1 SEC Staff Briefing: The Roll-out of Interactive Data Reporting for US-listed Public Companies David M. Blaszkowsky, Director, Office of Interactive Disclosure.

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SEC Staff Briefing:SEC Staff Briefing:The Roll-out of Interactive Data Reporting The Roll-out of Interactive Data Reporting for US-listed Public Companiesfor US-listed Public Companies

David M. Blaszkowsky,

Director, Office of Interactive Disclosure

XBRL Canada Conference

Toronto

5 November 2009

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DisclaimerDisclaimer

As a matter of policy, the Securities and Exchange Commission disclaims responsibility for the private statements of SEC employees. The views I am expressing today are solely my own, and do not reflect the views of the Commission, the Commissioners, or of any employees other than myself.

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Interactive Data / XBRL: Interactive Data / XBRL: “News From the Front”“News From the Front”

Mandate started 15 June – How is it working? First Reporting period in XBRL went well

>500 filings, >10 percent are Phase II/III “early” filers First detail-tagged, first 10K submissions Includes Canadian, other foreign private issuers

Companies can tag successfully Modest cost, modest time Learning curve: Most frequent problems are the most basic,

easiest “Best practices” starting Benefits of a large, comprehensive taxonomy

“User-side” awakening Investor applications emerging Investor interest increasing

Concerns about detailed footnote tagging Staff are reviewing XBRL exhibits for technical quality, tag choice, etc.

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““Interactive Data” Add Structure and Interactive Data” Add Structure and Meaning to Filed Financial DisclosuresMeaning to Filed Financial Disclosures

Mapping

Label: Net SalesTag: NetSalesMetadata: - Currency

- Year- Amount- Scenario- Value

Tagging

OR: an “Extension”

Footnotes (Block, Detailed)

US-GAAP: List of Tags

P&L

B-S

“Taxonomy”

Footnotes

Flows

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Why is Interactive Data Important for Why is Interactive Data Important for Company Information?Company Information?

Filers/Corporations Process improvements and

savings

Easier/Faster compliance

Better communication, visibility to investors Especially for mid/small-

caps

Buy-side “Faster, cheaper, better”

As-reported, and complete

No introduced errors

More useful, more functionality

Higher analysis/analyst productivity

Improved comparability

Improved Market Efficiency

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Public Company Reporting Using Public Company Reporting Using Interactive DataInteractive Data

What will be required

Who and when

Important additional features

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What Will Be RequiredWhat Will Be Required

Content: Primary financial statements (IS, BS, etc.) Footnotes Financial statement schedules. Certain company identifier information (“DEI”)

Forms Periodic Reports (10Q, 10K, 20F, 40F) Transition Reports Reports on Forms 8-K and 6-K with revised audited versions of

financial statements Securities Act registration statements (S-1, S-3, S-4, S-11, F-1, F-3,

F-4, F-9, F-10) Not IPOs

Interactive data requirements are provided as an exhibit “Disclosure Neutrality”

Posting to the Filer’s website, if it has one, same business day, for at least 12 months

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Year 1 Year 2

Filer Group

Domestic/Foreign Large

Accelerated Filers Using US GAAP

• Public Float >$5 billion

• All other Large/Accelerated Filers

All other Filers in US GAAP

(including smaller reporting companies)

All Issuers using IFRS as published by the IASB

Phase-in SchedulePhase-in Schedule

Who?

What?

• Face Financials: All facts

• Footnotes: Block tag each footnote

• Schedules: Block tag each schedule

• All from first year• Footnotes:

• Each significant accounting policy

• Block tag each table• Tag each amount

• Schedules: Tag each amount

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Year 1 Year 2

Filer Group Begin with the first 10Q (or annual, for 20F/40F filers)

for periods ending after 15 June

Domestic/Foreign Large

Accelerated Filers Using US GAAP

• Public Float >$5 billion 20092009 20102010• All other Large/Accelerated

Filers 20102010 20112011

All other Filers in US GAAP

(including smaller reporting companies)

20112011 20122012

All foreign private issuers using IFRS as published by the IASB 20112011 20122012

Phase-in SchedulePhase-in Schedule

When?

Who?

30 day grace period, from the filing date of the related report, for the initial submission (by amendment) of interactive data exhibit

30 day grace period, from the filing date of the related report, for the initial submission (by amendment) of interactive data exhibit

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Data reliability and non-complianceData reliability and non-compliance

Data in the interactive data file submitted will be subject to a limited liability

Subject to specified anti-fraud provisions except in connection with a failure to comply with the tagging requirements that occurs despite a good faith attempt to comply and is corrected promptly after the filer becomes aware of the failure

Limited liability provision phase-out: Over a two-year period for each company. Provision would terminate completely on October 31, 2014.

Interactive data files will be excluded from the officer certification requirements under the Exchange Act rules

No requirement of auditor assurance on their interactive data exhibits

Filers that do not provide or post required interactive data on the date required will be deemed not current with their Exchange Act reports “Curable” by providing/posting the interactive data file

SEC Interactive Data Previewer, and automated validations are helpful

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Thank You! Part 1…Thank You! Part 1…

Contact Information for Questions [email protected]

202-551-4144

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Feedback and Findings Feedback and Findings From Filings to DateFrom Filings to Date

Extensions Check to ensure against unnecessary extensions

Recheck the taxonomy to make sure that a tag doesn’t already exist

Don’t create a new tag if a standard tag exists Tag choices could be questioned by staff or by the

marketplace

If extending, include definition for monetary elements, and describe whether it has debit/credit attribute

Negative values vs. negated labels: understand the element and its definition Taxonomy designed so that most elements have a positive

value

Tags versus labels…

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Feedback and Findings Feedback and Findings From Filings to Date(2)From Filings to Date(2)

Labels: Make sure the labels match those of the traditional (HTML) document exactly

“Sales” vs. “Turnover”: Same tag, different label

Labels can be extended without creating a new tag

Use the pre-viewer to compare and check!

Rendering aesthetics vs. tagging integrity

XBRL is dependent on the integrity of the tags

Focus on the accuracy of the tags, not the visual appearance of the rendering

Make sure element labels match line item captions

Some differences cannot be avoided, e.g. indenting, fonts, underlining, total/subtotal captions, brackets (on SSE)

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Feedback and Findings Feedback and Findings From Filings to Date(3)From Filings to Date(3)

Management review is prudent

Senior management should have an opportunity to review

Even if tagging is outsourced, they are still your financials and tags

Remember: Voluntary Filing Program is closed for most public filers

Public companies can only submit required filings

VFP only open for Article 6 and for mutual funds

FPIs: IFRS filings cannot be provided yet

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Feedback and Findings Feedback and Findings From Filings to Date(4)From Filings to Date(4)

Finally – Looking to make the Interactive Data roll-out effective and

smooth

Check regularly for SEC staff comments and FAQs

Look for additional public information seminars Archive of 10 June 2009 event

http://www.connectlive.com/events/secinteractivedata061009/

Reprise for the next phase of filers, and for footnotes

Communicating with companies: web, phone, podcasts, other media as appropriate

Best practices will emerge

Above all: Start early! Whether for phase 2 , or for footnotes!

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Thank You!Thank You!

Contact Information for Questions [email protected]

202-551-4144