Canadian Move to Single National Securities Regulator: Key to Restoring Investor Confidence
by Diane Mueller

Last week’s recommendation from the Expert Panel on Securities Regulation, led by former federal cabinet minister Thomas Hockin, regarding the formation of a national securities regulator for Canada has been a long time coming. About 40 years of prior debate and research preceded this panel’s 11 months of deliberations which culminated in a forgone conclusion that a single, national securities regulator would be more efficient and effective than the current 13 provincial securities regulatory organizations.

Today, Canada is the only Group of Seven (G7) member without a single national securities watchdog. Even with this new recommendation, it is naïve to think that the provincial regulators will go quietly into the night; the Expert Panel’s recommendation to keep existing staff in place and simply change the reporting lines may appease most provinces during the transition period.In the coming months, we’ll watch the Obama administration take over the reins of the U.S. SEC’s 21st Century Disclosure Initiative; the U.S. blueprint for a modernized disclosure system based on interactive data, or eXtensible Business Reporting Language (XBRL). We’ll also see the Dutch and Australian governments quietly roll out their own financial data standardization and infrastructure modernization efforts to unify “across government” information silos. The time has come for Canada to join the modern era, and a move to a single regulatory body is certainly a step in the right direction and bodes well for the advancement of significant regulatory standards like XBRL.

Next Steps for Canada
Unifying the 13 provincial securities regulators will be a good first step towards streamlining the capital markets regulators and giving Canada an economy of scale for modernizing infrastructure and the underpinnings of Canadian regulatory processes. The next step is to get the Harper government to fund the much needed overhaul and modernization of the regulatory system.

President Obama’s upcoming visit to Canada would be a good time for the Harper government to enter discussions with the U.S. about using XBRL for the filings process to:
• gain overall efficiencies by leveraging global standards,
• aid in the transparency of financial data,
• help mitigate risks in the regulatory process; and
• improve the accuracy and quality of the financial data being reported.

Harper's Finance team should also take a close look at the Dutch and Australian efforts to break down governmental information silos with their move to a Standard Business Reporting (SBR) approach. This SBR approach relies heavily on XBRL because the Dutch and Australian governments have recognized the interdependent nature of government agencies and the increased need for information sharing via a standards-based approach.

With XBRL projects underway across the globe, it doesn't take a genius to see the writing on the wall — more cross-agency, cross-jurisdictional, cross-border cooperation and a standards-based approach are needed to manage the risks that the current global financial crisis has highlighted.

Diane Mueller has been actively involved in the development efforts of the XBRL standard for the past nine years. She is the Canadian representative to the XBRL International Steering Committee, serves as Vice Chair of that body, and chairs the XBRL Working Groups on Rendering and Software Interoperability. She currently serves as vice president of XBRL development at JustSystems, the largest independent software vendor in Japan and a worldwide leader in XML and information management technologies. Learn more about JustSystems at http://www.justsystems.com, and contact Diane at mhtml:%7BC6A0053C-9F5C-4921-9C1D-1F288B86073A%7Dmid://00000099/!x-usc:mailto:diane@justsystems.com.

About XBRL
XBRL (eXtensible Business Reporting Language) is a royalty-free, open specification for software that uses XML data tags to describe financial information for public and private companies and other organizations. XBRL benefits all members of the financial information supply chain by utilizing a standards-based method with which users can prepare, publish in a variety of formats, exchange, and analyze financial statements and the information they contain. XBRL International is a non-profit consortium of approximately 500 organizations worldwide working together to build the XBRL language and promote and support its adoption. XBRL International is responsible for the technical XBRL specification and each country-specific jurisdiction works to facilitate the development and adoption of local XBRL taxonomies, or dictionaries, consistent with accounting, regulatory, and market standards and practices.

About XBRL Canada
XBRL Canada is the non-profit consortium for XML business reporting standards in Canada and is a jurisdiction of XBRL International. It represents the business information supply chain, including accounting firms, software companies, financial databases, financial printers, and government agencies. To join or learn more about XBRL in Canada, please visit us at http://www.xbrl.ca.

About JustSystems and XBRL
Along with the SEC, the International Accounting Standards Committee (IASC) Foundation, XBRL International, and many other organizations worldwide, JustSystems has been aggressively supporting the development of the XBRL standard and integrating the interactive data format into its xfy platform. JustSystems’ software solutions work with XBRL to enable a richer way of working with and utilizing information, leveraging our technology around information search and retrieval, semantics, document management, and data integration. To learn more about how to accelerate the creation, quality, and consistency of the financial content that your organization produces and consumes today or to participate in the JustSystems beta program, please visit http://na.justsystems.com/xbrl_blog/.