XBRL for Mutual Funds: Other FAQs

The calendar on the wall is on its last page. The effective date of the XBRL ruling – requiring all open-end mutual funds to file the Risk/Return Summary section in XBRL format as an exhibit, as well as publish the XBRL files to the fund’s website (when one exists) - is just days away.

We have spent the past several months on this blog answering questions we have received from the financial services community. The SEC recently joined in us in this effort to educate on the topic by XBRL by releasing a new series of FAQs regarding the mandate. The information it contains is a great compliment to some of the topics we have covered. 

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Merrill Corporation is proud to offer XBRL Complete, a suite of services that meets - and has options to exceed – the mandated requirements for XBRL for mutual funds. For more information, please click here or call 866-367-9110.

XBRL for Mutual Funds: Will it be a Happy New Year?

The first of the year is right around the corner, and the number of business days left are quickly dwindling away, which means the effective date of the XBRL ruling – requiring all open-end mutual funds to file the Risk/Return Summary section in XBRL format as an exhibit, as well as publish the XBRL files to the fund’s website (when one exists) - is upon us.

We have given our view of the XBRL language and technology through this blog, but wanted to share a brief (but pithy) article from The Financial Times regarding XBRL and its perception globally. The points that are made are interesting and give further credence for why products that can facilitate the XBRL process are beneficial. 

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Merrill Corporation is proud to offer XBRL Complete, a suite of services that meets - and has options to exceed – the mandated requirements for XBRL for mutual funds. For more information, please click here or call 866-367-9110.

XBRL for Mutual Funds: Are You Ready.....yet

2 1/2 months ago, we asked if you were ready for the XBRL mandate requiring all open-end mutual funds to file the Risk/Return Summary section in XBRL format as an exhibit, as well as publish the XBRL files to the fund’s website (when one exists). Since then, we have been providing a list of FAQ's and technical details regarding what will be needed come January 1, 2011.

With 30 days left, we wanted to republish our thoughts on what needs to be considered when choosing a vendor: 

The core functions that are needed to meet these requirements include: tagging, filing and publishing. This is a simple synopsis of the mandate, and while there are also complex elements to the implementation, when choosing a vendor, there are two basic success factors to be considered:

1. Subject matter experts who are familiar with the ruling and its detailed implications.

• Taxonomy? Element? Dimension? Extension? If these words are not in your vernacular, then an XBRL expert who is focused on U.S. mutual funds (not corporate filings or foreign mutual funds) will be a necessary addition to your team.

2. Systematic process for expeditiously and accurately tagging, filing and publishing your data in XBRL format.

• An automated tagging solution ensures that your data is tagged correctly – the 1st time and every time. In addition, classes are handled with ease in a well-designed tagging platform.
• Once your XBRL-tagged data is ready for filing – it flows seamlessly in our filing engine.
• Afterwards, once the XBRL data is accepted by the SEC, our standard publishing option converts the XBRL data into human-readable, HTML-rendered format. Both the XBRL data as well as the HTML version are published to your fund’s website on the same day that it is filed. The HTML view helps your investors understand the content of the XBRL files.
  

Additionally, because the mandate only requires the XBRL files to be published to your website, few of a fund’s investors will be able to harness the true power of XBRL unless they have access to XBRL-enabled software. An enhanced publishing solution uses the XBRL data within a viewer that allows your investors to compare any combination of your funds – side-by-side – in a matter of seconds. 

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Merrill Corporation is proud to offer XBRL Complete, a suite of services that meets - and has options to exceed – the mandated requirements for XBRL for mutual funds.

For more information, please click here or call 866-367-9110.

XBRL for Mutual Funds: Time to Make a Decision

We are 43 days away from the effective date of the XBRL ruling – requiring all open-end mutual funds to file the Risk/Return Summary section in XBRL format as an exhibit, as well as publish the XBRL files to the fund’s website (when one exists). 

As we have said in all of our XBRL posts over the past several months, the on-boarding process should be started approximately 30-45 days before the beginning of the year in order to understand and get comfortable with the tagging and publishing needs well in advance. Therefore, this is our first post that falls within that window, and based on industry analysis, only about 46% of the market has made a decision on how they will comply with this ruling. Of the 46%, only 5% have decided to handle this work themselves “in-house.” The rest have selected Merrill Corp. or another vendor.

While we have been posting weekly news, information and FAQs on the XBRL mandate, in general, there has been very little mainstream content published on the impending mandate. However, Tom Steiner-Threlkeld recently published a piece entitled, XBRL: To Insource Or To Outsource? which provides an objective perspective on XBRL as it pertains to mutual funds. For this week's post, we wanted to provide a couple excerpts from that piece:

"No matter what, before you decide whether to handle the task in-house or hire a service, get yourself a team that you trust to help make the decision and work through the process."

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"Allow yourself two or three months to get prepared. Give yourself time to evaluate your alternatives, understand the process, establish tags and gather or convert the information from existing sources to get ready to deliver them in the XBRL format to the SEC."

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"In the mutual fund case, the task looks a lot simpler than in making corporate financial statements interactive. There are only 250 reporting elements to deal with in the taxonomy for mutual fund summaries, compared to 17,000 elements in the taxonomy for financial reporting by public companies."

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"The question on insourcing versus outsourcing the tagging, filing and publishing tasks boils down, [said Guy Stanzione, SEC compliance services manager for Merrill Corporation], to whether a company wants to spend the money. The money not just to train staff up front, but to retrain staff as taxonomies change, to add or supplement staff as needed and to keep up to date with all changes made, over time, by the SEC, in its requirements."

