Stress test puts EDGAR under fire

The EDGAR database of corporate information is slated for a stress test in 01/to prove itself to the corporate world.

"We're going to get a bunch of people together and blast our filing service with filings," said Rick Heroux, project manager for the EDGAR (Electronic Data Gathering Analysis and Retrieval) database, the Securities and Exchange Commission's automated system for filing corporate and financial information.

Although it is confident that the system will function smoothly, the SEC wants to prove it to the tens of thousands of publicly traded companies that will be using the system.

"This summer, some of our larger customers were concerned that the system capacity would not be able to handle" large volumes of filings, Heroux said.

In addition to the internal stress test on EDGAR's hardware and software, he said the agency will enable corporate filers to test the system themselves, although he doubts they would be able to submit the volume of files necessary to put EDGAR to a proper test.

When completed, the results of the stress tests will be posted on the SEC Web site.

EDGAR was launched 16 years ago as a dial-up service that required forms to be in ASCII format, but it has been reconfigured over the past 19 months to take advantage of the Internet.

With the modernized system, companies may now use the Internet to transmit HTML files — complete with graphics — to EDGAR. They also can include hyperlinks to previously filed documents in the EDGAR database.

The database's ability to accept HTML documents not only makes the SEC Web site more user-friendly to the public, but it is easier for businesses that download the information for resale.

Those businesses package the data and sell it to their own corporate customers, making the EDGAR database a public information service that the private sector supports.

"There has been some controversy over whether the SEC should be involved in providing online information," said Jason Mahler, vice president and general counsel to the Computer and Communications Industry Association in Washington, D.C. "But EDGAR is something we find is a beneficial service of the government."

When the database was a fully dial-up, text-based system, the SEC had nine corporate subscribers to its information service, each paying about $210,000 a year.

But as EDGAR moved to HTML, the cost dropped. Today, according to Heroux, the SEC has three times the number of customers buying its top-shelf service at a cost of $40,000 a year.