SEC Prepares Proposal to Eliminate Quarterly Reporting Requirement

The Securities and Exchange Commission is preparing a proposal to eliminate the requirement to report earnings quarterly and instead give companies the option to share results twice a year, according to people familiar with the matter. The regulator could publish the proposal as soon as next month, the people said. In preparation for the proposal, regulators have been talking to officials at the major exchanges to discuss how they may need to adjust their rules. Once the proposal is published, it will be subject to a public comment period. After that period, which typically lasts at least 30 days, the SEC will vote on it. There are no guarantees it will ultimately happen. The rule is expected to make quarterly reporting optional, not eliminate quarterly reports altogether. The push for semiannual reporting gained steam late last year. The Long-Term Stock Exchange petitioned the SEC to eliminate the quarterly earnings report requirement, The Wall Street Journal reported in September. Within days, President Trump and SEC Chairman Paul Atkins both said they supported the idea. Publicly traded companies in the U.S. have reported results every three months for the past 50-plus years. Trump briefly explored the idea of moving to semiannual earnings reports during his first term, but the effort went nowhere. Those in favor of less-frequent reporting requirements believe a switch could help boost the shrinking number of public companies in the U.S. Among the reasons companies cite as to why they remain private is the time-consuming and costly clerical work required to list and maintain publicly traded shares. Any change is likely to face opposition from investors who rely on the transparency of regular disclosures. Publicly listed European companies are no longer required to report quarterly financial results after a 2013 rule change. The U.K. also ended quarterly reporting requirements about a decade ago, though many companies still report quarterly. [https://www.wsj.com/finance/regulation/sec-prepares-proposal-to-eliminate-quarterly-reporting-requirement-1d700bbb](https://www.wsj.com/finance/regulation/sec-prepares-proposal-to-eliminate-quarterly-reporting-requirement-1d700bbb)