Need for Digital Alternative to General Purpose Financial Statement
Wednesday, October 28, 2015 at 03:49PM
Charlie in Digital Financial Reporting

“The difficulty lies not so much in developing new ideas as in escaping from old ones.” (John Maynard Keynes)

The general purpose financial statement (or financial report) has existed for over two millennium. Formats for general purpose financial statements have included clay (see below), paper, word processor documents such as Microsoft Word, PDF, and HTML.  The common thread that all these reports have is that a machine cannot read these reports because the reports are unstructured.

The institution of accountancy needs to create a digital, or structured, version of the general purpose financial statement which is machine-readable.

Annual balance sheet of a State-owned farm, drawned up by the scribe responsible for artisans: detailed account of materials and workdays for a basketry workshop. Clay, ca. 2040 BC.; Wikipedia, Retrieved October 28, 2015.

Financial Statement, Wikipedia, Retrieved October 28, 2015

The digital general purpose financial report is an improvement that helps move the institution of accountancy forward, providing an improvement to that institution. Given today's increasing volume of financial information, complexity of financial information, and importance of financial information; it makes perfect sense to provide such a digital alternative or option.

Financial analysis has been digital for many years; first via the electronic spreadsheet and now with a multitude of options.

With digital books, maps, photos, films, music, blueprints, etc.; what about the digital financial statement does not make sense?  Perhaps I am stating the obvious.

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This is my vision of how a digital financial report would work.

Imagine being being able to pivot a financial report:

https://upload.wikimedia.org/wikipedia/commons/d/d7/8-cell.gif

Article originally appeared on Intelligent XBRL-based structured digital financial reporting using US GAAP and IFRS (http://xbrl.squarespace.com/).
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