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Merrill Corporation is proud to offer XBRL Complete, a suite of services that meets - and has options to exceed – the mandated requirements for XBRL for mutual funds. For more information, please click here or call 866-367-9110.

XBRL for Mutual Funds – Filing and Publishing Considerations (Part 2)

We are 51 days away from the effective date of the XBRL ruling – requiring all open-end mutual funds to file the Risk/Return Summary section in XBRL format as an exhibit, as well as publish the XBRL files to the fund’s website (when one exists).

This week, we will continue our discussion of the functional steps of XBRL by including Part Two of the filing and publishing steps. Remember, until you file or publish your XBRL-tagged data, it does not exist to the SEC. So, this article will focus on these important final steps in the process.

 

As we have mentioned in previous blog posts, the XBRL data is not intended for humans to read. However, because it will be important to share information with your investors, having different publishing options becomes more important.

 

For this reason, the Merrill XBRL Complete product has incorporated into it three different publishing options to fit how you want to publish and share this information with your investors.

• Option 1: A simple publish of the XBRL data to your fund’s website. 

You can stop there as this is the only requirement of the ruling. However, a number of funds are interested in taking extra steps to ensure that their investors understand what is included in the XBRL-tagged file, so that leads us to ...

• Option 2: A simple publish the XBRL-tagged data to your fund's website, as well as an HTML-rendering of that data so your investors can have a human-readable version of only the data included in the XBRL file. 

However, in order to harness the true power of XBRL to the advantage of your investors, we have...

• Option 3: A viewer that is similar to the SEC's Interactive Risk & Return Summary Report Viewer, but with a special twist. Instead of the SEC’s branding at the top of the website, it will contain your logo, branding, colors, etc. In addition, it will be anchored to your fund’s website so that your investors remain within your site (as opposed to navigating away to the SEC or other site). Further, your investors will be able to do side-by-side comparisons of only your funds or compare your funds against the entire universe of funds.

No matter which option you choose, because of the automated, systematic approach we have developed, the XBRL-tagged data will be published within the “same day” that it is filed with the SEC.

As we have said previously, maintaining compliance with respect to XBRL will be one part technology, one part process and one part human expertise. This is why we have developed not only a XBRL-solution based on solid technology and processes, but also the Merrill Compliance Services Team to navigate funds through the compliance waters, from the discovery process through “going live."

As always, our overall message is that the time to prepare is now. Don’t be caught off guard and start the on-boarding process approximately 30-45 days before the beginning of the year. This will allow you to understand your tagging and publishing needs well in advance to make the proper business decision. Being prepared is the key to a successful transition to XBRL.

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Merrill Corporation is proud to offer XBRL Complete, a suite of services that meets - and has options to exceed – the mandated requirements for XBRL for mutual funds. For more information, please click here or call 866-367-9110.

XBRL for Mutual Funds – Filing and Publishing Considerations

We are 59 days away from the effective date of the XBRL ruling – requiring all open-end mutual funds to file the Risk/Return Summary section in XBRL format as an exhibit, as well as publish the XBRL files to the fund’s website (when one exists).

This week, we will continue our discussion of the functional steps of XBRL by covering the filing and publishing steps. With so much focus on the mechanics of 'tagging' the data in XBRL, filing and publishing seem to be after-thoughts when in fact they are where the “rubber meets the road.” Remember, until you file or publish your XBRL-tagged data, it does not exist to the SEC. So, this article will focus on these important final steps in the process.

In the end, the XBRL data needs to be filed and published to your fund’s website on the “same day.” If you have multiple funds filing and publishing on or around the same day, then it will be critical to have a structured, systematic process for both of these steps. A reputable vendor who offers XBRL tagging-filing-publishing services must be structured to scale and support many funds on any given day. When considering a vendor, you should carefully discuss each step in the process as well as the hand-off between each of the steps to ensure that the “same day” aspect of the ruling can be met. Look for manual steps in the process or hand-off as they will slow the process and introduce risk.

For example, at Merrill Corp, we simply modified our existing, time-proven process for filing EDGAR to fit the specific requirements for XBRL.

For publishing, we followed a similar approach as we used for tagging. To ensure that the published data is identical to the filed data – we, again pull it from the SEC. We call the data that is filed, accepted and stored by the SEC  “golden data.” By pulling the golden data, we ensure that any last second changes to the XBRL data that was filed is included in the published data, too.

Now, the Interactive Data ruling requires only the XBRL-tagged data is to be published to the fund’s website. Here’s an example of XBRL-tagged data that your investors would see if they opened up that file:

As you and I know (and we have mentioned in previous blog posts), this data is not intended for humans to read. However, how you plan to convey this information to your investors is important. The XBRL Complete product has responded with three different publishing options to fit how you want to publish and share this information with your investors. We will explain these three options in our next post.

As always, our overall message is that the time to prepare is now. Don’t be caught off guard and start the on-boarding process approximately 30-45 days before the beginning of the year. This will allow you to understand your tagging and publishing needs well in advance to make the proper business decision. Being prepared is the key to a successful transition to XBRL.

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Merrill Corporation is proud to offer XBRL Complete, a suite of services that meets - and has options to exceed – the mandated requirements for XBRL for mutual funds. For more information, please click here or call 866-367-9110.

