Extensible business reporting language xbrl a new dimension in financial reporting

78 International Journal of Business, Accounting, and Finance, Volume 5, Number 1, Winter 2011
EXTENSIBLE BUSINESS REPORTING LANGUAGE XBRL: A
NEW DIMENSION IN FINANCIAL REPORTING
Augustine Enofe
Pesi Amaria
Argosy University
ABSTRACT
From its inception in the late 1990s, extensible business reporting language (XBRL) has
created a revolutionary buzz in the financial reporting community. This study will examine the
impact of XBRL in financial reporting and determine if this new phenomenon is truly a promise or
just a passé. The result of the study suggests that XBRL will not enhance financial reporting. The
result further suggests that the biggest winner of the process will be the stock analyst, followed by
the investors. Majority of the respondents did not believe XBRL will have any impact on
convergence. However, 100% of the respondents believed that XBRL will not reduce financial
fraud or have any impact on internal control.
Keywords: Accounting, XBRL, financial reporting, business reporting
INTRODUCTION
Invented in 1998 by Charles Hoffman (Farewell, 2006), extensible business reporting
language better known as XBRL has created a revolutionary buzz in the financial reporting
world. Since the efforts of the AICPA in 1999, the language known as the extensible financial
reporting markup language (XFRML) was rechristened the eXtensible Business Reporting
Language (XBRL) (Harding, 1999; Hannon, 2004a; Kernan, 2009). XBRL is a specification of
Extensible Markup Language (XML), and represent the future in data accessibility. This new
reporting tool promises to provide both internal and external benefits (Marshall & Heffes, 2007)
to the accounting and financial reporting community. In addition to increasing transparency in
financial reporting, XBRL also has the ability to increase efficiency and effectiveness to shared
financial information. XBRL is quickly becoming the standard method of communicating
financial data among a wide range of users thus honoring its pledges to change business and
financial reporting from the traditional method to the digital method (Garbellotto, 2007).
Below is the manner organizations currently collect financial information that is used for
the preparation of financial statement (Farewell, 2006).
This study will quantitatively examine the impact of XBRL in financial reporting and
attempt to answer the question whether this new Phenomenon is truly a promise that is here to
stay or just another financial passé.

International Journal of Business, Accounting, and Finance, Volume 5, Number 1, Winter 2011 79
BUSINESS PROCESS WITHOUT XBRL
Adopted from Hoffman & Strand [2001, 15]
HOW DOES XBRL WORK?
XBRL is a process of moving data from one area to the other in an electronic format
(Van Hilvoorde & Garbellotto, 2007). There are two approaches to moving data: a move from
system to system or from system to person (Van Hilvoorde & Garbellotto, 2007). This
movement can either be internally within the organizations or externally between two
organizations. Internal movement simply moves data between ledgers, sub ledgers and ending
up in a report format, or externally from one organization to a regulatory agency.
The second type of movement from system to a person mean that an individual can
receive similar documents and yet use the data in a different format. There are four types of data
that can be moved using XBRL. They include aggregated business data (financial statements,
and fiscal fillings), transactional data (general ledger posting), operational data (orders and
invoices), and unstructured data (emails, word and excel documents). In implementing XBRL in
an organization, there are six major steps according to Phillips, Bahmanziari, and Colvard
(2008).
Step One: This is the downloading of the taxonomies. The taxonomies are the dictionary of the
logs that are used in the markup process.
Step Two:This is the open dragon tag and the file that needs to be tagged. Excel is open with the
dragon tag add in. If a rivet menu option appears, go to the add-in and select the rivet software
you then open the excel file you want to tag.
Regulatory Fillings
Accounting System
Printed Financials
Third Party
Information
Explanatory Text Website
Tax Returns
Trade Filings

Step Three:In this step, the entire file is set-up. Also in this step, define the entity that is to be
reported to. First, set-up a unique ID for each company, and then use either the company
taxpayer identification number or the company trade tickler symbol.
Step Four: In this step, the data is marked up. It is recommended to set-up a hopper that will
contain all the common elements.
