By Walter C. Schmidt and Eric E. Cohen
In Brief
The Millennium's New Fuel
The explosion of interest in the Internet--to the point where it has become a viable communications and commercial medium--would not have been possible without the development of HTML, the code that web pages are based upon. Its simplicity and convenience have been thoroughly exploited in the seemingly endless array of innovative websites which appear daily.
Nevertheless, HTML suffers from some fundamental flaws that hamper its ability to become a truly universal information exchange medium. Enter XML, extensible markup language, a successor to HTML that promises to make data sharing--with clients, customers, suppliers, and colleagues--virtually seamless. All you will need to know is "Use XML file." And guess what? XML is not some distant, pie-in-the-sky idea. It exists today, is in use, and is probably accessible with your current web browser.
What does this mean for the CPA? The importance of keeping up with changing technology cannot be understated. Knowing all the technical details may not be necessary, but being fluent with the possible impact of change is essential for anyone hoping to remain their client's or employer's most trusted advisor.
As we near the new millennium, there is a newcomer to the arena of data-transfer. Sharing information has been around since the dawn of time--or at least since the dawn of communications. Sun, IBM, Oracle, Microsoft, Lotus, and everyone and their brother has said this newcomer is the most important development since laser-sliced toast--the proverbial better mousetrap.
This newcomer's name is extensible markup language, or XML. Using document type definitions (DTDs), it allows the promise of self-defining flexibility without sacrificing underlying universality. Your clients and employers will be confronted with XML at every turn as they continue to evolve their systems, manual and automated, to meet the e-commerce challenge of the year 2000 and beyond.
What this newcomer promises is to make searching on the Internet far more efficient. It combines the ease and context of Yahoo with the scope and content of AltaVista--and it's coming to a computer near you! XML has the ability to take data from any computer, any operating system or application, and share that with computers, people, the Internet, you name it. It opens the door for companies and industries to agree on what data should look like and then make that data plug and play.
How would you like it if you no longer cared if your clients or service center was using QuickBooks, Great Plains, or SAP? They hit one button--"Send data to XML"--and that file can be used to do budgets and forecasts, tax returns, write-ups, and even continuous auditing. All you need to know is "Use XML file."
The importance of you being right there with them as their financial and business consultant of choice cannot be overemphasized. You don't need to know all the details about XML, but you do need to speak and understand the language.
In English, Please
So what exactly is this XML? In a single breath, "It is a way to create, maintain, share, and use common information formats that are self-defining, self-contained, and allow for the transfer of information over all electronic means--intranets, internets, and extranets--and all forms of media--not just paper, but even braille and voice applications."
Where is it being used now? Dell's procurement system and the Wall Street Journal online, just to name two. Where can you learn more about it (in addition to reading on)? Try the XML for Accountants home page, which can be found at http://www.computercpa.com/xml2.html (maintained by one of the authors).
Furthermore, various disciplines (Can you say accountancy?) can agree on a standard format to describe certain information (Can you say enterprise?), and then describe this format using XML. Once in place, any business could share its vital information with any other business or group of businesses, in a consistent way. Plus, this format could always be modified to meet future circumstances (Can you say always current, or never out of date?).
Who's in Charge ... and of What
The World Wide Web Consortium (W3C), the international industry consortium responsible for the evolution and maintenance of the web, developed the formal XML recommendation.
XML is a close cousin of HTML, the language of the World Wide Web. They both use what is known as markup: symbols that describe the contents of a page (HTML) or a file (XML). While HTML describes the contents of a web page, its text, and its graphics, XML consists of the data itself and how it can be displayed (like HTML), stored (like a file), or immediately used and processed by the application (like data).
But why extensible? Unlike HTML, XML's markup symbols are both self-defining and unlimited. So there is room for growth and specialization, especially when an industry can agree on specific standard document formats described in XML that can be used to communicate and translate data. Plus, XML, like HTML, is a subset of SGML (standard generalized markup language), a universally recognized, platform-independent international standard for defining descriptions of electronic documents.
Where is all this (XML) going? Banking, e-commerce, enterprise financial data, litigation documents, and enterprise parts lists (just to name a few) are among the expected applications.
One More Time on the What
There was SGML, then HTML, now XML--and not too far behind is XHTML (for more on XHTML, see the accompanying glossary)Glossary. Let's look at XML again, and in more than one breath.
Do you remember the first time you saw the World Wide Web? Were you amused when you saw your first animation? Surprised when you listened to the radio or saw a movie clip on your computer? If data is an important part of your business (and if you're a CPA, it probably is), viewing an XML tree in your web browser may have the same impact.
Web browser features are easy to get your arms around once you have sat down and taken a tour of the web. You can see text presented handsomely, view animated graphics, listen to music, and watch trailers for upcoming movies by typing an address--the uniform resource locator (URL)--into the appropriate place at the top of your web browser. It has now become commonplace to see URLs on television, in the newspaper, on business cards, and emblazoned across the products we buy.
How can you get your arms around XML? Until you see XML in action, it is just another TLA (three-letter acronym). The best way to understand it is to see it. If you have Microsoft Internet Explorer version 5 (IE5), which supports XML, point it to www.computercpa.com/fss.xml, and keep reading.
The Nitty Gritty. XML is a markup language. In a simplistic sense, that means you put codes around the content of your file to tell your software what to do with it. For example, a name in an XML-based database may have codes, called starting and ending tags, around it like this:
If you have had the opportunity to look up the aforementioned website in an XML-capable browser, you will see a collapsible and expandable category tree. If you have a non-XML capable browser, you will see the text in a disorganized fashion. Click the "plus" and "minus" signs, and you will see that you can move up and down the tree of this financial statement quickly and easily. The data has become an outline.
XML files can be supplemented by other files which further define data and let you sort, filter, and present the data in an unlimited number of ways. Now, bring up www.computercpa.com/ fs.xml in IE5. A simple style sheet has been applied to the same data seen before. By applying different style sheets, you can display the same data differently, in the most appropriate form for the audience or medium.
If you have ever wanted to work with data from your business software, whether it is accounting, contact management, production, or any other kind of system, you have worked with a report writer or sent the data out--exported the data--to an intermediate file. You probably had to choose between a dBase format, a Lotus or Excel format, or plain or comma-separated text. XML has the potential to make data transfer between two systems or multiple organizations as simple as "Export to XML".
Even searching for information on your local intranet (or the Internet) can be dramatically improved through XML. Right now, you only have the choice of using an indexer, which looks through all of the words found on a web page, or a categorizer, which lets you search through a manually maintained hierarchical category tree. XML can combine both techniques, searching comprehensively through only relevant data, since the markup tags define what all that data actually represents.
Therefore, XML is not purely a technology issue. It is an information, cooperation, and management issue. The first shot in the XML revolution has been fired. Now it is up to authoritative organizations like the AICPA to help develop the underlying industry-specific definitions that will make all this possible. CPAs need to develop a requisite understanding of XML to facilitate its use by businesses for electronic transactions.
And What Am I Supposed to Do with All of This?
As we said in the beginning: Sit back and search the web more efficiently. Share data from any computer, operating system, or application; with other people, the Internet, or you name it. And, most importantly, continue being right there as your client's financial, business, and e-commerce consultant of choice. Any questions? *
The CPA Journal is broadly recognized as an outstanding, technical-refereed publication aimed at public practitioners, management, educators, and other accounting professionals. It is edited by CPAs for CPAs. Our goal is to provide CPAs and other accounting professionals with the information and news to enable them to be successful accountants, managers, and executives in today's practice environments.
©2008 The New York State Society of CPAs. Legal Notices
){kind=link}