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Tag Archive: Securities and Exchange Commission (SEC)

SEC Poised to Improve Political Spending Transparency

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SEC-shieldThe government shutdown. Single digit congressional approval ratings. Polarization and dysfunction. Not all that ails our democracy can be blamed on the Supreme Court decision in the Citizens United case, but $1.2 billion in spending by outside groups—at least $300 million of that from undisclosed donors—doesn’t help create a working democracy. There is no shortage of possible solutions—from fixing a broken FEC and changing IRS rules, to public funding of elections and a Constitutional amendment overturning Citizens United, but in the short term, the most necessary and promising solutions come in the form of more transparency of money in politics. And it just so happens that there is some traction developing for one transparency measure.

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OpenGov Voices: PySEC, bringing corporate financial data to the masses

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Disclaimer: The opinions expressed by the guest blogger and those providing comments are theirs alone andLuke Rosiak do not reflect the opinions of the Sunlight Foundation or any employee thereof. Sunlight Foundation is not responsible for the accuracy of any of the information within the guest blog.

Luke Rosiak is a former Sunlight Foundation reporter and database analyst who now writes for the Washington Examiner. This post addresses the tooling around Extensible Business Reporting Language and provides recommendations on what needs to be done. You can reach Luke on Twitter at @lukerosiak.

In the early 1990s, long before most federal agencies had embraced the digital era, the Securities and Exchange Commission (SEC) undertook a truly “big data” initiative that showcased some of the best that open data had to offer: Its quarterly reports were uploaded in real time, in text, rather than PDF, format, to a public FTP server called EDGAR. (File Transfer Protocol or FTP is a standard network protocol used to copy a file from one host to another over a network.)

Like with the Federal Election Commission, the companies submitted their own reports, but they immediately entered the public record, and it was the government who required the submissions, dictated the forms and made them available.

EDGAR, which was implemented in part by Sunlight Foundation supporter Carl Malamud, revolutionized a massive industry of financial watchers who used the reports to decide what companies to invest in--and which to dump. Firms like Bloomberg and Reuters processed the text files into structured data, and analysts pored over them.

washington times imageAnd before long, the SEC was pushing the ball even further, with talk of XBRL or Extensible Business Reporting Language. After all, financial information was almost entirely numbers-based, lending itself to computer analysis, and was fairly structured, with accountants all using a core of the same carefully-defined terms--though Wall Street accounting is too complex to fit in simple columns and rows, necessitating nested structures and the ability to dynamically define new terms.

The X in XBRL was a double-edged sword there. XBRL’s power, advocates said, was derived from its flexibility. It was a unified language that could express financial ideas whether the company was trading goats in Ethiopia or derivatives in Manhattan. To provide that kind of flexibility, it allowed accountants to define their own terms in financial documents, extending from a base of agreed-upon terms, in America called the US-GAAP.

But the US-GAAP itself had thousands of terms, and accountants who were accustomed to filing paper reports never bothered to learn its structure. Lazy filers created their own custom terms when buried somewhere in the GAAP, there was already a universal term that meant the same thing. That defeated the purpose of structured reporting, because it made comparing across companies impossible.

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