Electronic Data Gathering Analysis and Retrieval (EDGAR) - Explained
What is the EDGAR System?
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Table of ContentsWhat is the Electronic Data Gathering and Retrieval (EDGAR) System?How does the EDGAR System Work?Using the EDGAR DatabaseAcademic Research on Electronic Data Gathering and Retrieval (EDGAR)
What is the Electronic Data Gathering and Retrieval (EDGAR) System?
EDGAR stands for electronic data gathering, analysis, and retrieval. EDGAR is a system created by the Securities and Exchange Commission (SEC) to facilitate electronic filing with the agency. The objective of the system is to increase efficiency, save time and money, and make accessibility more convenient.
How does the EDGAR System Work?
EDGAR enables companies to file corporate documents with the Securities and Exchange Commission (SEC). Companies may file income statements, balance sheets, statement of cash flow, and a variety of other corporate documents required of reporting companies. These documents contain information for disclosure to investors, potential investors, and other creditors. The information filed through EDGAR is well-structured, regardless of the company size and nature. For instance, if investors want to know whether the company has switched any accounting principles in the accounting period, the investor can find this information in Part 2, item 9 in the annual report or (10-k). The drawback of EDGAR is that the information that is filed is in a different format from the financial reports that investors traditionally use to make decisions. The filings generally contain all the information in a single text. Many investors consider it more difficult to find the needed information.
Using the EDGAR Database
EDGAR database enables users (creditors, investors, shareholders and more) to easily access company information. The company may be searched by using company ticker symbol. Also, the search interface displays those companies in the search list first which have recently filed information. Users can download information from most companies without charge. The information that can be accesses include quarterly, annual reports, financial statements, form 10-k which contains company overview, history, information about products, organization structure, and the company's markets.
Academic Research on Electronic Data Gathering and Retrieval (EDGAR)
- Corporate reporting on the Internet, Ashbaugh, H., Johnstone, K. M., & Warfield, T. D. (1999). Accounting horizons,13(3), 241-257. This article explores the use of the Internet by firms to augment the significance of their financial reports. A firm is said to practice Internet Financial Reporting (IFR) when its website provides (1.) a link to the US Security and Exchange Commission's Electronic Data Gathering, Analysis and Retrieval System. (2.) a link to the firm's complete financial report. (3.) a link to its annual financial report on another website. The authors observe that the effectiveness of the firm's internet financial reporting depends on the ease of access to the data, the amount of data revealed and the ability of users to download and analyze the data.
- Timely financial reporting at corporate web sites?, Ettredge, M., Richardson, V. J., & Scholz, S. (2002). Communications of the ACM,45(6), 67-71. This article studies how fast accounting reports are uploaded on corporate Websites. Uploading speed is a sign of managers' incentives to participate in real-time, and faster Internet reporting in the future. The results of the study show that averagely there is a lag of about 30 days between the day that the annual reports were filed with the SEC and the day that it was uploaded on the Website. The author gave a lot of examples of variation in the updating lags and recognized some of the features associated with speedy or slow updating of Websites.
- Financial Reporting in XBRL on the SEC'sEDGARSystem: A Critique and Evaluation, Debreceny, R. S., Chandra, A., Cheh, J. J., Guithues-Amrhein, D., Hannon, N. J., Hutchison, P. D., ... & Mascha, M. (2005).Journal of Information Systems,19(2), 191-210. The impacts of the suggested Securities and Exchange Commission (SEC) Rule (33-8496) that inspires firms to file financial reports in the eXtensible Business Reporting Language (XBRL) format is explored in this article. It examines the implications of the rule in three areas: (1) The function of XBRL in financial reporting, (2) the effect of XBRL on the SECs filing plan, (3) concerns with XBRL taxonomies.
