6/30 Fiscal Year-end Filers: Your Year 2 Tagging Table Is Ready

I remember back in freshman English my teacher had us memorize a Shakespeare quote from Macbeth, the one that starts "To-morrow, and to-morrow, and tomorrow creeps in this petty pace from day to day..." (Macbeth, Act 5, Scene 5).  

Throughout the years, for whatever reason, I've been able to recite this quote from memory.  Strange how the brain works...remembering something like this from the past... but little did I know this would cause me today to realize that Shakespeare has another quote very appropriate to all the valuation/submission discussion around the mandate of late.  I'm sure you know the quote I'm talking about; I've modified it a bit to bring it to current times: To [file] or not to [file], that is the question. (adapted from Hamlet, Act 3, Scene 1)

The conflicts of Hamlet tie nicely to conflicts in the Final Rule (FR) involving companies that have fiscal year ends between June 15th and September 14th (roughly).  To simplify things, I'll refer to this group as "6/30 Filers".  In most (key operative word) cases, the SEC has tried to have US-based companies following GAAP start their XBRL mandate efforts on a 10-Q versus a 10-K.  Unfortunately they fell short when it comes to 6/30 Filers starting their detail/Year 2 tagging.

The Shakespearian conflict herein lies between information contained in the FR on page 59, and pages 179-180.  Page 59 states the following:

To allow filers time to become familiar with tagging footnotes, in each filer’s first year of interactive data reporting, only level (i) will be required. All four levels will be required starting one year from the filer’s initial required submission in interactive data.

One year from the filer's initial required submission.  Okay, 6//30 Filers...good news, right?  Much like you didn't do your initial XBRL submission on your 10-K, you don't start your detail tagging on a 10-K.  Right?  Based upon this wording?  Well, let's just say putting ye's unwavering faith in this part of the FR would be a bad thing.  Here's why. Pages 179-180 effectively shuts the door on page 59 in two way as a result of the specific discussion on when a company can file Year 1 tagging:

"...if none of the financial statements for which an Interactive Data File is required is for a fiscal period that ends on or after June 15, 2010."

Applied to Year 2 tagging, this means that ANY submission with statements that involve data for periods on or after June 15th MUST be in detail/Year 2 tagging.  By not specifically excluding the 10-K in this wording, the SEC steps away from their effort to not have companies do something around interactive data the first time on a 10-K.  In addition, instead of getting a full year to prepare for Year 2 tagging, 6/30 Filers only get 9 months.  Pages 179-180 solidify the fact that 6/30 Filers in fact do their first detail/Year 2 tagging submission based on their 10-K, while literally every other US GAAP filer (save for ACCELERATED companies; see previous blog post) get started on a 10-Q.  

Not sure how Shakespeare would react to this FR double-speak, but I'm pretty sure I know how Nadine feels...=)

-Rob