Step Five: This step is validation. Validation involves two steps. The first step is validation for
the mark up, and the second is validation of calculations. With the latter, there are two additional
options. The first is enhanced validation where errors will happen when only the summary
elements are tagged and the taxonomy detail elements are not present. The second is that strict
XBRL allows for the omission of some taxonomy detail elements.
Step Six:The final step is the exporting of data. Once the data have passed the validation steps,
export XBRL from the dropdown menu.
The Sarbanes-Oxley Act and the subsequent changes in corporate governance as a result
of the act put financial executives under pressure to provide financial information that are
efficient as well as effective. XBRL could be the saving grace to the solution the executives
have been looking for to meet this tough demand (deMesa Graziano, 2002).
PROBLEM STATEMENT
XBRL is a web-based technology that requires no specific prior knowledge. The premise
of the technology is to encode financial statements and create information that can be read
automatically by any XBRL enabled software. This can be accomplished through XML enabled
data exchange between disparate software application by providing a framework for defining
tags called “taxonomies”, and the corresponding relationships (Schema) (deMesa Graziano,
2002). Generally, XBRL convert financial data to an interactive data that can be identified by
tags. These tags are often referred to as taxonomies (Fox, 2006).
Taxonomies are defined as classification schemes that are in compliance with XBRL
specifications to achieve specific information exchange or reporting objectives (Hall, 2007). The
use of XBRL smoothes company specific terminology thereby allowing the comparison of two
company financial statements. As shown in the diagram below, data is entered once in the
XBRL documents which can be used to generate financial statement for the organization, and all
stakeholders. The chances of an error are minimal because data are only imputed once (Farewell,
2006).
Since inception in the late 1990s, there have been many articles written about XBRL and
the potential to transform financial reporting to a new level. Jones and Willis (2003) asserted
that XBRL is completely platform independent which means that XBRL will work on any
operating system and on any computer and interface with almost all software. In addition, it is
flexible so that if a report is created by one specific software, it has the ability to be transferred to
a different software (Jones & Willis, 2003). Hannon (2004b) examined the growth of XBRL in
the European nations and the impact of the international accounting convergence in spreading
the growth. Hannon (2004b) also examined the slow growth of XBRL in the United States as

BUSINESS PROCESS AFTER IMPLEMENTATION OF XBRL
Adopted from Hoffman & Strand [2001, 15]
compared to the European nation. In a keynote address delivered at the 14th
annual XBRL
international conference held in Philadelphia December 4th
through 6th
2006, the Security and
Exchange Commission’s chairman Christopher Cox examined the benefits of XBRL which
includes reduction in human error, and reduction in restatement of financial statements (Cox,
2008, p. 7). Garbellotto (2008) argued the value of XBRL for those large organizations that
gather large amount of data. Lester (2007) also weighed in on the benefits to be derived from the
use of XBRL. These contributions are noteworthy, and no attempt will be made to duplicate
these prior studies but rather to build on the work of this prior studies. This study will
quantitatively examine the impact of XBRL in financial reporting and attempt to answer the
question whether this new Phenomenon is truly a promise that is here to stay or just another
financial passé.
OBJECTIVE OF THE STUDY
In reaching a conclusion whether XBRL is the tool that will help reshape the image of the
accounting profession, this study will attempt to answer the following questions:
HYPOTHESIS
Hypothesis 1: The use of XBRL will significantly enhance financial reporting.
Hypothesis 2: If properly implemented, XBRL will be advantageous to all stakeholders in
understanding financial reporting.
Hypothesis 3: International convergence will be greatly enhanced with the use of XBRL.
Hypothesis 4: The implementation of XBRL will be cost prohibitive for small firm.
METHODOLOGY
This study will use a quasi-experimental research design to analyze the survey data. The
design method involves a survey of respondents’ opinions on XBRL. A questionnaire will be
Accounting System
Printed Financials
Third Party
Information
Explanatory Text
Regulatory Fillings
Website
Tax Returns
Trade Filings
XBRL
Documents

used to gather the required information. The survey and questionnaire will be targeted toward
certified public accountant (CPA) professionals and Chief Financial Officer (CFO) of a medium
to large size companies located in Jacksonville, Florida and the Surrounding communities.
