In a continued effort to educate on the development of XBRL technology in industries such as financial services (and beyond), Merrill Corporation will share articles and columns published on the topic.
For the financial industry, the eccentricities of XBRL are well known. However, as pointed out in this Dodd-Frank.com article, most of those issues are associated with second quarter form 10-Qs. As it turns out, the confusion only increases when it comes to registration statements.
About the only thing that may be perfectly clear is XBRL exhibits are not needed for an initial public offering. Even to arrive at that conclusion requires a tortured reading of Regulation S-K Rule 601(b)(101) and the statement “first is required for a periodic report on Form 10-Q.” Obviously if an issuer is doing an IPO they have never filed a 10-Q.
Confused yet? How about this: according to the written regulations, XBRL is only required for a registration statement that includes a “price or price range.” However, as Jill Radloff points out:
That is almost never the case for a resale registration statement so one may be tempted to conclude XBRL exhibits are not necessary. We believe the SEC takes the opposite position. The reasoning is the securities have already been sold, a price has been determined, and therefore the registration statement must include XBRL exhibits.
Radloff’s article goes into great detail about a number of other tricky steps in this process for both form 10-Qs and form S-1s. We have also described a number of the regulations that must be kept in mind in previous blog posts.
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