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SECURITIES AND EXCHANGE COMMISSION

17 CFR Parts 229, 230, 232, 239, 249, 270 and 274

[Release Nos. 33-10514; 34-83551; IC-33139; File No. S7-03-17]

RIN 3235-AL59

Inline XBRL Filing of Tagged Data

AGENCY: Securities and Exchange Commission.

ACTION: Final rule.

SUMMARY: We are adopting amendments to require the use of the Inline eXtensible

Business Reporting Language (“XBRL”) format for the submission of operating

company financial statement information and fund risk/return summary information. We

also are adopting the elimination of the 15 business day XBRL filing period for fund

risk/return summaries. The amendments are intended to improve the data’s usefulness,

timeliness, and quality, benefiting investors, other market participants, and other data

users and to decrease, over time, the cost of preparing the data for submission to the

Commission. The amendments will also eliminate the requirement for operating

companies and funds to post “Interactive Data Files” (i.e., machine-readable computer

code that presents information in XBRL format) on their websites and terminate the

Commission’s voluntary program for the submission of financial statement information

interactive data that is currently available only to investment companies and certain other

entities.

DATES: Effective date: These amendments are effective on September 17, 2018.

Compliance dates: See Section III.A.1.c.

FOR FURTHER INFORMATION CONTACT: Mark W. Green, Senior Special

Counsel, Division of Corporation Finance, at (202) 551-3430; John Foley, Senior

Counsel, Division of Investment Management, at (202) 551-6792; Robert M. Willis,

Assistant Director, Office of Disclosure Technology, Anzhela Knyazeva, Senior

Financial Economist, or Hermine Wong, Special Counsel, Division of Economic and

Risk Analysis, at (202) 551-6600.

SUPPLEMENTARY INFORMATION: We are adopting amendments to:

Commission Reference

Regulation S-K 1

Regulation S-T 2

Securities Act of 1933 (Securities

Act) 3

Securities Exchange Act of 1934

(Exchange Act) 4

17 CFR 229.10 through 229.1208.

17 CFR 232.10 through 232.903.

15 U.S.C. 77a et seq.

15 U.S.C. 78a et seq.

CFR Citation

(17 CFR)

Item 601

Rule 11

Rule 201

Rule 202

Rule 305

Rule 401

Rule 402

Rule 405

Rule 144

§ 229.601

§ 232.11

§ 232.201

§ 232.202

§ 232.305

§ 232.401

§ 232.402

§ 232.405

§ 230.144

Rule 485

Rule 497

Form S-3

Form S-8

Form F-3

Form F-10

Rule 13a-14

§ 230.485

§ 230.497

§ 239.13

§ 239.16b

§ 239.33

§ 239.40

§ 240.13a-14

Rule 15d-14

Form 10-Q

§ 240.15d-14

§ 249.308a

Investment Company Act of 1940

(Investment Company Act) 5

Securities Act and Investment

Company Act

Form 10-K

Form 20-F

Form 40-F

Form 6-K

Rule 8b-1

§ 249.310

§ 249.220f

§ 249.240f

§ 249.306

§ 270.8b-1

Rule 8b-2

Rule 8b-33

Rule 30a-2

Form N-1A

§ 270.8b-2

§ 270.8b-33

§ 270.30a-2

§ 239.15A and

274.11A

I. INTRODUCTION ..................................................................................................................... 4

II. BACKGROUND AND ECONOMIC BASELINE ................................................................ 7

A. Overview of Existing XBRL Requirements for Operating Companies and Funds ..................... 7

B. Current XBRL Practices and Affected Parties ...........................................................................11

1. XBRL Preparation ........................................................................................................11

2. Voluntary Use of Inline XBRL by Operating Companies under the Exemptive Order 13

3. XBRL Data Use ............................................................................................................17

III. FINAL AMENDMENTS AND ANTICIPATED ECONOMIC EFFECTS .................... 20

A. Discussion of the Final Amendments .........................................................................................20

1. Inline XBRL Requirements ..........................................................................................20

2. Elimination of the Website Posting Requirements .......................................................51

3. Termination of the 2005 XBRL Voluntary Program ....................................................53

4. Technical Amendments ................................................................................................54

B. Potential Economic Effects of the Amendments ........................................................................55

1. Inline XBRL Requirements ..........................................................................................57

2. Elimination of the Website Posting Requirements for Financial Statement Information

and Risk/Return Summaries ......................................................................................79

3. Termination of the 2005 XBRL Voluntary Program ....................................................80

4. Alternatives ...................................................................................................................80

IV. OTHER MATTERS ............................................................................................................. 86

V. PAPERWORK REDUCTION ACT ..................................................................................... 86

A. Background ................................................................................................................................86

B. Summary of Comment Letters and Revisions to Proposals........................................................87

C. Reporting and Cost Burden Estimates ........................................................................................88

1. Registration Statement and Periodic Reporting ............................................................88

2. Regulation S-K and Regulation S-T .............................................................................96

VI. FINAL REGULATORY FLEXIBILITY ACT ANALYSIS ............................................. 97

A. Need for, and Objectives of, the Final Amendments..................................................................97

B. Significant Issues Raised by Public Comments ..........................................................................97

C. Small Entities Subject to the Amendments.................................................................................99

D. Projected Reporting, Recordkeeping and Other Compliance Requirements ............................100

E. Agency Action to Minimize Effect on Small Entities ..............................................................102

VII. STATUTORY BASIS........................................................................................................ 104

TEXT OF THE FINAL RULE AND FORM AMENDMENTS............................................ 104

15 U.S.C. 80a et seq.

I. INTRODUCTION

In 2009 the Commission adopted rules requiring operating companies 6 to provide

the information from the financial statements accompanying their registration statements

and periodic and current reports in machine-readable format using XBRL by submitting it

to the Commission in exhibits to such registration statements and reports and posting it

on their websites, if any. 7 That same year, the Commission similarly required open-end

management investment companies (including exchange-traded funds (“ETFs”)

organized as open-end management investment companies) (“funds”) to provide

risk/return summary information from their prospectuses in XBRL format by submitting

it to the Commission in exhibits and posting it on their websites, if any. 8

XBRL requirements currently apply to operating companies that prepare their

financial statements in accordance with U.S. generally accepted accounting principles

(“U.S. GAAP”) or in accordance with International Financial Reporting Standards

(“IFRS”) as issued by the International Accounting Standards Board (“IASB”). 9 XBRL

For purposes of both the existing XBRL requirements for financial statement information and

these amendments, operating companies are filers subject to the financial statement information

XBRL requirements of Item 601(b)(101) of Regulation S-K and Forms F-10, 20-F, 40-F and 6K. Operating companies do not include any investment company that is registered under the

Investment Company Act, any business development company (“BDC”), as defined in Section

2(a)(48) of that Act [15 U.S.C. 80a-2(a)(48)], or any entity that reports under the Exchange Act

and prepares its financial statements in accordance with Article 6 of Regulation S-X [17 CFR

210.6-01 through 210.6-10], as well as asset-backed issuers. See Release No. 33-9002 (Jan. 30,

2009) [74 FR 6776] (“2009 Financial Statement Information Adopting Release”) as corrected by

Release No. 33-9002A (Apr. 1, 2009) [74 FR 15666], at 6780-1, nn. 69 and 78 and accompanying

text.

17 CFR 232.405. See also 2009 Financial Statement Information Adopting Release.

See Release No. 33-9006 (Feb. 11, 2009) [74 FR 7747] (“2009 Risk/Return Summary Adopting

Release”) as corrected by Release No. 33-9006A (May 1, 2009) [74 FR 21255]. The risk/return

summary is set forth in Items 2, 3, and 4 of Form N-1A under the Securities Act and the

Investment Company Act.

As used in this release, the phrase “IFRS as issued by the IASB” refers to the authoritative text of

IFRS.

requirements also apply to funds pursuant to Form N-1A and related rules under

Regulation S-T. 10 Operating companies and funds subject to these XBRL requirements

must submit an Interactive Data File, 11 including information tagged in XBRL, as an

exhibit to the Related Official Filing, which is filed in the traditional HyperText Markup

Language (“HTML”) or, less commonly, American Standard Code for Information

Interchange (“ASCII”) format. 12

The 2009 requirements were intended to make financial information and fund

risk/return summaries easier for investors to analyze and to assist in automating

regulatory filings and business information processing. 13 Since that time, however, some

observers have expressed concerns regarding the quality of, extent of use of, and cost to

create XBRL data. 14 In addition, the Commission staff has identified common data

quality issues associated with financial statement information XBRL data filed by

operating companies. 15

See General Instruction C.3.(g) to Form N-1A; Rule 405 of Regulation S-T.

17 CFR 232.11; 17 CFR 232.405. The term “Interactive Data File” means the machine-readable

computer code that presents information in XBRL electronic format pursuant to Rule 405 of

Regulation S-T. The Interactive Data File currently consists of an instance document and other

documents as described in the Electronic Data Gathering, Analysis, and Retrieval system

(EDGAR) Filer Manual. The instance document contains the XBRL tags for the information

contained in the corresponding data in the Related Official Filing to satisfy the content and format

requirements in Rule 405. The other documents in the Interactive Data File contain contextual

information about the XBRL tags.

17 CFR 232.11. The term “Related Official Filing” means the ASCII or HTML format part of the

official filing with which an Interactive Data File appears as an exhibit or, in the case of Form N1A, the ASCII or HTML format part of the official filing that contains the information to which an

Interactive Data File corresponds.

See 2009 Financial Statement Information Adopting Release, at 6776; 2009 Risk/Return Summary

Adopting Release, at 7748.

See Release No. 33-10323 (Mar. 1, 2017) [82 FR 21487] (“Inline XBRL Proposing Release”), at

14283, nn. 29-30, at 14286, n. 70, at 14287, n. 78, and accompanying text.

See, e.g., Staff Observations of Custom Axis Tags (Mar. 29, 2016),

https://www.sec.gov/structureddata/reportspubs/osd_assessment_custom-axis-tags.html (retrieved

Jun. 20, 2018); Staff Observations of Custom Tag Rates (July 7, 2014),

At the same time, since the adoption of the original XBRL requirements in 2009,

other observers have disagreed with the claim that the XBRL requirements impose high

costs and emphasized the decrease in costs over time as filers and filing agents have

gained experience and widely adopted the XBRL technology. 16 Other observers have

discussed the improvement in XBRL data quality over time and examined the benefits of

XBRL data. 17 The same observers have associated XBRL data with better availability of

information about smaller operating companies from an access to capital standpoint. 18

We have reviewed and considered all of the comments that we received on the

Inline XBRL Proposing Release. 19 The final amendments reflect changes made in

response to those comments. We are adopting the Inline XBRL requirements for

https://www.sec.gov/dera/reportspubs/assessment-custom-tag-rates-xbrl.html (retrieved Jun. 20,

2018); Staff Observations from the Review of Interactive Data Financial Statements (Dec. 13,

2011), https://www.sec.gov/spotlight/xbrl/staff-review-observations-121311.shtml (retrieved Jun.

20, 2018).

See Inline XBRL Proposing Release, at 14286.

See Inline XBRL Proposing Release, at 14286 and at 14287, n. 81.

Id.

See letters from Advanced Computer Innovations, Inc. (Mar. 1, 2017) (“ACI”); Association of

International Certified Professional Accountants (May 16, 2017) (“AICPA”); Biotechnology

Innovation Organization (May 16, 2017) (“BIO”); CFA Institute (Jun. 12, 2017) (“CFA

Institute”); Cigna Corporation (May 16, 2017) (“Cigna”); Data Coalition (May 16, 2017) (“Data

Coalition”); Deloitte & Touche LLP (May 5, 2017) (“Deloitte”) ; Ernst & Young LLP (May 16,

2017) (“EY”); Federated Investors (May 16, 2017) (“Federated I”); Federated Investors (Jun. 1,

2018) (“Federated II”); Financial Executives International (May 16, 2017) (“FEI”); Jack Frei

(Mar. 13, 2017) (“Frei”); Gartner, Inc. (May 10, 2017) (“Gartner”); Grant Thornton LLP (May 16,

2017) (“Grant Thornton”); Hindssight 2020, llc (May 15, 2017) (“Hindssight”); Charles S.

Hoffman (May 14, 2017) (“Hoffman”); Investment Company Institute (May 16, 2017) (“ICI I”);

Investment Company Institute (Jun. 1, 2018) (“ICI II”); IRIS Business Services Limited (Mar. 27,

2017) (“IRIS”); Hemant Khatod (Mar. 27, 2017) (“Khatod 1”); Hemant Khatod (Mar. 27, 2017)

(“Khatod 2”); Suresh Kumar (Mar. 21, 2017) (“Kumar”); Paul Lewis (Mar. 10, 2017) (“Lewis”);

Reps. Randy Hultgren, Carolyn Maloney, and Darrell Issa, Members of Congress (Apr. 27, 2017)

(“Members of Congress”); Merrill Corporation (May 16, 2017) (“Merrill”); Morningstar, Inc.

(May 16, 2017) (“Morningstar”); Octachoron Limited (May 15, 2017) (“Octachoron”); Bill

Palmer (May 12, 2017) (“Palmer”); Laurie A. Pergamit (May 2, 2017) (“Pergamit”); Somnath Ray

(May 17, 2017) (“Ray”); Daniel C. Sweeney (Mar. 27, 2017) (“Sweeney”); TagniFi (Apr. 19,

2017) (“TagniFi”); U.S. Bancorp Fund Services, LLC (May 16, 2017) (“USBFS”); Workiva Inc.

(May 23, 2017) (“Workiva I”); Workiva Inc. (Mar. 6, 2018) (“Workiva II”); XBRL International

(May 16, 2017) (“XBRL International”); XBRL US (May 16, 2017) (“XBRL US”).

operating companies and funds substantially as proposed, with modifications to address

input from commenters. We are also eliminating the XBRL website posting

requirements for operating companies and funds and eliminating the Commission’s

interactive data voluntary program (“2005 XBRL Voluntary Program”), 20 as proposed.

The discussion below begins with a background description of the existing XBRL

requirements and current XBRL practices. The discussion of the amendments is found in

Section III.A.

We believe that the use of Inline XBRL may reduce the time and effort associated

with preparing XBRL filings, simplify the review process for filers, and improve the

quality and usability of XBRL data for investors, market participants, and other data

users. The Commission will continue to monitor industry practices and market

developments in disclosure technologies. Should future developments suggest that a

more efficient or less costly reporting standard would provide at least substantively

similar benefits as Inline XBRL, we would evaluate whether changes to our reporting

format are appropriate, including, without limitation, designating another reporting

standard as an alternative to Inline XBRL for some or all aspects of the rule.

II. BACKGROUND AND ECONOMIC BASELINE

A. Overview of Existing XBRL Requirements for Operating Companies and Funds

See Rule 401 of Regulation S-T. In 2005, the Commission began to allow registrants to

voluntarily submit financial information in XBRL form as exhibits to periodic reports and

Investment Company Act filings. See Release No. 33-8529 (Feb. 3, 2005) [70 FR 6556]. In 2007,

the voluntary program was expanded to permit risk/return summary submissions. See Release No.

33-8823 (Jul. 11, 2007) [72 FR 39289]. As a result of rule amendments adopted by the

Commission in 2009, the 2005 XBRL Voluntary Program is now only open for participation by

investment companies and other entities that prepare their financial statements in accordance with

Article 6 of Regulation S-X. See 2009 Financial Statement Information Adopting Release and

2009 Risk/Return Summary Adopting Release.

The XBRL requirements for the required information are located in the

Interactive Data File provisions of Regulation S-K; 21 Forms F-10, 22 20-F, 23 40-F, 24 6K, 25 and N-1A; 26 Rule 405 of Regulation S-T; and the EDGAR Filer Manual. 27

Operating companies are required to submit financial statements and any

applicable financial statement schedules in XBRL as exhibits to certain Exchange Act

reports and Securities Act registration statements. 28 In general, operating companies that

prepare their financial statements in accordance with U.S. GAAP or in accordance with

IFRS as issued by the IASB must submit their financial statements to the Commission in

XBRL. Filers that are required to provide information in XBRL must use the taxonomies

specified on the Commission’s website. 29

See Item 601(b)(101) of Regulation S-K [17 CFR 229.601(b)(101)].

See Paragraph (101) of Part II—Information Not Required to be Delivered to Offerees or

Purchasers of Form F-10.

See Paragraph 101 of the Instructions as to Exhibits of Form 20-F.

