SEC Offers Speedy Reviews to Companies in Tech Test

Reuters - January 11, 2006

By Joel Rothstein

WASHINGTON, Jan 11 (Reuters) - The U.S. Securities and Exchange Commission on Wednesday said it will expedite reviews of registration statements and annual reports for companies that participate in a voluntary technology initiative.

Last February, the SEC began accepting financial filings on a voluntary basis to test an interactive data format called XBRL, or extensible business reporting language.

The SEC has said it hopes the new format will enhance users' ability to search the filings database, extract and analyze data, perform financial comparisons within industries and speed up the commission's review of filings.

Using a tagged financial filing, an analyst could easily transfer the data to a Microsoft Excel spreadsheet or similar analytical tool, rather than having to read the data in text form and retype the information, according to XBRL advocates Microsoft Corp.(MSFT.O: Quote, Profile, Research) , Morgan Stanley (MWD.N: Quote, Profile, Research) , PR Newswire and Reuters Group Plc (RTR.L: Quote, Profile, Research) (RTRSY.O: Quote, Profile, Research) , which have joined together to promote the new technology.

In November, the Commission began seeking proposals from software vendors for the long term management of the SEC's electronic filing system with an eye toward making it capable of handling such interactive data.

It is looking at awarding the contract in the summer of 2006.

The system, widely known as EDGAR, currently receives about 700,000 filings per year, but SEC Chairman Christopher Cox, who is championing interactive data improvement, said he believes the system is no longer state of the art.

Some companies have complained that the new format is complex which may account, in part, for the slow adoption of the technology standard.

To solve this problem, EDGAR Online Inc. (EDGR.O: Quote, Profile, Research) , a private company that provides tools for analyzing SEC filings, said in a separate announcement on Wednesday that it is introducing a new product to convert companies' current financial documents into XBRL-tagged documents.

According to Robert Krugman, director of analytical solutions for EDGAR Online, companies will not have to learn the new technology format. Instead, they will submit documents to their filing agents as they do today who will then work with the EDGAR Online tools to complete the conversion to the new interactive data format.

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