Does the Year 2000 XBRL Taxonomy Accommodate Current Business Financial Reporting Practice?
Bovee, Michael Ettredge, Rajendra P. Srivastava
XBRL (Extensible Business Reporting Language) is an application of XML (Extensible Markup Language) intended for use in digital business reporting. Observers predict XBRL will provide benefits to firms that adopt it, such as enhancing information use, facilitating comparability and consistency, and providing technological capability for near-continuous financial reporting through the Web. However, questions arise regarding how well the proposed taxonomy for financial statements corresponds to firms’ preferred reporting practices. We argue that a poor fit may lead to information loss and to subsequent resistance to use or general adoption of the taxonomy. A lack of fit could therefore negate anticipated firm or information-user benefits.