See Paragraph B.(15) of the General Instructions to Form 40-F.

See Paragraph C.(6) of the General Instructions to Form 6-K.

See General Instruction C.3.(g) to Form N-1A.

The EDGAR Filer Manual sets forth the technical formatting requirements for the presentation

and submission of electronic filings through the EDGAR system. EDGAR performs automated

collection, validation, indexing, acceptance, and forwarding of submissions by companies and

others who are required to file forms with the Commission. See

https://www.sec.gov/edgar/aboutedgar.htm (retrieved Jun. 20, 2018).

Financial statements in XBRL are required as exhibits to Exchange Act reports on Forms 10-Q,

10-K, 20-F, 40-F, and, in some cases, 8-K and 6-K. Financial statements in XBRL also are

required as exhibits to Securities Act registration statements that contain financial statements, such

as Form S-1 (except registration statements filed in connection with an initial public offering).

Securities Act registration statements that do not contain financial statements, such as a Form S-3

or other form filed by an issuer that incorporates by reference all required financial statement

information from its periodic reports, and Exchange Act registration statements are not required to

include Interactive Data Files. See 2009 Financial Statement Information Adopting Release.

See Rule 405(c)(1) of Regulation S-T.

Funds are required to submit risk/return summary information in XBRL as

exhibits to registration statements and to prospectuses with risk/return summary

information that varies from the registration statement. 30

An operating company generally must submit the Interactive Data File as an

exhibit to the relevant Related Official Filing. 31 Funds are required to submit the

Interactive Data File within 15 business days of (1) the effective date of the registration

statement or post-effective amendment that contains the related information, 32 or (2) the

filing of a form of prospectus made pursuant to paragraph (c) or (e) of Rule 497. 33

Operating companies and funds may delay submission and posting to the extent provided

under a hardship exemption. 34

When filers submit XBRL exhibits during EDGAR filing, the XBRL exhibits are

validated for compliance with certain EDGAR Filer Manual technical requirements

before the attachments are accepted. During EDGAR filing, EDGAR validates XBRL

documents that make up an Interactive Data File, producing error and warning messages

when issues with the XBRL data are identified. EDGAR also “renders”—creates a

human-readable version of—XBRL data that can be viewed on the EDGAR website.

EDGAR users can view a rendered version of the tagged information submitted in the

See General Instruction C.3.(g) to Form N-1A.

See Rule 405(a) of Regulation S-T.

See General Instruction C.3.(g)(i), (iv) to Form N-1A.

See General Instruction C.3.(g)(ii), (iv) to Form N-1A.

An operating company may delay the submission and posting of the Interactive Data File to the

extent provided under a temporary or a continuing hardship exemption. See Rules 201 and 202 of

Regulation S-T. A fund filer may delay the submission and posting of the Interactive Data File to

the extent provided under a continuing hardship exemption. See Rule 202 of Regulation S-T.

XBRL exhibit by clicking on the “Interactive Data” button next to the relevant filing on

EDGAR.

For both operating companies and funds, the Interactive Data File submitted to

the Commission also must be posted on the filer’s website, if any, on the earlier of the

calendar day that the filer submitted or was required to submit it. 35 Operating companies

must keep the Interactive Data File posted for at least 12 months. 36 Funds must keep the

Interactive Data File posted until the registration statement or post-effective amendment

to which the Interactive Data File relates is no longer current. 37

Currently, the requirement for operating companies to submit and post financial

statement information in XBRL applies through the exhibit requirements of Item

601(b)(101) of Regulation S-K 38 and Forms F-10, 39 20-F, 40 40-F, 41 and 6-K. 42 Similar

requirements for funds to submit and post risk/return summary information in XBRL

apply through the exhibit requirements of Form N-1A 43 and Rule 497. 44 These exhibit

See Rule 405(g).

Id.

See Rule 405(g) and General Instruction C.3.(g)(iii) to Form N-1A.

If a fund does not submit or post interactive data as required, its ability to file post-effective

amendments to its registration statement under Rule 485(b) under the Securities Act is

automatically suspended until it submits and posts the interactive data as required. See Rule

485(c) under the Securities Act. The Interactive Data File also must be submitted in such a

manner that will permit the information for each series and, for any information that does not

relate to all of the classes in a filing, each class of the fund to be separately identified. See General

Instruction C.3.(g)(iv) to Form N-1A.

The exhibit requirements of Item 601(b)(101) relate to Forms S-1, S-3, S-4, S-11, F-1, F-3, F-4, 8K, 10-Q, and 10-K.

See Paragraph (101) of Part II (Information Not Required to be Delivered to Offerees or

Purchasers) of Form F-10.

See Paragraph 101 of the Instructions as to Exhibits of Form 20-F.

See Paragraph B.(15) of the General Instructions to Form 40-F.

See Paragraph C.(6) of the General Instructions to Form 6-K.

See General Instruction C.3.(g) to Form N-1A.

requirements specify when information in the Related Official Filing triggers the

requirement to submit and post an Interactive Data File in the manner provided by Rule

405 of Regulation S-T. 45 Rule 405 sets forth the basic content, format, submission, and

posting requirements for the Interactive Data File, such as the requirement to submit the

Interactive Data File as an exhibit to the Related Official Filing. 46 Rule 405 also requires

that an Interactive Data File be submitted in accordance with the EDGAR Filer Manual. 47

The EDGAR Filer Manual contains additional formatting and submission requirements

for the Interactive Data File.

On June 13, 2016, the Commission issued an exemptive order under the Exchange

Act to permit operating companies that comply with certain conditions listed in the order

to file structured financial statement data required in their periodic and current reports

using Inline XBRL through March 2020, in lieu of filing all their XBRL data in a

separate exhibit. 48

B. Current XBRL Practices and Affected Parties

1. XBRL Preparation

See Rule 497(c), (e).

The exhibit provisions that specify when an Interactive Data File is required for financial

information also specify when it is optional and when it is prohibited.

See Rule 405(a)(2) for the exhibit requirement.

See Rule 405(a)(3).

See Order Granting Limited and Conditional Exemption under Section 36(a) of the Securities

Exchange Act of 1934 from Compliance with Interactive Data File Exhibit Requirement in Forms

6-K, 8-K, 10-Q, 10-K, 20-F, and 40-F to Facilitate Inline Filing of Tagged Financial Data, Release

No. 34-78041 (Jun. 13, 2016) [81 FR 39741] (“Exemptive Order”).

There were approximately 8,315 filers of annual and quarterly reports (Forms 10K, 10-Q, 20-F, and 40-F), including amendments, during calendar year 2017. 49 As of

December 2017, there were approximately 11,181 funds registered on Form N-1A. 50

Filers may prepare their Interactive Data to comply with existing XBRL requirements inhouse or use an outside service provider. 51 Tagging required disclosures in XBRL may

involve either a standalone or integrated approach. 52

In 2009 the Commission estimated the expected direct cost of compliance with

XBRL requirements by operating companies. 53 After the adoption of the 2009 rules,

several pre-proposal commenters and studies provided estimates of the cost of

The figures are based on staff analysis of EDGAR filings. Filers were identified based on Central

Index Key (“CIK”) codes. Some filers, including investment companies, asset-backed issuers, and

filers who have received a hardship exemption, are not subject to financial statement information

interactive data requirements. Interactive data requirements for operating companies also pertain

to certain Securities Act registration statements, as well as certain filings on Forms 8-K and 6-K

containing specified financial statements.

The figures are based on data obtained from ICI as of December 31, 2017, available at

http://www.ici.org/research/stats, and staff analysis of EDGAR filings. This count includes 9,360

mutual funds and 1,821 ETFs registered as open-end investment companies. The estimate of

ETFs is reduced to exclude approximately eight ETFs registered as unit investment trusts

(“UITs”). UITs and closed-end funds are not subject to the proposed amendments and are

therefore excluded from this estimate.

See Inline XBRL Proposing Release, at 14285. See also William Sinnett, SEC reporting and the

impact of XBRL: 2013 survey, Financial Executives Research Foundation (Nov. 15, 2013)

(“FERF Study”), at 15.

See Inline XBRL Proposing Release, at 14285. With a standalone approach, filers or filing agents

create an XBRL exhibit by copying the information from the filing document and tagging it in

XBRL, which requires them to expend incremental resources to create and tag a copy of the data

and verify the consistency of tagged data across documents. With an integrated approach, XBRL

tagging of required disclosures is a part of a broader disclosure management process, and

integrated disclosure management software is used to generate both the HTML filing and the

XBRL exhibit.

See 2009 Financial Statement Information Adopting Release, at 6804 (estimating direct costs of

preparing and submitting interactive data-formatted financial statements, excluding the cost of

website posting, at $39,510–$81,220 ($12,450–$20,340) for the first submission (each subsequent

submission) with block-text footnotes and schedules and $29,700–$59,150 ($20,075–$36,940) for

the first submission (each subsequent submission) with detailed tagging of footnotes and

schedules, and the cost of website posting at $1,000 per year).

compliance with financial statement information XBRL requirements. 54 According to a

2013 survey, the median operating company filer required 25 hours for the preparation

and 15 hours for the review of XBRL and between $8,000 and $10,000 for the services of

outside professionals for its most recent annual filing. 55 According to another survey, the

median small filer paid $10,000 or less on an annual basis for fully outsourced creation

and filing of its XBRL exhibits. 56 Preliminary statistics from a pricing survey being

conducted by the AICPA and XBRL US indicate that the cost of XBRL formatting has

declined 41% since 2014 and that the average cost of XBRL preparation for small

reporting companies in 2017 averaged $5,850 per year. 57 The 2009 Risk/Return

Summary Adopting Release estimated the expected direct cost of compliance with the

fund risk/return summary XBRL requirements. 58

2. Voluntary Use of Inline XBRL by Operating Companies under the Exemptive

Order

See Inline XBRL Proposing Release, at 14285-6, n. 69.

See FERF Study, at 18–19.

See Research shows XBRL filing costs are lower than expected, AICPA,

https://www.aicpa.org/InterestAreas/FRC/AccountingFinancialReporting/XBRL/DownloadableD

ocuments/XBRL%20Costs%20for%20Small%20Companies.pdf (retrieved Jun. 20, 2018)

(“AICPA Study”); Mohini Singh (2017) The Cost of Structured Data: Myth vs. Reality, CFA

Institute, https://www.cfapubs.org/doi/pdf/10.2469/ccb.v2017.n5.1 (retrieved Jun. 20, 2018).

See https://xbrl.us/wp-content/uploads/2018/06/XBRL-US-Letter-to-HFSC-RE-HR-5054-6-62018.pdf (retrieved Jun. 20, 2018).

See 2009 Risk/Return Summary Adopting Release, at 7769 (estimating direct costs of preparing

and submitting interactive data-formatted risk/return summary information, excluding the cost of

website posting, at $23,200 for the first submission ($3,100 for each subsequent submission) and

the cost of website posting at $250).

One commenter stated that it uses a third-party vendor for XBRL preparation and estimated the

average time the commenter expends to review the approximately 336 risk/return summary XBRL

filings per year produced for its funds at approximately 12 hours per month, with a peak of 32

hours per month. See letter from Federated II. This amounts to an average review time of

approximately 0.43 hours per filing (12 hours per month x 12 months / 336 filings per year). The

cost of outside services for XBRL preparation, which are incurred in addition to the review time,

is not stated in this letter.

A small but growing number of operating company filers have relied on the

Exemptive Order to voluntarily file in Inline XBRL. 59 Large accelerated, accelerated,

and nonaccelerated filers and smaller reporting companies were well represented, with

large accelerated filers representing a larger proportion of voluntary operating company

filers than their proportionate share of all operating company filers. 60

Filers that have filed in Inline XBRL under the Exemptive Order used XBRL

preparation software or filing agents that already can accommodate Inline XBRL. Based

on filing software information, where available in the filing, voluntary Inline XBRL filers

used seven different vendors. 61 In conjunction with the Exemptive Order, the

Commission also made the open source Inline Viewer available to the public so that filers

could test and view their submissions before EDGAR filing and the public could easily

view the Inline XBRL document within the context of a web browser.

One commenter—whose vendor members are estimated by the commenter to

“provide XBRL creation services for an estimated 80% of U.S. public companies that file

in XBRL to the SEC each quarter”—stated that “[m]any vendors today already have

Inline XBRL capabilities or have development underway” to incorporate this capability

into their tools. 62

Based on staff analysis of Inline XBRL filings, as of May 21, 2018, approximately 152 unique

operating company filers filed approximately 526 Inline XBRL filings. The number of filers that

have voluntarily filed in Inline XBRL so far is modest relative to the overall number of filers

(approximately 1.8%).

As of May 21, 2018, staff analysis of voluntary Inline XBRL filings showed that large accelerated

filers accounted for approximately 38% and accelerated filers approximately 18% of such filings.

By comparison, based on staff analysis of Forms 10-K, 10-Q, 20-F, and 40-F filings and

amendments to them filed during calendar year 2017, large accelerated filers accounted for

approximately 26% and accelerated filers for approximately 19% of such filings.

This estimate is based on filings information as of May 21, 2018.

See letter from XBRL US. See also letters from Workiva I, IRIS, and ACI.

Based on our understanding of the experience of voluntary Inline XBRL filers and

the input from commenters whose XBRL solutions were used in voluntary Inline XBRL

filings, filers have not incurred increases in the cost of XBRL software. 63 We recognize,

however, that filers that voluntarily elected to file in Inline XBRL under the Exemptive

Order may not be representative of all filers affected by the amendments. For example,

most voluntary filers already used integrated XBRL preparation software. Thus, their

transition to Inline XBRL likely entailed minimal changes to XBRL preparation

workflow, with the resulting minor impact on both the cost of XBRL preparation and

XBRL data quality.

With regard to data quality of voluntary Inline XBRL filings by operating

companies under the Exemptive Order, Commission staff reviewed a random sample of

25 Form 10-Q and Form 10-K Inline XBRL filings submitted pursuant to the Exemptive

Order as of November 1, 2017 64 to determine whether Inline XBRL had any effect on a

particular issue of data quality: negative values. 65 For each of the 25 filings, Commission

staff reviewed the Inline XBRL filing and the latest filing prior to the Inline XBRL filing

to determine if amounts were inappropriately entered as negative values in either of the

Vendors identified as having been used in voluntary Inline XBRL filings and other software

vendors and filing agents that reference Inline XBRL capabilities on their websites, and in other

public sources, accounted for approximately 87% of financial statement XBRL filings filed during

2017 for which preparation software could be identified. Preparation software could not be

identified for approximately 3% of financial statement XBRL filings.

See, e.g., letters from Workiva I and ACI. Both of these commenters were vendors whose XBRL

preparation solutions were used by voluntary Inline XBRL filers.

The examined subset of filings was randomly drawn from 252 Inline XBRL filings submitted as of

November 1, 2017.

Most XBRL numeric elements are designed to be entered as positive values. Even if the XBRL

element is related to a credit balance, the element should still be submitted as a positive number

because debit and credit balances represent presentation attributes for the HTML document, not

the underlying meaning of the XBRL element.

filings. Commission staff observed one Inline XBRL filing with an inappropriate

negative value for a footnote disclosure; the same disclosure in the latest filing prior to

the Inline XBRL filing did not have an inappropriate negative value. After the initial

Inline XBRL filing, that filer submitted a subsequent Inline XBRL filing and corrected

the error.

One commenter stated that XBRL data quality has not improved significantly,

based on errors in XBRL data identified during the commenter’s review of early

voluntary Inline XBRL filings pursuant to the Exemptive Order. 66 However, the example

provided by the commenter of an Inline XBRL tagging error was not an error in the

Inline XBRL document, but rather a presentation discrepancy when the Inline XBRL

document was run through the EDGAR Renderer, which is designed for XBRL format

documents and not Inline XBRL format documents. In part of the example provided, the

Inline XBRL document had a dimensional axis that does not present in the EDGAR

rendered view.

Nevertheless, these observations suggest that some XBRL data quality issues may

remain for a minority of filers. The relatively small number of voluntary Inline XBRL

filings to date makes it difficult to draw definitive conclusions about the extent to which

Inline XBRL may improve data quality going forward. Moreover, we are not able to

observe whether the reviewed voluntary filings were prepared with the use of the Inline

XBRL Viewer tool, which can facilitate detection of certain types of errors, such as

negative values and scaling errors. In addition, the experience of a small number of

voluntary filers may not be representative of all filers subject to the amendments.

See letter from TagniFi.

