Everything you need to know about Inline XBRL (iXBRL)

What is iXBRL tagging?

iXBRL (Inline eXtensible Business Reporting Language) tagging is the process of embedding machine-readable XBRL tags directly inside a human-readable HTML filing. The result is a single document that regulators, investors and analysts can read and analyze, and that you can file with the SEC through EDGAR.

iXBRL (Inline XBRL) is a filing format that merges the aesthetic benefits of a human-readable HTML file with the machine-readable XBRL instance document file. The result is a combined file that is submitted to a regulator — and available to the public through the EDGAR program — that contains both the traditional financial statements and the XBRL tagging information.

XBRL tags are embedded “in line” with the text of the traditional HTML document. In short, iXBRL enables filers to prepare a financial report that looks like a traditional financial statement and is appealing to the eye, but has all of the rich, machine-readable XBRL data embedded under the text. 

If you are a public company filing with the SEC — whether preparing a 10-K, a mutual fund updating a risk/return summary, a closed-end fund or BDC filing annual shareholder reports or a variable contract issuer filing Forms N-3, N-4 or N-6 — iXBRL tagging requirements apply to you. This guide is the consolidated reference for both audiences: what iXBRL tagging is, where it came from, who has to do it and what to look for in an iXBRL tagging platform for SEC filings.

In this guide

• What is Inline XBRL, and how does it work?
• What is the benefit of iXBRL?
• A short history of iXBRL
• iXBRL tagging requirements for public companies (SEC corporate filers)
• iXBRL tagging requirements for mutual funds, BDCs, closed-end funds and variable contracts
• iXBRL tagging compliance dates at a glance
• The iXBRL creation, tagging and filing process
• How do you select XBRL tags?
• Recommendations for meeting iXBRL tagging requirements
• Choosing iXBRL tagging platforms for SEC filings

What is Inline XBRL, and how does it work?

iXBRL is enabled by xHTML (eXtensible HyperText Markup Language), which takes traditional HTML and adds a layer of machine-readable metadata. Most web pages today use xHTML: the HTML layer includes the basic text, colors and images that we see, while the metadata later includes all the information that Google and other search engines use to instantly scan the page, understand its content and rank the page.

iXBRL uses xHTML to place XBRL tags “in line” (in the metadata layer) with the visible text. Like a modern web page, iXBRL provides both human and machine readers with the information they want, all in the same document.

The SEC includes an iXBRL viewer in the EDGAR system, enabling anyone with a recent standard internet browser to view publicly available iXBRL filings right within the EDGAR system. The iXBRL viewer enables human readers to easily navigate, search and filter using the XBRL tags embedded within the document.

XBRL format vs. iXBRL format

Both formats are intended to make data easier to analyze and use. You can add machine-readable XBRL tags to pieces of financial data to classify information according to a standard taxonomy. The iXBRL format allows you to embed those machine-readable XBRL tags into an HTML document, so humans can read it, too.

What is the benefit of iXBRL tagging?

iXBRL builds on the core benefits of XBRL:

• Making financial information machine-readable: XBRL makes it much easier for data analytics tools to consume financial information. XBRL tags essentially function as barcodes for the financial numbers, so that computers and analytics tools can instantly ingest this data for immediate analysis and comparison.
• Making financial information more usable: The reality is that people don’t read financial statements cover-to-cover as often anymore and increasingly use data analytics tools to digest and distill the insights they are looking for. By making financial information more machine-readable, Inline XBRL ultimately makes that information easier for people — investors, analysts, etc. — to consume and use that information.
• Driving consistency in financial reporting: iXBRL filings are required to follow either the US GAAP taxonomy or the IFRS taxonomy. This comprehensive, standards-based tagging helps to drive consistency and enable better comparisons both within and among companies’ financial statements.
• Giving companies greater control of telling their story: Historically, analysts and journalists have served as the interpretive storytellers of companies’ financial information, consuming the full-text statements and providing the public with their interpretations, comparisons and other insights. iXBRL lets companies tell their financial story directly to the public, using consistent tags that enable the audience to directly understand and compare financial information.

Finally, iXBRL takes all those XBRL benefits and wraps them up with the simplicity and efficiency of creating and filing a single document. Previous to Inline XBRL, filers created their traditional PDF or HTML document — and then created a separate XBRL document.