DATA COLLECTION AND ANALYSIS
One hundred participants are randomly selected from the telephone directory of CPAs
and medium to large size company CFOs. At least 25 of the participant will be CFOs and the
remaining will be CPA in public practice.
Demographics
Of the 43 companies surveyed, 26 (60.5%) are small size with less than 100 employees,
10 (23.3%) are medium size with 100-500 employees, and 7 (16.3%) large to MNC with 500-
1000 plus employees. Almost all (98%) but one company are private. Only one company out of
43 responded yes to being subject to Public Company Accounting Oversight Board (PCAOB)
reporting requirement. Of the 42 companies that responded no to PCAOB reporting requirement,
29 (69%) responded no to being familiar with XBRL and 13 (31%) responded yes to being
familiar with XBRL. All 43 (100%) responded no to using XBRL.
The age of the survey sample varied from 25 to 64 years with majority (42%) between 25
and 34 years. The education level of the sample is college graduate (77%), master degree (21%),
and doctor degree (2%). The breakdown by industry is manufacturing (14%), retail (14%),
service (21%), banking/financial services (9%), education (7%), government (7%), and public
accounting practitioners (28%). CFO (42%) and CPA (35%) are majority of the sample
surveyed. The rest of the respondents are president/CEO (2%), educator (7%), manager (9%),
and partner (5%).
ANALYSIS OF RESULTS
In answering the hypotheses, the study examined several issues such as the need for
XBRL; familiarity with XBRL and its potential; the process of implementing XBRL; helping to
solve the problem of financial statement fraud; the accuracy, flexibility, and ease of use of
XBRL; the cost, time consuming, and lack of awareness of XBRL; the understanding of financial
reporting by stakeholders; and the benefits from XBRL to the international accounting
convergence. Additional considerations included the degree of enhancement to financial
reporting; the usefulness of XBRL in design simplicity for implementation; the internal control
over financial reporting; the use of XBRL in reducing financial statement fraud and the fraud of
management override of controls; the extent of benefit to small and large firms; and the likely
change in the accounting profession and the type of professionals benefiting most from the use of
XBRL.
Relationship of the reporting and understanding of the XBRL financial statements, the
international standards convergence with XBRL, and the cost of XBRL implementation
The following analysis is related to 43 respondents working in small (26), medium (10),
or large/MNC (7) size companies.

None of the 43 companies has used XBRL. On the question of the company being
subjected to PCAOB reporting, 42 (98%) out of 43 companies responded no which included 26
(62%) small, 10 (24%) medium, and 6 (14%) large to MNC, (Size of company – small, medium,
large, MNC x Organization subject to PCAOB reporting requirements – yes/no, Chi Square =
6.313, df = 3, p = .097 not significant).
When comparing to the familiarity with XBRL, 29 (67%) out of 43 companies are not
familiar and 14 (33%) are familiar. Of the 26 small size, 17 (65%) are not familiar and 9 (35%)
are familiar; of the 10 medium size, 7(70%) are not familiar and 3 (30%) are familiar; and of the
6 large/MNC, 5 (83%) are not familiar and 1 (17%) is familiar with XBRL, (Size o f company –
small, medium, large, MNC x Familiarity with XBRL – yes/no, Chi Square = 2.841, df = 3, p =
.417 not significant).
Forty one companies (95%) are not in the process of implementing XBRL. Only two
(5%) large/MNC companies are implementing XBRL, (Size of company – small, medium, large,
MNC x Process of implementing XBRL – yes/no, Chi Square = 24.209, df = 3, p = .000
significant).
When respondents are asked about the need for XBRL, 32 (74%) out of 43 said no while
11 (26%) said yes to management seeing a need for XBRL. Of the 26 small, 20 (77%) said no
and 6 (23%) said yes; of the 10 medium, 7 (70%) said no and 3 (30%) said yes; and of the 7
large/MNC, 5 (71%) said no and 2 (29%) said yes to management seeing a need for XBRL, (Size
of company – small, medium, large, MNC x Management see a need for XBRL – yes/no, Chi
Square = 3.338, df = 3, p = .341 not significant).