Since the implementation of the voluntary Inline XBRL program, we have

observed that, not only is the public using the Inline XBRL data, but some data users

have also made enhancements to the Commission’s open source Inline XBRL Viewer.

These enhancements, such as creating instantly human-readable time series charting, may

help to make the XBRL data even more useful. For example, using these enhancements,

a user can hover over the revenues element of a filing and instantly view the latest two

years of reported revenues for that filer, or hover over a narrative element and instantly

view the latest two years of text reported for that element by that filer.

3. XBRL Data Use

There is a wide range of XBRL data users, including investors, financial analysts,

economic research firms, data aggregators, academic researchers, filers seeking

information on their peers for benchmarking purposes, and Commission staff.

During the second quarter of 2017, individual financial statement information

XBRL exhibits were accessed on the EDGAR website approximately 53.1 million times

(including approximately 13.7 million unique filing views by approximately 149,000

unique IP addresses) and individual risk/return summary XBRL exhibits were accessed

approximately 6.8 million times (including approximately 839,000 unique filing views by

approximately 8,000 unique IP addresses). 67 This is the approximate equivalent of 287

The figures are based on staff analysis of EDGAR log file data for the second quarter of 2017.

The analysis examined access during the second quarter of 2017 to all financial statement

information XBRL exhibits filed with annual and current reports and amendments to them and all

risk/return summary XBRL exhibits filed with amendments to registration statements and forms of

prospectuses since inception of the XBRL requirements. The analysis did not exclude access by

“bots” because machine-readable XBRL data is designed to enable automated aggregation and

processing. Due to data availability, these statistics do not capture access to XBRL data through

the Public Dissemination Service or the use of the data, tools, and products made available by

third-party data aggregators, incorporating XBRL data to varying degrees, which likely account

for the largest share of market participants’ access to such data. These statistics also do not

capture access to DERA XBRL datasets, which is discussed separately. The data definitions used

exhibit views and 74 unique filing views for each filing with financial statement

information XBRL data and 224 exhibit views and 28 unique filing views for each filing

with risk/return summary XBRL data during the examined quarter.

The Commission also combines, organizes and posts for bulk download financial

statement information and risk/return summary XBRL data extracted from filings. 68 As

of June 16, 2018, in the approximately eight months since the Commission began posting

risk/return summary datasets, financial statement data sets had approximately 55,327

page views (including approximately 33,130 unique page views); financial statement and

notes data sets had approximately 232,398 page views (including 194,623 unique page

views), and risk/return summary data sets had approximately 2,089 page views (including

approximately 1,791 unique page views). 69

A number of businesses have created products that provide XBRL data to

to identify XBRL exhibits excluded access to XBRL data as part of a complete submission file or

as part of an Inline XBRL document (for filings pursuant to the Exemptive Order).

Applying the same methodology, individual XBRL files of nonaccelerated filers and smaller

reporting companies were accessed on the EDGAR website approximately 23.3 million times

(including approximately 6.2 million unique filing views by approximately 46,000 unique IP

addresses). This is the approximate equivalent of 239 exhibit views (64 unique filing views) per

filing. Filer status was obtained from the XBRL portion of the respective filing. Applying the

same methodology, individual XBRL files of biotechnology companies were accessed on the

EDGAR website approximately 4.9 million times (including approximately 1.3 million unique

filing views by approximately 24,000 unique IP addresses). This is the approximate equivalent of

288 exhibit views (78 unique filing views) per filing. Companies were classified as being in the

biotechnology sector based on primary Standard Industry Classification (“SIC”) codes (obtained

from the XBRL portion of the respective filing) that correspond to industry groups for

pharmaceutical products and medical equipment in the Fama and French 49 industry classification

(http://mba.tuck.dartmouth.edu/pages/faculty/ken.french/Data_Library/det_49_ind_port.html,

retrieved Jun. 20, 2018).

See https://www.sec.gov/dera/data/financial-statement-data-sets.html,

https://www.sec.gov/dera/data/financial-statement-and-notes-data-set.html, and

https://www.sec.gov/dera/data/mutual-fund-prospectus-risk-return-summary-data-sets (retrieved

Jun. 20, 2018).

These statistics do not account for the use of third-party products or websites incorporating these

datasets. See, e.g., https://console.cloud.google.com/launcher/details/sec-public-data-bq/secpublic-dataset (retrieved Jun. 20, 2018).

investors. Data aggregators (i.e., entities that, in general, collect, package, and resell

data) have incorporated XBRL data into their products to varying degrees. Various thirdparty data providers extract or preview information contained in XBRL exhibits, offering

XBRL analytics tools or using XBRL data to supplement other reported data based on

filer disclosures. 70

The Commission staff uses XBRL data to efficiently analyze large quantities of

information in support of risk assessment, rulemaking, and enforcement activities,

including as part of its internally developed Corporate Issuer Risk Assessment and

Financial Statement Query Viewer applications.

Commenters and studies have noted the benefits of XBRL data in providing a

wide range of financial reporting data that is not always available elsewhere. 71 Other

commenters and studies have indicated that XBRL data use has been limited, in part due

to concerns regarding data quality and lack of awareness of XBRL. 72 Several

See, e.g., a discussion of XBRL analytics tools, https://xbrl.us/use/howto/ (retrieved Jun. 20,

2018); https://xbrl.us/home/category/productsservices/service/data-aggregation/ (retrieved Jun. 20,

2018); Mitchell R. Wenger, Rick Elam, and Kelly L. Williams (2013) A tour of five XBRL tools,

Journal of Accountancy (Apr. 1, 2013),

https://www.journalofaccountancy.com/issues/2013/apr/20126677.html (retrieved Jun. 20, 2018);

Inline XBRL Proposing Release, at 14286, n. 77; letters from Octachoron and TagniFi.

See, e.g., letters from CFA Institute, Data Coalition, Grant Thornton, Members of Congress,

Octachoron, TagniFi, XBRL US, and XBRL International.

Various academic studies have examined the benefits of XBRL for the information environment

of firms. See Inline XBRL Proposing Release, at 14295, n. 169. See also Yu Cong, Hui Du, and

Miklos A. Vasarhelyi (2017) Are XBRL files being accessed? Evidence from the SEC EDGAR

log file data set, Journal of Information Systems (forthcoming) (examining rates of access to

XBRL files and providing some evidence that investors in smaller operating companies access

XBRL files and that investors may prefer XBRL files to non-XBRL files when both types of files

are included with the filing).

See Inline XBRL Proposing Release, at 14287, n. 78. See also letter from BIO (stating that

“XBRL data is little used by biotech investors”). But see note 67 above (discussing XBRL data

use for smaller and biotech companies that is generally consistent with the XBRL data use for all

operating companies).

commenters stated that risk/return summary XBRL data is little used by investors. 73

Some commenters stated that the use of risk/return summary XBRL data is limited due to

the delay in its availability as compared to the HTML version of the same information. 74

One of these commenters, a large data aggregator that processes fund information for

investors, indicated that it must manually extract information from fund HTML filings

because the structured XBRL filing comes too late for investors’ preferences. 75

The 2005 XBRL Voluntary Program for financial statement information has not

been used for several years, with no submissions during calendar years 2011–2017. 76

III. FINAL AMENDMENTS AND ANTICIPATED ECONOMIC EFFECTS

A. Discussion of the Final Amendments

1. Inline XBRL Requirements

a. Use of Inline XBRL Format

On March 1, 2017, the Commission proposed rule and form amendments to

facilitate improvements in the quality and usefulness of XBRL data and, over time,

A December 2016 global survey of members by the CFA Institute, corroborating the results of the

prior surveys, found that less than half of the respondents (approximately 45%) were aware of

XBRL and, among those aware of XBRL, a minority of respondents (approximately 23%) use

financial XBRL data from periodic reports. See CFA Institute Member Survey: XBRL,

https://blogs.cfainstitute.org/marketintegrity/2016/12/05/do-you-know-what-xbrl-is-a-majority-ofsurvey-respondents-do-not-know/ and https://www.cfainstitute.org//media/documents/survey/xbrl-member-survey-report-2016.ashx (retrieved Jun. 20, 2018).

See letters from Federated I and II, Frei, ICI I and II, and USBFS. One of these letters cited

limited use of XBRL data posted on the filer’s website in connection with the discussion of

limited XBRL data use. See letter from Federated II.

See, e.g., letters from Morningstar (“we use the HTML filings rather than the XBRL filings

because we can process them and share the information with end investors more quickly than if we

were to wait for the XBRL filing”) and XBRL US (“[r]isk/return data from mutual funds today is

not as timely as investors would prefer”).

See letter from Morningstar.

A few filers submitted Voluntary Program XBRL exhibits (EX100), but those filings seem to have

been made in error.

decrease filing costs by decreasing XBRL preparation costs. 77 The proposed

amendments would require operating company financial statement information and fund

risk/return summary information to be submitted in the Inline XBRL format. 78 Inline

XBRL allows filers to embed XBRL data directly into an HTML document, eliminating

the need to tag a copy of the information in a separate XBRL exhibit. Inline XBRL is

both human-readable and machine-readable for purposes of validation, aggregation, and

analysis. The proposed amendments also would eliminate the requirements for filers to

post Interactive Data Files on their websites and terminate the 2005 XBRL Voluntary

Program with respect to financial statement information. 79

The majority of commenters generally supported the proposed Inline XBRL

requirements. 80 Many of these commenters specifically supported the proposal to replace

the XBRL format with the Inline XBRL format for operating company filers, 81 while

several commenters supported applying the proposed Inline XBRL requirements to both

operating companies and funds. 82 Several commenters opposed the proposed Inline

XBRL requirements for some or all filers. 83

See Inline XBRL Proposing Release.

Inline XBRL™ and iXBRL™ are trademarks of XBRL International. XBRL® is a registered

trademark of XBRL International. The Inline XBRL technology is freely licensed by XBRL

International. See https://specifications.xbrl.org/spec-group-index-inline-xbrl.html (retrieved Jun.

20, 2018) and https://specifications.xbrl.org/presentation.html (retrieved Jun. 20, 2018).

See note 20 above.

See, e.g., letters from ACI, AICPA, CFA Institute, Data Coalition, Deloitte, Grant Thornton,

Hoffman, IRIS, Lewis, Kumar, Members of Congress, Merrill, Morningstar, Octachoron, Palmer,

TagniFi, Workiva I, XBRL International, and XBRL US.

See, e.g., letters from ACI, AICPA, CFA Institute, Data Coalition, Deloitte, Grant Thornton,

Hoffman, IRIS, Members of Congress, Merrill, Morningstar, Octachoron, TagniFi, XBRL

International, XBRL US, and Workiva I.

See, e.g., letters from ACI, AICPA, CFA Institute, Data Coalition, Members of Congress,

Morningstar, XBRL International, and XBRL US.

After considering these comments, we are adopting, substantially as proposed,

amendments to Rule 405 to require the submission of financial statement information and

risk/return summary information Interactive Data Files in Inline XBRL. 84 Operating

companies and funds, on a phased in basis, will be required to embed a part of the

Interactive Data File within an HTML document using Inline XBRL and to include the

rest in an exhibit to that document. The portion filed as an exhibit to the form will

contain contextual information about the XBRL tags embedded in the filing. The

information as tagged will continue to be required to satisfy all other requirements of

Rule 405, including the technical requirements in the EDGAR Filer Manual.

The Inline XBRL requirement, similar to the current XBRL requirement, will

apply to financial statement information in HTML regardless of whether it appears in the

non-exhibit part of a filing and/or in one or more exhibits. Accordingly, under Inline

XBRL, tags must be embedded wherever that HTML information appears.

The Commission received a number of comments that addressed data usability,

quality, and cost issues. Various commenters stated that Inline XBRL would, over time,

(i) increase the efficiency of review and yield savings of XBRL preparation time and

cost; 85 (ii) potentially improve the quality of XBRL data (by reducing discrepancies

Two of these commenters elaborated on their specific support to replace the XBRL format with

the Inline XBRL format for risk/return summaries. See letters from Morningstar and XBRL US.

See, e.g., letters from Cigna and FEI (opposing the Inline XBRL requirement for financial

statement information); letters from Hindssight and Pergamit (expressing general opposition to

Inline XBRL); and letters from Federated I and II, Frei, ICI I and II, and USBFS (opposing the

Inline XBRL requirement for risk/return summaries).

See new Rule 405(a)(3).

See, e.g., letters from ACI, AICPA, CFA Institute, Cigna, Data Coalition, FEI, IRIS, Kumar,

Lewis, Members of Congress, Merrill, Workiva I, XBRL International, and XBRL US. But see

letter from ICI I (stating that funds will not realize a significant increase in the effectiveness and

between HTML and XBRL data); 86 and (iii) increase the data’s usability (through greater

accessibility and transparency of the data and enhanced capabilities for data users, who

would no longer have to view the XBRL data separately from the text of the

documents). 87 One commenter stated that while “Inline XBRL will not directly

contribute to increased quality . . . indirectly, Inline XBRL will contribute to better

decisions related to the meaning conveyed by the machine-readable XBRL format.” 88

Another commenter emphasized the benefit of Inline XBRL “in allowing filers greater

control over the presentation of financial exhibits.” 89

Several commenters that supported requiring Inline XBRL for financial statement

information expressed concern that switching to Inline XBRL would not be sufficient to

significantly improve the quality of financial statement information XBRL data without

additional measures. Some of these commenters recommended that the Commission

implement additional validation rules, including the incorporation of XBRL Data Quality

Committee validation rules. 90 Some of these commenters recommended expanding the

efficiency of XBRL preparation) and letter from Pergamit (stating that Inline XBRL would not

yield benefits for filers).

See, e.g., letters from ACI, AICPA, CFA Institute, IRIS, Kumar, Lewis, Members of Congress,

Merrill, Morningstar, Octachoron, Palmer, Ray, XBRL International, and XBRL US. But see, e.g.,

note 107 below (stating that there would not be gains in data quality for risk/return summaries)

and letters from EY, TagniFi, and Workiva I (stating that there would not be gains in data quality

for financial statement information).

See, e.g., letters from ACI, AICPA, CFA Institute, Deloitte, IRIS, Morningstar, Octachoron, Ray,

TagniFi, and XBRL US. But see letters from Federated I and II (regarding risk/return summaries)

and Pergamit.

See letter from Hoffman.

See letter from Octachoron.

See, e.g., letters from AICPA, CFA Institute, Deloitte, TagniFi, Workiva I, XBRL International,

and XBRL US.

scope of auditor assurance to include review of XBRL tags. 91 Some commenters

encouraged additional engagement or alignment with other entities such as the Financial

Accounting Standards Board (“FASB”), the IASB, and international regulators who are

also using the Inline XBRL format. 92

We continue to analyze the data quality of submissions made in XBRL and Inline

XBRL, as well as monitor developments related to the XRBL standard and the Inline

XBRL specification. If additional technical rules within the EDGAR environment are

deemed necessary, they may be reflected in updates to the EDGAR Filer Manual, but we

are not imposing additional XBRL validation requirements at this time. We note that

filers, vendors, and filing agents are currently able to voluntarily incorporate validation

rules into their software and that the Commission makes available various tools to assist

XBRL filers. Moreover, filers remain subject to Rule 405(c) of Regulation S-T, which

imposes certain fundamental data quality requirements on Interactive Data File

submissions. 93

Regarding our engagement with other entities such as the FASB, we note that the

staff actively engages with the FASB over the development of the U.S. GAAP Taxonomy

throughout the year. For example, the staff reviews and consults on the taxonomy

development process, taxonomy changes, and comments received from the public. We

See, e.g., letters from AICPA, CFA Institute, Deloitte, EY, Grant Thornton, Hoffman, XBRL

International, and XBRL US.

See, e.g., letters from AICPA, EY, and XBRL International.

17 CFR 232.405(c)(1). In particular, each data element in the Interactive Data File must reflect

the same information in the corresponding data in the Related Official Filing; data elements

contained in the corresponding data in the Related Official Filing may not be changed, deleted, or

summarized in the Interactive Data File; and each data element contained in the Interactive Data

File must be matched with an appropriate tag from the most recent version of the standard list

of tags specified by the EDGAR Filer Manual, with a new special element required to be created

and used only if an appropriate tag does not exist in the standard list.

continue to encourage all members of the public to submit any comments they may have

to improve the U.S. GAAP Taxonomy to the FASB. As we have noted throughout this

release, we are aware of various developments that could impact the Commission’s

XBRL requirements and will continue to monitor those developments as filers transition

to Inline XBRL.

With respect to expanded auditor assurance, one commenter stated that a recent

survey of its members found that “77 per cent of respondents wish to have assurance of

the tagged data.” 94 Another commenter stated that “audit committees are likely to request

that auditors perform a separate attestation engagement to provide an opinion on the

accuracy and consistency of the XBRL formatted information, and issue a report” in

order “to provide investors additional confidence in the iXBRL formatted information.” 95

However, a different commenter stated that XBRL data cannot be audited because tag

selection is subjective and no accounting standards are applicable. 96

As the Commission stated in the Inline XBRL Proposing Release, the proposed

amendments were intended to modernize existing financial statement information XBRL

requirements to incorporate developments in the XBRL technology since the 2009

adoption of these requirements. The proposal did not contemplate any changes to the

application of officer certifications or auditor assurance requirements to XBRL data. 97 In

particular, the Commission noted that, because the proposed amendments related only to

the manner of submitting the Interactive Data File and not the data that comprises the

See letter from CFA Institute.

See letter from AICPA.

See letter from Workiva I.

See Inline XBRL Proposing Release, at 14297, n. 181 and accompanying text.

Interactive Data File, it was not proposing to change the existing positions pertaining to

the exclusion of the Interactive Data File from the officer certification and assurance

requirements. 98 Consistent with the proposal, we are not making any such changes at this

time.

Several commenters recommended clarifying that financial statement information

XBRL data under the new Inline XBRL requirement would not be subject to auditor

assurance in order to address a potential “expectations gap” that might arise if XBRL data

is embedded in a document containing HTML financial statements subject to auditor

assurance. Commenters had different suggestions on how to communicate the auditor’s

responsibility related to financial statement information XBRL data, such as by including

some form of reporting mechanism or disclosure within the filing, or by having the

Commission re-affirm its position from the Inline XBRL Proposing Release that there is

no change in auditor responsibility. 99

Id. Currently, the financial statement information Interactive Data File is excluded from the

officer certification requirements under Rules 13a-14(f) and 15d-14(f) of the Exchange Act [17

CFR 240.13a-14 and 240.15d-14]. Furthermore, auditors are not required to apply AS 2710

(Other Information in Documents Containing Audited Financial Statements), AS 4101

(Responsibilities Regarding Filings Under Federal Securities Statutes), or AS 4105 (Reviews of

Interim Financial Information) (prior to December 31, 2016, AU Sections 550, 711, and 722,

respectively) to the Interactive Data File submitted with a company’s reports or registration

statements. In addition, filers are not required to obtain assurance on their Interactive Data File or

involve third parties, such as auditors or consultants, in the creation of their Interactive Data File.

See 2009 Financial Statement Information Adopting Release, at 6796–6797. However, the

Commission has previously stated that XBRL is part of an issuer’s disclosure controls and

procedures. See 2009 Financial Statement Information Adopting Release, at 6797.

Risk/return summary information Interactive Data File requirements do not require funds to

involve third parties, such as auditors or consultants, in the creation of the interactive data

provided as an exhibit to a fund’s Form N-1A filing, including assurance. With respect to

registration statements, SAS 37 (currently AS 4101) was issued in April 1981 to address the

auditor’s responsibilities in connection with filings under the federal securities statutes. With

respect to existing risk/return summary information Interactive Data File requirements, an auditor

is not required to apply AS 4101 to the Interactive Data File. See 2009 Risk/Return Summary

Adopting Release, at 7760–7761 and footnote 183.

See, e.g., letters from AICPA, Deloitte, EY, and Grant Thornton.

Consistent with the suggestions of these commenters, we are reiterating that the

change from the XBRL format to the Inline XBRL format does not change the

Commission’s positions with respect to officer certifications and auditor assurance.

Accordingly, we are not requiring additional transparency regarding auditors’

responsibilities related to financial statement information XBRL data at this time.

However, consistent with the existing XBRL requirements, issuers would not be

prohibited from indicating in the financial statements (such as in a footnote) the degree

(or lack thereof) of auditor involvement related to the financial statement information

XBRL data. 100

A few commenters cited concerns about the burden of transition to Inline

XBRL. 101 The amendments address transition issues through the use of a staggered

phase-in period, discussed in greater detail in Section III.A.1.c below. Further, in

response to commenter concerns, we are making certain modifications from the proposed

compliance dates to help filers address any transition issues. In particular, in response to

commenters’ suggestions, the amendments include an additional transition

accommodation for operating companies whereby Inline XBRL will be required for the

first Form 10-Q for a fiscal period ending on or after the applicable compliance date,

which is intended to further facilitate the transition to Inline XBRL. The amendments

also modify the phase-in period for funds to provide funds and vendors with additional

time to transition to Inline XBRL for risk/return summaries and to modify their processes

100

See 2009 Financial Statement Information Adopting Release, at 6796.

101

See, e.g., letters from Cigna and FEI (regarding the burden of transition for operating companies);

Hindssight (expressing concern about costs but not specifying whether it pertained to operating

companies or funds); Federated I and II, Frei, ICI I and II, and USBFS (regarding the burden of

transition for funds).

for preparing and reviewing these filings to accommodate the elimination of the 15

business day filing period. We believe that these aspects of the amendments will help to

mitigate the burden of transition to Inline XBRL.

As proposed, the amendments will also require risk/return summary information

to be submitted in Inline XBRL. 102 Among commenters that addressed the Inline XBRL

requirement for funds, several commenters expressed support for Inline XBRL for

risk/return summaries. 103 Some of these commenters cited the potential benefits of

increased timeliness and usability of XBRL data to investors and other data users. 104

They also described economies of scale that funds may realize from their vendors

providing an XBRL preparation process that is consistent with operating companies

under a single standard specification. 105 Several commenters opposed the Inline XBRL

requirement for risk/return summaries. 106 These commenters stated that there are few, if

any, data quality issues with risk/return summary XBRL data today and concluded that

Inline XBRL would not improve the quality of risk/return summary XBRL data. 107 One

102

See new Rule 405(a)(3)(ii) of Regulation S-T.

103

See, e.g., letters from ACI, AICPA, CFA Institute, Data Coalition, Members of Congress,

Morningstar, XBRL International, and XBRL US.

104

See letters from Morningstar and XBRL US.

105

Id.

106

See, e.g., letters from Federated I and II; Frei; ICI I and II; and USBFS. In addition, two

commenters generally opposed Inline XBRL without stating whether their opposition was specific

to funds or operating companies. See letters from Pergamit and Hindssight.

107

See letters from ICI (reiterating the observation in the Inline XBRL Proposing Release that,

compared to financial statements of operating companies, mutual fund risk/return summaries have

fewer instances in which numeric data is embedded into text and the data is generally more

standardized as a reason why, in the commenter’s view, data quality is not an issue for mutual

fund risk/return summaries) and USBFS (stating that it was not aware of any XBRL filing data

quality issues affecting the funds serviced by the commenter or any other funds in the industry).

commenter stated that the proposed Inline XBRL requirements for funds do not have

tangible benefits for investors and impose costs that would outweigh any benefits. 108

Commenters also expressed differing views regarding the extent to which

investors, Commission staff, and academics use the fund information submitted in

XBRL. Some commenters stated that XBRL data filed by funds is little used by

investors 109 or data aggregators. 110 Others stated that it was used by data aggregators

and, if more timely provided, its use by data aggregators and, indirectly, by investors,

would increase. 111 Two commenters observed that the current 15 business day filing

delay decreases the usefulness of this data as a means of providing timely information to

investors and stated that they or others would make greater use of this data if we

eliminated the delay. 112

After considering the input of commenters, we continue to believe that it is

important for risk/return summary information to be provided in an XBRL format and

that this format be as usable for investors and other data users as possible. We

108

See letter from Federated II.

109

See letters from Federated I (stating that it does “not believe that either XBRL, or the proposed

iXBRL filing and posting requirements are (or would be) useful to investors.”); Federated II; Frei

(“There has been no evidence that the SEC staff, academics, or every day investors uses [sic] this

data.”); ICI I (stating that investors generally do not use XBRL tagged risk/return summary

information and instead obtain this risk/return information in human-readable form from fund

prospectuses, on fund websites, or on third party information provider websites.”); ICI II; USBFS

(stating that the XBRL data is generally not used by investors, investment advisers, or brokerdealers in making investment decisions or recommendations).

110

See letter from ICI (stating that its members provide data directly to many information providers

and further noting that these information providers separately extract data from HTML filings).

111

See letters from Frei and USBFS (referencing XBRL data use by data aggregators) and XBRL US

(noting Morningstar’s support of eliminating the 15 day filing period as it would allow them to use

the XBRL data to more rapidly disseminate fund data to investors).

112

See letters from Morningstar (noting that it currently uses the HTML filings rather than the XBRL

filings because it can process and share the information with investors more quickly than if it were

to wait for the XBRL filing) and XBRL US (stating that the elimination of the 15 business day

period would make XBRL data much more valuable to data providers and investors).

understand, based on commenter input, that many investors obtain risk/return summary

information through data aggregators but that they may seek it out more quickly than it is

currently available in XBRL through fund submissions. To meet this demand for more

timely data, one data aggregator manually extracts the risk/return summary information

from fund HTML or ASCII filings over a period of days rather than wait up to 15

business days for the XBRL filings. We further understand, based on commenter input,

that transitioning to Inline XBRL will allow risk/return summary information to reach

investors via aggregators in hours, rather than days, after a Related Official Filing. As a

result, we expect that more timely XBRL data will lead to increased use of that data by

third-party data aggregators already in the market. We also anticipate that data

aggregators with fewer resources or any new entrants to the data aggregation market

would be better positioned to compete to provide information products to investors based

on fund risk/return summaries if timely delivery does not require the resources necessary

to tag the information manually. Investors will also be able to take further advantage of

the XBRL data in ways that were not possible before. Because the Inline XBRL format

embeds XBRL within the HTML document, investors can use their own web browser to

view the embedded XBRL data and metadata within the context of the Related Official

Filing, without having to download the information into any separate applications for

review and analysis.

Contrary to some commenters’ statements that this data is little used, risk/return

summary XBRL data is accessed on EDGAR on a regular basis. 113 We also disagree

with commenters who suggested that investors do not benefit when data aggregators use

113

See Section II.B.3 above.

XBRL data. 114 These aggregators typically use this data to provide information to

investors, and funds are primarily held by retail investors, who often look to third party

information sites when evaluating various funds for investment.

Preparing Inline XBRL filings involves embedding XBRL tags into the HTML

document. This single-document approach should create long-term benefits by removing

a separate workflow of checking the numbers and text in the original HTML filing for

consistency with the numbers and text in the separate XBRL filing and the related time

demands that entails—time demands that currently contribute towards much later filings

by funds and less timely information for fund investors.

Several commenters indicated that funds would not realize cost savings from

Inline XBRL and that funds would incur significant costs of transition to Inline XBRL,

which would be compounded by the elimination of the 15 business day filing period and

would outweigh any benefits. 115 One commenter stated that its members do not

anticipate a significant increase in the efficiency and effectiveness of their filing

processes from the shift to Inline XBRL. 116 Two commenters stated that a number of

funds currently use a standalone approach to XBRL preparation and thus may require

significant changes in XBRL preparation workflow to transition to Inline XBRL. 117 One

of these commenters further indicated that the Commission may have overestimated the

114

See, e.g., letters from Federated II, Frei, ICI II, and USBFS.

115

See letters from Federated I and II, Frei, ICI I and II, and USBFS.

116

See letter from ICI I.

117

See letters from USBFS and XBRL US. Another commenter referenced the comment letter by

USBFS (stating that “at least one large filing vendor believes that the SEC’s proposal may have

significantly underestimated the cost of implementing iXBRL tagging in the mutual fund context,

particularly for smaller registrants”). See letter from ICI II.

proportion of funds that use an integrated approach to XBRL preparation. 118 According

to this commenter, while funds that use “the largest financial printers” are likely well

positioned to comply with the Inline XBRL requirement, funds that instead rely on other

service providers for preparing and submitting XBRL filings (e.g., law firms,

administrators, in-house advisory firm personnel, and smaller financial printers) will be

forced to incur significant costs and potentially change vendors. 119 Thus, the commenter

asserted, the Inline XBRL Proposing Release significantly underestimated the costs of

transitioning to Inline XBRL for funds, particularly for smaller filers.

We recognize that many funds today prepare and file an HTML or ASCII version

of risk/return information in the Related Official Filing and then, up to 15 business days

later, prepare and file a separate XBRL exhibit with this same risk/return information. As

a result, many funds may incur one-time costs to change their workflow processes as they

transition to filing this information in an Inline XBRL format without this extended filing

period. We acknowledge that this may cause some funds to change vendors or software

products used to create these filings, and that these transition costs will likely be greater

than estimated in the Proposing Release. 120 However, we believe that the improved data

usability that Inline XBRL offers, particularly when combined with the more efficient

Inline XBRL process that reduces the need for the extended filing period, provides

benefits to investors that justify these initial costs to funds.

Accordingly, we are adopting Inline XBRL and the related elimination of the 15

business day filing period for fund risk/return summaries. However, in light of the

118

See letter from USBFS.

119

Id. We note, however, to the extent funds rely on other service providers to prepare and submit

XBRL filings, those service providers in turn may be relying on financial printers.

120

See letters from Federated I and II, ICI I and II, and USBFS.

comments and to help funds address transition issues, we are extending the proposed

phase-in for risk/return summary Inline XBRL requirements, as discussed in greater

detail in Section III.A.1.c below. After careful consideration, we continue to believe that

the amendments to risk/return summary XBRL requirements to reflect the evolution of

XBRL technology will offer benefits to data users and further believe that the modified

compliance dates provide sufficient time for filers, software vendors, and filing agents to

transition to Inline XBRL.

b. Timing of Submission of Interactive Data File

The Commission did not propose any changes to the timing of the required

submission of the financial statement information XBRL data, nor are we adopting any,

and operating companies will generally continue to be required to submit the Interactive

Data File with the filing.

With respect to risk/return summary information, currently an Interactive Data

File for a Form N-1A filing, whether the filing is an initial registration statement or a

post-effective amendment to it, must be submitted as an amendment to the registration

statement to which the Interactive Data File relates. 121 That amendment with the

Interactive Data File also must be submitted after the registration statement or posteffective amendment that contains the related information becomes effective but not later

than 15 business days after the effective date of that registration statement or posteffective amendment. 122

121

General Instruction C.3.(g)(i) to Form N-1A.

122

Id.

Funds also are required to submit an Interactive Data File for any form of

prospectus filed that includes risk/return summary information that varies from the

registration statement. 123 In the case of those filings, however, funds are permitted to file

the Interactive Data File concurrently with the filing or up to 15 business days subsequent

to the filing. 124 As the Commission noted in the 2009 Risk/Return Summary Adopting

Release, the period of 15 business days was intended both to provide funds with adequate

time to prepare the exhibit and to make the interactive data available promptly. 125

i. Concurrent Submissions with Certain Post-Effective Amendment Filings

To help facilitate efficiencies in the fund post-effective amendment filing process,

the Commission proposed to permit funds to submit Interactive Data Files concurrently

with certain post-effective amendments to fund registration statements. 126 The

Commission proposed this change in recognition of the fact that, in its experience, posteffective amendments filed pursuant to these paragraphs of Rule 485 generally are not

subject to further revision. 127

123

See General Instruction C.3.(g)(ii) to Form N-1A.

124

Id.

125

See 2009 Risk/Return Summary Adopting Release, at 7754, n. 97 and accompanying and

following text.

126

See proposed General Instruction C.3.(g)(i)(B) to Form N-1A.

127

With the exception of post-effective amendments filed pursuant to Rule 485(b)(1)(iii), a posteffective amendment filed under Rule 485(b)(1) may become effective immediately upon filing.

Paragraph (b)(1)(i) of Rule 485 permits a post-effective amendment filing for the purpose of

bringing the financial statements up to date under Section 10(a)(3) of the Securities Act or Rule 312 or 3-18 of Regulation S-X. 17 CFR 210.3-12 and 210.3-18.

Paragraph (b)(1)(ii) of Rule 485 permits a post-effective amendment filing for the purpose of

complying with an undertaking to file an amendment containing financial statements, which may

be unaudited, within four to six months after the effective date of the registrant’s registration

statement under the Securities Act.

Paragraph (b)(1)(v) of Rule 485 permits a post-effective amendment filing for the purpose of

making any non-material changes which the registrant deems appropriate.

We received one comment letter on this aspect of the proposal. The commenter

expressed support for the proposed amendment, believing that administrative costs would

be reduced relative to making a separate filing for submitting the XBRL data. 128 After

considering commenter input, and to provide funds with flexibility to achieve cost and

administrative efficiencies, we are adopting the amendments as proposed. 129

ii. 15 Business Day Filing Period

To improve the timeliness of the availability of risk/return summary XBRL

information, the Commission proposed to eliminate the 15 business day filing period for

the submission of the Interactive Data File accorded to all fund filings containing

risk/return summaries (initial registration statements; post-effective amendments; and

forms of prospectuses that include risk/return summary information that varies from the

registration statement). At the same time, the Commission sought comment on whether a

different length filing period might be more appropriate. In proposing to mandate the use

of Inline XBRL, the Commission noted that Inline XBRL involves embedding XBRL

data directly into the filing. Inline XBRL thereby reduces the need for this filing delay,

which is typically used to prepare and review a separate XBRL-only filing.

Paragraph (b)(1)(vii) of Rule 485 permits a post-effective amendment filing for any other purpose

which the Commission shall approve.

128

See letter from Federated I (stating that it is “generally in support of allowing mutual funds to

submit the interactive data files concurrently with certain post-effective amendments as we believe

this would reduce administrative costs associated with filing interactive data separately”).

129

See new General Instruction C.3.(g) to Form N-1A; see also new Rule 405(a)(3)(ii) of Regulation

S-T. The amendments to these two provisions have the result of permitting fund filers to submit

XBRL data concurrently with the Related Official Filing.

Two commenters supported the Commission’s proposal to eliminate the 15

business day filing period. 130 These commenters noted that the elimination of the 15

business day filing period would allow data aggregators to process and share the

information more quickly with investors, who are the end-users. This is because

aggregators would no longer have to either wait 15 business days or manually extract

information from the HTML or ASCII version of the risk/return summary in order to

provide the information to investors in a more timely manner, which itself takes time. 131

One commenter, while supporting elimination of the current filing period, noted that

funds are “accustomed to taking advantage of the 15-day grace period” and so would

need to enact major workflow changes if this period is eliminated, likely requiring

increased staffing levels and resulting in higher costs for both funds and their vendors. 132

This commenter also acknowledged that funds may encounter greater challenges than

operating companies under the proposed amendments, given that many fund complexes

must make multiple, simultaneous filings for the funds they sponsor or manage. 133 This

commenter asked the Commission to consider giving funds more time to make the

transition to Inline XBRL due to these challenges, but nevertheless urged the

Commission to adopt the proposal, believing that moving the marketplace to a single

standard—Inline XBRL—would be “beneficial to all stakeholders over the long-term.” 134

130

See letters from Morningstar and XBRL US.

131

Id.

132

See letter from XBRL US.

133

Id. See also letters from Federated II (stating that it submitted 1,291 filings, in addition to 336

XBRL filings, in the past calendar year for its funds) and ICI II (referencing the letter from

Federated II).

134

See letter from XBRL US.

Three commenters expressed concerns about the costs, changes in workflow, and

loss of flexibility associated with the elimination of the 15 business day filing period. 135

Two commenters proposed that the Commission preserve the 15 business day filing

period to allow funds time to work through any technical difficulties that may occur with

the tagging process and review and approve the tagged filings. 136 These commenters also

stated that, for those funds that mail the prospectus and shareholder report together, the

shorter timeframe for Inline XBRL review would increase the likelihood of having to

mail the prospectus and shareholder report separately, which if it occurred, would

increase the mailing costs for fund shareholders. 137

One commenter did not support eliminating the current XBRL filing period, but

stated that funds would not be burdened by shortening this period from 15 business days

to 10 business days. 138 Another commenter suggested, as an alternative, shortening the

15 day timeframe to 7 days. 139

After evaluating comments received on this issue, and in light of our decision to

require the use of Inline XBRL for fund filers as proposed, we are eliminating the current

15 business day filing period for risk/return summary XBRL data. As a result:

•

For post-effective amendments filed pursuant to paragraph (b)(1)(i), (ii), (v),

or (vii) of Rule 485, Interactive Data Files must be filed either concurrently

with the filing or in a subsequent amendment that is filed on or before the date

135

See letters from Federated I and II, ICI I and II, and USBFS.

136

See letters from ICI I and II and Federated I and II.

137

Id. One of these commenters estimated the additional mailing costs of sending the prospectuses

separately at approximately $1.5 million per year. See letter from Federated II.

138

See letter from USBFS.

139

See letter from ICI II.

that the post-effective amendment that contains the related information

becomes effective; 140

•

For initial registration statements and post-effective amendments filed other

than pursuant to paragraph (b)(1)(i), (ii), (v), or (vii) of Rule 485, Interactive

Data Files must be filed in a subsequent amendment on or before the date the

registration statement or post-effective amendment that contains the related

information becomes effective; 141 and

•

For any form of prospectus filed pursuant to Rule 497(c) or (e), funds must

submit the Interactive Data File concurrently with the filing. 142

We recognize that many funds will experience changes in workflow and

associated costs once the filing period is eliminated. However, we believe that

eliminating the 15 business day filing period will significantly improve the timely

availability of risk/return summary XBRL information for investors, other market

participants, and other data users, yielding substantial benefits. Two commenters

indicated that the benefits of XBRL data are currently not being realized for many

potential data users, including data aggregators and (indirectly) investors, due to the filing

period. 143 For data aggregators responding to demand for the data earlier than 15

business days after the effective date of the related filing, eliminating this period will

remove the need for time-consuming manual extraction of this information from HTML

or ASCII filings and allow data aggregators to obtain this data earlier, thereby expediting

140

See new General Instruction C.3.(g)(i)(B) to Form N-1A.

141

See new General Instruction C.3.(g)(i)(A) to Form N-1A.

142

See new General Instruction C.3.(g)(ii) to Form N-1A.

143

See letters from Morningstar and XBRL US.

the availability of the data and related analysis to investors. 144 Further, the transition of

funds to Inline XBRL will entail embedding XBRL tags into the HTML filing, reducing

the need for a separate XBRL filing period.

In addition, eliminating the current 15 day filing period could have other, indirect

beneficial effects. We understand some funds currently provide more timely return

information to some data aggregators. However, funds do not provide other information

contained in the risk/return summary information on a more timely basis, such as fee and

risk information, which data aggregators also use to provide information products to

investors. Providing more timely XBRL data may enable data aggregators to better

compete in providing timely information to investors. Today, only those aggregators

with sufficient resources to manually extract this information from the text filings can

respond to demands to provide investors with more timely data. Further, in the staff’s

experience, risk/return summary information is relatively standardized and the list of

XBRL data elements that are tagged in the risk/return summary should not vary

substantially from period to period, minimizing the impact of workflow changes in this

area. Therefore, we do not see a compelling reason to retain even a shortened filing

period, such as 10 or 7 days, and note that any delayed filing period would undermine the

timeliness and usability benefits.

We also note that, while funds may currently use the 15 business day filing period

to review the XBRL data, operating companies prepare, review, and file XBRL data

without an additional filing period. Compared to fund filings with risk/return summaries,

operating company XBRL filings entail a more complex taxonomy, with more data

144

Id.

elements, as well as more instances of numeric data being embedded into text. Studies

have shown that concurrent submission of the HTML and XBRL data for operating

companies began with a standalone approach and over time transitioned to an integrated

approach as technology developed to achieve efficiencies. 145 For example, one recent

study found that the median small filer paid $10,000 or less for fully outsourced XBRL

preparation. 146 Similarly, preliminary statistics from a pricing survey being conducted by

the AICPA and XBRL US indicate that the cost of XBRL formatting has declined 41%

since 2014 and that the average cost of XBRL preparation for small reporting companies

in 2017 averaged $5,850 per year. 147 The experience of operating companies leads us to

believe that, while many funds may not currently use an integrated approach to XBRL

preparation and filing, with the concurrent HTML and XBRL filing, funds will likely

transition to an integrated approach to achieve efficiencies. We would expect, after the

initial transition, the costs to funds of preparing and reviewing XBRL submissions using

an integrated approach similarly to go down over time, as they have for operating

companies.

145

See Trevor S. Harris and Suzanne Morsfield, “An Evaluation of the Current State and Future of

XBRL and Interactive Data for Investors and Analysts”—“White Paper Number Three,”

Columbia Business School Center for Excellence in Accounting and Security Analysis (December

2012),

https://www8.gsb.columbia.edu/rtfiles/ceasa/An%20Evaluation%20of%20the%20Current%20Stat

e%20and%20Future%20of%20XBRL%20and%20Interactive%20Data%20for%20Investors%20a

nd%20Analysts.pdf (retrieved Jun. 20, 2018), at 38 (stating that filers have transitioned over time

to integrated disclosure management solutions). Consistent with this observation, approximately

71% of operating company filers relied on integrated solutions in the 2013 FERF survey,

compared to approximately 54% of operating company filers in the 2012 FERF survey. See FERF

Study, at 6; William Sinnett, SEC reporting and the impact of XBRL: 2012 survey, Financial

Executives Research Foundation (Nov. 15, 2013), at 25-26.

146

See AICPA Study.

147

See note 57 above.

We anticipate that the technology and related workflow changes that accompany

the transition to Inline XBRL will partly mitigate the concern about certain fund groups

having to mail prospectuses separately if the 15 business day filing period is eliminated,

because XBRL tags will be embedded in the HTML filing. In addition, based on staff

analysis of fund filing data on EDGAR, most fund groups currently mail prospectuses

and shareholder reports separately. Finally, recently adopted 17 CFR 270.30e-3 (“Rule

30e-3” under the Investment Company Act) will provide certain registered investment

companies with an optional method to satisfy their obligations to transmit shareholder

reports by making such reports and other materials accessible at a website address and

mailing investors a short paper notice indicating how to access the reports. 148 This

change may reduce the mailing costs associated with shareholder reports, thereby

potentially mitigating some of these concerns.

The amendments eliminating the 15 business day filing period do not change the

liability provisions related to the Interactive Data File. One commenter recommended a

temporary modification to the liability provisions pertaining to the Interactive Data File

for risk/return summary filings following the elimination of the 15 business day filing

period, similar to the temporary modified liability provision that was put in place when

the XBRL requirements were adopted in 2009. 149 Given that we have delayed

compliance with the Inline XBRL requirement and the elimination of the 15 business day

period until two years after the effective date for funds that, together with other

148

See Release No. IC-33115 (June 5, 2018) 83 FR 29158.

149

See letter from Federated II.

investment companies in the same “group of related investment companies,” 150 have net

assets of $1 billion or more as of the end of their most recent fiscal year (“large fund

groups”) and three years after the effective date for small fund groups, as discussed in

greater detail in Section III.A.1.c below, we do not believe that such a temporary liability

modification is necessary.

c. Phase-In of the Inline XBRL Requirements

We are adopting phased compliance dates substantially as proposed, with

modifications to further mitigate the potential burden of the initial transition on filers and

preparers:

Operating Companies

Compliance Date 151

Large accelerated filers that prepare their

financial statements in accordance with

U.S. GAAP

Accelerated filers that prepare their

financial statements in accordance with

U.S. GAAP

All other filers

Fiscal periods ending on or after June 15,

2019

Funds

Compliance Date

Fiscal periods ending on or after June 15,

2020

Fiscal periods ending on or after June 15,

2021

Any initial registration statement (or post150

For these purposes, the definition of a “group of related investment companies” is the same as the

term defined in Rule 0-10 under the Investment Company Act [17 CFR 270.0-10]. Rule 010(a)(1) defines the term as applied to management investment companies as two or more

management companies (including series thereof) that (i) hold themselves out to investors as

related companies for purposes of investment and investor services; and (ii) either (A) have a

common investment adviser or have investment advisers that are affiliated persons of each other,

or (B) have a common administrator. We believe that this broad definition would encompass most

types of fund complexes and therefore is an appropriate definition for compliance date purposes.

151

Form 10-Q filers will not become subject to the Inline XBRL requirements with respect to Form

10-K or any other form, however, until after they have been required to comply with the Inline

XBRL requirements for their first Form 10-Q for a fiscal period ending on or after the applicable

compliance date for the respective category of filers.

effective amendment that is an annual

update to an effective registration

statement) that becomes effective on or

after:

Large fund groups

September 17, 2020 (two years after the

effective date of the amendments)

Small fund groups

September 17, 2021 (three years after the

effective date of the amendments)

Except as noted below, based on the information on vendor readiness provided by

commenters and the staff’s observations of developments in the XBRL preparation

industry and experience with voluntary Inline XBRL filings pursuant to the Exemptive

Order, we are adopting a three-year phase-in for operating companies, as proposed: (i)

large accelerated filers that prepare their financial statements in accordance with U.S.

GAAP will be required to comply with Inline XBRL for financial statements for fiscal

periods ending on or after June 15, 2019; (ii) accelerated filers that prepare their financial

statements in accordance with U.S. GAAP will be required to comply with Inline XBRL

for financial statements for fiscal periods ending on or after June 15, 2020; and (iii) all

other operating company filers that are subject to financial statement information XBRL

requirements, including foreign private issuers (“FPIs”) 152 that prepare their financial

statements in accordance with IFRS, will be required to comply with Inline XBRL for

financial statements for fiscal periods ending on or after June 15, 2021. 153

In a modification from the proposal, in response to comments, 154 domestic form

filers 155 will be required to comply beginning with their first Form 10-Q for a fiscal

152

See Rule 405 under the Securities Act [17 CFR 230.405] and Rule 3b-4(c) under the Exchange

Act [17 CFR 240.3b-4(c)].

153

See new Rule 405(f)(1)(i).

154

See note 161 below.

155

Form 20-F and 40-F filers do not have quarterly report filing obligations and are therefore not

affected by this provision.

period ending on or after the applicable compliance date, as opposed to the first filing for

a fiscal period ending on or after that date, to enable filers to gain experience with Inline

XBRL through less complex filings. 156 This approach is similar to the approach in the

2009 Financial Statement Information Adopting Release, which was intended to facilitate

the transition of filers to financial statement information XBRL requirements.

Most commenters that addressed the proposed phase-in for operating companies

supported it. 157 Some commenters supported the general phase-in approach but

recommended postponing the compliance dates until after the third quarter of 2018 or

creating a fourth early phase-in category for the largest 500 filers. 158 One of these

commenters supported the phase-in for smaller filers because of potential cost increases

during the transition period and specifically suggested that emerging growth companies

(“EGCs”) 159 be added to the third phase-in category. 160 Several commenters proposed

adjusting the compliance dates for the Inline XBRL requirement so that they initially

apply to quarterly reports on Form 10-Q rather than Form 10-K, due to the lower

complexity of Form 10-Q. 161

156

As an example, a Form 10-Q filer in the first phase-in group with a calendar fiscal year end will be

required to begin compliance with the Inline XBRL requirement with its Form 10-Q for the period

ending June 30, 2019. As a further example, a Form 10-Q filer in the first phase-in group with a

June 30 fiscal year end will be required to begin compliance with the requirement with its Form

10-Q for the period ending September 30, 2019.

157

See, e.g., letters from AICPA, Kumar, Merrill, and XBRL US (also citing a survey of filers among

which 71% supported a phase-in and 13% did not, while 52% thought that one year was the right

amount of time before the first phase of filers is required to comply).

158

See, e.g., letters from EY and FEI.

159

See Rule 405 under the Securities Act and Rule 12b-2 of the Exchange Act [17 CFR 240.12b-2].

160

See letter from BIO.

161

See, e.g., letters from AICPA, EY, and Kumar.

Some commenters expressed a concern about the initial transition of operating

companies to Inline XBRL because not all software vendors and filing agents are

currently Inline-capable. 162 One of those commenters stated that the relative burden of

initial transition for filers would depend on vendor readiness and that compliance dates

should reflect this. 163 However, two commenters opposed a phase-in, stating that the

costs of Inline XBRL transition would be minimal and that the phase-in would lower the

benefits to data users. 164 One of those commenters suggested that compliance should

begin with quarterly filings ending on or after June 15, 2019. 165 In addition, a number of

commenters stated that the Inline XBRL transition would involve either no burden or

only a small burden for filers and preparers because many vendors already include the

Inline XBRL capability as part of their software package or could easily incorporate it as

they have for their foreign customers that are required to use Inline XBRL for other

reporting purposes. 166 Several commenters also stated that the Inline XBRL transition

would have little impact on data users’ existing processes for analyzing XBRL data and

that many of them already use Inline XBRL data from foreign jurisdictions. 167

162

See, e.g., letters from Cigna and FEI.

163

See letter from FEI.

164

See letters from Workiva I and CFA Institute.

165

See letter from Workiva I.

166

See, e.g., letters from ACI; IRIS; Workiva I; Merrill; XBRL US (“At the latest, all XBRL US

vendor members will be ready to file using inline XBRL by the second quarter of 2019.”).

167

See, e.g., letters from Morningstar; Octachoron; TagniFi; XBRL US (“We held informal

discussions with several of these organizations ranging from startup companies . . . to large

established organizations . . . These organizations, which today use XBRL-formatted US

corporate data, indicated that extracting data from Inline XBRL is the same as extracting data from

conventional XBRL files. Several indicated that they have already begun to use Inline XBRL

given its availability in other non-US markets. Of these, the cost to do so was minimal, requiring

zero to little change to their current process.”).

After considering commenter input, we are not introducing additional phase-in

categories, postponing the compliance date for EGCs, or making further modifications to

the phase-in for operating companies. We do not believe that the potential incremental

benefits to some filers from such changes would offset the increased complexity and

delays of the benefits of Inline XBRL for market participants and other data users. EGCs

will be required to comply beginning with fiscal periods ending on or after June 15, 2020,

or June 15, 2021, depending on filer status and basis of accounting. Because the relative

burden for filers of the fixed costs of initial transition to Inline XBRL, if any, is likely to

depend on filer size, we believe that this approach provides smaller EGC filers, and other

smaller filers, with sufficient time to transition to Inline XBRL.

With respect to funds, the Commission proposed a two-year phase-in based on net

asset size. Specifically, for large fund groups, it proposed a compliance date of one year

after the effective date to comply with the new requirements. For small fund groups, the

Commission proposed a compliance date of two years after the effective date, to provide

these filers with an additional year to comply with the new requirements.

Several commenters expressed concerns about the workflow and vendor changes

that may be required for funds to transition to Inline XBRL and adjust to the elimination

of the 15 business day filing period. 168 In particular, one commenter stated that “to the

extent the Commission determines to proceed in adopting the Proposed Rule, we

encourage the Commission to provide mutual funds and their filing agents a minimum of

two years to plan for and implement the changes needed to comply with the Proposed

168

See notes 115-119 above and accompanying text.

Rule.” 169 Another commenter stated that one year would not be “a realistic timeframe for

implementation of the proposed amendments” and suggested 18 months “as a more

achievable compliance date.” 170 Another commenter supported the Inline XBRL

requirement for funds and the elimination of their 15 business day filing period but

suggested that “the Commission may want to consider giving mutual funds more time to

make the transition than operating companies” given the likely workflow changes in

instituting these amendments. 171

After considering commenters’ concerns, and consistent with their suggestions, to

provide funds and vendors with additional time to implement any necessary workflow

changes, we are extending the phase-in with respect to the Inline XBRL and timing

requirements for risk/return summary XBRL data and modifying the compliance dates to

two years after the effective date of the amendments for large fund groups and three years

after the effective date of the amendments for small fund groups. 172

We believe that these compliance dates will provide sufficient time for filers,

filing agents, and software vendors to transition to Inline XBRL and adjust to the

elimination of the extended filing period. Given that any fixed cost of initial transition

may have a relatively greater impact on smaller filers, this approach will give such filers

time to develop related expertise, as well as the opportunity to benefit from the

169

See letter from USBFS.

170

See letters from Federated I and II.

171

See letter from XBRL US.

172

When we adopted the risk/return summary information XBRL requirements on February 11, 2009,

all filers had approximately two years to comply (until January 1, 2011). After considering

commenter feedback, we are providing a similar period for larger filers to comply with the

proposed Inline XBRL requirements. Further, after considering commenter feedback, we believe

that smaller fund filers may benefit from even more time to comply with these new requirements.

experience of larger filers with Inline XBRL. The phase-in is also expected to provide

filing agents and software vendors with additional time to transition to Inline XBRL and

develop related expertise.

Similar to the proposal and consistent with a commenter’s suggestion, 173 the

amendments will permit all filers to file using Inline XBRL prior to the compliance date

for each category of filers. Filers will be able to file in Inline XBRL under the

amendments once the EDGAR system has been modified to accept submissions in Inline

XBRL for all forms subject to the amendments, which is anticipated to be March 2019. 174

Notice of EDGAR system readiness to accept filings in Inline XBRL will be provided in

a manner similar to notices of taxonomy updates and EDGAR Filer Manual updates. We

believe that offering filers the option to file using Inline XBRL before the compliance

date will enable filers that are ready to transition to Inline XBRL to begin realizing the

benefits of Inline XBRL sooner. It will also enable vendors and filing agents used by

early Inline XBRL adopters to gain valuable expertise that may help facilitate the

transition to Inline XBRL for filers that transition to Inline XBRL at a later time.

Otherwise, prior to the applicable compliance date, filers that do not file using Inline

XBRL will continue to be required to submit the entire Interactive Data File as an exhibit,

as they do currently. 175

d. Scope of the Inline XBRL Requirements

173

See letter from Workiva II.

174

Operating companies may continue to voluntarily file certain Exchange Act reports in Inline

XBRL prior to that time pursuant to the Exemptive Order, which will cease to be operative once

voluntary reporting under the amendments is permitted. See note 48 above and accompanying

text.

175

See new Rule 405(f)(2) and (3).

The Inline XBRL requirements for financial statement information will apply to

all operating company filers, including smaller reporting companies (“SRCs”), 176 EGCs,

and FPIs that are currently required to submit financial statement information in XBRL.

Several commenters supported our proposal not to exempt individual categories of

operating company filers subject to XBRL requirements from the Inline XBRL

requirement, citing data quality and efficiency reasons. 177 One commenter did not

specifically address an exemption from the Inline XBRL format requirement but

recommended exempting EGCs, SRCs, and nonaccelerated filers from XBRL

requirements generally, citing concerns about cost and lack of use of XBRL data. 178

We do not expect Inline XBRL to significantly affect the overall costs of

compliance with XBRL requirements. While filers may incur a small initial transition

cost, they also may realize reductions in ongoing costs of compliance with XBRL

requirements. 179 Furthermore, filers may realize reductions in ongoing costs due to the

elimination of the website posting requirement. We have sought to alleviate the initial

transition burden for filers through phased compliance dates. Given the benefits expected

from the Inline XBRL requirement, the overall readiness of the Inline XBRL technology,

and the input from commenters regarding vendor readiness, we are not exempting any

filers that are subject to existing XBRL requirements. Exempting some categories of

filers subject to XBRL requirements from Inline XBRL could reduce the aggregate data

176

See Rule 405 under the Securities Act, Rule 12b-2 under the Exchange Act and Item 10(f) of

Regulation S-K [17 CFR 229.10(f)].

177

See, e.g., letters from CFA Institute, Merrill, Morningstar, and XBRL US.

178

See letter from BIO. But see AICPA Study (discussing XBRL preparation costs for smaller filers)

and note 67 above (discussing XBRL data use for smaller filers and biotechnology companies).

179

See Sections III.B.1.a and V.C below.

quality and usability benefits for investors, analysts, and other users and create a need for

investors and other data users to maintain indefinitely the support for both sets of

technologies, potentially resulting in ongoing inefficiencies.

Some commenters addressed the scope of information subject to XBRL

requirements more generally, although no such changes were contemplated as part of the

Inline XBRL Proposing Release. 180 Several commenters expressed overall support for

XBRL requirements in general 181 or suggested expanding the scope of operating

company information that is required to be tagged, 182 or is permitted to be tagged, 183 in

XBRL, while other commenters recommended exemptions from XBRL requirements for

certain operating companies 184 or funds, 185 citing concerns about cost.

Two commenters recommended that, to the extent that the Commission wishes to

modernize structured disclosure requirements for fund filers, it should rescind the

existing XBRL requirements for risk/return summary information and replace them with

requirements to tag certain risk/return summary information in the XML format on Form

N-CEN. 186 Another commenter recommended that risk/return summary XBRL

180

See Inline XBRL Proposing Release, at 14291.

181

See, e.g., letters from CFA Institute, Grant Thornton, Members of Congress, Morningstar,

TagniFi, XBRL International, and XBRL US.

182

See, e.g., letters from CFA Institute, Data Coalition, Merrill, XBRL International, and XBRL US.

183

See letter from Gartner.

184

See note 178 above.

185

See letters from Federated I and II (recommending that we exempt funds from XBRL or replace

XBRL with XML on Form N-CEN); ICI I and II (recommending that we exempt funds from

XBRL); USBFS (recommending that we require funds to submit XBRL data only for forms of

their prospectus that have been used to sell shares of the fund).

186

See letters from Federated (stating that filing tagged data on Form N-CEN would create

consistency in data tagging language and allow the Commission and third-party information

providers to access important data about a fund in one location) and ICI. See also Release No. IC32314 (Oct. 13, 2016) [81 FR 81870]. We note that, while funds are currently required to update

requirements apply only to forms of prospectuses that have been used to sell shares of the

fund. 187

As the Commission stated in the Inline XBRL Proposing Release, these

amendments are aimed at modernizing existing XBRL requirements to incorporate

developments in the XBRL technology since the 2009 adoption of these requirements. 188

Therefore, at this time, we are not changing the categories of operating company or fund

filers, or the scope of operating company or fund disclosures, that are subject to these

XBRL requirements.

2. Elimination of the Website Posting Requirements

We are adopting, as proposed, the elimination of the XBRL website posting

requirements for financial statement information and risk/return summaries. 189

In the 2009 Financial Statement Information Adopting Release and the 2009

Risk/Return Summary Adopting Release, the Commission stated that it thought that the

website availability of the interactive data would encourage its widespread dissemination,

make it easier and faster for investors to collect information on a particular filer, enable

search engines and other data aggregators to more quickly and cheaply aggregate the data

and make them available to investors, and potentially increase the reliability of data

their registration statements and file new XBRL data every time risk/return summary information

changes, there is no requirement to update Form N-CEN (filed annually) for intra-year changes to

its information. Therefore, filing risk/return summary tagged data on Form N-CEN could result in

investors receiving risk/return summary information in a less timely manner.

187

See letter from USBFS.

188

See Inline XBRL Proposing Release, at 14291.

189

Website posting is currently required by Rule 405(g) and General Instruction C.3.(g) to Form N1A.

availability to the public. 190 However, the Commission also noted that this benefit could

be limited since investors seeking to aggregate machine-readable XBRL data across

companies, manually or through an automated process, may find XBRL exhibits posted

on individual filers’ websites less useful. 191

We believe, based on our experience, that users of XBRL data generally do not

seek the information directly from individual filers’ websites; rather, they obtain the data

from a more central repository of the data, such as the Commission’s EDGAR system or

third-party aggregators. We believe that access to XBRL data for purposes of

aggregation and processing, whether by data aggregators or individual data users, is most

efficiently achieved when such machine-readable data is consistently organized (e.g.,

with respect to directory structure) and made available at a single source. Based on our

experience since the Commission adopted the website posting requirements in 2009, we

believe that potential data users can obtain sufficiently reliable access to XBRL data

through EDGAR and do not need the backup of a website posting on a filer’s website to

access the XBRL data. Thus, data users should not incur significant costs from the

elimination of the requirement to post the XBRL data on filers’ websites. Operating

companies and funds are expected to recognize a modest benefit from the elimination of

this requirement. 192

190

See 2009 Financial Statement Information Adopting Release, at 6791–6792. Similarly, in

adopting the website posting requirement for risk/return summary XBRL information, the

Commission stated that website availability of the interactive data will encourage its widespread

dissemination, contributing to lower access costs for users. See 2009 Risk/Return Summary

Adopting Release at 7755-7756.

191

See 2009 Financial Statement Information Adopting Release, at 6807. See also 2009 Risk/Return

Summary Adopting Release, at 7767, n. 263 (“We believe the benefits will stem primarily from

the requirement to submit interactive data to the Commission and the Commission’s disseminating

that data.”).

192

See Sections III.B.2 and V.C below.

All of the commenters that addressed this aspect of the proposal supported

eliminating the website posting requirements, citing the lack of utility to data users and/or

the potential cost savings to filers. 193 One commenter that is a filer of risk/return

summary information noted that an average of only three users per month access XBRL

risk/return summary information through that filer’s website. 194

After considering the input from commenters, we agree that data users will not

benefit from continued application of the website posting requirements, in light of the

greater efficiency of retrieving XBRL data from EDGAR or other sources for purposes of

aggregation and analysis. We continue to believe that most filers will realize a small

benefit from the elimination of the website posting requirements, although the magnitude

of the benefit for the average filer is likely to be small.

3. Termination of the 2005 XBRL Voluntary Program

We are adopting, as proposed, the termination of the 2005 XBRL Voluntary

Program for financial statement information interactive data. 195 Subsequent to the

adoption of the interactive data requirements for financial statement information for

operating companies in 2009, the only filers that remain eligible for the program are

registered investment companies, BDCs, and other entities that report under the

Exchange Act and prepare their financial statements in accordance with Article 6 of

Regulation S-X. No commenters objected to the termination of the program and given its

193

See, e.g., letters from CFA Institute; Federated I and II; ICI I; Merrill; USBFS (supporting

elimination but noting that it will not generate cost savings and may entail a small cost to modify

the website to remove XBRL links and pages); and Workiva I.

194

See letter from Federated II.

195

We are amending Regulation S-T to remove Rule 401 that specifies voluntary program

requirements and making related technical and conforming changes.

very infrequent use, we do not believe that its continued existence will provide significant

benefits.

4. Technical Amendments

We are adopting, as proposed, certain technical, conforming changes to the rules

for hardship exemptions, current public information under Rule 144(c)(1) under the

Securities Act, and form eligibility, consistent with the changes in format to the

Interactive Data File and elimination of the website posting requirements. In addition, in

Regulation S-T, we are deleting the definition of “promptly” from Rule 11 because it was

used only in 17 CFR 232.406T (“Rule 406T”), which has expired, and deleting references

to Forms S-2 and F-2 because those forms have been eliminated.

Although not proposed, we are adopting additional technical, conforming changes

consistent with the elimination of the 2005 XBRL Voluntary Program and additional

technical clarifying changes. In connection with the elimination of the 2005 XBRL

Voluntary Program, these changes affect Item 601(b)(100) of Regulation S-K; a heading

within and Rules 11, 305(b), and 402 of Regulation S-T; Rules 13a-14(f) and 15d-14(f)

under the Exchange Act; paragraph 100 of the Instructions as to Exhibits of Form 20-F;

paragraph C.(5) of the General Instructions to Form 6-K; Rules 8b-1, 8b-2, 8b-33, and

30a-2(d) under the Investment Company Act; and General Instruction B.4.(b) of Form N1A under the Investment Company Act.

We are substituting the term “filing” for “form” in the definition of Interactive

Data File in Rule 11 of Regulation S-T and in some instances within Rule 405 of

Regulation S-T because the term “filing” better describes the range of documents subject

to XBRL requirements. Also, we are altering proposed Rules 201(c)(1) and 202(c)(2)

under Regulation S-T to specify that when a hardship exemption is received the

document required to set forth a related legend must appear where the Interactive Data

File exhibit otherwise would have appeared.

Further, we are amending Rule 201 under Regulation S-T to adopt a temporary

hardship exemption for the inability to timely file Interactive Data Files for risk/return

summary information. 196 Since 2009, while operating companies could avail themselves

of both the temporary hardship exemption under Rule 201 and continuing hardship

exemption under Rule 202, funds were limited to continuing hardship exemptions. The

2009 Risk/Return Summary Adopting Release explained that while the Commission was

adopting a continuing hardship exemption with respect to risk/return summary

information data, the Commission was not adopting a temporary hardship exemption

because the final rules included a 15 business day filing period for submitting the

Interactive Data File. 197 Because we are eliminating the 15 business day filing period,

we are amending Rule 201 to similarly allow funds to avail themselves of the temporary

hardship exemption.

Additionally, we are adopting technical changes to Rule 485 under the Securities

Act to account for the elimination of the website posting requirements. We are also

adopting technical changes to paragraphs (c) and (e) of Rule 497 under the Securities Act

to indicate that a fund that files pursuant to Rule 497 must, if applicable pursuant to

General Instruction C.3.(g) of Form N-1A, “submit” an Interactive Data File. 198

B. Potential Economic Effects of the Amendments

196

See Note to Paragraph (c) of Rule 201.

197

See 2009 Risk/Return Summary Adopting Release, at 7757, n. 129.

198

This change in terminology makes Rule 497 consistent with Rule 485 under the Securities Act.

We are mindful of the costs imposed by and the benefits obtained from our rules.

Securities Act Section 2(b), 199 Exchange Act Section 3(f), 200 and Investment Company

Act Section 2(c) 201 require us, when engaging in rulemaking that requires us to consider

or determine whether an action is necessary or appropriate in the public interest, to

consider, in addition to the protection of investors, whether the action will promote

efficiency, competition, and capital formation. Additionally, Exchange Act Section

23(a)(2) requires us, when adopting rules under the Exchange Act, to consider the impact

that any new rule will have on competition and not to adopt any rule that will impose a

burden on competition that is not necessary or appropriate in furtherance of the purposes

of the Exchange Act. 202

The amendments aim to increase the efficiency and lower the cost of compliance

with the existing XBRL requirements through process improvements associated with the

Inline XBRL technology and the elimination of the website posting requirements. The

discussion below addresses the potential economic effects of the amendments, including

their likely costs and benefits, as well as the likely effects of the amendments on

efficiency, competition, and capital formation, relative to the economic baseline, which is

comprised of XBRL practices in existence today. 203

199

15 U.S.C. 77b(b).

200

15 U.S.C. 78c(f).

201

15 U.S.C. 80a-2(c).

202

15 U.S.C. 78w(a)(2).

203

See Section II.B above.

At the outset, we note that, where possible, we have attempted to quantify the

costs and benefits expected to result from the amendments to the XBRL requirements. 204

However, in some cases we have been unable to quantify the economic effects. For

example, it is difficult to quantify the extent to which Inline XBRL will enhance the

quality and usability of XBRL data and, if so, how it will affect XBRL data use. We

have been able to gain some insight into the potential economic effects of the

amendments based on the experience of filers that have used Inline XBRL on a voluntary

basis pursuant to the Exemptive Order; however, these insights are necessarily limited by

the relatively small and self-selected nature of this subset of filers.

We assess the potential impact of the amendments relative to the economic

baseline, which includes existing XBRL requirements, information about filers subject to

these requirements, and current practices related to XBRL filing and use, described in

Section II above.

1. Inline XBRL Requirements

a. Use of Inline XBRL

i. Benefits

After considering the input from commenters, as well as the experience of

operating companies that voluntarily filed in Inline XBRL, 205 we continue to believe that

filing in Inline XBRL has the potential to benefit both filers and users of this information.

In particular, we continue to believe that the use of Inline XBRL may reduce the time and

effort associated with preparing XBRL filings; simplify the review process for filers; and

204

One comment letter requested that the Commission quantify the benefits of the proposal. See

letter from Federated II.

205

Funds are not eligible to voluntarily file in Inline XBRL pursuant to the Exemptive Order.

improve the quality and usability of XBRL data and thus increase the use of XBRL data

by investors, other market participants, and other data users. 206

Embedding XBRL data in an HTML document rather than tagging a copy of the

data to create a separate XBRL exhibit should increase the efficiency and effectiveness

of the filing preparation process and, by saving time and effort spent on the filing

process, over time, reduce the cost of compliance with existing XBRL requirements. 207

Inline XBRL eliminates the need to create a separate XBRL instance document

containing all of the XBRL tags, which can reduce the incidence of those re-keying

errors that are associated with producing separate documents for the same information.

Inline XBRL also makes it possible for filers or filing agents to view XBRL metadata 208

within the HTML document, which can facilitate the review of XBRL data and better

equip filers to detect XBRL errors. Further, filers or filing agents can use tools like the

open source Inline XBRL Viewer to review the Interactive Data File and more

efficiently filter and identify errors and locate information within the filing (e.g., by

using the topic query feature). Thus, by facilitating the preparation and review of XBRL

data, Inline XBRL can decrease the overall time and cost required by filers to comply

with the existing XBRL requirements.

Various commenters stated that they expect Inline XBRL to result in a lower cost

and/or greater efficiency of XBRL preparation. 209 However, other commenters stated

206

See Inline XBRL Proposing Release, at 14293-4, nn. 154, 155, and 162. See also notes 86-88

above.

207

See Inline XBRL Proposing Release, at 14293-4, nn. 155, 156. See also note 85 above.

208

Such metadata include, for example, definitions, reporting period information, data type, and

related references.

209

See note 85 above.

that Inline XBRL will not necessarily result in burden savings for filers. 210 As the

Commission noted in the Inline XBRL Proposing Release, the benefit of savings in

ongoing XBRL preparation and filing costs due to Inline XBRL will be smaller for filers

that presently rely on the integrated XBRL preparation approach. 211 Nevertheless, such

filers may realize small time savings and/or efficiencies in the filing process from Inline

XBRL. 212 Additionally, because Inline XBRL gives the preparer full control over the

presentation of filer disclosures, those filers that currently choose XBRL tags so that the

data looks similar to the HTML document when rendered by software into a humanreadable presentation will have less of an incentive to do so because Inline XBRL will

embed XBRL tags into the HTML document. 213 It is challenging to quantify potential

gains in the effectiveness and efficiency of the filing preparation process and the resulting

reductions in the ongoing cost of compliance with the XBRL requirements due to data

limitations and variation in filer circumstances. However, for purposes of the Paperwork

Reduction Act of 1995 (“PRA”), 214 we continue to estimate that the average burden of

XBRL preparation will decrease slightly after the initial transition to Inline XBRL and

the average annual external cost of XBRL preparation will increase slightly. 215 We

210

See, e.g., letters from ICI I (regarding risk/return summaries) and Pergamit.

211

See Inline XBRL Proposing Release, at 14294.

212

Software vendors and filing agents that currently use the integrated XBRL preparation approach,

combining the processes of creating interactive data tags and an HTML document, cannot

presently take full advantage of the resulting efficiency because of current requirements. At

present, filing agents and/or filers that use integrated XBRL solutions must expend the effort,

albeit minimal, to split out the interactive data and save it to a separate instance document for

filing.

213

See also note 89 above and accompanying text.

214

44 U.S.C. 3501 et seq.

215

See Section V.C.1 below. Compared to the existing XBRL requirements for operating companies,

the annual internal burden per filer for Inline XBRL filers is expected to be approximately 1 hour

lower in the first year (1 response x (8 – 2) hours + 3.5 responses x (–2) hours) and 9 hours lower

recognize that individual filers’ costs and cost savings from Inline XBRL may vary for a

number of reasons, including the filer’s and the filing agent’s experience with Inline

XBRL.

The use of Inline XBRL may also improve XBRL data quality and thus

potentially benefit data users. When XBRL is embedded directly into the HTML

document, the filer prepares and reviews a single document, rather than separate

documents—as is the case with the current reporting requirement—which should enable a

reduction in data errors, particularly for those filers that currently use the standalone

XBRL preparation approach. 216 Further, filers or filing agents can use review tools like

the open source Inline XBRL Viewer to more readily filter and identify errors. To the

extent that Inline XBRL technology can reduce the rate of XBRL errors that are not

detected by filers with the current XBRL filing practices and technology, Inline XBRL

could incrementally improve XBRL data quality, which could potentially benefit data

users. 217 Additionally, since Inline XBRL filers will have less of an incentive to create

after the first year (4.5 responses x (–2) hours); the annual external cost per filer for Inline XBRL

filers is expected to be approximately $22.50 higher, beginning in the first year (4.5 responses x

$5).

Compared to the existing XBRL requirements for funds, the annual internal burden per filer for

Inline XBRL filers is expected to be approximately 3.32 hours higher in the first year (1 response

x (4 – 0.5) hours + 0.36 responses x (–0.5) hours) and 0.68 hours lower after the first year (1.36

responses x (–0.5) hours); the annual external cost per filer for Inline XBRL filers is expected to

be approximately $10 higher, beginning in the first year.

216

See Inline XBRL Proposing Release, at 14288, n. 83 and at 14293-4, n. 155. Filers that do not

currently use an integrated approach may achieve greater benefits in data quality and efficiency

from the more integrated process that Inline XBRL offers. See notes 117-119 above (discussing

the use of a standalone approach by fund filers).

217

Existing format requirements for Interactive Data Files include the element accuracy requirement,

which provides that each data element (i.e., all text, line item names, monetary values,

percentages, numbers, dates, and other labels) contained in the Interactive Data File must reflect

the same information in the corresponding data in the Related Official Filing. See Rule

405(c)(1)(i) of Regulation S-T.

custom XBRL tags solely to mimic the appearance of an HTML filing, Inline XBRL

could increase the ability of investors, other market participants, and other data users to

compare information across filers for those filers that currently engage in such tagging

practices. 218

A number of commenters stated that Inline XBRL could result in an improvement

in XBRL data quality and a potential decrease in XBRL errors. 219 However, several

commenters stated that Inline XBRL by itself will not improve data quality since the

change in the format does not affect the nature of tagging or the filer’s ability to select

inappropriate custom tags. 220 As the Commission stated in the Inline XBRL Proposing

Release, because the amendments do not modify the scope and substance of existing

XBRL requirements or the categories of filers subject to the requirements, the

improvement in data quality and the overall economic benefits incremental to Inline

XBRL likely will be smaller than the benefits of the XBRL requirements more

generally. 221 The Commission also noted that Inline XBRL filers may continue to use

custom tags to represent certain company-specific data after the switch to Inline

XBRL. 222 Therefore, while Inline XBRL and tools such as the Inline XBRL Viewer

facilitate review and detection of certain re-keying errors, they will not resolve all XBRL

We also note that the incremental effects of Inline XBRL on the reduction in XBRL errors will be

smaller if other ongoing initiatives continue to reduce XBRL data errors. For example, the XBRL

US Data Quality Committee periodically publishes guidance and validation rules to help public

companies detect inconsistencies or errors in their XBRL-formatted financial data, such as

incorrect negative values, improper relationships between elements, and incorrect dates associated

with certain data. See https://xbrl.us/data-quality/rules-guidance/ (retrieved Jun. 20, 2018).

218

See notes 89 and 213 above and accompanying text.

219

See note 86 above.

220

See, e.g., letters from EY, TagniFi, and Workiva I (regarding financial statement information).

221

See Inline XBRL Proposing Release, at 14295.

222

Id.

data quality issues. A review of a sample of voluntary Inline XBRL filings pursuant to

the Exemptive Order suggests that some XBRL data quality issues may remain for a

minority of filers. However, the experience of a relatively small number of voluntary

filers may not be representative of all filers subject to the amendments, particularly given

that the Exemptive Order only extended to operating companies and that most voluntary

filers already use integrated software, thus their transition to Inline XBRL likely entailed

minimal changes to XBRL preparation workflow and a resulting minor data quality

impact.

Several commenters indicated that Inline XBRL would not result in significant

improvements in risk/return summary XBRL data quality because there is little evidence

of issues with the quality of risk/return summary XBRL data today. 223 We acknowledge

that data quality benefits may be more modest for funds than for operating companies, in

part due to greater standardization of risk/return summary XBRL data. 224 However, we

understand that funds can also experience data quality issues in compiling separate

XBRL risk/return summary files. 225

Overall, we continue to believe that the benefits of potential reduction in certain

errors from Inline XBRL, although incremental, may generally contribute to future

improvements in XBRL data quality, especially when used in conjunction with tools such

as the Inline XBRL Viewer. 226

223

See note Error! Bookmark not defined. above.

224

See also Inline XBRL Proposing Release, at 14287.

225

See Inline XBRL Proposing Release, at 14294-14295. See also note 216 above and accompanying

text.

226

The Inline XBRL Viewer can enable a faster review and detection of certain data quality errors

because of its data filter functions, such as sorting amounts entered as negative values in Inline

XBRL filings.

Inline XBRL could also enhance how users view XBRL data related to

Commission disclosures. Several commenters stated that Inline XBRL will contribute to

greater usability and transparency of XBRL data for investors and other data users. 227

With Inline XBRL, the EDGAR system enables users to view information about the

reported XBRL data embedded in Inline XBRL filings on the Commission’s website,

using any recent standard Internet browser, without the need to access a separate

document. With this feature, when a user views a filing submitted in Inline XBRL on

EDGAR, the user will be able to see tags and the related metadata while viewing the

HTML document. These Inline XBRL features can provide the benefit of greater context

and information to investors. The software enabling this feature has been made freely

available in an effort to facilitate the creation of cost-effective Inline XBRL viewers and

analytical products. 228 Moreover, despite the limited number of Inline XBRL filings so

far, we have observed enhancements that the public has made to the Inline XBRL Viewer

to improve analysis of Inline XBRL data, which may improve the usability of the data.

With respect to funds, the benefit of increased usability of risk/return summary

XBRL data is expected to be further enhanced when combined with the elimination of the

15 business day filing period for risk/return summary XBRL information, which will

make XBRL data available to investors and other data users more quickly.

To the extent that the use of Inline XBRL results in an improvement in XBRL

data quality and usability, and thus in increased use of XBRL data by investors, market

participants, and other data users, we expect the benefits associated with XBRL in

227

See notes 87-88 above.

228

See https://www.sec.gov/structureddata/edgarvalandrender (retrieved Jun. 20, 2018).

general to be enhanced. As the Commission stated in the 2009 Financial Statement

Information Adopting Release and 2009 Risk/Return Summary Adopting Release, the

availability of information in XBRL enables investors and other data users to capture and

analyze that information more quickly and at a lower cost, as well as to search and

analyze the information dynamically; facilitates comparison of information across filers

and reporting periods; and leads to better-informed investment decisions and potential

gains in the efficiency of capital formation and allocation, through a reduction in the

information barriers faced by investors or costs of collecting and analyzing disclosures. 229

We lack the ability to quantify the incremental contribution of Inline XBRL to potential

increases in the use of XBRL data and the broader economic benefits of XBRL. We

anticipate that the effect will depend on several factors, including the extent of

improvements in XBRL data quality and usability following the transition to Inline

XBRL; changes in XBRL data use by investors, other market participants, and other data

users; and technological innovation in XBRL preparation and analytics solutions.

ii. Costs

The Inline XBRL requirement may impose costs on filers, XBRL preparation

software vendors, filing agents, and data users.

We expect that the initial transition to Inline XBRL could result in a cost to filers.

Filers may switch to Inline XBRL either by using Inline XBRL enabled preparation

software that they develop or license or by obtaining Inline XBRL preparation services

from a third-party service provider (filing agent). Filers that rely on filing agents for

XBRL preparation may incur an incremental cost of Inline XBRL upgrades (to the extent

229

See 2009 Financial Statement Information Adopting Release, at 6777, 6807–6808; 2009

Risk/Return Summary Adopting Release, at 7766–7768.

that the cost incurred by filing agents is passed on to filers). Filers that prepare XBRL

filings in-house will need to replace or update their XBRL preparation software with

versions that include Inline XBRL capabilities. We expect such costs to be lower if

there is more competition among filing agents and software vendors that offer Inline

XBRL capabilities. Filers also may incur an internal cost to train their personnel to use

Inline XBRL and to comply with the Inline XBRL requirements.

Filers that use software that is already enabled for Inline XBRL or that can readily

be modified to accommodate the Inline XBRL format, as well as filers that use filing

agents that use such software, are expected to incur a minimal transition cost. In

particular, for filers and filing agents that rely on integrated XBRL filing solutions, filing

in Inline XBRL could require only a very minor adjustment to the filing process, similar

to choosing the format in which the file will be saved out of several available formats.

Conversely, filers and filing agents using a standalone approach will require greater

changes to their workflow. Several commenters expressed concerns about a lack of

software vendor readiness and a greater than anticipated burden of initial transition. 230

Some operating company filers have demonstrated the Inline XBRL capability

through electing to voluntarily file in Inline XBRL pursuant to the Exemptive Order. 231

In addition, a number of XBRL software vendors and filing agents involved in XBRL

preparation for a significant share of the U.S. XBRL market have developed or indicated

plans to offer Inline XBRL capabilities. 232 One commenter stated that “[m]any vendors

230

See notes 101, 115, 117-118, and 162 above.

231

See Section II.B.2 above. Funds are not eligible to voluntarily file in Inline XBRL under the

Exemptive Order.

