Friday 3 February 2017

Has the dream come true - Is there enough XBRL?

If you missed the introduction, then you can go back to this post.

I think I'm gonna end up tackling the "enough" question alot. Today as we stand at the beginning of the 2017 10-K reporting season, lets for now just narrow it down to the question of history.

Throughout this examination of the validity of XBRL today, I want to keep it as real world as possible, so a lot of my work in the coming weeks is gonna be working with a subset of companies from that most popular of general US indices - the S&P500. So I'm gonna draw from approx. 250* constituents to see if we can get closer to an answer.

*No I haven't just halved the index! I didn't want to work with financial companies as that just makes my life harder and I wanted to just look at companies that were going to lodge 10-K's in the current reporting window. Conveniently that left me with 256.

So before any reporting for 2017 began, we had (Source: XBRL to XL Database):

Which means not surprisingly, given how long XBRL has been a requirement, pretty much the entire population already has a five year history (not 100% as not all constituents were listed when XBRL filing started). That's a good start but even more excitingly, nearly 60% of this index population is suddenly gonna have 10 years of data! As the majority of their data points will now stretch back 10 years for the first time by the end of this reporting cycle. Companies are required to disclose 3 years of income and cash flow data (in each filing) so 8 filings will take you back 10 years for period items (9 years for balance sheet items).

In fact 4 companies (chevron corp, fluor corp, newmont mining corp, united technologies corp) had already filed 10'K's 8 times so this year will have a complete 10 year history.

10 years has always been regarded by analysts as the kinda historical period you can properly get your teeth into. The theory being that it equates roughly with an entire macro-economic cycle - from boom to bust.

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