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SEC Publishes Taxonomy for Foreign Private Issuers' Submission of Data in XBRL

On March 1, 2017, the Securities and Exchange Commission (SEC) published on its website the tags or "taxonomy" needed by foreign private issuers that prepare their financial statements in accordance with International Financial Reporting Standards (IFRS) to submit those reports using the interactive data format known as eXtensible Business Reporting Language (XBRL). XBRL is a machine-readable data format that allows investors and other data users to more easily access, analyze and compare financial information across reporting periods and across companies.

Background

On January 30, 2009, the SEC adopted rules requiring the following entities to provide their financial statements to the SEC and on their corporate websites, if any, in interactive data format using XBRL: (i) U.S. domestic public companies and foreign private issuers that prepare their financial statements in accordance with U.S. generally accepted accounting principles, and (ii) foreign private issuers that prepare their financial statements using IFRS as issued by the International Accounting Standards Board (IASB).

Of particular interest to foreign private issuers, the requirement to provide XBRL-tagged financial statements applies to annual reports on Forms 20-F and 40-F, each Form 6-K that includes updated or revised financial statements, and registration statements of foreign private issuers that include financial statements (rather than financial statements incorporated by reference). Forms 20-F and 40-F, when used as registration statements under the Securities Exchange Act of 1934, as amended, do not trigger the XBRL rules (although filers may voluntarily submit an XBRL-format exhibit with these registration statements).

The SEC required these foreign private issuers to begin their submissions at the end of a three-year phase-in period. However, the SEC had not specified on its website the taxonomy needed to properly format the IFRS financial statement line items; therefore these foreign private issuers, relying on an SEC No-Action Letter from the Division of Corporation Finance and the Office of the Chief Accountant to the Center for Audit Quality (Apr. 8, 2011), were not required to submit to the SEC and post on their corporate websites, if any, interactive data files until the SEC specified the taxonomy for these foreign private issuers to use.

Compliance Date

With the SEC's publication of the IFRS taxonomy, foreign private issuers that prepare their financial statements in accordance with IFRS as issued by the IASB may begin submitting their financial statements in interactive data format. Although the existing XBRL rules require these foreign private issuers to submit financial data in XBRL immediately upon publication of the taxonomy, the SEC stated that such issuers may first submit financial data in XBRL with their first annual report on Form 20-F or 40-F for a fiscal period ending on or after December 15, 2017.

Authors:

Scott D. Fisher

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