232

See note 62 above.

today already have Inline XBRL capabilities or have development underway” to

incorporate this capability into their tools. 233 The commenter also stated that, at the

latest, all of its vendor members will be ready to file using Inline XBRL by the second

quarter of 2019, which is compatible with the compliance date for the first operating

company phase-in category. 234 Another commenter stated that “[m]ost providers either

have Inline XBRL capabilities or will have it soon” and that “[t]he cost of switching to

providing Inline XBRL is not significant enough to cause a competitive change in the

marketplace.” 235 Several XBRL vendors indicated in their comment letters that they

have Inline XBRL capabilities.236

Further, the experience of operating company filers electing to make voluntary

Inline XBRL submissions pursuant to the Exemptive Order suggests that filers have not

incurred a significant change in external preparation costs. However, this inference is

based on a relatively small number of operating company filers, most of which already

use integrated XBRL software. Thus their change in costs may not be representative of

the overall population of filers subject to the amendments.

Although we recognize the likelihood of relatively greater initial costs being

incurred by filers that do not use such software or such filing agents, we believe that, as a

general matter, the overall cost of initial transition to Inline XBRL technology will be

relatively small. In particular, we expect this to be the case because the amendments do

not modify the substance of the XBRL requirements and thus do not affect the process of

233

See letter from XBRL US.

234

Id.

235

See letter from Merrill.

236

See, e.g., letters from ACI, IRIS, and Workiva I.

selecting tags from the taxonomy for the required disclosures (the disclosure mapping

process that precedes the creation of the XBRL submission accounts for the

overwhelming majority of the XBRL preparation time and cost). The creation of the

Inline XBRL document will occur after the mapping of company disclosures to the

taxonomy is completed and will consist largely of a software function, which could

include a broad range of file formats (e.g., HTML, PDF, XBRL, and Inline XBRL).

Inline XBRL cannot be used with the ASCII format. Thus, filers that prepare the

Related Official Filing in the ASCII format will incur additional costs of switching to

HTML, and any fixed costs of such a change will have a relatively greater effect on

smaller entities. 237 We continue to believe that such costs will be minimal. First,

relatively few filers presently use the ASCII format and therefore only those few filers

will need to incur the cost of switching to HTML as a result of the amendments. On

March 1, 2017, the Commission adopted amendments to require the use of the HTML

format for registration statements and periodic and current reports that are subject to the

exhibit requirements under Item 601 of Regulation S-K and for Forms F-10 and 20-F. 238

As of September 1, 2018, all registrants will be required to comply with those

amendments. 239 While those amendments excluded some operating company filings that

will be subject to Inline XBRL requirements, in particular, Form 6-K and Form 40-F

237

See Inline XBRL Proposing Release, at 14288-14289.

238

See Release No. 33-10322 (Mar. 1, 2017) [82 FR 14130].

On October 11, 2017, the Commission proposed amendments that would similarly require funds to

file in HTML format registration statements and reports that include exhibits. See Release No. 3310425 (Oct. 11, 2017) [82 FR 50988] (“FAST Act Proposing Release”).

239

The requirements were effective September 1, 2017, although smaller reporting companies and

nonaccelerated filers need not comply until September 1, 2018.

filings, in practice almost no such filings are presently filed in the ASCII format. 240

Similarly, a relatively small proportion of fund filings is filed in the ASCII format. 241

Second, the average costs of switching from ASCII to HTML will be small because the

software tools to prepare and file documents in HTML are widely used and the

incremental cost of HTML features is minimal. 242 Additionally, the phase-in of the

Inline XBRL requirements is expected to partly mitigate the impact on smaller ASCII

filers by giving them more time to adjust.

While we expect that filers will continue to incur ongoing costs of compliance

with the XBRL requirements, 243 we do not expect those ongoing costs to increase

appreciably due to Inline XBRL. For most filers, we anticipate that the transition to

Inline XBRL will, over time, somewhat reduce the ongoing costs of compliance with the

XBRL requirements, as discussed in greater detail in Section V.C below. For purposes of

the PRA, we continue to estimate that the average filer will incur a one-time increase in

in-house personnel time to transition to Inline XBRL and a slight increase in the annual

external cost of XBRL preparation. After the initial transition to Inline XBRL, we

estimate that the average filer will experience a small decrease in the in-house personnel

240

We have identified approximately 0.1% of filings in ASCII format among Forms 6-K filed in

2017. We have not identified filings in ASCII format among Forms 40-F filed in 2017.

241

In 2016, approximately 2.6% of Form N-1A filings, 4.9% of amendments filed under Rule 485(a),

14.1% of amendments filed under Rule 485(b), and 5.5% of filings under Rule 497 were in the

ASCII format, as shown by staff analysis of EDGAR filings.

On October 11, 2017, the Commission proposed amendments that would similarly require funds to

file in HTML format registration statements and reports that include exhibits. See FAST Act

Proposing Release.

242

See Inline XBRL Proposing Release, at 14289.

243

See 2009 Financial Statement Information Adopting Release, at 6800–6802, 6804–6806.

time required to comply with XBRL requirements. 244 While the incremental initial and

ongoing costs of Inline XBRL are not expected to be significant for the average filer,

such costs for individual filers may vary due to filer circumstances, including their

familiarity with Inline XBRL and the XBRL preparation solution used by the filer or its

filing agent.

Further, the European Securities and Markets Authority has recently adopted a

requirement for issuers that are listed on European Union (EU) regulated markets and

that prepare their annual financial reports in accordance with IFRS to use the Inline

XBRL format beginning on January 1, 2020. 245 Under the amendments, FPIs that

prepare their financial statements in accordance with IFRS as issued by the IASB will be

required to comply with the Inline XBRL requirements for financial statements for

periods ending on or after June 15, 2021. Thus, the incremental burden of transition to

Inline XBRL under the amendments for FPIs filing IFRS financial reports with the EU

market regulators is expected to be minimal.

We note that some filers may incur an increased burden if their filings contain a

major technical error in the XBRL data. In particular, currently, when there is a major

technical error in the XBRL data submitted in an exhibit, the EDGAR validation system

causes the exhibit to be removed from the submission, but the submission as a whole is

not suspended. 246 With the Inline XBRL format, the EDGAR validation system will

244

See Section V.C below.

245

See https://www.esma.europa.eu/policy-activities/corporate-disclosure/european-single-electronicformat (retrieved Jun. 20, 2018).

246

During filing and validation, the EDGAR Renderer creates error and warning messages when

issues with the XBRL data are identified. Certain errors will result in the XBRL exhibits being

“stripped” from a filing, although the rest of the filing is accepted in EDGAR.

typically suspend a filing that contains any major technical error in the Interactive Data

File, which will require the filing to be revised before it can be accepted by EDGAR. 247

Based on staff observations, very few XBRL exhibits are removed by the EDGAR

system due to such major technical errors, in part, because filers and filing agents

routinely use tools, including ones that the Commission makes available, to help identify

and correct technical errors prior to EDGAR filing. 248 Because similar validation tools

will be available to Inline XBRL filers, we believe that such suspensions should be rare

for Inline XBRL filers.

The Commission did not propose and is not making changes with respect to

application of officer certifications or auditor assurance requirements to XBRL data. 249

In response to commenters’ suggestions, we are reiterating that the change from the

XBRL format to the Inline XBRL format does not affect our existing positions with

respect to those requirements. Therefore, we do not anticipate changes in audit fees or

other filer costs relative to the baseline stemming from officer certifications or auditor

assurance. One commenter stated that the use of Inline XBRL might result in an increase

in the rate of voluntary use of auditor assurance. 250 While we acknowledge this

247

In some cases, a major technical error in the Interactive Data File would instead cause the XBRL

content to be removed from the submission, but in that case the submission as a whole would not

be suspended.

248

To assist with XBRL filing, the Commission has made available for download certain tools, such

as the Previewer and Interactive Data Test Suite, that filers can use with their own systems to test

XBRL submissions prior to EDGAR filing. See

https://www.sec.gov/structureddata/edgarvalandrender and

https://www.sec.gov/structureddata/interactive-data-test-suite (retrieved Jun. 20, 2018).

249

See note 98 above.

250

See AICPA (stating that “going forward, to provide investors additional confidence in the iXBRL

formatted information, audit committees are likely to request that auditors perform a separate

attestation engagement to provide an opinion on the accuracy and consistency of the XBRL

formatted information, and issue a report . . .”). See also note 100 above and accompanying text.

possibility, we lack the information necessary to quantify the magnitude of such a

potential effect.

Changes to the XBRL format may affect XBRL preparation software vendors and

filing agents, and some of the transition costs incurred by software vendors and filing

agents from Inline XBRL may be passed on to filers. Various commenters stated that the

effect of the amendments on software vendors and filing agents will be small, 251 while

some commenters expressed concern about vendor readiness. 252 As the Commission

stated in the Inline XBRL Proposing Release, we recognize that XBRL preparation

software vendors and filing agents that do not already use Inline XBRL would have to

expend resources to transition to Inline XBRL, including upgrading or replacing software

and training staff. Initially, software vendors and filing agents that cannot readily

implement Inline XBRL, particularly smaller vendors, will be at a competitive

disadvantage. Transition costs could be partly mitigated by the availability of the

royalty-free Inline XBRL specification and transformation registry, which defines how

the values of facts that appear in HTML documents are converted to the required data

types for XBRL. 253 Transition costs may also be lower for software vendors or filing

agents that have experience with Inline XBRL in other jurisdictions. 254

251

See notes 231-236 above and accompanying text.

252

See note 230 above.

253

See note 78 above.

254

For example, Inline XBRL is used in the UK (https://www.gov.uk/government/publications/xbrltagging-when-what-and-how-to-tag); Australia (https://asic.gov.au/about-asic/media-centre/find-amedia-release/2015-releases/15-104mr-asic-introduces-format-for-improved-communication-offinancial-information/); Ireland (https://www.revenue.ie/en/companies-and-charities/submittingfinancial-statements/who-must-submit-financial-statements-in-ixbrl.aspx); South Africa

(https://www.xbrl.org/news/progress-in-the-cipc-implementation-of-xbrl/); Denmark and Japan

(https://www.xbrl.org/the-standard/why/who-else-uses-xbrl/ (retrieved Jun. 20, 2018). Specific

disclosure requirements differ from those in the United States. See also note 245 above.

The phase-in incorporated in the amendments is expected to give software

vendors and filing agents time to develop and update software in ways that minimize

transition costs. It is also possible that the ongoing costs of Inline XBRL preparation

solutions will go down over time, including for filers in later phase-in categories, as

Inline XBRL solutions become more widespread in the XBRL preparation industry.

Data users may incur a cost to modify their XBRL extraction software or

algorithms to accommodate Inline XBRL (e.g., to download files from a different URL,

to use different filenames, or to parse XBRL information from a different file format).

Although we do not have sufficient information to quantify the costs to data users of a

change from the XBRL format to the Inline XBRL format, we believe that such costs are

likely to be minimal because the amendments do not affect the taxonomy or the scope of

the information required to be tagged. Additionally, we have made freely available to the

public the software enabling users to view information about the reported XBRL data

contained in embedded tags and to extract XBRL data, in an effort to facilitate the

creation of cost-effective Inline XBRL viewers and analytical products. 255 For most data

users that previously processed either XBRL instance documents or HTML documents,

the slight increase in processing times due to the potentially larger size of the Inline

XBRL document is unlikely to be a significant limitation in light of the advanced state of

existing computing technology and internet connectivity speeds. Several commenters

255

See https://www.sec.gov/structureddata/edgarvalandrender (retrieved Jun. 20, 2018) and

http://arelle.org/download/ (retrieved Jun. 20, 2018).

stated that they either already have the capability to use Inline XBRL data or that XBRL

data users will incur minimal costs to transition from XBRL to Inline XBRL. 256

b. Timing of Submission of Interactive Data File

The Commission did not propose, and is not adopting, changes to the timing of

the required submission of the financial statement information XBRL data. Thus, no

economic effects are expected relative to the baseline.

The Commission proposed to permit funds to submit Interactive Data Files

concurrently with certain post-effective amendments to registration statements under

Rule 485(b), which was supported by one commenter, 257 with no commenters opposing

the proposed change. As proposed, we are permitting filers to file risk/return summary

information Interactive Data File concurrently with certain post-effective amendments

under Rule 485(b). We continue to believe, as the Commission stated in the Inline

XBRL Proposing Release, that this change may help facilitate efficiencies in the posteffective amendment filing process and result in small savings in compliance costs for

some fund filers, and no commenters disagreed with our analysis.

256

See, e.g., letters from XBRL US (stating that it “held informal discussions with several of these

organizations ranging from startup companies . . . to large established organizations . . .” and that

“[t]hese organizations, which today use XBRL-formatted US corporate data, indicated that

extracting data from Inline XBRL is the same as extracting data from conventional XBRL files.

Several indicated that they have already begun to use Inline XBRL given its availability in other

non-US markets. Of these, the cost to do so was minimal, requiring zero to little change to their

current process.”); TagniFi (stating that it has used XBRL to collect and standardize financial

statement data for more than 6,000 companies representing over 99% of the U.S. market

capitalization, using approximately 140,000 XBRL filings since 2009 and further stating that it has

used Inline XBRL financial data since June 2016); Octachoron (stating that “[t]he technologies we

have developed to build and manipulate individual company information, compare filings across

time and across sectors, and compile market-wide statistical analysis, would in principle be

unaffected by a change to Inline XBRL filing.”); and Morningstar (stating that “[i]n our

experience, it will be a relatively seamless transition from XBRL to Inline XBRL because the

technology is sufficiently developed.”).

257

See note 128 above.

We are eliminating the current 15 business day filing period for the submission of

risk/return summary XBRL data, as proposed. We continue to believe that eliminating

the 15 business day filing period will significantly benefit investors, other market

participants, and other data users by ensuring timely availability of risk/return summary

XBRL information. The more timely availability of risk/return summary XBRL

information is expected to reduce the time that investors, other market participants, and

other data users require to extract risk/return summary information from filings and to

facilitate aggregation, analysis, and comparisons of risk/return summary information

across funds. Eliminating this period will remove the need for manual extraction of this

information from HTML or ASCII files and make important fund fee, return, and risk

information contained in the risk/return summary freely available to investors more

quickly than it is today. As indicated by commenters that supported the proposed change,

XBRL data users currently face a delay in the availability of risk/return summary XBRL

data relative to risk/return summary information filed in HTML, which for some users

has rendered the XBRL data less useful. 258

To the extent that having risk/return summary information available in the XBRL

format in a timely manner enhances the ability of investors, either directly or through

third parties such as data aggregators, to perform aggregation, analysis, and comparison

of information about funds, the amendments may facilitate better informed investment

decisions, increase competition among funds for investor capital, and improve the

efficiency of capital allocation. To the extent that more timely information on fund fees,

returns, and risks becomes available to investors through these tools, fund complexes

258

See notes 130 and 143 above and accompanying and following text.

may benefit as well if greater investor awareness of risk/return information helps funds

attract investors. We understand many fund complexes urge these third parties to provide

fund information and analysis to investors as quickly as possible (and well in advance of

15 business days) for these reasons. We acknowledge that these benefits will be limited,

to the extent that investors currently can efficiently obtain timely information about fund

performance and risks from other sources, such as the Related Official Filing, fund

websites, or third parties. Two commenters stated that tagged risk/return summary

information would not be valuable because the information is historical and is not as

timely as the performance information investors may obtain from other sources. 259

However, to the extent that risk/return summary information in a registration statement is

generally valuable to investors, timely availability of the same information in XBRL

format should enhance its value by enabling more efficient aggregation, analysis, and

comparison of that information across funds and time periods.

As the Commission stated in the Inline XBRL Proposing Release, we recognize

that eliminating the 15-day period will reduce the flexibility with respect to the timing of

preparing and reviewing XBRL data that is presently afforded to fund filers. 260 We also

recognize that most fund filers currently rely on this flexibility to submit XBRL data after

the post-effective amendment or form of prospectus to which it relates and that its

elimination could increase XBRL compliance costs for fund filers and their filing agents

(that may pass these costs on to filers) as they adjust their workflows. Consistent with

this analysis, several commenters noted that funds currently rely on the flexibility

afforded by the XBRL filing period to prepare and review XBRL data and resolve any

259

See letters from Federated II and ICI II.

260

See Inline XBRL Proposing Release, at 14297.

technical issues with XBRL tagging and that the removal of the filing period would cause

funds to incur costs to change current workflows. 261 However, the Inline XBRL format

required under the amendments involves embedding tags into the filing itself, which

reduces the relevance of preserving the 15 business d

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