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Toward Semantic Model of Financial Reporting

Over the past several days I have been undertaking a fascinating review of a set of 5525 SEC XBRL financial filings for the purposes of (a) better understanding the semantic model of financial reports and (b) to see how SEC XBRL filings adhere to that model.

This is what I have found for those 5525, all 10-Q and 10-K SEC XBRL filings:

  • 5,525 of the set (100%) report the concept dei:EntityRegistrantName.
  • 1,166 of the set (21%) report the concept dei:TradingSymbol, which means that this concept is really not that useful, because some have it, some don't.
  • 5,525 of the set (100%) report the concept dei:DocumentPeriodEndDate; however, about 20 filers report the wrong value (i.e. not the balance sheet date, looks like they are using the submission date or something). All the others report this properly and this concept makes finding the current period balance sheet a cake walk.
  • 5,382 of the set (97%) report the concept us-gaap:Assets.
  • 5,384 of the set (97%) report the concept us-gaap:LiabilitiesAndStockholdersEquity or us-gaap:LiabilitiesAndPartnersCapital. (Personally, I belive the US GAAP Taxonony should have only one concept, which would be us-gaap:LiabilitiesAndEquity.)
  • 5,382 of this set (97%) have the concept for Assets and the concept for LiabilitiesAndEquity being equal.  What was really interesting is that I saw 5 filings where the balance sheet did not balance (i.e. these two numbers did NOT agree) in either the HTML filing or in the XBRL filing.
  • 5,312 of the set (96%) report one of four concepts which represents Equity: us-gaap:StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest, us-gaap:StockholdersEquity, us-gaap:PartnersCapitalIncludingPortionAttributableToNoncontrollingInterest, us-gaap:PartnersCapital. Further, there is inconsistent use of these equity concepts, but you can figure out the value of Equity for each of these filers. (Personally, I believe there should only be two concepts: us-gaap:Equity and us-gaap:EquityOfParent).
  • 3,691 of the set (67%) report components of Liabilities and Equity which I can confirm add up to the total of Liabilities and Equity.  What I mean by this is that Liabilities and Equity = Liabilities + Commitments and Contingencies + Redeemable Noncontrolling Interest + Redeemable Preferred Stock + Equity.  Now this is interesting because I did not think you could provide a value for commitments and contingencies, so I learned something.  This is probably the hairiest thing to figure out other than Revenues.  There are more that probably got this correct, but I cannot compute the values correctly because of the goofy way different classes of redeemable preferred stock are handled.  But this goofy approach is consistent with the goofy approach multiple classes of normal preferred and common stock are handled.
  • 5,304 of the set (96%) reported net cash flow on the cash flow statement using the concept: us-gaap:CashAndCashEquivalentsPeriodIncreaseDecrease or us-gaap:CashPeriodIncreaseDecrease. (Personally, it seems to me that only one concept is needed here for the US GAAP Taxonomy).
  • 5390 of the set (98%) reported one of three concepts to express what amounts to Net Income (Loss): us-gaap:ProfitLoss, us-gaap:NetIncomeLoss, us-gaap:NetIncomeLossAvailableToCommonStockholdersBasic.  Now, what I am saying is that the US GAAP term "Net Income (Loss)" is being reported using three DIFFERENT concepts.  Basically, there is ambiguity as to which of the three of those concepts to use in different reporting scenarios.  I think I have the right algorithm for detecting the correct concept but I cannot be sure as I have not tied out the income statement like I have tied out the upper level of the balance sheet which proves my balance sheet numbers are correct.
  • 4,641 of the set (84%) reported one of 10 different concepts which represents some variation of the notion of Revenue.
  • 5,299 of the set (96%) used one of 10 concepts to report what amounts to Organization, Consolidation, Basis of Reporting, Nature of Business, or other information related to the presentation of financial statements.

Now, what is even more interesting is that 3,170 (57%) have a combination of all of the characteristics which I was looking for in that bulleted list!  There were 21 different "generators" of this set of SEC XBRL financial filings.

What does this mean?  Well, to me it means a few things.  First, for where we are in the SEC XBRL reporting game, this is pretty impressive in terms of quality particularly considering the large group of those creating this XBRL. If all 3,170 of these were from one source that would be significantly different than from this much larger source of these filings.  Second, while my models were simpler, the model is expanding in complexity but not by a lot really.  Third, there is definitely a leveragable semantic model peering out from that set of 5,525 SEC financial filings.

My next step is to drill into the cash flow statement one more level, which will be rather easy.  After that I will tackle the income statement which be more of a challenge as there is very little consistent upper level structure to leverage.  Or said better, it may be that there is more variety so it is harder to detect the patterns.  Or another way of looking at it is that a bottom up approach may be superior to a top down approach.  We shall see.

The individual disclosures are a bit of a different story, but how to handle them is beginning to reveal itself.

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