Quarterly company reporting may become optional in the U.S. - WSJ

The U.S. Securities and Exchange Commission (SEC) is preparing a proposal to abolish mandatory quarterly reporting for public companies and allow them to publish results twice a year, The Wall Street Journal (WSJ) reported, citing sources.

The regulator may publish a proposal as early as April, the newspaper's interlocutors added. According to them, representatives of the agency are now discussing with the largest U.S. stock exchanges what changes in their rules may be required in case the SEC cancels quarterly corporate reports.

The SEC's proposal, if published, would have to be put out for public comment for 30 days, the WSJ writes. Then the SEC will have to hold an internal vote. There is no guarantee that the initiative will be adopted, the newspaper notes. It is expected that the rule will make quarterly reporting optional, but will not cancel it completely, the newspaper points out.

This is not the first time that the US is discussing the possibility of introducing semi-annual reporting instead of quarterly reporting. The initiative already gained momentum in September last year, when the Long-Term Stock Exchange (Long-Term Stock Exchange) - a U.S. platform where companies focused on long-term development are listed - filed a petition with the U.S. Securities and Exchange Commission with a proposal to abolish mandatory quarterly reporting, The Wall Street Journal wrote. A few days after the petition, U.S. President Donald Trump and SEC Chairman Paul Atkins announced their support for the idea.

Trump considered the possibility of switching US companies to semi-annual reporting during his first term, WSJ notes, but the initiative did not gain traction then. Proponents of reducing the frequency of reporting believe that such a transition could stop the number of public companies in the U.S. from shrinking: in their opinion, business remains private, including because of the labor-intensive and expensive procedures associated with going public and maintaining a listing, the publication explains.

That said, any changes are likely to meet resistance from investors who depend on the transparency of regular disclosure, the WSJ notes.

Currently, public companies in the U.S. publish accounts every three months, a norm that has been in place for over 50 years.

Public companies in Europe, meanwhile, are not required to publish quarterly reports after a rule change in 2013. In the UK, such requirements were also abolished about a decade ago, although many listed companies still continue to report quarterly, the WSJ points out.

This article was AI-translated and verified by a human editor