Using Language Processing to Evaluate the Equivalency of the FASB and IASB Standards

• In Event: SET Section

Abstract

The passage of the Data Transparency and Accountability Act in the United States Congress will necessitate that government agencies provide more data in transparent formats. The issue of how to interpret such data remains an open question. The accounting profession has continued to struggle with common formats since the inception of balance sheets and income statements. The original FASB Conceptual Framework was developed to help construct consistent GAAP standards. XBRL was developed to provide a consistent representation of the data contained in financial statements and other financial documents. This research explores the use of two codifications (US GAAP and IFRS) of GAAP standards in both their syntactic representation through XBRL taxonomies and their semantics through their authoritative references back to their own standards and codification. The research uses language theory and mathematical logic to model the codifications in terms of the strings used to represent lexical content in the financial statements and to provide a systematic mapping to the semantics of the related XBRL specifications. The immediate objectives of this research are to provide a means to compare the semantic richness of US GAAP and IFRS and to determine the consistency of either standardization with respect to the emerging shared Conceptual Framework.

Authors

• Rob Nehmer, Oakland University

• Ingrid E Fisher, University at Albany, SUNY