The release, at the end of May, of staff comments from the PCAOB on the issues that accounting firms need to consider when providing assurance around XBRL documents came as a surprise to many. The PCAOB, the powerful US regulator of accounting firms set up following the prosecution and subsequent closure of Arthur Andersen, is closely watched by the accounting industry worldwide, and its unexpected reference to a little-known interpretation of a standard called AT101 is significant.

As the primary tool used in investment decision-making, both the content and release of company financial statements are heavily regulated. The dissemination of performance information in XBRL format creates some new external assurance issues. The gradual shift of reporting to granular, machine-readable reports in XBRL format, from the time honored pen and paper approach, means that information can be moved around faster, more accurately and in a more targetted manner. At the same time, the inherent comfort that companies and auditors alike take from paper-based performance reporting can be lost. Controllers and CFOs want to see that what is being published is what they have prepared. Since XBRL involves releasing performance data in a manner that is primarily machine readable, there is a need to confirm that what is being produced is what was intended.

The PCAOB's Q&A covers a number of areas, including:

• The need for the auditor that does the work to be independent of the production of the XBRL document.
• The need to ensure that the tagging choices made by the company are appropriate - companies need to endeavour to map their chart of accounts to the appropriate GAAP concept, and should not create new (extension) concepts where one already exists.
• The need to ensure that the XBRL data document does not contain more information in it than the printed version of the financial statement.

For practical purposes, this means that companies that are participating in the SEC's voluntary XBRL filing program should discuss this plan with their auditors. There are a range of tools under development that should make this process relatively straightforward, but companies are best placed to ask their software vendors to provide this type of support. There is currently no obligation on the part of participating companies to have their XBRL reports reviewed by their auditors. But the PCAOB's document serves both as a reminder to audit firms that they need to bring their audit teams up to speed with these new attestation arrangements, and to companies as a strong hint that the current exemption from external review will not last forever.

All in all, the fact that the PCAOB has provided this comment should be read as a strong endorsement of the SEC's work on the voluntary filing program. It's entirely too early to work out whether it is also an indication that the US securities regulators expect that the current trickle of XBRL filings will turn into a torrent. But being prepared is never a bad policy!