Cheryl Boggs Savage, C.P.A.
Reliable Professional Solutions

SEC Compliance

When must I comply with XBRL reporting?

Countries and jurisdictions all over the world are beginning to require the use of XBRL. In the United States, the Securities and Exchange Commission (“SEC”) has been the primary advocate of XBRL. The SEC requires XBRL use by operating companies, mutual funds and nationally recognized statistical rating organizations (“Rating Agencies”).

Credit Rating Agencies

Nationally Recognized Statistical Rating Organizations (“NRSROs”) are required to comply with two XBRL disclosure rules, the “10% Disclosure Rule” and the “100% Disclosure Rule”. These rules consist of:

  • The “10% Disclosure Rule”: An NRSRO is required to publically disclose, in XBRL format, a random sample of 10% of the ratings issued for which the issuer, obligor, underwriter, or other sponsor paid (“issuer paid”), within six months of the rating event, and with several additional conditions related to the contents of the sample.
  • The “100% Disclosure Rule”: An NRSRO must also make publicly available all credit rating action history related to credit ratings that are outstanding that were issued on or after June 26, 2007, with issuer-paid ratings disclosed within 12 months of the rating event and subscriber-paid ratings within 24 months of the rating event.

Mutual Funds

Beginning January 1, 2011, mutual funds must file with the SEC and post to their Web sites the risk/return summary section of their prospectuses in XBRL format. The XBRL risk/return information will be provided as exhibits to registration statements and as exhibits to prospectuses with risk/return summary information that varies from the registration statement.

Operating Companies

The most significant U.S. XBRL reporting requirements involves quarterly and annual reports to the SEC on Forms 10-Q and 10-K. Beginning with the quarterly reports for periods ending after June 15, 2009 certain entities for Large Accelerated Filers with Public Float greater than or equal to $5 billion; continuing with quarterly reports for periods ending after June 15, 2010 for Large Accelerated Filers with Public Float of greater than or equal to $700 million but less than $5 billion, and finally for all remaining SEC filing entities beginning with quarters ended after June 15, 2011.

In the first year of compliance Operating Companies must detail tag their face financial statements and block tag their footnotes. In the second year of compliance detail tagging of face financial statements and footnotes is required. Detail footnote tagging is required at each of the following four levels:

Level 1: Each complete footnote tagged as a text block

Level 2: Each significant accounting policy within the significant accounting policy footnote tagged as a text block

Level 3: Each table within each footnote tagged as a text block
Level 4: Within each footnote, each amount (i.e., monetary value, percentage and number) is required to be separately tagged

Operating Company reporting requirements can be summarized as follows.

Web Hosting Companies