Digital Financial Reporting

In about 2000 or so I began experimenting with XBRL, modeling typical business use cases in XBRL to see how it was done. I literally began collecting these use cases. Over the years I have created at least seven iterations of what got referred to as "patterns", but I now use the term metapatterns and business use cases.

My latest iteration of metapatterns and business use cases can help professionals during your journey to mastery of digital financial reporting, helping you to make proper use of XBRL. These metapatterns and patterns have come full cycle. Back in about 2007 we used these patterns to help understand how to best construct the US GAAP Taxonomy. Ultimately, I created a model or reference implementation of an SEC XBRL filing to understand how to properly express financial information using XBRL. I then took what I learned from creating the model/reference implementation, cycled back, and have reconstructed the metapatterns and business use cases in these current versions to reflect what I have learned.

There is one additional step these models require which is to recast the model/reference implementation following the metapatterns and business use cases. This is crucial because the model/reference implementation shows clearly how the different pieces of a digital financial report relate to one another. You cannot get this understanding from the metapatterns or business use cases to the extent necessary because they are generally isolated examples to keep them focused on specific areas.

Be aware that the metapatterns and business use cases assume that you have the appropriate understanding of fundamental information such as the multidimensional model, the US GAAP Taxonomy/SEC logical model, etc.  While one resource which contains all this fundamental background material does not yet exist, I have put together an organization of material in one location for your use which collectively has all these fundamentals, should you need that background.  You can find that information summarized here on my blog.

Stepping through this information in order is crucial; there are no short cuts. Trying to understand how to use XBRL properly but skipping steps is like trying to understand algebra without knowing how to count or basic mathematics. Mastering this material will be easier when XBRL software has matured and much of this information is absorbed within software applications which help you use these technologies correctly. But regretfully, that is not the state of XBRL software today. A good sign that you are missing fundamental understanding is frustration and confusion.

For professionals who are investing in their skill sets, mastery of XBRL will pay dividends as we move to the paradigm of digital financial reporting. Making this investment today is harder than it will be five years from now; but being on the leading edge of this change has its advantages.