The IASC taxonomy is an XML-based specification for the commercial and industrial sector that allows users and suppliers of financial information to exchange financial statements across all software and technologies, including the Internet. Expected to be final in the next few months, the IASC taxonomy, which is based on International Accounting Standards, will help many countries, including those in Europe and Asia, to develop and implement XBRL (eXtensible Business Reporting Language) for financial statements. 

The Institute of Chartered Accountants in England & Wales (ICAEW), also a member of the XBRL.org Committee, has formed a broad-based steering group in London that’s in the process of developing the U.K. taxonomy for financial statements. "Many countries in Europe and Asia are using International Accounting Standards today," said Brian Carsberg, IASC’s secretary general. "XBRL will enhance the transition to full alignment for those countries currently using their local standards to transition to International Accounting Standards. XBRL incorporates standardized data tags, thereby giving a consistent approach and application of the specification to a particular country’s accounting principles."

"Companies tagging their financial statements in XBRL can immediately realize some of its major benefits: a streamlined financial reporting process, technology independence, full interoperability, and reliable extraction of financial information," said Mike Willis, XBRL.org Committee chair. "And XBRL does not require a company to disclose any additional information beyond that which it normally discloses in its current financial statements. Costs for a user to implement XBRL will be minimal since its functionality is being built into software technology and operating procedures, allowing increased flexibility to prepare and extract financial statements according to the accounting principles of different geographies and national jurisdictions."

When using XBRL, information is entered only once, allowing that same information to be rendered in any form, such as a printed financial statement; an HTML document for the company’s Web site; filing documents with government entities; a raw XML file; or other specialized reporting formats, like credit reports or loan documents. Willis said, "XBRL will allow us to electronically import or output globally standardized statements, eliminating the need for redundant data entry while simplifying usability of the information."

Interest in the XBRL specification has expanded internationally with the advent of other XML-based tools and solutions being used by various industry-sector groups to exchange information across disparate systems and software formats. Members of the XBRL.org Committee represent the largest financial, accounting, and technology organizations from around the world. XBRL.org membership exceeds 85 organizations and is expanding as industry sectors and foreign jurisdictions begin development of XBRL specifications for financial and other business reporting. For more information about XBRL, visit http://www.xbrl.org. 

Source: International Accounting Standards Committee, London, 011-44-20-7427-5921; http://www.iasc.org.uk.