The future of SEC filings…

August 19, 2008

At 11 am, SEC Chair Chris Cox plans to announce some big changes and lay out a path for the implementation of XBRL, which today’s Washington Post is describing as “Financial Data on Steroids”. In addition to streaming the press conference here, Cox will be taking questions from ordinary folks via email. (UPDATE: See the press release here and the question that I asked in the comments below)

Anything that makes getting through the filings will be much welcomed. But methinks the excitement might be a bit premature because in the end much of the data is (to put it mildly) pretty disorganized. I was thinking about this in light of this 8K that Meredith Corp. (MDP) filed yesterday setting salaries for next year and bonuses for the past year. On the surface, the filing is pretty routine — the type of thing you might ignore, not to mention basic enough to easily tag — what XBRL is all about.

But once you start digging around, that’s when things start to get a bit more complicated. Take the cash bonuses for last year, which range from $531K for CEO Stephen Lacy to $235K for the President of the company’s Broadcasting Unit. (We’ll ignore for a minute Meredith’s performance during this period and whether cash bonuses are really justified here). Indeed, yesterday’s 8K is pretty similar (except for the bonus amounts) to this 8K that Meredith filed last year that disclosed a $1.5 million bonus for Lacy. Still, as far as XBRL might work, so far, so good because you can easily compare the two data points.

The problem — at least as I see it — comes when you look at Meredith’s proxy for 2007. Not only are the words “cash bonus” never mentioned once in the filing, but the “bonus” column for Lacy in the summary comp table is listed as zero.

Now, granted I’m not an XBRL expert, which is why I’ll be listening in at 11 am (and maybe even asking a question). Still, it seems to me that if you have divergent information in different filings on something as simple as a cash bonus, how will XBRL make it easier to understand information in multiple filings that’s a lot more complicated to understand?

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