On the question of do you like the potential of XBRL, 30 (70%) out of 43 said no while
13 (30%) said yes to liking potential of XBRL. Of the 26 small, 19 (73%) said no and 7 (27%)
said yes; of the 10 medium, 6 (60%) said no and 4 (40%) said yes; and of the 7 large/MNC, 5
(71%) said no and 2 (29%) said yes to liking the potential of XBRL, (Size of company – small,
medium, large, MNC x Did you like the Potential of XBRL – yes/no, Chi Square = 3.419, df = 3,
p = .331 not significant).
All 43 respondents agreed that XBRL would not help solve the problem of financial
statement fraud. However, when asked if they agree to XBRL being easy to use, is accurate and
flexible, 34 (79%) did not agree and 9 (21%) agree. Of the 26 small, 20 (77%) did not agree and
6 (23%) agree; of the 10 medium, 8 (80%) did not agree and 2 (20%) agree; and of the 7
large/MNC, 6 (86%) did not agree and 1 (14%) agree to XBRL being easy to use, is accurate and
flexible, (Size of company – small, medium, large, MNC x XBRL is easy to use, accurate and
flexible – yes/no, Chi Square = .408, df = 3, p = .939, not significant).
XBRL is costly, time consuming and lack awareness was agreed by 14 (33%) of the
respondents whereas 29 (67%) did not agree. Of the 26 small, 17 (65%) did not agree and 9
(35%) agree; of the 10 medium, 7 (70%) did not agree and 3 (10%) agree; and of the 7
large/MNC, 5 (71%) did not agree and 2 (28%) agree to XBRL being costly, time consuming
and lack awareness, (Size of company – small, medium, large, MNC x XBRL is costly, time
consuming and lack awareness – yes/no, Chi Square = .417, df = 3, p = .417 not significant).
On the question of would XBRL be advantageous to all stakeholders in understanding
financial reporting, 40 (93%) out of 43 said no only 3 (7%) indicated yes that XBRL would be
advantageous.
When asked if the international accounting convergence will greatly benefit from XBRL,
30 (70%) responded that it would not and 13 (30%) indicated that it would greatly benefit. Of the
26 small, 18 (69%) said no and 8 (31%) said yes; of the 10 medium, 7 (70%) said no and 3

(10%) said yes; and of the 7 large/MNC, 5 (71%) said no and 2 (28%) said yes to the
international accounting convergence will greatly benefit from XBRL, (Size of company – small,
medium, large, MNC x International accounting convergence will greatly benefit from XBRL –
yes/no, Chi Square = 2.835, df = 3, p = .418, not significant).
When asked if the use of XBRL will significantly enhance financial reporting, 23 (54%)
responded that it would not and 20 (46%) indicated that it would significantly enhance financial
reporting. Of the 26 small, 13 (50%) said no and 13 (50%) said yes; of the 10 medium, 7 (70%)
said no and 3 (10%) said yes; and of the 7 large/MNC, 3 (43%) said no and 4 (57%) said yes to
the use of XBRL will significantly enhance financial reporting, (Size of company – small,
medium, large, MNC x Use of XBRL will significantly enhance financial reporting – yes/no, Chi
Square = 2.402, df = 3, p = .493, not significant).
XBRL will be more useful if the design is simple to implement was agreed by 36 (84%)
of the respondents whereas 7 (16%) did not agree. Of the 26 small, 5 (19%) did not agree and 21
(80%) agree; of the 10 medium, 1 (10%) did not agree and 9 (90%) agree; and of the 7
large/MNC, 1 (14%) did not agree and 6 (86%) agree to XBRL will be more useful if the design
is simple to implement, (Size of company – small, medium, large, MNC x XBRL will be more
useful if the design is simple to implement – yes/no, Chi Square = .651, df = 3, p = .885, not
significant).
On the question of would Internal control over financial reporting be greatly improved
with XBRL, 37 (86%) out of 43 said no only 6 (14%) indicated yes that the internal control over
financial reporting will be greatly improved with XBRL.
When asked in your opinion, did you think the use of XBRL will reduce financial
statement fraud, all 43 (100%) responded that use of XBRL will not reduce financial statement
fraud. Questioning further will the use of XBRL reduce the fraud of management override of
controls, again all 43 (100%) responded that use of XBRL will not reduce the fraud of
management override of controls.
On the question of will XBRL benefit larger firm more than small firm, almost all 41
(95%) respondents but 2 (5%) said that XBRL will benefit larger firm more than small firm.
When asked did you think XBRL will change the accounting profession as we know it,
majority 38 (88%) said no and 5 (12%) said yes to XBRL will change the accounting profession.
Who will benefit most from the use of XBRL, the respondents indicated that stock
analyst (46%), investors (23%), regulatory authorities (7%), management (6%), and
accounting/financial professional (4%) benefiting from the use of XBRL. Of the 26 small, the
majority benefiting will be stock analyst (42%), investors (23%), management (15%), and
accounting/financial profession (15%). Of the 10 medium, the majority benefiting will be stock
analyst (50%), investors (20%), regulatory (20%), and management (10%). Of the 7 large/MNC,
the majority benefiting will be stock analyst (57%), investors (28%), and management (14%),
(Size of company – small, medium, large, MNC x Who will benefit most from the use of XBRL –
stock analyst, investors, regulatory authority, management, accounting and financial
professional, Chi Square = 7.518, df = 12, p = .822, not significant).
The following analysis is related to 43 respondents working in a professional capacity as
CFO (18), CPA (15), or other (10) including president/CEO, educator, management, or partner in
companies.
When comparing to the familiarity with XBRL, of the 18 CFO, 12 (67%) are not familiar
and 6 (33%) are familiar; of the 15 CPA, 7(47%) are not familiar and 8 (53%) are familiar; and
of the 10 other including president/CEO, educator, management, or partner in companies, all 10

(100%) are not familiar and 0 (0%) is familiar with XBRL, (Are you familiar with XBRL – yes/no
x Position with the company – president/CFO/educator/management/partner, CFO, CPA, Chi
Square = 7.781, df = 2, p = .020 significant).
None of the 43 respondents including CFO, CPA, president/CEO, educator, management,
or partner in companies has used XBRL.
On the question of do you like the potential of XBRL, of the 18 CFO, 13 (72%) said no
and 5 (28%) said yes; of the 15 CPA, 8 (53%) said no and 7 (47%) said yes; and of the 10 other,
9 (90%) said no and 1 (10%) said yes to liking the potential of XBRL, (Did you like the potential
of XBRL – yes/no x Position with the company – president/CFO/educator/management/partner,
CFO, CPA, Chi Square = 3.913, df = 2, p = .141 not significant).
All 43 respondents agreed that XBRL would not help solve the problem of financial
statement fraud. However, when asked if they agree to XBRL being easy to use, is accurate and
flexible, of the 18 CFO, 14 (78%) did not agree and 4 (22%) agree; of the 15 CPA, 10 (67%) did
not agree and 5 (33%) agree; and of the 10 other, all 10 (100%) did not agree and 0 (0%) agree to
XBRL being easy to use, is accurate and flexible, (XBRL is easy to use, accurate and flexible –
yes/no x Position with the company – president/CFO/educator/management/partner, CFO, CPA,
Chi Square = 4.060, df = 2, p = .131 not significant).
XBRL is costly, time consuming and lack awareness, of the 18 CFO, 12 (67%) did not
agree and 6 (33%) agree; of the 15 CPA, 7 (47%) did not agree and 8 (53%) agree; and of the 10
other, all 10 (100%) did not agree and 0 (0%) agree to XBRL being costly, time consuming and
lack awareness, (XBRL is costly, time consuming and lack awareness – yes/no x Position with
the company – president/CFO/educator/management/partner, CFO, CPA, Chi Square = 7.781,
df = 2, p = .020 significant).
On the question of would XBRL be advantageous to all stakeholders in understanding
financial reporting, 40 (93%) out of 43 respondents said no only 3 (7%) indicated yes that XBRL
would be advantageous.
When asked if the international accounting convergence will greatly benefit from XBRL,
of the 18 CFO, 13 (72%) said no and 5 (28%) said yes; of the 15 CPA, 7 (47%) said no and 8
(53%) said yes; and of the 10 other, all 10 (100%) said no and 0 (0%) said yes to the
international accounting convergence will greatly benefit from XBRL, (International accounting
convergence will greatly benefit from XBRL – yes/no x Position with the company –
president/CFO/educator/management/partner, CFO, CPA, Chi Square = 8.180, df = 2, p = .017
significant).
When asked if the use of XBRL will significantly enhance financial reporting, of the 18
CFO, 9 (50%) said no and 9 (50%) said yes; of the 15 CPA, 6 (40%) said no and 9 (53%) said
yes; and of the 10 other, 8 (80%) said no and 2 (20%) said yes to the use of XBRL will
significantly enhance financial reporting, (Use of XBRL will significantly enhance financial
reporting – yes/no x Position with the company –
president/CFO/educator/management/partner, CFO, CPA, Chi Square = 4.010, df = 2, p = .135
not significant).
XBRL will be more useful if the design is simple to implement, of the 18 CFO, 3 (17%)
did not agree and 15 (84%) agree; of the 15 CPA, 3 (20%) did not agree and 12 (80%) agree; and
of the 10 other, 1 (10%) did not agree and 9 (90%) agree to XBRL will be more useful if the
design is simple to implement, (XBRL will be more useful if the design is simple to implement –
yes/no x Position with the company – president/CFO/educator/management/partner, CFO,
CPA, Chi Square = .444, df = 2, p = .801 not significant).

On the question of would Internal control over financial reporting be greatly improved
with XBRL, of the 18 CFO, 17(94%) said no and 1 (6%) said yes; of the 15 CPA, 10 (67%) said
no and 5 (33%) said yes; and of the 10 other, all 10 (100%) said no and 0 (0%) said yes that the
internal control over financial reporting will be greatly improved with XBRL, (Internal control
over financial reporting will be greatly improved with XBRL – yes/no x Position with the
company – president/CFO/educator/management/partner, CFO, CPA, Chi Square = 7.371, df =
2, p = .025 significant).
When asked in your opinion, did you think the use of XBRL will reduce financial
statement fraud, all 43 (100%) respondents said that use of XBRL will not reduce financial
statement fraud. Questioning further will the use of XBRL reduce the fraud of management
override of controls, again all 43 (100%) respondents said that use of XBRL will not reduce the
fraud of management override of controls.
On the question of will XBRL benefit larger firm than small firm, almost all 41 (95%)
respondents but 2 (5%) said that XBRL will benefit larger firm than small firm.
When asked did you think XBRL will change the accounting profession as we know it, of
the 18 CFO, 17 (95%) did not agree and 1 (6%) agree; of the 15 CPA, 11 (73%) did not agree
and 4 (27%) agree; and of the 10 other, all 10 (100%) did not agree and 0 (0%) agree to XBRL
will change the accounting profession, (XBRL will change the accounting profession as we know
it – yes/no x Position with the company – president/CFO/educator/management/partner, CFO,
CPA, Chi Square = 5.263, df = 2, p = .072 not significant).
Who will benefit most from the use of XBRL, 18 CFO indicated that the majority
benefiting will be stock analyst (44%), investors (11%), regulatory authorities (11%),
management (17%), and accounting/financial profession (17%); 15 CPA indicated that the
majority benefiting will be stock analyst (60%), investors (20%), regulatory authorities (7%),
management (13%), and accounting/financial profession (0%); and 10 other indicated that the
majority benefiting will be stock analyst (30%), investors (50%), regulatory authorities (0%),
management (10%), and accounting/financial profession (10%), (Who will benefit most from the
use of XBRL – stock analyst, investors, regulatory authority, management, accounting and
Financial professional, x Position with the company
– president/CFO/educator/management/partner, CFO, CPA, Chi Square = 9.277, df = 8, p =
.319 not significant).
SUMMARY OF FINDINGS
Based on the result of the study, 54% of the respondent did not believe that XBRL will
enhance financial reporting while 46% believe otherwise. Meanwhile, majority of the
respondent believe that not all stakeholders will benefits from the implementation of XBRL.