XBRL for Mutual Funds – Reviewing XBRL-Tagged Data

We are 71 days away from the effective date of the XBRL ruling – requiring all open-end mutual funds to file the Risk/Return Summary section in XBRL format as an exhibit, as well as publish the XBRL files to the fund’s website (when one exists).

This week, we will continue our discussion of the functional steps of XBRL. As we mentioned last week, there are three (3) functional areas impacted by this ruling – tagging, filing and publishing. This week, we will cover some additional steps within the“tagging” phase.

Once you have completed the “on-boarding” process, your teams should have experienced the technology and process that will be used during ‘live’ production and should be comfortable moving forward. Whether you are tagging the data in-house or using an external vendor, it is important to remember that the accuracy of the data and corresponding tags is still yours. Therefore, you should always review the XBRL-tagged data before filing with the SEC and publishing to your fund’s website.

Native XBRL Language

So, the obvious question exists: Because XBRL is not intended to be read by humans (but rather for computers), how does one review the XBRL-tagged data? The answer is by simply letting a computer read it and present it back to you in such a way that you can read it.

As an example, software can isolate the tag and then show you the content that will be included within that tag. For example, the SEC’s “alfalfa” example shows the following tags and corresponding data:

(rr_distributionandservice12b1feesoverassets) 0.28%
(rr_otherexpensesoverassets) 0.13%

By using XBRL software to visually align the tags in a separate column from its respective data, this is one of many ways that a system can organize the XBRL-tagged data in such a way that it is easy for you to read, review and provide feedback. 

What should also be included in the review of the XBRL-tagged data is the method to capture changes, questions, etc. This method should be constructed in such a way to expedite the review, feedback and approval steps, as opposed to a manual review process – which would include routing a file to the appropriate people who need to review and provide feedback. A systematic, controlled approach with built-in flexibility will ensure a complete and accurate review of the XBRL-tagged data.

What a web-based solution should do is act as a “gatekeeper” for compiling all feedback as well as reconciling the differences and making the appropriate changes.

For example, Sara logs into the system at 7 AM and makes three comments and requests one change. At 9 AM, Tom logs into the system. If he had not seen Sara’s comments, then he would have repeated 2 of Sara’s 3 comments and missed the change. Instead, he reviews her feedback and takes no additional action. In the end, the process serves as its own "gatekeeper" as the technology allows each user to see the feedback of others.

Once your team has reviewed and approved the XBRL data, the next steps are filing and publishing, which we will discuss in the next week’s post.

As we have said previously, maintaining compliance with respect to XBRL will be one part technology, one part process and one part human expertise. This is why, at Merrill Corporation, we have developed not only a XBRL-solution based on solid technology and processes, but also the Merrill Compliance Services Team to navigate funds through the compliance waters, from the discovery process through “going live."

As always, our overall message is that the time to prepare is now. Don’t be caught off guard and start the on-boarding process approximately 30-45 days before the beginning of the year. This will allow you to understand your tagging and publishing needs well in advance to make the proper business decision. Being prepared is the key to a successful transition to XBRL.

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Merrill Corporation is proud to offer XBRL Complete, a suite of services that meets - and has options to exceed – the mandated requirements for XBRL for mutual funds. For more information, please click here or call 866-367-9110.

XBRL for Mutual Funds: Best Tagging Solution is Solid Mix of Technology, People and Process

The countdown is now down to 79 days from the effective date of the XBRL ruling – requiring all open-end mutual funds to file the Risk/Return Summary section in XBRL format as an exhibit, as well as publish the XBRL files to the fund’s website (when one exists). To continue our XBRL blog series outlining the different aspects of the mandate, this week, we will move beyond the basics of XBRL and begin our discussion of the functional steps.

There are three functional areas impacted by this ruling:  tagging, filing and publishing. In this edition, we will focus on the implementation or “on-boarding” process to setup your funds leading up to the tagging process.

Like the title of this post says, the key to a successful tagging solution involves a solid mix of technology, people and process. In the end, your solution will only be as strong as its weakest link. For example, if you have the best people using shoddy technology surrounded by a weak process, then the time and effort to produce accurately tagged XBRL data will become increasingly difficult, if not impossible.

A solid technology solution will utilize a systematic, controlled approach with flexibility. With a systematic approach, you can tag your funds utilizing a “one-to-many” method for those funds that have similar information and tagging structure, versus tagging each fund independently.

As a direct result of the Summary Prospectus ruling that went into effect in January 2010, the Risk/Return Summary section has six (6) standard sections that are expected to be presented in a prescribed order. Because there is a known, expected set of information in the Risk/Return Summary section, the taxonomy (dictionary) or elements (tags) is a concise set of tags – enabling technology-enabled solutions built to support it. However, because there will be occasions when tags will need to be customized, it will be important for your technology to also be flexible. An audit trail to track any changes including who, when and why a tag was changed will be important. By using the appropriate technology, you can be assured that your tags are correct the first time and every time.

Once you have the right technology to tag your funds, you need to make sure that the people running it understand the ruling, the technology itself and everything about the taxonomy and selection of the appropriate tags. Subject matter experts will be an integral component in the process.

Lastly, tying it all together will be the process that surrounds the technology and is used by the subject matter experts to tag your funds’ data in XBRL. If the process is precise, then the three parts should integrate seamlessly.

It’s a good idea to be begin the on-boarding process approximately 30-45 days prior to the “go-live” date of your first funds impacted by the January 1, 2011 XBRL ruling adoption date. Fund complexes and fund administrators are preparing now since they have larger numbers of funds and want to be ready in advance of the approaching holiday season at the end of the year.

