of Advancement Through Knowledge

1. XBRL eXtensible Business Reporting Language of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪

2. FERF Bookstore Proceeds from purchases made through the bookstore on the FEI website benefit FERF. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ FERF is the non-profit 501(c)(3) research affiliate of FEI. FERF researchers identify key financial issues and develop impartial, timely research reports for FEI members and non-members alike, in a variety of publication formats. The Foundation relies primarily on voluntary tax-deductible contributions from corporations, chapters, and individuals.

3. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ FELIX (Financial Executives List Exchange) is a moderated, e-mail based discussion forum that allows FEI members to communicate with and learn from their peers. Finance & Information Technology News: Knowledge for Financial ExecutivesA quarterly electronic newsletter covering IT issues that affect financial executives.

4. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ What is eXtensible Business Reporting Language (XBRL)? • Electronically tagging data in financial and other reports, which facilitates retrieval and analysis of the data. • Business information format standard • “UPC” for Financial Statements • Open Standard, No licensing fees

5. Standardization Presentation Cash & Cash Equivalents References GAAP I.2.(a) Instructions Ad Hoc disclosures Label cashCashEquivalentsAndShortTermInvestments Calculation Cash = Currency + Deposits FormulasCash ≥ 0 XBRL Item Contexts US $ FY2004 Budgeted Validation of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ How Does XBRL Work? • Element or Item • Specification • Taxonomy=Financial dictionary Tagging Process creates an Instance Document that is readable by software

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7. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ Brief History • XBRL International • Development in 1998 • Now 550 companies • XBRL US • Local jurisdiction of XBRL International • Mission: Support implementation of XBRL in the United States through development of taxonomies for use by US public and private sectors • Fast tracked by SEC • Project to review XBRL benefits launched in 2004 • FEI/FERF monitoring since approx. 2000

8. FEI provides you with ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ FEI Advocacy and Accounting Policy Initiatives • Committee on Corporate Reporting • Commented over the years on time, liability, auditor involvement, footnote tagging, taxonomy. • Recommended to start filing with SEC Form 10-Q, to use Form 8-K, delayed submission • All considered through comment process • Represented on SEC Committee on improvements to financial reporting (CIFiR) on its interactive data subcommittee • About ½ have to adopt this year FEI has a reputation for being a widely-influential voice on behalf of financial executives before the U. S. SEC, FASB, PCAOB, IASB and the U. S. Congress.

9. FEI provides you with ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ FEI Advocacy and Accounting Policy Initiatives • Committee on Finance and Information Technology • XBRL is an initiative of Technology & Reporting Subcommittee • Commented on U.S. taxonomy • Meetings with the XBRL Advisory Committee to the International Accounting Standards Board and with XBRL US • All considered through comment process • CFIT member Taylor Hawes is XBRL US board member • CFIT technical advisor Mike Willis is XBRL International chair • Collaborates with FERF on objective studies on XBRL FEI has a reputation for being a widely-influential voice on behalf of financial executives before the U. S. SEC, FASB, PCAOB, IASB and the U. S. Congress.

10. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ The SEC Rules • Provide the SEC a new exhibit with their financial statements, including the footnotes and schedules to the financial statements, in interactive data format (XBRL) • Will not replace traditional filing formats in ASCII or HTML • Local jurisdiction of XBRL International • Mission: Support implementation of XBRL in the United States through development of taxonomies for use by US public and private sectors • Required on SEC forms and on corporate websites • SEC forms: Annual 10-K, Quarterly 10-Q, foreign forms 20-F and 40-F, registration statements • 3-year phase-in period based on size and status

11. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ The SEC Rules • Domestic and foreign large accelerated filers on US GAAP • Public float above $5 billion • Beginning with quarterly report containing financial statements for a fiscal period on or ending after June 15, 2009 • All other domestic and foreign large accelerated filers on US GAAP • Beginning with periodic report containing financial statements for a fiscal period on or ending after June 15, 2010 • Remaining filers on US GAAP and foreign private issuers on IFRS • Beginning with periodic report containing financial statements for a fiscal period on or ending after June 15, 2011

12. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ The SEC Rules • Footnotes • Tag as a block of text in year one of use • Tag detailed qualitative disclosures in subsequent years (but each narrative not required) • File exhibit at the same time as report except: • For initial interactive data exhibits (can file within 30 days) • For detailed footnote and schedules in year two • If you don’t file… • Will be deemed NOT current with Exchange Act reports • Will NOT be deemed to have adequate current info for safe harbor • But, once data is provided, will be deemed current again-will NOT lose timely filing status

13. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ The SEC Rules • Voluntary XBRL filing program ends for 50 companies • Liability • Interactive data (XBRL) file subject to federal securities laws if submitted within 24 months of when it was required • Furnished, not filed for specified liability provisions • Protected from liability for initial failure to comply as long as good faith effort and prompt corrections made

14. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ XBRL Filing Case Study: AGL Resources • Voluntary filer program: initial XBRL-formatted 10-Q for 2nd quarter of 2007 • Financial reporting team plan involving software, identification of filings and extensions • 100 hours of training and preparation • Since then… • Took 2 hours until filing of 10-Q for 2nd quarter of 2008 that was filed on the same day • Implementation Cost=$10,000 for creation and submission of four quarterly and one annual set of XBRL financials over a year

15. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ XBRL Filing Case Study: United Technologies • Tagging of First Form 8-K earnings release • 80 hours of software training, establish process, perform tagging and filing • Since then… • Process now less than 4 hours • Overall time and cost reduced by over 20%

16. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ Beyond the Rules – the XBRL potential

17. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ Systems Integration • Existing process • Constant need to integrate number of different systems • Common solution is enterprise resource planning (ERP) software application • Furnished, not filed for specified liability provisions • Protected from liability for initial failure to comply as long as good faith effort and prompt corrections made • XBRL enables • Disparate systems (G/L, transaction and sub-ledgers) to speak the same language

18. XBRL GL Auto Journalizing Business Systems Oracle E-Business Suite Add-ons Journalizing XBRL GL Financial Information XBRL GL Conversion Engine Purchasing Wages Sales AR GL AP XBRL GL Documents of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ Systems Integration • Case Study: Wacoal ($1.4 billion Japanese apparel manufacturer) • Worked with vendor Hitachi to connect 32 disparate systems • Wacoal translated many document types, on a variety of platforms: mainframes, minicomputers, UNIX systems and PC servers • Done in under 6 months • Avoided approximately $100 million for a single instance ERP

19. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ Data Access, Assembly and Review • Existing process • Still largely manual • Wide range of proprietary software • Multiple reviewers and edits of reports and excel spreadsheets • By using data extraction tools, XBRL enables • More effective use of existing report writer apps for financial statement tables, footnotes, MD&A • Decreases extraction time and number of documents

20. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ Data Quality • Existing process • Data validation tests prior to moving to data warehouse • Errors passed back to data provider • XBRL enables data validation at the source level • No data passing back and forth • Example: FDIC applied in 2005 for call reports that shared information needs with 8,000 banks • Data error rate dropped from over 68% to under 5% • Reduction in processing time from 45 to less than two days • Reduction of analytical personnel from over 1,000 to fewer than 200

21. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ Spreadsheets • Existing process • Manual • Control risk from multiple reviewers and editors • XBRL enables • Self-service customized spreadsheet generation • Automated population of prior period information • Functioning like virtual dashboards

22. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ Case Study: Microsoft • Filed 10-Q in XBRL format: financial statements, footnotes even before voluntary filing program • Furnished full 10-K for fiscal 2005 • Working on integrating into internal management reporting system in a few years • Investor Central • Released in Jan. 2008 • Portal of information for all investors • Drill down into detailed finances

23. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ Are Analysts Using? • Some but more awareness needed • But, comparable to awareness building of EDGAR • SEC will replace EDGAR with Interactive Data Electronic Applications (IDEA) that is XBRL based

24. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ Software: Bolt-On Vs. Built-In Approach • ERP Vendor: SAP • Launched XBRL publisher product after SEC rule finalized • Partnered with XBRL software provider UBMatrix • Users of SAP products (Business Objects Planning and Consolidation, Business Suite software packages) can tag data • ERP Vendor: Oracle • XBRL manager feature of Oracle Hyperion financial reporting • XBRL publisher product consolidates, analyzes, approves XBRL report • Built-in Vendor: Clarity Systems • XBRL reporting services built into financial reporting system • Tagging is automated • Bolt-On Tagging Vendors • Fujitsu, Hitachi, NewClaurs, Rivet

25. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ Next Steps • Get educated • SEC final rule and SEC website • XBRL International, PCAOB websites • Consider free XBRL US webcasts or filer training workshops in New York City, Wed., May 20 and San Francisco, Sept. 16, 2009 • FEI website and Current Financial Reporting Issues conference in New York City, Mon.-Tues., Nov. 16-17 • Learn from others through their actual filings on SEC website • Read XBRL US preparers guide • Get management engaged

26. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ Next Steps • Develop a plan • Identify a task force • Q2 filing considerations: users need a tag reader, new taxonomies expected, some software better than others • Identify options • Information about 64 vendor products on XBRL US website including product/service features, pricing, contact and customer support information • Consider talking to auditors, financial printer or wire service for recommendations

27. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ Next Steps • Estimate costs/resources • Instance documents are labor intensive the first time • Informal survey of 45 companies, 15-20 companies have hired vendors; costs for one company is $3K per quarter. Create a practice run XBRL-enabled instance document • Free or trial tools available • Review taxonomies • Think through the process from start to finish • Start early!

28. of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪ Future Considerations • XBRL US • Taxonomy for MD&A out for comment • Integrating with standard setters (ISO 9000, Society for Worldwide Interbank Financial Telecommunication) to develop common structure • Potential IFRS transition – IFRS and US taxonomies different • FEI/FERF continues to monitor

29. Questions? Cheryl Graziano cgraziano@financialexecutives.org (973) 765-1064 of Advancement Through Knowledge ▪ Interaction ▪ Information ▪ Influence ▪ Integrity ▪