Greetings and Introduction
During a recent conference chat, a close friend (not of mine) noted that it had been a bit since the Aspire XBRL blog had been updated. The passive-aggressively expressed statement seemed somewhat snarky (stay tuned, Clough enthusiasts). So, I immediately slammed down the phone, ceased parting the Oreo in my hands, and retreated to my office where I barricaded myself in the corner nearest the window facing California. I sat in quiet solitude and reflected intensely for about 2 or 3 minutes. Though it pained me to admit, the comment did not appear to be entirely off-base.
Around this time last year, I clearly remember telling this individual, in passing, that my posts should largely coincide with baseball season. In the United States alone, each of the 30 baseball teams plays approximately 160 regular season games; add spring training and the post-season, roughly 2,500 games are played from February through October. After considering professional leagues throughout the world, the Olympics, little league and pick-up games, it appeared that there was a distinct possibility, albeit extremely rare, that my statement could be open to interpretation.
And so as another baseball season gets underway, so does the Aspire XBRL blog. We start with a topic that’s hotter than Chris Davis’ bat and will send more chills up your spine than fingernails scratching against a calculator: Other Comprehensive Income.
Summary of FASB’s Draft UGT Implementation Guide – Other Comprehensive Income
The FASB issued its draft UGT Implementation Guide – Other Comprehensive Income (the “draft Guide”) on March 29, 2013, which is available for comment for 60 days (through May 27, 2013). The draft Guide is the fifth interactive data implementation guide issued by the FASB and the fifth issued in 2013, with the others being (links enabled):
- •Insurance Industry: Concentration of Credit Risk
- •Insurance Industry: Reinsurance–Related Disclosures
- •Segment Reporting
- •Subsequent Event Disclosures
The primary purpose of the draft Guide is to provide level 4 modeling of transactions impacting accumulated other comprehensive income. The draft Guide provides five examples for modeling with the primary differentiators being (a) whether values are changes in AOCI or are reclassifications out of AOCI; and (b) the physical location of the filer’s disclosure of AOCI and changes thereto (i.e., face financial statements, versus the notes). The five examples set forth in the draft Guide are:
- Disclosure of changes in AOCI presented on the face of the financial statements. The filer should use of the elements located within section “148400 – Statement – Statement of Comprehensive Income” of the UGT.
- Disclosure of changes in AOCI presented in the notes to the financial statements. The filer could use the elements and dimensions located within section “500000 – Disclosure – Equity” of the UGT.
- Disclosure of changes in AOCI with multiple pension and other postretirement benefit plan components. The filer could use the elements and dimensions located within section “500000 – Disclosure – Equity” of the UGT; however, the extension of members (beyond those available in the UGT) may be necessary.
- Reporting of amounts reclassified out of AOCI in the notes to the financial statements. The filer could use the elements and dimensions located within section “500000 – Disclosure – Equity” of the UGT and will most likely utilize “Reclassification out of Accumulated Other Comprehensive Income [Axis]” which is a new dimension in the 2013 UGT (pending SEC approval).
- Reporting of amounts reclassified out of AOCI on the face financial statements. The filer’s parenthetical disclosure will most likely necessitate the use of “Reclassification out of Accumulated Other Comprehensive Income [Axis]” which is a new dimension in the 2013 UGT.
Aspire XBRL’s Implementation Comments
For financial statement preparers, the following bullets may be useful:
- • If you are required to include a statement of changes in AOCI, then use the elements within section “148400 – Statement – Statement of Comprehensive Income” of the UGT and include all relevant calculation relationships.
- • If you (1) currently disclose or have the option to disclose AOCI and changes thereto in the notes to the financial statements, and (2) do not disclose the destination of the reclassifications of amounts from AOCI, then example 2 or 3 could provide a less complex model for you to follow for XBRL purposes.
- • The 2013 UGT’s addition of the dimension “Reclassification out of Accumulated Other Comprehensive Income [Axis]” may assist in alleviating some of the pain that filers encounter in selecting and/or extending concepts. Using the 2013 UGT, the “destination” value (i.e., the line item to where the reclassification from AOCI is going) is tagged using a concept tag.
- • If you’re currently disclosing several reclassified amounts using parentheticals, then stop doing that. Change your disclosure to be more “XBRL-friendly” and create a table if at all possible.
- • Assuming the SEC approves the 2013 UGT without significant changes, your XBRL software and/or provider may not update your AOCI note upon transition to the 2013 UGT, especially if your AOCI note currently has several extended concepts.
Aspire XBRL’s Thoughts
When preparing a filer’s taxonomy, I understand and respect the necessity to “imitate” (or be in line with) the structure of the UGT from a compliance standpoint; at least, as close as possible. Under the current filing requirements, the disclosure of values using dimensions appears at least somewhat based on the physical location of the data (i.e., face financial statements versus notes to the financial statements). The draft Guide appears to place a greater emphasis (thus perhaps an implied importance) on those values disclosed and calculation relationships existing in the face financial statements.
