The SEC’s eyes turn to twice-yearly earnings reports

The SEC is working on a proposal to allow public companies to release earnings reports twice a year instead of quarterly, according to the WSJ.

Talk of making the over-50 quarter requirement optional has grown over the past year as companies bemoan the cost and burden of preparing for quarterly earnings. The requirement is also believed to be one of the reasons some companies choose to stay private longer.

Those supporting the change hope the semi-annual requirement will encourage more companies to go public by making it easier to maintain public company status. SEC Chairman Paul Atkins and President Trump have expressed support for the idea. The newspaper reports that the SEC has already begun discussions with exchanges about potential next steps, although any change is still a long way off.

If the SEC releases its proposal — which could come in the next few weeks — it will be subject to a public comment period and then a vote. There is precedent for this rule, the Journal notes. Both the European Union and the United Kingdom removed mandatory quarterly reporting about a decade ago in favor of semi-annual disclosure, although many companies in both markets still report quarterly by choice.