The Impact of XBRL on Financial Statement Structural Comparability

Steve Yang (), Fang-Chun Liu () and Xiaodi Zhu ()
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Steve Yang: Stevens Institute of Technology
Fang-Chun Liu: Stevens Institute of Technology
Xiaodi Zhu: Stevens Institute of Technology

A chapter in Network, Smart and Open, 2018, pp 193-206 from Springer

Abstract: Abstract The quality of corporate financial reporting has long been an important interest of financial reporting users, including investors, financial analysts, and regulators. Comparability is a key qualitative characteristic of accounting information that facilitates the comparison of financial statements. However, various reporting formats and accounting taxonomy standards result in inconsistent reporting structures that indirectly affect comparability. To improve information comparability, the U.S. Securities and Exchange Commission (SEC) mandated the adoption of the eXtensible Business Reporting Language (XBRL), a search-facilitating technology, to reduce the costs of information search and improve the efficiency of information processing. Leveraging on the XBRL adoption enforced by the SEC, this study investigates whether the comparability of financial statement structure has improved in the post-mandate XBRL period. The results show a significant, consistent comparability improvement in the post-XBRL adoption period, providing empirical evidence of the positive impact of XBRL on enhancing financial statement structural comparability.

Keywords: XBRL; Financial reporting quality; Comparability; Financial statement structure (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:spr:lnichp:978-3-319-62636-9_13

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DOI: 10.1007/978-3-319-62636-9_13

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