A Napster for Financial Data?

Imagine this: At any time of the day or night, and with just a few clicks of the mouse, a financial planner or an individual investor can access a company’s present and past financial reports in extraordinary detail. In addition, an array of instant analyses of those data can be performed, which displays them either graphically or as conventional financial statements. Within seconds a user can compare a company’s balance sheets with those of several competitors, examine an enterprise’s debt-to-equity ratio in any fiscal period, chart its stock price history and download an audit client’s major non-financial news. As if that’s not enough, the same range of analyses can be performed for any public company worldwide and the information even can be converted into any currency.

“No way,” you’re probably thinking. “At least not in my lifetime.”

Think again. All the underlying technology—XBRL (Extensible Business Reporting Language)—for it is available right now. All that’s missing is a standardized protocol to implement it—and the first steps for creating such a protocol to perform those feats have been taken. A team comprising the Nasdaq Stock Market, Microsoft and PricewaterhouseCoopers just launched a pilot project designed to demonstrate that the concept of making both the data and the analysis tools available on the Internet is not only feasible but both practical and sought by financial professionals, investors and regulators.

If you want to see what the future looks like, just point your web browser to www.nasdaq.com/xbrl (see exhibit 1, at right) and download a free demonstration file called the Excel Investor’s Assistant. You’ll need Excel 2000 or later to run the demo.

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