Presumably for a majority of filers, the AOCI values disclosed in the notes would reconcile (or agree) to those values included in the statement of changes in equity (or equivalent statement). And generally speaking, it’s possible to utilize one concept for one value, regardless of its physical location within a filing (provided that the definition of the value is consistent between the locations). The use of dimensions in the footnotes enables the same value (with the same definition) to be tagged using two different methods, which simplifies rendering but could muddy the consumption of that data.
For instance, the draft Guide’s Example 2 is a commonly used table among filers. Assuming for a minute that dimensions did not exist (I know, I know), each value within the table could be accurately tagged using UGT elements from “148400 – Statement – Statement of Comprehensive Income”. However, each value would need to be tagged individually with its own concept, and that can be a cumbersome process. While the process of tagging Example 2 becomes easier by adding dimensions, each of the values (with the exception of the “Total” column) has applied at least one dimension. So this muddying of the water provides an opportunity for those companies who embrace and harness the increasingly important role that dimensions play in tagging key information.
As a side note, the draft Guide’s Example 5 encourages the use dimensions for values disclosed parenthetically in the face financial statements. As a result, values disclosed parenthetically in the face financial statements are treated similarly to values in the notes, rather than values not parenthetically disclosed in the face financial statements.
Expect more posts and more XBRL-related thoughts from Aspire. Some may be inspiring; some will be simple links to compliance updates. So expect more…except during the week of the Masters. The week at Augusta is unlike no other.Read more
It’s springtime. “Year-end” is almost a distant memory, the birds are nesting and chirping, and America’s favorite pastime is in full swing – time for big strikes, big hats and the inception of another annual quest to set standards and improve financial reporting. XBRL US Best Practices Committee (the BPC) recently updated its Resolutions Summary through March 2012. In it, the BPC has provided its recommendations on using the units registry, non-numeric items disclosed in multiple periods, when values should be expressed as fractions, and which concepts within the USGT to use when reporting deferred tax liabilities not recognized by the filer.
An overriding theme of the BPC’s recommendations is encouraging consistent utilization of what I would call the lowest common denominator (like balls and strikes) while minimizing concept and/or unit extensions. As you can imagine, the output/ impact, at its most basic form, is two-fold: granular reporting by the filer to drive consistency; and absorption of efficient and comparative information by the user.
To simplify a common issue, consider the following hypothetical filing excerpt for fictional Company Ticker (tckr):
“The Company acquired three thousand properties in March 2012 and five hundred properties in April 2012. Upon being acquired, these properties were immediately integrated into the Company’s ASegment and BSegment, respectively.”
Out of ease and under the protection of limited liability provisions, some filers may tag the values “3” and “5” and create the respective extension concepts and calendars for these values. Let’s play two:
(calendar: 3/1/2012 – 3/31/2012)
(calendar: 4/1/2012 – 4/30/2012)
Instead, the filer is encouraged to think in terms of an end user of the financial information, rather than the preparer. How can this information be compared to peers, among others in one’s filing tier, or SIC? Tagging these values in a different manner using the 2012 USGT may improve the quality of Company Ticker’s XBRL submission. For example:
Calendar: 3/1/2012 – 3/31/2012
Data type: xbrli:integerItemType
Units of measure: Property
Precision: Thousands (3)
Calendar: 3/1/2012 – 3/31/2012
Data type: xbrli:integerItemType
Units of measure: Property
Precision: Hundreds (2)
(Note that if Company Ticker is a calendar year-end company and its acquisition of the properties occurs after 1Q 2012 in April 2012, in certain circumstances, the BPC has recommended applying additional axes and member(s) to indicate that the transaction occurred after the reporting date – see the BPC’s December 2011 and January 2012 Resolutions).
By utilizing USGT concepts, a lowest common denominator for units (Property), and members most likely already extended, Company Ticker’s financial information more readily interpreted and comparable.
In addition to the above, some key takeaways from the BPC’s newly released recommendations which may improve the quality of a filing include:
-Every number reported in an XBRL instance must have a unit of measure associated with it. The unit that is used is partially determined by the data type of the item. In the 2012 taxonomy the FASB has updated the taxonomy to expand the data types used on elements. In addition when creating an extension it is important that an appropriate data type is defined for each extension element.
-An extension unit should only be created when the unit required is not already defined in the registry. (Until the unit registry is recommended all non monetary and share units will be extension units).
-The pure unit should only be used for ratios, rates, and percentages.
-The SEC requires that if one item is reported with a particular scale all items with the same unit should be reported using the same scale. Therefore, use consistent units throughout the filing for measuring items with the same data.
(The above bulleted excerpts are largely verbatim taken from the BPC’s March 2012 Resolutions release.)
Link to XBRL US BPC March 2012 Resolutions:
Link to XBRL US BPC Resolutions Summary dated April 1, 2012:
Link to the latest version of the units registry: