This article presents the history of XBRL and the need to address common problems in the area of finance and its mechanism in the process of reporting.

Nowadays, freely available on the net is an electronic language for financial reporting called eXtensible Business Reporting Language (XBRL) [previously called XFRML]. As the name suggests, It is an eXtensible Markup Language (XML)-based framework that provides the financial community with a standards-based method to prepare and publish in a variety of formats, reliably extract and automatically exchange financial statements of publicly held companies and the information they contain. The aim of this language is not to establish new accounting standards but to enhance the usability of the ones that we have through the digital language of business. The identification tags and the language itself are so standardized that financial data from a country that has set accounting standards, such as US GAAP, can be easily compiled into the accepted accounting standards of another country even if they are totally different. Although all companies do not require the reporting of financial data in XBRL, it has been suggested that it won't be long before all companies will have to report their financial data in this language because of its increasing popularity.

Let's take a hypothetical case where we need to run an analysis on the financial statement on a company's website. These statements would simply be in plain text. So, if someone wanted to put these numbers onto a spreadsheet for analysis, it would either have to be manually entered or copied and pasted for each account and corresponding number. On the other hand, if the data was supported by XBRL, one could easily convert this data into XBRL compatible spreadsheet program.

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