But the standard is seen as an important part of restoring consumer and investor confidence in Big Business.
Sixty percent of senior execs at financial institutions believe that trust in their industry has been eroded by the corporate scandals of the past year, according to surveys and interviews by PricewaterhouseCoopers and The Economist Intelligence Unit, an Economist Group business.
To help cure the problem, the two organizations have presented a five-step recovery plan for financial institutions suffering from an erosion of public trust, including a strong endorsement for the Extensible Business Reporting Language, or XBRL.
The financial-services vertical market, which stands to lose the most from accounting scandals, needs to move forward on Internet-based reporting standards, the report says. Pushing the use of XBRL, a programming language that uses standard data tags to identify specific information in financial reports, would help the financial-services industry in several ways. The language would make it easier for investors and regulators to navigate financial statements and more difficult for executives to hide financial information in footnotes, thus increasing the integrity of the reports. The standard also could help move the financial-reporting process toward real-time disclosure. Already companies such as Microsoft and Morgan Stanley are using the language for their financial statements.
But for banks, the benefits go even deeper. As lenders, they could use XBRL to generate complex data queries and comparative analyses on credit applications in near real time, reducing the risk of and increasing the speed in lending. And in the heavily regulated industry, XBRL could help simplify the reporting processes between financial-services organizations and regulatory and accounting authorities. But for that to happen, XBRL needs widespread adoption. That isn't immediately likely, as executives still know little about the language. According to the survey, only 42% of financial executives believe XBRL will make reports more useful, while 47% say they don't know what role XBRL could play.
5 Top Federal Initiatives For 2015As InformationWeek Government readers were busy firming up their fiscal year 2015 budgets, we asked them to rate more than 30 IT initiatives in terms of importance and current leadership focus. No surprise, among more than 30 options, security is No. 1. After that, things get less predictable.
Join us for a roundup of the top stories on InformationWeek.com for the week of December 14, 2014. Be here for the show and for the incredible Friday Afternoon Conversation that runs beside the program.