Washington, D.C., Aug. 19, 2008 — Securities and Exchange Commission Chairman Christopher Cox today unveiled the successor to the agency’s 1980s-era EDGAR database, which will give investors far faster and easier access to key financial information about public companies and mutual funds.
The new system is called IDEA, short for Interactive Data Electronic Applications. Based on a completely new architecture being built from the ground up, it will at first supplement and then eventually replace the EDGAR system. The decision to replace EDGAR marks the SEC’s transition from collecting forms and documents to making the information itself freely available to investors to give them better and more up-to-date financial disclosure in a form they can readily use.
The Washington Post is on top of the story, and says the new system will change the way companies report their financials as well as the way journalists cover business news.
While advocates say the new system will eventually save companies money because of the speed and ease of preparing disclosures, some critics complain about the initial expenses of making the transition, a burden that is particularly unwelcome during an economic slowdown.I'm certainly paying attention to how those regulated by the SEC are reacting, and I think it's fair to say that any such system will have growing pains. But this is certain: We're in a brave new world when it comes to financial communications. The SEC is absolutely correct to look at information technology tools to make sure investors have the clearest picture possible to make educated decisions. Chairman Cox is showing some leadership here, and his staff is thinking ahead.