Determining the Number of Applicable XBRL SEC-Filers in Second and Third Years of SEC's Interactive Data Rule Proposal

[Miles P. Jennings, Jr.]

The SEC will issue its rule proposal regarding interactive data in the next week or so.

Wall Street may want to sharpen its sense of which companies will be filing in XBRL and when those companies will first have to file under the new proposed standard.

Well, I thought I would take a whack at it---in a simplistic way. So first the definitions for "Accelerated Filer" and "Large Accelerated Filer" must be determined. Large Accelerated Filers are those with $700 million market capitalization or more, and Accelerated Filers have market cap of less than $700 million but at least $75 million.

Hoping to get a simple estimate of the number of companies required to file in the second and third years, I consulted two stock screeners---Nasdaq and Google. I suggest using Google since it is easier to count the search results. But, Nasdaq and Google may have different databases from which they search, so let the user beware! Also, one must exclude the ADRs and foreign securities listed for the relevant years.

The proposed rule is pretty clearly for those U. S. companies with market caps of $5 billion or more in the first year; then the balance of Large Accelerated U. S. Filers in the second year; and then the balance of filers (including non-U. S. filers) in the third year.

If there is a way to estimate the approximate number of required filers in the second and third year, I would think that information would be of interest to the market. If someone has the energy, the following two stock screeners might be of assistance:

Nasdaq Screener (can creata screens for NYSE as well)
Google Stock Screener

Market price will also be a factor in determining the final number of XBRL-filing companies.

And, alas, perhaps the SEC could provide some guidance on the estimated number of affected companies in year 2 and year 3. No doubt the SEC has a clear breakdown of the estimated number of companies affected by this new rule proposal. Not having the data-mining resources of the SEC into the filing archives, I find estimating even a rough number for the affected companies in the SECOND and THIRD years to be a real trick.

With all the data resources of XBRL.US, the AICPA, and the SEC, it would seem that having a rough estimate of the number of affected companies per year might be in the public interest.

[Dan O'Brien]

Hello Miles,

Pulling information from the 12/05 adopting release when the accelerated filer concept was born (see pg. 40), it looks like there are roughly 1700 large accelerated filers and 2300 accelerated filers, give or take a few given that this data is a few years old. Since the universe of public companies is 10,000+ (excluding foreign private issuers and voluntary debt filers), there are likely about 6000+ non-reporting issuers.

So I think its accurate to assume those numbers to look like:

Year 1 mandate - 500 (companies >$5 billion public float)
Year 2 mandate - 1700 (rest of LAF)
Year 3 mandate - 6000 - 10000 (all others who file in US GAAP)

Dan

[Miles P. Jennings, Jr.]

Your information helps to rationalize the SEC's schedule and suggests that the phase-in period is reasonable. The LAFs certainly have the wherewithal to comply within two years, and the 3rd-year allowance for all others is a generous time frame.

The challenge of the phase-in schedule is also mitigated by the voluntary filers and also the fact that banks are already preparing their call reports in XBRL. The 3rd-year companies will have the benefit of industry experience and new products and services developed over the next two years.

That info is really helpful. You must have laughed about my trying to dope it out from stock screeners!

Thanks, Dan.