A short history of iXBRL

The story of iXBRL actually goes back to the Great Depression. In response to the stock market crash of 1929, the SEC drafted the Securities Exchange Act of 1934. The act focused on creating greater transparency and accountability by requiring publicly traded companies to make certain financial information publicly available. Today, all that information is digitally available to the public through the EDGAR system.

The eXtensible Business Reporting Language (XBRL) was created in 1998. In 2005, the SEC started accepting voluntary XBRL submissions — and since 2009, the SEC mandated that all periodic and interim financial reporting be submitted using the XBRL format. Beginning in 2018, the SEC began phasing in requirements for filings to be submitted in iXBRL. As of June 15, 2021, all US GAAP and IFRS filers are now required to file both their annual Form 10-K and quarterly Form 10-Qs in iXBRL format.

The EU and other global markets have begun following a similar trajectory toward mandating filing in iXBRL format. The European Standards Market Authority (ESMA) followed with its own European Single Electronic Format (ESEF) mandate for the use of iXBRL and governing bodies in a number of markets worldwide are implementing similar iXBRL requirements.

iXBRL tagging requirements for public companies

If you are a public company — or a private company considering a future IPO, SPAC/de-SPAC transaction or direct listing — iXBRL tagging requirements are already part of your disclosure footprint.

In the U.S., best practice is now to do your iXBRL tagging right alongside the drafting or creation of your financial statements — truly in-line, instead of as a separate post-drafting process. This includes the annual 10-K form, all quarterly 10-Q forms, as well as any interim 8-K forms.

Recommend the digital team refresh this section with a short paragraph covering iXBRL tagging expansions since 2021 — SEC filing fee tables, pay-versus-performance, cybersecurity disclosures — and internal-link to each existing Toppan Merrill post. Leaving a placeholder here rather than writing new compliance copy without SME review.

iXBRL tagging requirements for mutual funds, BDCs, closed-end funds and variable contracts

If you are a financial services provider, a separate but parallel set of iXBRL tagging requirements applies to you.

The deadlines for financial services providers to start filing certain disclosures in Inline XBRL format has been in effect for Large Fund Groups ($1B+ in net assets) since September 17, 2020. For Small Fund Groups, Closed-End Funds (CEFs), Business Development Companies (BDCs), and Variable Life and Annuity contracts, Inline XBRL is quickly approaching.

With large fund groups being the first incorporating iXBRL, what are we learning? In short, be prepared. The U.S. Securities and Exchange Commission (SEC) adopted iXBRL requirements for mutual funds, closed end funds and variable annuity and variable life insurance products, which were long expected. But, that doesn’t make meeting the mandate any less overwhelming—especially for those adding XBRL tags for the first time. Throw in the added curveball of learning new procedures and processes with remote teams, proper preparation and testing of new workflows can get difficult…fast.

Mutual funds, closed end funds and variable annuity and variable life insurance products face different requirements for their iXBRL filing. Below is a recap of iXBRL compliance dates for mutual funds, business development companies, closed end funds and variable annuity and variable life insurance contracts.

Fund Groups (Open-End, ETFs)

The SEC is requiring large fund groups with $1 billion or more in assets to file fund risk/return summary information in iXBRL format for initial registration statements (or an annual update to a registration statement) effective on or after Sept. 17, 2020 – currently in effect.

The deadline is Sept. 17, 2021, for fund groups that fall short of that asset threshold.

By the way…. Prior to the September 21st EDGAR release, redlining was not supported in an iXBRL filing. It’s important to note that the SEC’s September 21st EDGAR release changed how redlining in an EDGAR filed document needs to be created, which can present unique technical challenges. It’s important to test file early and often.

Variable contract products (VA, VUL)

The SEC recently announced its rule to streamline variable annuity and variable life insurance disclosures for new investors. The goal is to make it easier for investors to evaluate which product is best for them.

The rule requires providers to tag disclosures in registration statements or amendments on Forms N-3, N-4, and N-6 forms of prospectuses that include information that varies from your registration statement. (Check out the “filings to be tagged” in the 713-page rule for more details.) Essentially, you’ll be tagging information to help investors more easily compare key benefits or features, fees or costs, principal risks of investing, standard death benefits, other available benefits, investment options, taxes and conflicts of interest.

The compliance deadline is Jan. 1, 2023.