- Automatic extraction and analysis of financialdatafrom theEDGARdatabase, Leinemann, C., Schlottmann, F., Seese, D., & Stuempert, T. (2001). South African Journal of Information Management,3(2). The authors use this article as a medium to discuss the new technique of obtaining data from the Electronic Data Gathering, Analysis and Retrieval (EDGAR) database of the Securities and Exchange Commission (SEC). The database has data on up to 68,000 firms. The authors establish a new text mining procedure to detect important financial information in the database. The information is then extracted with dextrapi (data extraction API) and converted into machine understandable XML syntax. This allows fast trading decisions from stock market investors.
- FSA: Applying AI techniques to the familiarization phase of financial decision making, Mui, C., & McCarthy, W. E. (1987).IEEE Expert,2(3), 33-41. Making financial decisions has two phases namely the familiarization phase and reasoning phase. Expert systems require the user to physically type in original data of the reasoning phase, which is then transformed into a final classification set. The final interpretation involves decisions like 1. Whether or not to invest in certain stocks, 2. Whether or not to give loans to certain firms and many more...
- EDGAR-Analyzer: automating the analysis of corporatedatacontained in the SEC'sEDGARdatabase, Gerdes Jr, J. (2003). Decision Support Systems,35(1), 7-29. To improve the accessibility to disclosures regularly filed by companies, the Securities and Exchange Commission (SEC) created the EDGAR (Electronic Data Gathering, Analysis, and Retrieval) electronic disclosure system. This article presents the results of the study on corporate Y2K disclosures in 18,595 10K fillings between 1997-1999 to demonstrate the abilities of the EDGAR-Analyzer program. It also describes the instrument that mechanizes the analysis of SEC filings, accentuating the unstructured part of the documents.
- Investor inattention and the market reaction to merger announcements, Louis, H., & Sun, A. (2010).Management Science,56(10), 1781-1793. Existing literature posits that investors pay little attention. The inattention hypothesis has been tested several times based on earnings announcement, and small corporate events announcements. The authors discover evidence that supports the hypothesis in terms of large corporate events merger announcements.
- EDGAR:Electronic Data Gatheringand Receiving, Pagell, R. A. (1995).Business Information Review,11(3), 56-68. The 1933 Securities Act and the 1934 Securities Exchange Act require about 14,000 institutions in the U.S to reveal their financial information to the Securities and Exchange Commission (SEC). Business libraries have been collecting this information in a variety of formats. The popular format in which business libraries have been gathering information is extracted information in yearly compilations such as Moodys Manuals. LEXIS/NEXIS and Disclosure are sub-contractors to the SEC, that monitors the prices that can be charged. This paper discusses EDGAR and writes on two new CD-ROM EDGAR products, from Moodys and Disclosure.
- UsingEDGARon the Internet to teach finance and business courses, Smith, S. D. (1996).Journal of Financial Education, 76-78. EDGAR represents Electronic Data Gathering, Analysis and Retrieval Project which many firms use to file forms to the SEC. This paper discusses EDGAR, a system that can be accessed for free on the internet, its potential use in teaching finance and business classes. The paper gives an example of its use in teaching a Principles of finance class and also discusses modifications for other classes.
- CrawlingEdgar, Garca, D., & Norli, . (2012). The Spanish review of financial economics,10(1), 1-10. The article is actually about the disclosure of important information to the Securities and Exchange Commission (SEC) by firms in the U.S not about crawling spiders as the title suggests. The article designed to introduce economist into the art of computing details for searching for information on the Internet. The main objective of this paper is to emphasize how easy it is to create open-source computer scripts to access financial information on firms.
- The Partnership OfEDGAROnline And XBRL-Should Compustat Care?, Tallapally, P., Luehlfing, M. S., & Motha, M. (2011). Review of Business Information Systems,15(4), 39-46. Compustat was the only source of a financial report before the EDGAR Online became functional. Though EDGAR Online has only gathered a small amount of attention in literature over the years, the authors suggest that EDGAR Online has the potential to succeed with the recent development of the XBRL (eXtensible Business Reporting Language) reporting mandate of the SEC (Securities and Exchange Commission). They also compare and contrast Compustat and EDGAR Online in terms of product pricing and presentation of data. They believe that the differences will give EDGAR Online an edge over Compustat.