« Insuring your SEC XBRL Financial Filing is Correct Effectiently and Effectively | Main | Creation of Financial Statement is a Collaboration »

Workflow Involved when Creating a Financial Statement

In a prior blog post I pointed out that creating a financial statement is a collaboration between many parties which exist both within your organization and some of which are external to your organization.

In this blog post I want to point out that there is a workflow which exists when creating a financial statement. Here is a very simplified workflow: create, review, approve, submit.

 

Clearly one can dig deeper into the many, many details of the workflow of creating a financial statement. The point here though is to simply point out that one should be thinking about workflow when considering software for creating SEC XBRL financial filings.

Further, workflow can be determined by the fundamental approach one chooses for getting their SEC XBRL financial filing created. Popular categories of approaches (which are covered in chapter 11 of XBRL for Dummies) include:

  • Bolt on: You basically "bolt on" another process for generating the XBRL to an existing process of creating the Word and HTML versions of your SEC filing. Typically one might purchase an additional software product to generate your XBRL output.
  • Out source: Outsourcing is really somewhat of a bolt on approach except that rather than purchasing software which adds the additional needed functionality of generating XBRL, you out source the entire process.
  • Integrated: Integrating the creation of the Word, HTML, and XBRL formats into one process is another approach to getting that XBRL generated.  This generally involves purchasing new software which offers XBRL generation or updating to a new version of an existing software product which you use which offers the feature of XBRL output.
  • "Roll your own" solution: A type of integrated approach is for you to "roll your own" solution by either creating internal systems which generate XBRL or somehow enhancing the functionality of a third party software product which you use. For example, this article discusses United Technologies use of XBRL.

If you were around when the PC was first introduced, you will recall that initially PCs had a character-based interface.  Think "DOS". That all changed with the introduction of the graphical user interface by Apple on its first Mac. Not everyone believed that the graphical user interface provided an improvement over the DOS character based interface.  But Apple proved the graphical user interface and the user interface paradigm shifted.

A similar paradigm shift will occur with SEC XBRL financial filing software.  If you really consider workflow; the common approaches used today where someone bolts on an additional process or outsourcing the process of generating the required XBRL does little to improve the overall financial statement creation process.  That is why accountants see little value in XBRL today.

When work flow is considered and appropriate software is created the value accountants will see from XBRL and what XBRL enables will change.  When will this change take place? In my view the change is already occurring slowly but surely. The pace will become more rapid over next year, I predict.

Further, I predict that accountants will be using XBRL enabled semantic, structured, model-based authoring software products for creating financial statements whether they need to submit XBRL to some regulator or bank, or not. Why? Because the workflow enabled by technologies such as XBRL will enable more effecient and effective processes.

Posted on Monday, October 10, 2011 at 09:14AM by Registered CommenterCharlie in | Comments2 Comments | References1 Reference

PrintView Printer Friendly Version

EmailEmail Article to Friend

References (1)

References allow you to track sources for this article, as well as articles that were written in response to this article.
  • Response
    Response: trackback test
    Workflow Involved when Creating a Financial Statement - Blog: Digital Financial Reporting (using XBRL) - Semantic, structured, model-based authoring of digital financial reports leveraging the XBRL medium

Reader Comments (2)

Hi to all, Link building with keyword search, consists mainly of two things that mean SEO. The importance can never be underestimated, as links to determine the page rank given by search engines. They bring traffic, which for most people convert to cash. Thus, the quality is very important and all organizations with a web presence or those who are addicted to the Internet should invest time and money in it. Professional link building services should be sought that implements solutions after a thorough knowledge of the market and the forces of influence.Thanks for your nice post.
December 26, 2011 | Unregistered CommenterSocial bookmarking
Good Financial Statement is good credit.
I have not good enough,and they don't approve my statement.
February 17, 2012 | Unregistered CommenterBentley

PostPost a New Comment

Enter your information below to add a new comment.

My response is on my own website »
Author Email (optional):
Author URL (optional):
Post:
 
All HTML will be escaped. Hyperlinks will be created for URLs automatically.