Merrill has developed a synergistic mix of technology, people and process as part of our Merrill XBRL Complete solution. We ensure that the overlapping content from your EDGAR filing to your XBRL filing match by retrieving data directly from the SEC. So, we begin with “golden data” as it is data that has been filed and accepted by the SEC. From there, our technology has a solid audit trial to track who made each and every change to the tags, when and why. Additionally, our Merrill Compliance Services Team expert team understands the details and nuances of the ruling, as well as the taxonomy and application of it, so if questions or concerns arise, we have the knowledge on how to address them (which includes having a direct line of contact with the SEC if the question is not clarified by the ruling itself). This workflow represents the basics of our process in preparation for the mandate.

In other words, we are ready for your funds today.

Our overall message is that the time to prepare is now. Understand your tagging and publishing needs well in advance to make the proper business decision because being prepared is the key to a successful transition to XBRL. Maintaining compliance with respect to XBRL will be one part technology, one part people and one part process. This means that selecting a partner for this endeavor will necessitate finding the ideal match that encompasses all of these components. For this reason, Merrill Corporation spent time not only developing a XBRL solution based on solid technology, but also a team of experts and processes to navigate funds through the compliance waters, from discovery through “going live."

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Merrill Corporation is proud to offer XBRL Complete, a suite of services that meets - and has options to exceed – the mandated requirements for XBRL for mutual funds.

For more information, please click here or call 866-367-9110.

XBRL for Mutual Funds – To File or Not to File XBRL? That is the Question.

We are 92 days away from the effective date of the XBRL ruling requiring all open-end mutual funds to file the Risk/Return Summary section in XBRL format as an exhibit, as well as publish the XBRL files to the fund’s website (when one exists).

To date, we have received tremendous feedback on our XBRL blog series outlining the different aspects of the mandate. This week, we will continue our Frequently Asked Questions series. In conjunction with the announcement of the Merrill XBRL Complete solution, we are going to delve a little deeper into specifics of the XBRL mandate of which our clients have inquired:

Q: This whole XBRL thing is confusing to me. How do I know when I have to file XBRL or when I don’t? Do supplements need to file?

A: What everyone should know is that after January 1, 2011, any updates to the Risk/Return Summary Prospectus will need to file with the SEC and publish to the fund’s website in XBRL format including the following:

1. The initial effectiveness of any new fund filed as a Pre-Effective Amendment to the N-1A;
2. The annual update of previously effective funds filed as a Post-Effective Amendment to the N-1A, pursuant to Rule 485(b);
3. Definitive materials, after going effective, and filed within five days of effectiveness, pursuant to Rule 497(c);
4. Supplements (stickers) filed throughout the year, pursuant to Rule 497.

XBRL can file simultaneously with the “traditional” EDGAR materials, or within fifteen business days of the filing. Post-EDGAR (within fifteen business days) allows you to catch your breath after meeting your effectiveness compliance deadline before focusing on the XBRL filing.

In addition to the filing XBRL with the SEC, the XBRL files must also be posted to the fund website and must remain accessible for the entire period of effectiveness of the fund – that is until the next annual update.

Q: How will I do this? How can I stay compliant?

A: Maintaining compliance with respect to XBRL will be one part technology, one part process and one part human expertise. This means that selecting a partner for this endeavor will necessitate finding the ideal match that encompasses all of these components. This is why, at Merrill Corporation, we not only developed a XBRL solution based on solid technology and processes, but also the Merrill Compliance Services Team to navigate funds through the compliance waters - from discovery process to "going live."

Our overall message is that the time to prepare is now. Don't be caught off guard. Understand your tagging and publishing needs well in advance to make the proper business decision. Being prepared is the key to a successful transition to XBRL.

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Merrill Corporation is proud to offer XBRL Complete, a suite of services that meets - and has options to exceed – the mandated requirements for XBRL for mutual funds.

For more information, please click here or call 866-367-9110.

XBRL for Mutual Funds: When the requirement hits will I be ready?

To date our blog series on XBRL for Mutual Funds has covered the background of the XBRL mandate requiring all open-end mutual funds to file the Risk/Return Summary section in XBRL format as an exhibit, as well as publishing the XBRL files to the fund’s website when one exists. Additionally, we have also presented a solution created by industry experts to allow for funds to have a smooth transition. 

The third function of this blog series is to address FAQs. At Merrill Corporation, because of our expertise on the subject, we have been working with our clients on both a broad overview and specifics as it relates to XBRL. To assist others that may have similar inquiries, here are responses to a few of the questions we have been asked: 

Q: What does this all mean to me?  
A: All open-end mutual funds will need to file interactive tagged data (XBRL) of their Risk/Return Summary section during the Prospectus’ annual update or any time a change is made through the year that impacts the Risk/Return Summary. 

Q: When do I “go live”?  
A: Based on the fund’s fiscal year end, the requirement could impact you as early as late-January/mid-February 2011. The September 30th funds will be the first impacted. 

Q: When do I need to start preparing?  
A: As of today, there are 101 total days remaining until this ruling goes into effect. Weekends, the upcoming holidays and vacation schedules push that number even lower. Most fund complexes want to have their funds on-boarded at least 30-45 days in advance of the associated EDGAR filings. For those companies who have funds that will file/publish XBRL in January and/or February, they will want to be “ready” by the end of the fall. 

