XBRL could make A-123 reports easier
WILLIAMSBURG, VA.—Federal financial and IT executives risk falling behind their commercial-sector counterparts by being slow to develop the use of Extensible Business Reporting Language (XBRL) in their financial-reporting systems, a panel of federal financial experts said at the Interagency Resource Management Conference last week.
XBRL is generating growing interest as a tool for improving internal financial and business reporting controls, Labor Department CFO Sam Mok said.
He lamented that departments using the same enterprise software packages still cannot share financial information. “Putting XBRL on top of those systems would give us better access to financial information and share best practices,” he said.Still evolving
The metatagging language, which describes and validates common business data, is still evolving, said Dr. Sridhar Ramamoorti, a partner in the National Corporate Governance Group of Grant Thornton LLP and chairman of the Academy for Government Accountability.
But aside from a handful of financial-regulatory agencies, such as the Federal Deposit Insurance Corp., commercial financial managers are moving much faster than their government counterparts in trying to implement the language, he said.
With the Office of Management and Budget’s June 30 deadline looming to implement A-123 internal controls over financial reports, financial officers could use all the help they can get. While XBRL is likely to take years to fully mature, it offers a promising tool for financial officers, Ramamoorti said.
Currently, too much emphasis continues to be focused on audits as a means of monitoring the quality of financial reporting, said Mok. “Audits are not really audits but ratification of financial reports,” he said.
And they’re costly, said Joe Kull of PricewaterhouseCoopers LLP of New York and a former deputy comptroller for federal financial management at OMB. While the federal government has made great strides in speeding up financial-reporting cycles, there are still too many restatements, he said. “We need to be able to better understand the flow of money” in real time to make better decisions.
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