Tagging Financial Reports with XBRL in a Couple of Clicks

For accountants and other financial professionals who need to produce information such as quarterly and annual reports in XBRL, Rivet Software of Denver has developed Dragon Tag XBRL. A Microsoft Office-based solution, Dragon Tag offers users the ability to drag an XBRL tag to data in a report.

By leveraging Microsoft Office, Rivet’s Dragon Tag provides accounting and finance professionals with a user-friendly application to both extend XBRL taxonomies and create XBRL documents based on existing Microsoft Word and Microsoft Excel documents. It can be used for regulatory reporting, investor relations, and internal financial information distribution.

“With Dragon Tag, I can drag and drop XBRL information onto your existing data,” explained Rob Blake, vice president of product marketing at Rivet. The first time an accountant prepares a quarterly report it might take six to 10 hours. But the tags then stay on the report, and the next time he can just change the data and make the report XBRL-ready in minutes.

“We think our application does it more easily than anybody else,” said Blake. Senior executives at Rivet, including the founder, the CFO, and Blake, are CPAs, he added. While many other XBRL firms have taken an IT-centric approach, Rivet was designed for the financial professionals.

“We want to make XBRL pervasive, and our approach is a little different. We focus on accountants and finance people,” he added.

Microsoft used XBRL to prepare its second quarter 2005 SEC report, and Ernst & Young was an early customer.

“With this Office 2003 add-in, along with other methods and tools, we were able to create and release our XBRL-compliant financial report with little disruption to the normal reporting cycle,” said Michael Ohata, director of business reporting for Microsoft. “Dragon Tag provides integration with Microsoft Office 2003 so we were able to work directly in Word and Excel, which addresses a key scenario for how finance professionals work.”

Rivet Software had also announced partnerships with PR Newswire, Edgar Online, and Software AG.

For Software AG, which will resell Rivet, the partnership allows users of Software AG’s Digital Reporting Platform to easily create XBRL documents based on information in Microsoft’s Word and Excel without rekeying data.

“Software AG’s Digital Reporting Platform is a framework of solutions that hides the complexity of XBRL,” said Christian Barrios Marchant, a member of the executive board of Software AG. “Our partnership with Rivet Software allows Rivet’s Dragon Tag application to provide accounting and finance professionals an easy way to turn existing Microsoft Office-based financial information into XBRL.”

PR Newswire members will be able to create their financial documents, such as earnings releases and financial statements, in XBRL.

Until Rivet’s Dragon Tag, added Blake, XBRL reporting was expensive and time consuming.

“In this post-Sarbanes Oxley climate, businesses must make their financial information transparent to key stake holders,” Blake added. “XBRL is quickly becoming the global standard for business reporting, a key step to this transparency. With the launch of Dragon Tag, Rivet has revolutionized the financial reporting industry by breaking down the barriers of XBRL reporting, delivering a new level of ease and affordability.”

Dragon Tag supports the latest XBRL specification, 2.1 and taxonomies such as US generally accepted accounting principles (GAAP). The application includes a comprehensive review and validation feature to ensure accuracy before releasing or submitting XBRL documents, and it has a wizard to help users extend existing XBRL taxonomies to meet specific reporting needs.

The Microsoft Office-XBRL Link

EDGAR Online and its I-Metrix Suite of eXtensible Business Reporting Language (XBRL) products can be used with Microsoft Office System technology to streamline financial reporting and reduce manual data entry and validation. To help companies understand how to use XBRL, Microsoft features EDGAR Online and Rivet Software in an Office Solutions site that includes a video to demonstrate how reporting and analysis can be automated.

“The process of financial reporting and analysis can represent a huge cost for many companies,” according to Microsoft. “For example, the preparation of quarterly statements for publicly traded companies consumes the majority of a finance department’s resources during the reporting period. Likewise, it is not uncommon for equity analysts to spend up to one-third of their time entering data into spreadsheet models and verifying that data for accuracy.”

“The primary challenge with producing reports and analysis is that the data needed to produce these items is locked in documents, and the data relies on those documents to give it context. For example, a number in an annual report requires contextual information — company name, time period, or revenue—to give the number meaning. To use data locked in a document or spreadsheet, it must be manually entered, copied, and may need to be recalculated.”

By combining the Microsoft Office System with EDGAR Online or Rivet, firms can speed up this process (www.microsoft.com/office/showcase/xbrl/default.mspx).

“Microsoft Corporation supports XBRL from both a public company and software company standpoint,” explained Ohata of Microsoft. “XBRL presents an opportunity to deliver financial and other information in an agreed-upon industry fashion that provides quicker insight and increased transparency. In addition, XBRL creates an opportunity for Microsoft to showcase to customers how software such as I-Metrix can help address common business challenges using familiar Microsoft Office System technology.”

Susan Strausberg, president and CEO of EDGAR Online, said the relationship with Microsoft will help business people realize the benefits of XBRL through using the Microsoft Office tools they rely on every day.