Some of you may remember Christopher Cox, who served as SEC Chair from 2005 to early 2009, when he was succeeded by Mary Schapiro.  His name doesn’t come up often, perhaps because his legacy was a weakened Commission tarnished by, among other things, the financial crisis and the Madoff scandal.

While Chairman Cox may not have been responsible for either of those debacles, he did leave another unpleasant legacy – XBRL.  He was among the biggest cheerleaders for XBRL, claiming that it would enable investors to compare companies within and across industries and would perform various other miracles.  Suffice it to say it hasn’t done that.  Aside from the fact that it’s time-consuming, it has failed to provide the benefits of comparability.  As a client recently said,

“[E]ven if two companies use the same taxonomy/tagging for Cost of Sales, they probably are not consistent in the underlying details that go into Cost of Sales.  One company might classify certain components as G&A instead.  There are many other examples.  Consistency is very important for one company’s reporting from period to period, however comparisons of competitors’ financials will always be approximations at best.”

Despite the above and other concerns with XBRL, it refuses to die.  In fact, there have been numerous suggestions to expand its use – for example, by adding XBRL requirements to proxy statement data, including information on executive compensation, and there has even been the occasional article suggesting that XBRL data should be audited by independent auditors.

I’ve conducted several informal and totally unscientific surveys on the use of XBRL.  While I suspect that someone somewhere is using it, I have yet to meet anyone, from investors to analysts to issuers, that places much, if any, reliance on it.  And I have heard many complaints along the foregoing and other lines.  So for those of you who are reading this, please let me know your views on XBRL.  I’ll report the results in due course.

As readers of this blog know, I have great respect for the SEC and its Staff.  However, as a general matter, the SEC rarely looks at rules that have been around for a while and says “let’s get rid of it – it’s not doing what it was supposed to do”.  (Another example – when Reg D was adopted, Form D was stated to be a temporary requirement to facilitate data collection on when and in what circumstances Reg D was used.  It’s now more than 40 years old with no signs of being retired.)  So I’m not particularly optimistic that XBRL will vanish, but one way to start down that road is to get some data.  I look forward to hearing from you!