Promoting Job Creation and Reducing Small Business Burdens Actby Representative Keith Ellison
Posted on 2015-01-14
in the house of representatives
Wednesday, January 14, 2015
Mr. ELLISON. Mr. Speaker, I am disappointed that the Republican
majority did not allow a single amendment on this bill that benefits
powerful financial interests. Members obviously have concerns about
elements of this bill--146 members opposed this identical bill last
week. A previous version of this bill also earned more than 100 no
votes last Congress. The 52 new members who began service last week
were not able to offer an amendment either.
These eleven bills make complex legal changes to our financial markets but no member of this Congress was afforded the opportunity to make a change. I offered three different amendments. All were rejected.
My first amendment had the support of Chairman Issa and Representative Polis. If we had more time, Ranking Member Cummings would have added his name. This amendment strikes Section 7. Section 7 moves us backwards in efforts to increase transparency in our financial markets.
Section 7 would exempt more than 70 percent of public companies from complying with the eXtensible Business Reporting Language (XBRL) requirement. This exemption would completely undermine progress already made by the Securities and Exchange Commission. Going back to the 19th century approach, requiring investors, academics, regulators and the public to read reams of filing papers is definitely not what we should be doing. Instead, we should provide the data in structured data sets available for bulk downloads for comparison and analysis by investors, academics, the regulators and the public.
The SEC has made incredible progress in catching up with more than two dozen other nations that collect information this way. It has also made it easier for firms. A recent study by XBRL.US found that the average cost of submission was only $10,000. In fact, seventy percent of firms in the study reported a cost of less than $10,000.
The costs to individual firms is offset by the benefits those firms will receive because investors have easier access to data to make investment decisions. Society will also benefit by having financial data more readily available.
My second amendment required the Securities and Exchange Commission to finalize its CEO pay ratio rule within 60 days of the bill's enactment. CEO pay rose an average of 4% last year. The average CEO earns more than 330 times his or her average employee.
My third amendment highlights what we really need to do to create jobs--end the mindless sequestration cuts which prevent us from making needed investments in infrastructure, housing, basic research, etc. It also strikes the language that further delays the transition to a safer financial system.
It is wrong that bills that help Wall Street and multi-national corporations get fast-tracked while bills that help working families have been slow-walked for years.
(From XBRL.US) Consequences of XBRL Exemption in H.R. 37--Minimal Savings, Reduced Transparency and Access to Capital for Small Companies New York, NY--The goal of Title VII in H.R. 37 is to reduce the burden on small public companies by delaying the XBRL (eXtensible Business Reporting Language) formatting requirement for companies with revenue under $250 million for a minimum of three years. The XBRL exemption in the bill will not reduce the burden on small companies.
The savings from an XBRL exemption is only $10,000 per year for most small companies. A December 2014 study conducted by XBRL US found that the average annual cost of XBRL filing for companies defined as ``small companies'' per the U.S. Securities and Exchange (SEC) definition is $10,406; and 70% pay $10,000 or less. These figures demonstrate that the annual cost of XBRL creation is low relative to the benefits that XBRL formatting can provide. Financial data in XBRL format is significantly more functional and timely, and therefore less costly for investors and analysts, than traditional HTML data, which must be rekeyed and vetted before use.
The study was based on aggregating annual costs for 1,299 companies, working with 14 separate service providers, geographically dispersed around the country. The dataset captures 32% of all companies with the small company designation.