Implementation of Financial Data Transparency Act Sheds Light on Opportunities in Colorado Special Districts

FDTA modernizes financial data, enhancing accessibility and value. Our research paper addresses and overcomes challenges in the adoption of the law.

CHICAGO, IL, USA, January 9, 2024 /EINPresswire.com/ — A significant report has been published by Truth in Accounting and XBRL.US, providing insights into the obstacles and advantages associated with implementing the Financial Data Transparency Act (FDTA) in particular districts of Colorado. The FDTA, a bipartisan bill, was officially enacted into law on December 23, 2022.

The FDTA aims to modernize the collection and dissemination of financial data by federal financial regulators, making it more accessible, standardized, and valuable for both investors and consumers. The paper highlights several challenges that local governments, particularly special districts, may face when adopting taxonomy and how to overcome those challenges.

The adoption of machine-readable financial statements in government operations holds the potential to streamline processes, bolster transparency, and enhance efficiency. However, the study underscores the need for concerted efforts to overcome both technical and human barriers to ensure successful implementation.

Key findings of the report include:

Technical Challenges in Implementation: The paper outlines technical challenges related to the cost, time, and effort required to transform traditional PDF financial statements into machine-readable inline XBRL instance documents. XBRL (the Extensible Business Reporting Language) is an open, globally adopted, nonproprietary data standard used by most public companies in the United States.

Human Barriers to Adoption: Three primary human obstacles hindering the widespread adoption of machine-readable financial statements in government operations include reluctance due to a lack of trust in government institutions, skepticism about the necessity of machine-readable statements, and insufficient communication among participants.

Importance of Leadership: The report emphasizes the crucial role of government leaders, including organizations such as the Governmental Accounting Standards Board (GASB), the Government Finance Officers Association (GFOA), the National Association of State Auditors, Comptrollers, and Treasurers (NASACT), and the Association of Government Accountants (AGA), in guiding the successful implementation of the FDTA.

Recommendations for Overcoming Challenges: The report addresses the identified challenges, including building trust through open communication, demonstrating the necessity of machine-readable statements, and fostering stakeholder collaboration.

Christine Kuglin JD, LLM, CPA
Director – Truth in Accounting – Daniels College of Business
President – Western Region – American Accounting Association
University of Denver
[email protected]
303-909-9424

Christine Kuglin JD, LLM, CPA
Truth in Accounting – Daniels College of Business, CO
+1 303-909-9424
[email protected]
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