Thanks for a great post Jason.

I think one reason why so many buy-side analysts (and I think it's more of an issue on the buy-side) use generalized financial statement is that it’s easy – far easier than having to maintain your own spreadsheet models that integrate the income statement, balance sheet and cash flow for a relatively large number of companies that either are in a portfolio or of interest.

One solution to this issue would be to use technology to make use of the XBRL-tagged data from the EDGAR database. Building a generic income statement, balance sheet and cash flow model and making tweaks to it for a specific company or industry isn’t rocket science. Manually gathering the data for it, however, is a time consuming chore. However, there isn’t freely available software that would automate the capture of XBRL-tagged data from the EDGAR database and then put it into whatever model an analyst might want to construct. The SEC punted on spending the money to develop such a tool for automated data extraction, which is one reason XBRL-tagged data is grossly underutilized.

If buy-side analysts and portfolio managers could automate the process of pulling actual, company-by-company results into a spreadsheet model, they would find it relatively easy to address each of the issues you raise here.

Best,
Robert