Prof. Jayanth R. Varma's Financial Markets Blog

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Prof. Jayanth R. Varma's Financial Markets Blog, A Blog on Financial Markets and Their Regulation. This blog is currently suspended.

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Sun, 17 Feb 2008

XBRL - Is India missing the bus?

Nearly two months after the Securities and Exchange Board of India (SEBI) launched its XBRL enabled electronic filing platform, no XBRL tools are available on this platform, while the corresponding platform in the US continues to innovate in providing increasingly better and more powerful interactive tools to view and analyze the data. On Friday, the US SEC unveiled its new XBRL tool, Financial Explorer, which prompted me to do a quick comparison.

I looked up Infosys Technologies in the Indian filing system and got static tabular data with which one cannot do anything meaningful except by downloading it. Unfortunately, the site does not appear to allow the data to be downloaded in XBRL or any other usable format. I then went to the SEC’s Interactive Financial Viewer and could download the raw XBRL filing as well export the data into Excel. I could also compare the filing of Infosys with that of Satyam in parallel columns. The power of XBRL allows similar elements in the two filings to be lined up correctly in this tabulation while also providing data in each that is not present in the other. The site also allows the user to chart the data choosing the rows and columns of data that is to be charted.

I then went to the Financial Explorer page and saw how various interactive charts could be produced from the XBRL data. These charts rely on the semantic information embedded in XBRL. For example, since XBRL encapsulates knowledge of what are the elements of shareholder equity, it can generate a chart explaining the changes in shareholder equity in terms of the changes in its constituent elements.

Above all, the SEC is providing the source code for most of its application at its XBRL viewers page and is encouraging software developers to take this and build other tools based on this. In a couple of years from today, I expect that financial data will be shared, analyzed and presented using XBRL tools. I have previously argued that one day financial statements will also be prepared using XBRL tools.

SEBI certainly needs to do far more than it has done so far to bring the power of these exciting tools to Indian investors.

Posted at 14:51 on Sun, 17 Feb 2008     View/Post Comments (2)     permanent link