Q: What will I need to do? 
A: Now is the time to review and select an appropriate vendorto manage the tagging, filing and publishing of your funds. Fund complexes holding approximately 18% of the funds on the market have already selected a vendor and are in the process of on-boarding their funds today. On-boarding your funds in advance will not only ensure that your technology is ready to go, but it is also a great opportunity for your teams to learn and put into practice their roles and responsibilities with the process. The end goal should be “no surprises.” 

Our information and ability to answer these questions comes from our research and development of Merrill XBRL Complete, a robust, end-to-end service offering that produces accurate and reliable tagged through a cost effective and efficient process. Additionally, the Merrill Compliance Services Team has the ability to navigate the compliance waters, guiding those in need through the discovery process, on-boarding/implementation, “going live” and periodic updates.  

Our overall message is that the time to prepare is now. Don’t be caught off guard. Understand your tagging and publishing needs well in advance to make the proper business decision. Being prepared is the key to a successful transition to XBRL.

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Merrill Corporation is proud to offer XBRL Complete, a suite of services that meets - and has options to exceed – the mandated requirements for XBRL for mutual funds.

For more information, please click here or call 866-367-9110.

XBRL for Mutual Funds: Are you ready?

For the past several weeks, this blog has been covering some of the key components of XBRL as it pertains to open-end mutual funds, specifically the requirement to translate the Risk/Return Summary section into XBRL format, as well as to publish the XBRL files to a fund’s website, when one exists.

Merrill Corporation announced its answer to the XBRL question last week – XBRL Complete. This solution provides open-end mutual funds with a robust, end-to-end service offering that produces accurate and reliable data in XBRL format through a cost effective and efficient process.

As we know, starting January 1, 2011, all open-end mutual funds are required to file the Risk/Return Summary section in XBRL format as an exhibit. In addition, the XBRL files must be published to the fund’s website, when one exists. The core functions that are needed to meet these requirements include: tagging, filing and publishing.

This is a simple synopsis of the mandate, and while there are also complex elements to the implementation, when choosing a vendor, there are two basic success factors to be considered:

1. Subject matter experts who are familiar with the ruling and its detailed implications.

• Taxonomy? Element? Dimension? Extension? If these words are not in your vernacular, then an XBRL expert who is focused on U.S. mutual funds (not corporate filings or foreign mutual funds) will be a necessary addition to your team.

2. Systematic process for expeditiously and accurately tagging, filing and publishing your data in XBRL format.

• An automated tagging solution ensures that your data is tagged correctly – the 1st time and every time. In addition, classes are handled with ease in a well-designed tagging platform.
• Once your XBRL-tagged data is ready for filing – it flows seamlessly in our filing engine.
• Afterwards, once the XBRL data is accepted by the SEC, our standard publishing option converts the XBRL data into human-readable, HTML-rendered format. Both the XBRL data as well as the HTML version are published to your fund’s website on the same day that it is filed. The HTML view helps your investors understand the content of the XBRL files.
  

Additionally, because the mandate only requires the XBRL files to be published to your website, few of a fund’s investors will be able to harness the true power of XBRL unless they have access to XBRL-enabled software. An enhanced publishing solution uses the XBRL data within a viewer that allows your investors to compare any combination of your funds – side-by-side – in a matter of seconds.

As of the posting of this blog, there are 108 days remaining until the mandate goes into effect. Are you ready? Over the next several weeks, we will continue to answer some of the critical questions regarding the mandate and solutions that demonstrate how ready you need to be.

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Merrill Corporation is proud to offer XBRL Complete, a suite of services that meets - and has options to exceed – the mandated requirements for XBRL for mutual funds.

For more information, please click here or call 866-367-9110.

XBRL Risk / Return Summary Section

As a comparison for what will be required content for the XBRL Risk / Return Summary Section for the XBRL mandate for mutual funds, here is a chart contrasting it to what is required for the Statutory Prospectus Summary Section:

	Statutory Prospectus Summary Section must include:	Risk/Return Summary Section tagging must include:
Investment objectives	X	X
Costs	X	X
Principal investment strategies, risks and performance	X	X
Investment advisers and portfolio managers	X
Purchase, sale and tax information	X
Financial intermediary compensation	X
Performance availability phone number and website address must be included in tagging		X

XBRL: Mutual Funds vs. Public Companies

As an organization that is on the forefront of the XBRL mandate and transition, one question we have been asked is exactly what the differences are between the new rules for mutual funds vs. the current rules for public companies. As a quick synopsis and tutorial, we have provided this basic chart which we will be going into more detail on in the upcoming weeks:

Mutual Funds	Public Companies
No Phase-In	Phased-In across Years by Size
Only Risk/Return Summary section of prospectus	Four (4) Financial Statements, Footnotes
400 elements in the taxonomy	17,000 elements in the taxonomy – “fineness”
Concise set of tags for selection within taxonomy	Granular review & analysis for selection of appropriate tag

What Precious Metal is YOUR Data?

Gold standard...Golden idea...Golden ticket.

Despite what the market says on any given day, verbally, gold is the entity that is most closely associated with those things being of the highest quality.

This is why, in the world of financial services companies, data that is this stored in the Security and Exchange Commission's EDGAR database is considered the "golden" data set because it is pure with 0% chance of content changes.

As the entire industry continues to move towards XBRL for electronic communication of financial and business data, the idea of this "golden" data set becomes more important. A company that is choosing a vendor to work with on their XBRL transition should be asking how and from where their data is being drawn to be tagged. The more moves it makes from non-EDGAR sources (through content management software, composition systems, etc.), the greater the chances that edits could be made to the information at some point during the workflow, and when working with XBRL, the most up-to-date version of the content has to be used.

