What I am more concerned about is the need for a consistent evolution of XBRL taxonomies within a coherent architecture, and the restrained use of X, i.e. eXtensibility, by preparers, lest XBRL documents become too complex to be useful. That is where scepticism is appropriate and healthy - but whether it is justified we will only be able to see further down the road.
Tuesday, January 08, 2008
XBRL Skeptics (sic) Abound?
In evaluating the viability of any innovation, it is crucial to keep an open mind (some call it paranoia) about its limitations and critical issues. From that point of view, CFO.com's piece about XBRL sceptics is comforting reading. The doubts offered there are really quite immaterial: The luddite accountant's view that financial analysis is an art rather than a science, for the exercise of which he needs the entire statement is answered crisply: you can have that, too. The reason why XBRL will hardly take off without regulation is easy to explain: It will only become really useful once all preparers issue their information in that standard, and that will not happen spontaneously. Without it being useful, preparers have an easy case to make against going to the effort. Classic chicken and egg. The other points raised are transient in nature.