The marriage of rules and data is beginning to take shape as the Accounting Standards Codification now includes some links to eXtensible Business Reporting Language (XBRL).

The Financial Accounting Standards Board has added some functionality to the Codification, which is the official electronic rulebook for all U.S. Generally Accepted Accounting Principles, to link accounting rules to XBRL tags. XBRL is the electronic format in which companies increasingly report their financial results. FASB says the Codification now provides a list of all XBRL elements that contain an electronic link to a paragraph in the Codification, linking complete XBRL element names together with all Codification paragraphs.

FASB says the Codification references include both the text-based Codification reference and an electronic link to the related Codification paragraphs. FASB’s “Notice to Constituents” provides some further detail about Codification references and electronic links embedded in the U.S. Financial Reporting Taxonomy.

Bruce Pounder, president of accounting education firm Leveraged Logic, says the linkage between the Codification and XBRL will be useful to public companies that are or will soon be required by the Securities and Exchange Commission to report financial data through XBRL. “It is important that the FASB has finally delivered what they led their constituents to expect with regard to linking the Codification and the U.S. Financial Reporting XBRL Taxonomy,” he says.

The XBRL taxonomy is a collection of electronic tags that are attached to specific quantitative or qualitative data in financial statements, says Pounder, enabling users to more readily interpret and compare data across various entities. Wherever GAAP requires or allows specific data in financial statements, there are one or more corresponding XBRL tags in the taxonomy, he said.

As an example, Pounder says, ASC 350-10-50-15 directs creditors to make certain quantitative and qualitative disclosures about impaired loans. The Codification now contains an XBRL Elements link at the end of that paragraph to show the list of XBRL tags associated with that requirement.

“That information would help the user apply XBRL tags correctly and completely to the contents of financial statements when preparing an XBRL submission for the SEC or a third party,” Pounder says. “It would also help internal or external auditors verify that XBRL tags have been correctly and completely applied.”