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XBRL and Interoperability of Financial Statements in the U.S.

5 Pages Posted: 1 Apr 2010  

Hongwei (Harry) Zhu

University of Massachusetts Lowell; Massachusetts Institute of Technology (MIT); Old Dominion University

Harris Wu

Old Dominion University

Date Written: March 25, 2010


In the wake of global financial crisis, there is a pressing need for improving transparency and interoperability of the financials of public companies. XBRL and XBRL taxonomies have the potential of helping us accomplish this objective. In the U.S., the SEC has mandated that all publicly listed companies must file their financial statements using XBRL and the US GAAP taxonomy beginning mid 2009 to late 2014 according to a phased-in schedule. Are the XBRL-based financial statements interoperable? We address this question by analyzing all the annual XBRL financial statements filed to SEC as of this February. We find that the statements still lack interoperability, which is partly caused by issues related to the GAAP taxonomy and misuse of the taxonomy by companies. On average, only 37% data elements are directly comparable between a pair of statements. Our timely findings have practical implications that will ultimately help improve the quality of financial data.

Keywords: XBRL, GAAP, interoperability, data quality, long tail

JEL Classification: M41, M44

Suggested Citation

Zhu, Hongwei (Harry) and Wu, Harris, XBRL and Interoperability of Financial Statements in the U.S. (March 25, 2010). Available at SSRN: or

Hongwei Zhu (Contact Author)

Old Dominion University ( email )

Norfolk, VA 23529
United States
757-683-5175 (Phone)


University of Massachusetts Lowell ( email )

One University Avenue
Lowell, MA 01854
United States

Massachusetts Institute of Technology (MIT) ( email )

Cambridge, MA 02139
United States


Harris Wu

Old Dominion University ( email )

Norfolk, VA 23529-0222
United States

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