Specifically, 42% of the respondents believe that stock analyst will be the biggest beneficiary
followed by investors at 23%. Most respondent think the implementation will have no impact on
the international accounting convergence. Although many respondents believe that the
implementation will not be cost prohibitive but they do agree that it will be a burden on small
firm. With respect to internal control and financial statement fraud, 100% of respondent do not
believe that XBRL will reduce financial fraud or impact internal control in any way. Despite the
findings, XBRL has many benefits both for analyst, large companies and investors.

WHAT ARE THE BENEFITS OF XBRL?
Reduction of Wasted Time
XBRL has the potential to reduce hours of wasted time as well as improve cost and
efficiencies for both users of financial data and internally prepared data alike (Stuart, 2006).
According to the Securities and Exchange Commission Chairman, Christopher Cox, adherence
to XBRL cannot only decrease the number of errors but detect them after they occur (Barron,
2007).
XBRL May Eliminate the Need for ERP
The use of XBRL could eliminate the need for consolidating every business unit into
ERP system (Stuart, 2006). Varying unit can achieve more autonomy in the software chosen to
transmit information from one system to another.
Improvement in Internal Reporting
XBRL can greatly enhance internal reporting capabilities to management.
Communicating financial information to management is just a matter of showing them the code
to enter in the system to generate the needed comparison for management decision making
(Garbellotto, 2007). Internal use of XBRL will decrease data preparation costs as well as the
cost associated with Sarbanes-Oxley Acts compliance (Hannon, 2006b).
Business Makeover
The transition to interactive data can result in a business make-over for both internal and
external business reporting. One major adjustment will be the cost reduction and optimization of
business process (Hannon, 2006a).
Growth of Outsourcing
The use of XBRL will eventually lead to the growth of outsourcing and consolidation of
subsidiaries. It may also leads to the automation of auditing and financial reporting. It may
provide for continuous reporting of financial data. XBRL application could also automate tax
fillings.
DISADVANTAGE OF XBRL
One major disadvantage of XBRL is the cost of acquiring the supporting software. In an
attempt to overcome this obstacle, many software companies are developing programs that have
the capacity to read, save, and import XBRL document at a reasonable cost (Pinsker & Li, 2008).
Once organization realizes the benefits they will gain from adopting XBRL, they will be more
willing to adopt the new tool (Stantial, 2007).

LIMITATION OF THE STUDY
One limitation of the study is that the sample size is small (43) and limited to the
Jacksonville community only. If the sample size was larger, and the coverage area was
expanded to include large cities with many fortune 500 firms, the result of the study may be very
different. As it turns out, many respondents are not aware of the XBRL movement.
RECOMMENDATION FOR FUTURE RESEARCH
Perhaps, future research should consider expanding the coverage area to include larger
cities as well as increase the sample size. A consideration of the impact of XBRL on the stock
exchange will be an area of significant interest for examination.
CONCLUSION
Heralded as the revolutionary solution that will change business and financial reporting,
XBRL is nothing more than a system for encoding financial statement data. XBRL promises to
increase reporting analysis, minimize errors, and improve audits efficiency and effectiveness
through accurate reporting of information. In addition it is designed to streamline the disparate
between internal and external reporting (Stuart, 2006). There has been a movement towards
XBRL for many years. With the renewed requirement by the SEC for publicly traded companies
to submit their annual financial report using XBRL, this phenomenon is fast becoming the wave
of the accounting profession future. However, the problem with the new phenomena is that in
addition to the cost of implementation, there are not many individual who are knowledgeable in
the use of XBRL. The larger accounting firms are quickly getting familiarized with the new
trend. With the current financial crisis around the world, it is becoming questionable whether
this is the right time to roll out this new fad. One thing for sure, once implemented, there is a
diminished chance for error, and XBRL saves time and improve data accuracy.
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About the Authors:
Augustine Enofe earned his Doctorate in Business Administration (DBA) with a concentration in accounting from
Argosy University, Sarasota. Dr. Enofe is an Adjunct professor of Accounting at Argosy University. He is a
Certified Public Accountant and a Certified Fraud Examiner.
Pesi Amaria earned his Doctor of Philosophy in Engineering Production from the University of Birmingham,
England. Dr. Amaria is a professor of management at Argosy University, Sarasota.

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