This might be a bit of inside baseball for some readers, but we’d be remiss if we didn’t note that the Securities and Exchange Commission published a reminder last week for companies to pay attention to the details of the XBRL “tags” they use in securities filings.

The SEC published a sample comment letter about XBRL filings, demonstrating the types of issues that might prompt SEC staff to send a comment letter to a company asking questions about its filings. The agency also included a few paragraphs of guidance about why XBRL is so important to financial reporting and analysis.

XBRL is the data-tagging language companies must use when filing registration statements and quarterly reports to the SEC. Every piece of financial data is tagged in XBRL, which allows other software applications — like, say, Calcbench — to parse that data quickly and precisely. When you sit there wondering, “How does Calcbench do it, making financial analysis so easy?” it’s all thanks to XBRL.

This means, of course, that companies must be diligent in the XBRL tagging they undertake. That’s been the case for years, but Congress underlined the importance of accurate filings when it enacted the Financial Data Transparency Act of 2022. Among other things, the law directed the SEC to improve the quality of corporate financial data.

Clean, accurate XBRL filings are a big part of that push; hence the XBRL guidance last week. 

For financial analysts wondering, “What does this have to do with me?” — honestly, not much. Most companies are quite good with the quality of their XBRL tagging, and Calcbench has a set of quality checks we run ourselves to assure that flawed tags are found and corrected before one ever appears on your search results. 

For corporate filers, the letter is another reminder that you need to practice good financial data hygiene. Most filers already use a dedicated vendor to help them prepare and submit their SEC filings with all XBRL tags in order — but Calcbench does have an XBRL Filer Portal page, where subscribers can check the quality of a company’s XBRL filings. Heck, a company can even check the quality of its own filings, and we extend that service even to companies that aren't Calcbench subscribers. (Just contact us at info@calcbench.com and we'll set you up to review your own filings.)

Using the XBRL Filer Portal

Here’s how it works. First, go to the XBRL Filer Portal, which might well be the most sparsely designed page on the internet. Enter the ticker of whatever company you want to research. See Figure 1, below. 

Calcbench will then return a page that looks something like Figure 2, below. You first see a list of all SEC filings we have on file for the ticker you entered, and seven tabs so you can see what XBRL glitches our database had flagged over the years. Some common glitches include:

• Tagging the wrong sign (a positive number instead of a negative one, or vice-versa)
• Scale errors, such as where you tag revenue to the precise dollar in one place, but rounded to the nearest million in another
• Possible typos
• Revised facts, where a company changes previously reported numbers in its current filing (we have an easy way to track revised facts, by the way)
• Extensions, where a company devises its own unique XBRL tag rather than using one from the SEC-approved XBRL taxonomy.

We randomly selected the New York Times Co. ($NYT) as a test case for our XBRL Filer Portal. Figure 2 then shows two instances where the Times switched the positive/negative signs for the Debt Securities Available for Sale line item. In both cases, Calcbench shows you the value originally submitted, the date submitted, and the date the company filed an updated, corrected tag. 

To be clear, this does not mean XBRL submissions are filled with errors. On the contrary, error rates are usually quite low. XBRL was designed with validation techniques embedded into the system, and filing vendors have their own quality checks, and financial data warehouses such as Calcbench have their own quality checks on top of that. 

We’re just pleased that the SEC (which is a Calcbench subscriber, we’re proud to say) understands the value of XBRL to strong financial analysis.