The SEC is considering a proposal to let public companies issue earnings reports semiannually instead of quarterly, according to the WSJ.
Discussion about making the decades-old quarterly requirement optional has intensified over the past year, as companies find the preparation for quarterly earnings costly and burdensome. This requirement is also seen as a factor in some companies remaining private longer.
Proponents of the change believe a semiannual requirement would encourage more companies to go public by simplifying the maintenance of public company status. SEC Chairman Paul Atkins and President Trump have both expressed support for the idea. The Journal notes that the SEC has started talks with exchanges on possible steps forward, but any change is far from imminent.
If the SEC introduces its proposal, expected in the coming weeks, it will undergo a public comment period followed by a vote. The Journal highlights there’s a precedent for such a rule, as the European Union and the U.K. did away with mandatory quarterly reporting about a decade ago in favor of semiannual disclosures, though many companies in these regions still opt to report quarterly.