(The article featured below is a selection from SEC Today, which is available to subscribers of that publication.)

Commenters Offer Differing Views on Timing and Benefits of Interactive Data Proposal

United States Steel Corp. believes that the SEC is underestimating the complexity and cost of providing interactive data, and might be overestimating its benefit to investors, particularly individual investors. The company submitted its views in a comment letter on the Commission's proposal to require companies to file their financial statements in interactive data format using XBRL. The comment period on the proposal closes August 1.

National City Corp. supports the interactive data initiative, but said that from a preparer's standpoint, interactive data will not result in efficiencies or cost reductions in its reporting process. The company plans to perform the tagging internally, and the proposed disclosures will create an incremental step in its filing process, the company wrote.

U.S. Steel said that it will be necessary for companies to continue to provide traditional financial statements in addition to interactive data. Interactive data is only one part of investment analysis, and many material facts are not quantifiable in that format, the company wrote. The company does not believe the majority of users of financial statements, especially individual investors, will embrace the use of interactive data immediately.

United Technologies Corp. ("UTC"), which has participated in the SEC's voluntary interactive data filing program for more than three years, acknowledged that there is a natural resistance in the marketplace to the switch to interactive data because of cost, resource limitations and conflicting priorities. As a result, UTC believes the Commission must mandate the use of XBRL if it wants it to become widely employed. There are no obstacles to the rapid implementation of interactive data by registered companies, in UTC's opinion. The existing XBRL tools are robust, the resources are available and the U.S. GAAP taxonomy is mature, the company wrote.

UTC and U.S. Steel disagree on the timing of the adoption of interactive data. U.S. Steel thinks that the first required submissions should be delayed at least until the filing associated with the first quarter of 2009. It also feels that the timing may be premature if U.S. companies will be required to adopt international financial reporting standards in the next several years. After the adoption of IFRS, companies will have the additional burden of going through the initial tagging process again, the company said.

UTC noted that, based on its experience, the learning curve is relatively short for XBRL. It took the company less than 80 hours to learn the software, tag the financials, validate the process and submit a filing. In its opinion, there is sufficient lead time before the end of 2008 for large companies to become acclimated with the interactive data process.

National City sided with U.S. Steel on the issue of timing. The company believes that the proposed timetable for implementing interactive data reporting is a little aggressive.

Software vendors are not currently ready for such a large demand for their services, according to National City, which has had some difficulty obtaining and installing third party software.

One point on which the three commenters agreed is that the first required submission with interactive data should be a Form 10-Q, not a 10-K. UTC said that it would facilitate the adoption of interactive data and possibly help mitigate any resistance if the first filing is a Form 10-Q. Based on its experience with the program, the company said that tagging a Form 10-Q is much easier than tagging a Form 10-K.

U.S. Steel and National City also advised the SEC that it would be much simpler for companies if the first required interactive data filing is a Form 10-Q. U.S. Steel recommended delaying implementation until 2009 to give preparers time to familiarize themselves with the process before filing the more complicated Form 10-K.

With respect to the proposed tagging of footnotes, UTC thinks that a phase-in period is appropriate, and that ASCII and HTML formatted statements should be permitted until interactive data rendering software becomes more prevalent. Once it does, the use of the other formats should be eliminated in order to realize the full benefits of migrating to XBRL, the company said.

National City agreed with the proposal to initially tag each footnote as a single block of text. The company also believes the detail should be expanded in the second year to show separate tags for each significant accounting policy. However, the company did not agree with the proposal to create individual tags for each dollar amount, percentage and GAAP disclosure in the footnotes.

The company estimates that tagging at this level would result in over 2,200 tags in its footnotes and would require a significant number of extensions to the standard taxonomy. The more customization that occurs to the standard taxonomy, the less useful the data will be for those wanting to perform comparisons among registrants, Nat'l. City said.