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revious articles on Extensible Business Reporting Language (XBRL) have primarily focused on the use of XBRL for financial reporting purposes. But XBRL also has potential uses for auditing purposes, such as enhancing internal controls and creating an electronic audit trail (Eric E. Cohen, âeurooeThe Need for and Issues Surrounding the Seamless Audit Trail,âeuro? www.oasis-open.org/committees/ dowload.php/16709/Tax%20XML%20Audit Trail_60215.doc).
In the May 2010 CPA Journal , the authors' article "XBRL-Beyond the Basics" presented the different components of XBRL for Financial Reporting (FR) and Global Ledger processing (GL). The authors also explored the benefits and challenges awaiting companies and CPAs that adopt this method of entering, processing, storing, and exchanging accounting information. This article follows up on the authors' previous article by focusing on using XBRL GL to process and store transactional data from business documents, update the general ledger, and produce financial reports. In addition, it explores the potential for using XBRL GL to enhance the audit trail and internal control. The authors use the international XBRL organization's most recent XBRL GL framework recommendation (Specification 2.1 Taxonomy), which defines how to store transactional data and establish a link between XBRL GL and XBRL FR (www.xbrl.org).
The Near Future: XBRL FR
The SEC mandated that all U.S. GAAP filers adopt XBRL FR by 2011, after a three-year phase-in period. The first year, ending in June 2009, included the largest U.S.-listed accelerated filers. The second year, ending in June 2010, included all other domestic and foreign large accelerated filers. The third year, ending in June 2011, will include all remaining filers using U.S. GAAP. The implementation of XBRL FR is motivating the next stage of XBRL adoption and innovation.
Most current articles regarding XBRL are about XBRL FR, which is an XML-based tagging language that defines the structure of financial data and provides standards for the tagging of summarized financial statement information (Bizarro and Garcia 2010; Troy J. Strader, "XBRL Capabilities and Limitations," The CPA Journal , December 2007, pp. 68-71; Robert Tie, "XBRL: It's Unstoppable," Journal of Accountancy , vol. 200, no. 2, August 2005, pp. 32-35). These standards relate to format, content, and, most importantly, structure. XBRL-tagged financial statement information is machineunderstandable that is, the tags specify the content of financial reporting data, which are then interpreted by...