The introduction of a computer code to financial reports was supposed to transform the way investors' could analyze the data. The reality is proving to be a little less exciting.

This summer, the biggest U.S. companies will have to start using the language, awkwardly named XBRL, in some of their financial filings, thanks to an almost obsessive drive by former U.S. Securities and Exchange Commission Chairman Christopher Cox to launch it.

XBRL stands for Extensible Business Reporting Language. It provides uniform and new ways for investors, regulators, journalists and others to read, parse and analyze complex company data more quickly.

The system has been years in the making, and could reveal numbers or trading ideas that might not have been available before so quickly.

You never know what new information means in the hands of an innovative analyst or trader, said David Blaszkowsky, director of the SEC's Office of Interactive Disclosure.

Nearly a decade ago, experts said XBRL would revolutionize financial reporting and bring visibility, consistency and transparency to often confusing financial statements. That may be, but it will take a few more years.

As of early May, 340 of the 500 largest U.S. companies were ready to start filing quarterly and annual reports using XBRL, according to a study released by nonprofit group XBRL US Inc. Many other companies do not have to begin filing until 2011.

While the SEC believes that most of the big ones are ready, it will not know for sure until companies file their quarterly reports, Blaszkowsky said.

Companies worth $5 billion or more in the public markets had to be compliant by June 15. This time, they will get a 30-day grace period, Blaszkowsky said.

Federal officials and the language's supporters say they are confident that the big companies are ready. Others say that they might submit error-ridden documents because they have not adequately prepared.

Others said the rules, while meant to aid investors, might do little for people like algorithmic traders who program computers to react to data and make trades in fractions of a second.

It is important for creating models, said Jamie Selway, managing director of institutional broker White Cap Trading. It wouldn't obviously be for news and such.

Developing deep thoughts about a company's or business sector's prospects is a more leisurely job than trying to make millions of dollars of profit during the trading day.

XBRL is better suited to the former activity, said Rodney Nelsestuen, senior research director for financial strategies and IT investments at TowerGroup. It's not going to be in the heat of the moment right away, he said.

One way to change that would be requiring corporate press releases to carry XBRL-coded data, but the government has no plans to do that and will not discuss future rule-making plans, Blaszkowsky said.

We asked the market a number of times what might be appropriate. We looked at various kinds of filings and we made a decision on what to go for in this round, Blaszkowsky said.

The SEC plans to keep communicating with companies about XBRL, but it looks increasingly unlikely that it will do that with the same verve that former Chairman Christopher Cox devoted to the language.

The financial crisis and resulting economic recession, along with a spate of high-profile crimes that eluded the attention of the SEC and other regulators, such as the Bernard Madoff fraud, have taken precedence over computing and coding.

I don't mean to be dismissive of it in any way. It's just not one of my highest priorities, current SEC Chairman Mary Schapiro told Reuters in an April interview.


Another concern is how prepared companies are to post their financial data accurately when using a new kind of technology.

A study by three professors at North Carolina State University published earlier this month revealed multiple errors among 22 big companies participating in a trial for filing XBRL-enabled documents that began in 2005.

Companies from 3M Co to Dow Chemical to Comcast Corp filed documents containing various problems that the study's authors worry will undermine XBRL's credibility among the people it is intended to help.

I think companies are underestimating the time and complexity of tagging the statements, said one of the authors, Eileen Taylor.

The study, which covered documents submitted for the 2006 fiscal year, including omitted amounts, inaccurate values and inaccurate labeling of various numbers.

Microsoft Corp , for example, reported two dollar amounts in millions instead of billions because of a data entry error, and Dow Chemical tagged some figures with incorrect dates that then affected other years' data, the study said.

These are big errors that you would never accept, Taylor said. If you were hand-keying, you might notice them.

Mark Bolgiano, chief executive of XBRL US Inc, a nonprofit group that works on XBRL standards, said the study relied on older definitions than the language is now using.

He also tempered the hope that the increased transparency and visibility that XBRL would bring to financial statements could put an end to fraud, such as the kind perpetuated by fallen energy trading giant Enron.

Would this have prevented Enron? Unfortunately, the answer is yes and no, he said. They can still put the wrong number in. This will not make people tell the truth if they intend to tell a lie.

(Reporting by Robert MacMillan; Editing by Richard Chang)