By the way… In order to leverage technology to help investors understand their variable contracts, the final rule includes provisions that are meant to enhance investors’ understanding of special terms when they view the summary prospectus online. Specifically, the rule requires that investors either be able to view the definition of each special term used in an online summary prospectus upon command, or to move directly back and forth between each special term and the corresponding entry in any glossary or list of definitions that the summary prospectus includes. For example, investors could view the definitions of special terms by moving or “hovering” the computer’s pointer or mouse over the term or selecting the term on a mobile device.

Closed-End Funds (CEFs) and BDCs

A separate rule requires business development companies (BDCs) and closed end funds (CEFs) to provide management’s discussion of fund performance (MDFP) in annual shareholder reports starting Aug. 1, 2021. As part of that rule, they also must comply with iXBRL reporting requirements for financial statement data, registration statement information and prospectus information for affected funds that are eligible to file a short-form registration statement, starting Aug. 1, 2022.

iXBRL tagging compliance dates at a glance

The table below captures the core iXBRL tagging requirements pulled directly from both source blogs. Verify against the most recent SEC releases for your specific filer type before publication.

The iXBRL creation, tagging and filing process

In the U.S., best practice is now to do your iXBRL tagging right alongside the drafting or creation of your financial statements — truly in-line, instead of as a separate post-drafting process. This includes the annual 10-K form, all quarterly 10-Q forms, as well as any interim 8-K forms.

How do you select XBRL tags?

There are two main standards, or taxonomies, for XBRL tagging. The US GAAP (Generally Accepted Accounting Principles) taxonomy is used primarily by domestic filers in the U.S., while the IFRS (International Financial Reporting Standards) taxonomy is used by international filers in the U.S., EU and other markets with iXBRL requirements. Both taxonomies serve as widely accepted guides that codify XBRL tagging principles to ensure consistency and accuracy in tagging.

Toppan Merrill is here to help with Bridge, an intuitive SEC reporting platform that provides a single source for your EDGAR and iXBRL submissions.

Recommendations for meeting iXBRL tagging requirements

Companies have been using Toppan Merrill to meet XBRL and iXBRL requirements for years. We’ve found a few strategies to be helpful for meeting deadlines with as little stress as possible.

Based on what we’ve seen, here’s what we recommend:

• Start early on plans for meeting the mandate, so you’re not scrambling before the deadline. Having a buffer should also reduce stress, especially if we run into more unexpected disruptions like natural disasters or another pandemic.
• As you work through vendor decisions, look for end-to-end content management and reporting solutions, so you don’t have to work with multiple vendors. It’s nice to have everything in one place, so you can aggregate data, create reports, collect sign-offs and approvals, add XBRL tags and file in a single platform or application.
• Since 2011, Toppan Merrill has provided an XBRL Dashboard that provides an easy to use and intuitive review portal – allowing filers to review their XBRL tagged content prior to filing by utilizing any or all of the SEC’s rendering models.

Choosing iXBRL tagging platforms for SEC filings

As iXBRL tagging requirements have expanded across both corporate filers and financial services providers, the iXBRL tagging platforms for SEC filings you choose are no longer just a tagging tool — they are an end-to-end disclosure environment for drafting, collaboration, tagging, review and EDGAR filing.

What to look for:

• A single source for EDGAR and iXBRL submissions. Toppan Merrill is here to help with Bridge, an intuitive SEC reporting platform that provides a single source for your EDGAR and iXBRL submissions.
• End-to-end content management and reporting. Look for end-to-end content management and reporting solutions, so you don’t have to work with multiple vendors. It’s nice to have everything in one place, so you can aggregate data, create reports, collect sign-offs and approvals, add XBRL tags and file in a single platform or application.
• A purpose-built review portal. Since 2011, Toppan Merrill has provided an XBRL Dashboard that provides an easy to use and intuitive review portal – allowing filers to review their XBRL tagged content prior to filing by utilizing any or all of the SEC’s rendering models.
• Deep SEC reporting expertise. For 55+ years, the dedicated SEC reporting experts at Toppan Merrill have supported issuers navigating the regulatory disclosure and filing process.

Toppan Merrill is here to help

Visit our SEC reporting page to learn more – or connect with one of our experts at [email protected] or by calling 800.688.4400.

Should you have questions about the 1940 Securities Act and the compliance requirements for investment companies, visit ToppanMerrill.com, connect with us via [email protected] or by phone at 800.688.4400.