Internet page or a printed document -- XBRL provides an identifying tag for each individual item of data," says an explanation on the XBRL International Web site. "This is computer readable. For example, company net profit has its own unique tag. In addition, the tags provide other information about the item, such as whether it is a monetary item, percentage or fraction, etc.
"XBRL can show how items are related to one another," continues the site. "It can thus represent how they are calculated. It can also identify whether they fall into particular groupings for organizational or presentational purposes. Most importantly, XBRL is easily extensible, so ... organizations can adapt it to meet a variety of special requirements."
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