Global Ledger - The Next Step for XBRL: Leveraging the Potential Throughout the Accounting Cycle

XBRL for U.S. GAAP is now a requirement for all publicly traded companies. But the full potential of XBRL will not be realized until the tagging of financial data takes place in the beginning of the accounting cycle, not the end as in current practice. This change will make way for new applications of software for managerial decision making and continuous auditing throughout the entire accounting information system. Although it may be overly optimistic to expect full XBRL GL tagging right away, a realistic next step is for management to require subsidiaries to transmit their closing accounting information with XBRL tags. The parent company’s home office can then employ open source systems to consolidate the XBRL data. Those consolidated XBRL data would then be used to prepare the traditional “paper” statements, including the auditor’s opinion.