Applying XBRL to US State and Local Government Audited Financial Reports

20 Pages Posted: 8 Jan 2019 Last revised: 11 Jan 2019

See all articles by Marc D. Joffe

Marc D. Joffe

Public Sector Credit Solutions

Jacqueline Reck

University of South Florida - College of Business Administration

Date Written: January 3, 2019

Abstract

Ten years after the Securities and Exchange Commission mandated the conversion of corporate financial statements to machine-readable formats, there is still no analogous mandate for state and local government Comprehensive Annual Financial Reports (CAFRs). We explore the challenges and benefits of migrating from PDF CAFRs to machine-readable filings using eXtensible Business Reporting Language (XBRL). After explaining the benefits of machine-readable audited municipal financial data, we consider the challenges of creating and implementing an XBRL taxonomy for this sector and the impact a filing mandate would have on state and local governments. To better assess the challenges, we update a CAFR taxonomy previously published by Neal M. Snow and Jacqueline L. Reck and apply it to a city in Florida. While corporate XBRL filers generally use third-party filing firms, they can also use open-source software, low-cost licensed software, or both to produce the filings. Providing a variety of low-cost alternatives to state and local governments helps mitigate the challenge of providing affordable filings.

Keywords: Comprehensive Annual Financial Reports, financial reporting, XBRL, state and local government debt, government financial reporting taxonomy

JEL Classification: M4, H74

Suggested Citation

Joffe, Marc D. and Reck, Jacqueline, Applying XBRL to US State and Local Government Audited Financial Reports (January 3, 2019). Mercatus Research Paper. Available at SSRN: https://ssrn.com/abstract=3311695 or http://dx.doi.org/10.2139/ssrn.3311695

Marc D. Joffe (Contact Author)

Public Sector Credit Solutions ( email )

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HOME PAGE: http://www.publicsectorcredit.org

Jacqueline Reck

University of South Florida - College of Business Administration ( email )

4202 E. Fowler Avenue, BSN 3403
Tampa, FL 33620-5500
United States

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