So, while chromium, strontium and osmium are all fine elements on the periodic table, it is their fellow metal gold that needs to be the word to describe the data from your company that is utilized in the XBRL process.

Let the Good Times Roll with XBRL

With the XBRL implementation clock still running towards January 2011, we at Merrill Corp. continue to prepare for the pending mandate. We will have some important announcements on this topic in the near future, but in the meantime, lets revisit the basics of XBRL with a blog I put together earlier this year:

“Tony, I need 400 words on XBRL. Make it funny, whimsical and entertaining.”

Sure. Right after I put the finishing touches on my new sci-fi / romantic comedy / musical sensation, “Roland the Headless Thompson Gunner on Holiday in Cambodia” (you’ll laugh and cry, and that’s just when you buy the tickets).

Something must be up with this thing, though, because it has gotten to the point where random people have been stopping me in the streets lately and asking, “Tony, what exactly is XBRL and what does it mean to me?” Why just yesterday, a beautiful woman with flowing brunette locks approached me. Before she could get a word out, I said, “Yes, yes. eXtensible Business Reporting Language. I know, this thing is really gaining momentum!” She looked at me and asked in broken English, “Is this…how you say…Empire State Building?” Clearly she was impressed.

Truth be told, my knowledge on this subject matter is limited, but because the XBRL train is leaving the station, I decided to hop an Amtrak train that was leaving the station and head someplace where no good New Yorker should ever go: Boston.

Deep in Red Sox Nation is where I summon a Goliath of information named David Comeau, whose knowledge of XBRL is rivaled only by his utter disdain for the Yankees and Manhattan Clam Chowder (“a made-up soup,” is what he claims).

I open the conversation with some friendly banter. “So how ‘bout those Mets?”

Dave grimaces. It’s a fingernails screeching across a chalkboard moment. He responds with a deadpan, “I know you didn’t come up here to talk about lousy New York baseball. What’s really on your mind, Anzivino?”

“Dave," I say, “I know about a lot of stuff, but XBRL is not one of them. Can you give me a synopsis on what this is and why it is such a hot topic?”

“An uncharacteristically excellent question,” Dave retorts while clearly mispronouncing every letter “R” with Beantown flair. “XBRL, as you know, is an acronym for eXtensible Business Reporting Language. It’s Interactive Data. In short, XBRL is going to help investors match risk and return information. It will give people the opportunity to compare two or more funds, side-by-side, and get an apples-to-apples snapshot on performance in an easy to read form. It will also help companies prepare the data more quickly and accurately. Most importantly, it has been mandated by the SEC for January 2011.”

“Ah, I’m starting to see the light here, David.” I say, jumping on a follow-up question. “But what will Shareholder Communications firms like Merrill bring to the party?”

“It’s all in the 'tagging.'” Dave confidently confides. “Data becomes interactive when it’s labeled using computer markup language. The markup languages use standard sets of definitions - or taxonomies - to enable the automatic extraction and exchange of data. Merrill provides the experience and knowledge of tagging and filing in XBRL that will be quite helpful to our clients with this new rule.”

As I nod my head and start to truly believe New Yorkers and Bostonians might be able to agree on something, David ruins it by saying, “it is, what we call up here, ‘wicked-cool.’”

I walked away from my conversation with David with a much better understanding of XBRL and the belief that it is a topic that will be discussed a great deal leading up to the January 2011 mandate.

I know now that XBRL is very real and here to stay…not unlike this delicious bowl of Manhattan clam chowder (sorry Dave).

You Want It........When?

Honest question, honest answer.

When’s the last time you requested rush proofs on a project for 8:00 am the following morning…but didn’t actually use them until 3:00 that afternoon?

Ah, don’t feel bad, it happens to the best of us. You meant well. Chances are, you arrived at your office with every intention of reviewing them immediately....but then the phone started ringing on two lines, your email was slapping you silly, Chatty Cathy in the next cube was asking your opinion on the best soy latte, and your Blackberry was blowing up like Mount Kilimanjaro.

The relationships between a client and marketing communications provider can become strained under these tight deadline scenarios. So, in an attempt to bring the two factions closer together, I am going to act as a liaison by divulging some industry secrets that most communications companies probably don’t want their clients to know.

Lets start with composition or EDGAR work. If you’re doing a project or series of projects, there are of course times when you need things yesterday. However, if your company needs everything immediately, there may be a kink in the workflow process because even the critical path should allow for some slack. More importantly, by allowing more time to turn the proofs back to you, there is significant cost savings to be had. How much? Well, a company that is able to give 15 hours notice as opposed to 8 hours can save between 20%-40% on composition costs (please read the sentence again to make sure that sinks in). In today’s world, a reduction like that would be beyond welcome. Work with your dedicated Customer Service Representative to figure out how best to save some reporting expense and chances are your Boss will think you rule (he or she might even say “You rule.”)

In a different but related world, printing projects can work in much the same way. Maybe you don’t need those copies going to your Fulfillment house in 48 hours. If so, another 24 hours or more could show you some significant savings. Again, work directly with your Account Executive, your Dedicated Customer Service Representative or your Business Solutions oriented Sales Professional to take full advantage of savings.

