The Financial Accounting Standards Board and its overseer, the Financial Accounting Foundation, are forming a team to take over responsibility for managing XBRL taxonomies for U.S. financial reporting purposes.

XBRL (eXtensible Business Reporting Language) is a technical language for communicating business information electronically. Taxonomies represent the dictionary for the language, mapping bits of information based on reporting standards to their proper destination. The taxonomy for U.S. Generally Accepted Accounting Principles is a list of computer-readable tags in XBRL that allows companies to label precisely the thousands of pieces of financial data that are included in typical long-form financial statements and related footnote disclosures.

The 2009 taxonomy currently in use for public company financial reporting was developed by XBRL US, the non-profit organization that has driven the development and adoption of XBRL for tagging business reports. The FASB provided technical accounting standards support to XBRL US during the development of the 2009 taxonomy. 

Since FASB writes the accounting standards that govern public company financial reporting, it’s the logical body to maintain the taxonomies going forward, said XBRL US representative Michelle Savage. “We are responsible for the technical quality, consistency and interoperability of taxonomies,” she said. “We leave the process and decisions around disclosure content to public policy and regulatory processes.”

The FAF said the new team will work toward releasing a taxonomy update in early 2011. The transition of responsibility follows several months of discussion between the FAF and the staff of the Securities and Exchange Commission, which has responsibility over filing requirements and therefore over the use and final content of any taxonomy required in filings.

"The FASB’s new role will help ensure that tagging standards remain closely aligned with the U.S. accounting standards they describe,” said SEC Chief Accountant James Kroeker. “This will be a benefit to investors and companies alike."