February 10, 2003

Mr. Jonathan G. Katz
U.S. Securities and Exchange Commission
450 5th Street, N.W.
Mail Stop 6-9
Washington, D.C. 20549-0609

Re: Comments on File No. S7-52-02, Proposed Rule: Mandated Electronic Filing and Web Site Posting for Forms 3, 4 and 5

Dear Mr. Katz:

XBRL-US, a non-profit consortium hosted by the American Institute of Certified Public Accountants (AICPA) and representing over 45 leading accounting, technology, government, regulatory and financial services bodies in the US, is committed to the promulgation of Extensible Business Reporting Language (XBRL) as an open, freely licensed standard for the efficient and transparent exchange of business information over the Internet.

We are grateful for this opportunity to comment on the Proposed Rule, "Mandated Electronic Filing and Web Site Posting for Forms 3, 4 and 5." We would like to respond to two of the questions raised in Section II. The Proposed Rule Amendments, F. Comment Solicited of the Proposed Rule:

(1) Regarding facilitating statutory requirements in general: Would any other technical amendments help to implement Exchange Act Section 16(a)(4)?

The electronic filing process outlined in Section 16(a)(4) can be streamlined and enhanced through the use of XBRL, a format based on Extensible Markup Language (XML), for business information exchanged over the Internet. The Exchange Act recognizes the Internet as a primary medium for communicating business information to investors in a timely manner, consistent with the will of Congress to inform the investing public about insider ownership transaction information. Because XBRL leverages all the benefits of XML, it facilitates the efficient, timely exchange of business information between preparers and the SEC's EDGAR system, as well as investors. XBRL streamlines the information gathering and dissemination processes by enabling companies to tag their financial information once and use it for multiple purposes, including SEC filings and posting on their public Web sites for investors and other interested parties to use.

XBRL provides for immediate use, and more transparent reporting, of all information contained in the Section 16 forms in a way that traditional electronic and paper formats do not allow. All relevant information in Forms 3, 4 and 5 can be tagged in XBRL, thus easing the retrieval, and facilitating consumption, of that information by analytical software applications.

XBRL-US strongly recommends that the SEC allow public companies the option to submit information tagged in XBRL for Forms 3, 4 and 5 and add XBRL to its list of allowable information formats. We are not advocating a change to the SEC's filing processes at this time; we are simply asking the SEC to allow XBRL-tagged data as a voluntary and compliant format for the EDGAR system and for web site postings.

XBRL leverages the benefits of XML, is designed specifically for business reporting and can integrate easily with existing systems. XBRL can simplify information exchange for regulatory filings, financial statements, performance reports, accounting records and other business information between preparers and various information consumers, including the investing public.

XBRL is already in use. A number of companies have already provided their complete financial statements in XBRL. Although the EDGAR system does not currently recognize XBRL as a compliant format, both Morgan Stanley and Microsoft have submitted their filings to the EDGAR system with XBRL reports attached as supplementary files. You can review these reports here: (http://www.sec.gov/Archives/edgar/data/895421/000095013002006869/0000950130-02-006869-index.htm); (http://www.sec.gov/Archives/edgar/data/789019/000103221003000123/0001032210-03-000123-index.htm).

XBRL is also being used in other countries, by organizations such as the Australian Prudential Regulation Authority, and is planned for use by the United Kingdom Inland Revenue and the National Tax Agency of Japan (Kokuzeicho) for regulatory filings. XBRL-US, in concert with XBRL International, Inc. (a 200 plus member global non-profit consortium operating in 12 geographical jurisdictions), is working with key members of the "corporate reporting supply chain" to ensure that XBRL delivers fully interoperable, transparent and reliable information to users in a timely manner.

(2) Regarding electronic filing of Section 16 forms: Are there any barriers to issuers' helping insiders to file or filing on insiders' behalf Section 16 forms and, if so, how can these barriers be eliminated or reduced?

Issuers of insider ownership transaction information face challenges in preparing, presenting and disseminating information to a multitude of users, including regulators and investors. Often, this information is manually re-keyed into a variety of output formats (e.g., Internet, paper and other digital formats) to meet the needs of each user. We recommend that the SEC allow public companies to submit the information in their Section 16 forms with XBRL tags to reduce these barriers.

XBRL enables enhanced information exchange by allowing companies to tag their business information once and submit it for multiple uses and presentation formats, including SEC Section 16 filings and corporate Web site postings for investors and other interested parties to use. Because information is only entered once, risk of manual data entry errors is greatly reduced, thereby improving the quality of the information exchanged with the EDGAR system and with the investing public. As XBRL is fully interoperable across software applications and operating systems, it can shorten the time between when the issuer disseminates information and when consumers can reuse it, making the information gathering process more automated from beginning to end.

In other words, XBRL reduces barriers to the exchange of information by:

  • Facilitating delivery of more timely, accurate data for decision making;

  • Promoting greater transparency and access to information over the Internet;

  • Enabling greater interoperability of data across all technologies;

  • Enabling more effective and efficient reporting and analysis;

  • Providing more precise, clear and consistent reporting; and

  • Lowering the cost of electronic filing, posting and information exchange over the Internet.

In summary, we are asking the SEC to allow public companies the option to submit information tagged in XBRL and add XBRL to its list of allowable information formats for both filing into the EDGAR system and web site postings.

XBRL-US and the AICPA are committed to a business reporting model that eases the reporting burden, protects the public interest and motivates companies to provide transparent, easy-to-understand information to help all supply chain members make better informed decisions. As the SEC and investors increasingly demand more timely access to information, unique information formats like XBRL can play a central role in meeting these demands. Because XBRL is extensible and interoperable, its true power resides in its ability to represent all business information prepared by public companies. This includes not only information related to insider transactions filed with the EDGAR system and posted on public Web sites, but also to 10Ks, 10Qs and every other company report. This Proposed Rule is an opportunity for the SEC to support the use of XBRL for the benefit of information filers/preparers, the SEC staff and the investing public.

Eric E. Cohen, CPA
Chairman, Steering Committee
  Anthony Pugliese, CPA
Vice President, Member Innovation

Members of XBRL-US include: American Institute of Certified Public Accountants (AICPA); Bank of America; BearingPoint, Inc.; BDO Seidman; Bowne & Co., Inc.; Bryant College; Capital Printing Systems, Inc.; CCH Tax Compliance; Creative Solutions; Crowe Chizek; Defense Finance and Accounting Service; Deloitte & Touche LLP; Eagle Technology Management, Inc.; EDGAR-Online, Inc.; Ernst & Young LLP; Fujitsu Laboratories of America, Inc.; GCom2 Solutions; General Electric Company; Grant Thornton LLP; Hitachi America, Ltd.; Hyperion Solutions Corp.; iLumen, Inc.; Informatica Corporation; Innovision Corporation; Institute of Management Accountants (IMA); J.D. Edwards & Co.; KPMG LLP; Lawson Software; Microsoft Corporation; Moody's Risk Management Services; Morgan Stanley; Nasdaq Stock Market; National Center for Charitable Statistics at the Urban Institute; Oracle Corporation; OneSource Information Services; Peoplesoft; Practitioners Publishing Company; PR Newswire; PricewaterhouseCoopers LLP; Reuters Data LLC; RIA; R.R. Donnelley Financial; Standard Advantage; The Woodburn Group; Thomson Financial; and UBMatrix, Inc.

For more information about XBRL, please visit http://www.xbrl.org/.