SEC Staff Observations: Element Selection Part 1, Searching

Most of the SEC's recent Staff Observations From Review of Interactive Data Financial Statements document deals with element selection. The ideas are largely summed up in a single sentence, ". . . filers should select the element with the narrowest definition that captures all material information."

The section starts out with a broad outline of tag searching strategies (copied at the bottom of this post). The SEC is encouraging you to develop this expertise and we definitely agree. Someone at your organization should

• have a general knowledge of the taxonomies' structure
• be able to navigate to and search for tags in your taxonomy
• understand how the tags relate to your particular financials and notes
• be comfortable explaining the tag choices made for your filing including why custom tags were created

[fyi, someone using our full service tagging process will be able to do these things]

The current official taxonomy release is at XBRL.US. They have a US GAAP Taxonomies Viewer available. For firms getting ready for their first filing in 2010 it's a great place to start. You can begin work even before you choose a process or vendor. Remember, it's not the tag, it's the definition!

-- Ed Hodder

Filers should select elements after a thorough search of the standard taxonomy and careful consideration of elements' standard definitions, standard labels, and other attributes. Filers will benefit from using several taxonomy search strategies to identify the appropriate element and becoming thoroughly familiar with the general organization of the standard taxonomy. Filers should understand that elements related to any particular face financial statement, such as the cash flow statement, may be located within another face financial statement section, such as the income statement, or within one of the "Disclosures" sections of the standard taxonomy. Also, filers should be aware that inadvertently misspelling search terms or using search terms that differ from standard label names may produce unintended search results, and search results may include elements unique to specific industries which may not be appropriate for the filer.