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The Case for Private Taxonomy

April 25, 2009

Both public and private taxonomies are applicable to the use of XBRL. When electronic public reporting and sharing of business information is desirable, then public taxonomies should be utilized. The value of public taxonomies is that they are standardized for public use. By reporting information using public taxonomies the reported information can be understood by all in light of the public taxonomy.

There is also are also a time for a private taxonomy. For instance (pardon the pun), companies can use private taxonomies to manage their internal business information. By tagging their business and financial information with a private taxonomy companies can transport that information from system to system even for ad hoc analysis of data in a spreadsheet program. By automating the use of business and financial data companies can eliminate hours of manual intervention and manual review of data.

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