Page 384 - Accounting Information Systems

CHA P TER 8 Financial Reporting and Management Reporting Systems 355

XBRL—Reengineering Financial Reporting

Online reporting of financial data has become a competitive necessity for publicly traded organizations.
Currently, most organizations accomplish this by placing their financial statements and other financial
1
reports on their respective Web sites as HTML (Hyper Text Markup Language ) documents. These docu-
ments can then be downloaded by users such as the SEC, financial analysts, and other interested parties.
The HTML reports, however, cannot be conveniently processed through IT automation. Performing any
analysis on the data contained in the reports requires them to be manually entered into the user’s informa-
tion system.
The solution to this problem is eXtensible Business Reporting Language (XBRL), which is the Inter-
net standard specifically designed for business reporting and information exchange. The objective of
XBRL is to facilitate the publication, exchange, and processing of financial and business information.
XBRL is a derivative of another Internet standard called XML (eXtensible Markup Language).

XML
XML is a metalanguage for describing markup languages. The term extensible means that any markup
language can be created using XML. This includes the creation of markup languages capable of storing
data in relational form in which tags (or formatting commands) are mapped to data values. Thus, XML
can be used to model the data structure of an organization’s internal database.
The examples illustrated in Figure 8-6 serve to distinguish HTML from XML using a bookstore order
formatted in both languages. Although essentially the same information is contained in both examples
and they look similar in structure, important differences exist between them. Although both examples use
tags (words that are bracketed by the symbols < and >) and attributes such as Doe, John, the way in which
these tags and attributes are used differs. In the HTML example, the tags have predefined meaning that
describes how the attributes will be presented in a document. The book order in this example can only be
viewed visually (similar to a FAX) and must be manually entered into the bookstore’s order entry system
for processing. In the case of the XML order, the tags are customized to the user, and the user’s
application can read and interpret the tagged data. Thus, the bookstore order prepared in XML presents

FI GUR E
8-6 COMPARISON OF HTML AND XML DOCUMENTS

Partial HTML Book Order
<H1>Book Order</H1>
<BOLD>Understanding XML</BOLD> End-user computer
<H2>Doe, John</H2> cannot process HTML
<ITALIC>1</ITALIC> and can only display
<BOLD>9.95</BOLD> the format.
<H2>Standard UPS </H2>

Partial XML Book Order
End-user computer can
<ORDERTYPE>Book Order</ORDERTYPE>
<TITLE>Understanding XML</TITLE> recognize XML and
<AUTHOR>Doe, John</AUTHOR> process accordingly,
<QUANTITY>1</QUANTITY> relieving some of the
<PRICE>9.95</PRICE> burden currently placed
<SHIPPING>Standard UPS </SHIPPING> on web servers.

1 HTML is discussed in more detail in Chapter 12.