The US Securities and Exchange Commission should decide in the next few months whether to make it mandatory for companies to file their financials in XBRL (extensible business-reporting language) format.

This would be a significant boost to the fortunes of the electronic standard which has been around for years but never quite got traction.

But while the idea is to create a standard specification for industry-wide use to help automate and standardise financial reporting, it could be a long time before this vision is achieved.

Many business users are still struggling to understand how XBRL can help deliver visual, cross-enterprise insight from raw data using less time and resources.

To my mind, XBRL isn't much of an improvement on the standards already in place and is, in the main, an empty standard.

The original design simply proposed an XML container within which business reports could be exchanged. In that sense, it is a specialisation of XML.

The main problem is the lack of an inner structure, which has left companies, governments and standards agencies, such as BASDA, with the task of establishing their own, often localised standards.

The result is that there is no inherent global compatibility.

Because of the wide-ranging nature of business, these structures, or 'taxonomies', are often very complex and frequently leave systems integrators with a difficult task.

Comparing financial data across companies and borders may be a pipe dream anyway. It is impossible, for example, to take data on pensions from the UK, Germany and Italy and compare it, because each company will be subject to different risk profiles and rules.

Different lenders do things in different ways. XBRL may provide the reporting infrastructure, but will not provide the level of detail required. For this reason, and the technical nature of the standard, gaining traction among finance professionals has been and will remain a huge barrier to adoption.

Interestingly the SEC has recognised the huge level of concern among companies about having yet more changes in reporting legislation thrust on them.

It has opened itself up and is actively requesting feedback on its interactive data agenda. Whether or not you're a fan of XBRL, this sort of approach is likely to start building momentum behind it. Whether it truly delivers value to the market will have to be seen, though.

David Turner is group marketing director at CODA, the finance systems business