And lastly, communication companies that handle a lot of Compliance work will most likely have some peak months and some months where things are not quite as hectic. If you have the luxury of strategically planning your printing needs, you could save a bundle on the off-months.

What this comes down to is if a company and the marketing vendor view their relationship as a respected partnership by compromising on schedules and costs, there will be benefits on all ends, and who knows, it may get you a new office far away from Chatty Cathy.

Integrated Solutions: More than just Par for the Course

This week, the world's best golfers are in Scotland to play in the British Open, one of the most prestigious tournaments in the sport. Watching this tournament at the same time as writing this blog post, I can't help make a comparison on what I was hoping to discuss today with what these athletes are going through, which is creating a customized, integrated solution to generate the best results.

At the Old Course at St. Andrews, these golfers have to put their whole game together. Because of all the variables that come with playing this course, tee shots have to be accurate, approach shots have to be planned well and short games have to be thought through appropriately. Additionally, you have to have both a short-term strategy (playing well hole-to-hole) and long-term strategy (playing well over four days), plus keep sight of your competitors.

For the world that I work in and the clients I work with, these broad concepts are very similar, especially when it comes to a communications plan. To be successful, an organization needs to find a proven, seasoned, thought-leader in the communications world who you can trust to make it all come together seamlessly. With that in mind, I like to think of myself as one of the premier "caddies" in the industry.

Now, some organizations claim to offer a fully integrated solution, but here are a few examples what helps us "make the cut":

• Single Source Composition: Typeset and EDGAR. Make a change to one file and it is automatically made to the other. Error-free, consistent, no muss, no fuss.
• Language and Format Translation: It’s deeper than dialects; it’s being an expert in the financial lexicon of a particular region.
• Industry Leading Financial and Commercial Printing: Traditional Web, Sheet-Fed or new-age, high-quality Digital. Flexibility to determine what avenue suits your project and budget best.
• World Class Fulfillment Services: Delivering speed, accuracy and reporting for your Enrollment Books, Complex Kitting, Collation, Binding and Shipping every time.
• Prospectus Complete: You know this Summary Prospectus thing is a pain in the neck. Merrill Prospectus Complete does what the others won’t…with ease, 100% compliance and cost effectiveness.
• N-SAR Manager: The devil’s in the details on these. Finally there’s a collaborative tool that gives the client control, ease of use and push-button SEC filings.
• MerrillConnect: Connect the entire sales cycle, automate repetitive processes, generate concise reporting, secure online order entry and empower you to manage sales, marketing and inventory…like it was your job.
• Data Publishing Architecture (DPA): Makes child’s play out of composing your Fact Sheets, Performance Reports and Pitch Books.
  

These are just a few examples of the clubs in our bag. To learn more, contact me at tony.anzivino@merrillcorp.com
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Tony Anzivino hails from the greatly misunderstood state of New Jersey. He's worked in Financial Shareholder Communications world from the age of 12, starting with Janitorial duties at his Father's firm. He likes biking, hiking and ketchup.

Guest Blogger: The Fine Art of Fine Art Engraving

Usually on this blog, I am Tony Anzivino: Marketing Communications Specialist in the Financial Services Industry. However, today, I am putting on the hat of Tony Anzivino: Supportive and Proud Colleague.

I had a post ready to go this week, but when I found out that my coworker, Elizabeth Pfeiffer, a member of the Fine Arts Engraving division at Merrill Corporation, was the recent recipient of an award at the International Engraved Graphics Association (IEGA) Annual Conference, I thought to myself, "that is one more award than I have won this week. Maybe she is more deserving of a post than I am."

Seriously though, this is a tremendous achievement and she has offered to discuss the process for putting together an award-winning document of this sort. I will be back after the holiday and throughout the rest of the summer, but for this week, Elizabeth, the blog is yours....


The Fine Art of Fine Art Engraving


Whenever someone hands me a business card, I instinctively run my hand over it, look on the back, rip the paper a little bit, and then finally look at the words. This process takes me about ten seconds, and by the end of that time, people tend to look at me like I am nuts. That’s when I have to fess up –

Yes, I work for an engraving company.

Engraving is the process of stamping ink onto paper with copper dies on presses that use two tons of pressure per square inch. (Yes, that is my canned speech and I’m sticking with it). The mark of true engraving is a beauty mark on the back, the raised print on the front, and finally, the fine quality paper that can withstand the process and make the design pop. Nothing makes a design more memorable than by engraving it.

Now, I am not a graphic designer. I am actually an English major. But there is something about the marrying of words with the printed art that sets my heart a twitter. Especially when the print is raised and I can not only see the words, but feel them. Engraving is an art, with the basic components being the ink that is chosen, the paper, and the design:

Ink 101: Engraving lays down the ink one color at a time. Each color has its own plate so the number of colors that you use will dictate how many times the paper will be stamped. As you can imagine, four colors can be done, but six or seven times through the press and the paper will be compromised. Engraving inks are also water-soluble, so they are 100% recyclable and drying time is less than a minute.

Paper 101: 20 lb copier paper just isn’t going to cut it. Because of the pressure that the presses use on paper, only the finest, highest quality paper can withstand the process. Engraving works best on uncoated woven, smooth, vellum, linen, textured, and metallic stocks. Coatings that are typically used for the lithography process will compromise the lay of the ink on the paper and are typically never used. When designing for an engraved piece, it is always best to consult with your engraving specialist for best choice with paper selection so that they can marry it to your design.

