The SEC is rolling out a new program that is expected to detect fraud. Using a computer reading tool known as XBRL, financial statements can now be monitored for unusual reporting. The SEC expects to roll out the tool in nine months, according to insiders.
XBRL is a language code used increasingly on financial data for better comparisons across publicly traded companies. The expectation is that shady accounting will be detected to avoid mass frauds such as the one committed by Bernie Madoff.
Other countries have announced they will adopt this monitoring tool as well, which will facilitate the passage of IFRS that are expected to coordinate global accounting standards.
There apparently were initial problems with the XBRL tagging system, but specialists are confident they will be resolved over time.
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