Design 101: I could write a book about how to design for engraving, but for now, I will just highlight some basic tips:

• The beauty of engraving inks is that they are very opaque, which means that white ink will print crisply and clearly over darkly colored stocks. So, designers are not limited on their selection of inks or colors.
• Many designs may call for gold or metallic inks to be used in the design. On the correct stock, these inks pop off the paper. However, metallic inks due tend to clump together or mottle when a large area is inked and will have to be screened to prevent this.
• Engraving uses Pantone colors and due to the nature of the ink, can match any branded or special color. That means that any four color process design can easily be matched on press once converted to the proper format.
• Engraving is best known for its ability to replicate fine details and is still used today for banknotes as a security measure because the ability to duplicate is nearly impossible. It is because of these fine details that many designs choose engraving over traditional printing methods.
• Engraving can incorporate the use of screens to produce gradients on press. The lowest that engraving can go is a 65% screen and retain the original integrity of the design.
  

While these are the basic ingredients for engraving, there is an extra variable, which is the willingness to consistently strive to get better. To me, it is a refined and highly skilled craft, and over the past four years, as I have graduated from flinching every time I heard the loud noises of the presses at work, to unconsciously walking in a rhythmic “cla-clank” step with it, I have worked hard to improve and evolve in this craft. Being honored with a Best of Show award at this year's International Engravers Graphics Association (IEGA) means all that all that work has been worth it.

Not bad for an English Major who flicks cards, huh?

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Elizabeth Pfeiffer is a Sales Support Specialist at Fine Arts Engraving, a Merrill Communications LLC company. She has been with the company for four years and started her career in the print industry with flexographic printing. She moved to Chicago and began her career at Fine Arts as a Customer Service Representative, Project Manager, and Sales Support Specialist. She can be reached at 630-920-9303 x 355 to discuss any engraving print projects or to assist with design tips for engraving.

Fund Management & Social Media: Paving the Unfinished Path – Part 2

Last week, I discussed some of the reasons why I had started using social media as a tool to share information and expand my status in the financial services marketing communication industry. This week, I wanted to talk about how I did it because my leap into this world wasn’t done on a whim. Successes and failures have already occurred in the short life span of the social media realm (think of where MySpace was just a few years ago), and so I knew that I needed to do my homework before taking the plunge.

Throughout my career, I have seen marketing tools come and go, and while I do believe that social media is beyond just a fad, making the assumption that this medium will continue in its current form is a bit narrow in consideration. So, i needed to find professionals to help.

In my research, I quickly discovered that the means in finding social media consultants is different than typical vendor searches because one of the most basic criteria - "experience" - is hard to quantify, and this is where many organizations can go wrong. No one can truly claim to have a decade of experience in the medium (yet). So, should an organization find someone that uses social channels 12 hours a day for personal or recreational use? Or a programmer that has learned to develop applications specifically for these sites?

In short, the answer is no.

In my mind, what organizations should be looking for when delving into social media are people that have had experience in a number of other communications niches (public relations, lobbying, advertising, etc.) and therefore have the knowledge on how social media channels can be utilized, in conjunction with other communications techniques.

In the financial services industry specifically, this is even more necessary because there is an utter lack of solid research available on social media (especially as it pertains to the 40 Act world). So, I reached out to a colleague named Paul Stamler. Paul cut his teeth at BEA Associates, Credit Suisse Asset Management and Bank of America, specializing in Fund Administration, Compliance and Distribution. These days Paul has aligned himself with a social media boutique agency called Make Me Social and is heading up a new endeavor to aid the fund management industry through social media. With this being such a hot topic, Paul’s been busy speaking with many fund groups who want to get involved, but I did manage to persuade him to share some insight with me:

Regarding FINRA:

“Look, the regulations surrounding investor communications have been in place since investors and fund companies exchanged letters through postal mail. Since then, we’ve graduated to fax machines, call centers, web sites, email and now real-time social media. To my thinking, the only difference between all those forms of communication is the speed with which they occur. So yes, there are compliance implications for social media in the fund industry, but they are being addressed in the context of existing compliance procedures. The solution will come from using the one thing that created the speed in the first place…technology.”

Regarding Internal Resources:

“Launching any social media strategy for business will require the input and leadership of Marketing, Compliance, Legal, IT and Sales teams who are currently interfacing directly with customers. Like any good business growth plan, it needs to be focused on the customer and on enhancing existing relationships that will hopefully lead to new ones.

Regarding External Services Providers / Consultants:

“There are a growing number of folks out there who claim to be experts in the area of social media strategy, but very few who can address all of the marketing, compliance and technology issues under one roof. This is the expertise that Make Me Social offers to any organization looking to expand their outreach through the use of social media.

So, to recap, social media marketing - in some form - looks like it’s here to stay, and I intend on using it as much as possible. For those organizations that agree with me, they should remember these suggestions:

1. Discussions are best started internally with a group where minds from Marketing, Compliance, IT and Sales are represented.

2. In a world of supposed experts in a field, partner with a social media firm that specializes and has knowledge and experience in the 40 Act world.

3. Lastly, one of the benefits of the internet, blogs and social media is the ability to distribute information directly to the public in relative freedom. But that doesn't mean there aren't rules, that if not followed, will frame your organization in a poor light. So, be factual and interesting (and yes, even controversial), but do it respectfully.

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Tony Anzivino hails from the greatly misunderstood state of New Jersey. He's worked in Financial Shareholder Communications world from the age of 12, starting with Janitorial duties at his Father's firm. He likes biking, hiking and ketchup.