When President Donald Trump in late 2025 resurrected his call for the Securities and Exchange Commission to ditch its longstanding requirement for public companies to disclose financial information quarterly, he billed it as a way to save companies money.
Switching to a six-month cadence, the president said in a September social media post, would also enable “managers to focus on properly running their companies.” The administration’s push appeared to take another significant step forward within recent weeks, with the Office of Management and Budget receiving a proposal from the SEC on the matter at the end of March, Bloomberg reported.
There’s potential for both cost and time savings, but it all hinges on investor and lender response to the change. Sources interviewed by CFO.com say that finance teams might not necessarily see their level of paperwork and reporting requirements abate much if banks and Wall Street keep up their own demands.
Brian Krogol, CFO of publicly traded insurance financing firm Standard Premium Finance, notes that his company’s primary lender requires quarterly financial statements, and he doesn’t see that changing even if the federal government changes disclosure requirements.
“There can be stakeholders beyond just the SEC that could require these quarterly financials,” Krogol says.
As for costs, Krogol predicts that any savings would likely be “marginal comparatively.” That’s because companies would still need to maintain compliance staff to file with the federal government every six months.
Krogol acknowledges there’s room for improvement in federal reporting requirements. He points to requirements on reporting by segment, for example. For a company like his, which works solely in “specialty finance,” such a requirement is “burdensome almost for no reason,” he says.
“It doesn’t even add value to the user of the financial statements,” Krogol says. “It’s almost like they’ve gone too far with the disclosure. Can we find places to pull back that’ll help small companies?”
David Bartz, partner and co-head of capital markets with law firm K&L Gates, says that the SEC’s proposal could indeed save money and lessen companies’ administrative burdens, but with an important caveat.
“It depends on how the investor market reacts,” Bartz says. “If the investor market is making companies still report their quarterly statements, that would mean a little bit less savings than only having to do it every six months.”
Still, it’s possible investors’ disclosure requirements could be less strict than the SEC’s current requirements for 10-Qs, which Bartz described as “very rules-intensive.” If investors and analysts demand less stringent disclosure requirements, there are potential cost savings there, too, Bartz says.
In an email to CFO.com, a spokesperson for the SEC noted that Chairman Paul Atkins’ goal is “removing the agency’s thumb from the scales and allowing the market to dictate the optimal reporting frequency based on factors such as the company’s industry, size, and investor expectations.”
“As with any rulemaking, the public will have the opportunity to comment on the proposal and make their feedback heard,” the spokesperson said.
And while finance and legal teams might still face a similar level of paperwork, the move could create “information gaps between companies and markets,” Bartz says. “Without a standardized, regulated format like a 10-Q, if companies end up voluntarily reporting quarterly information, such disclosure could be selective,” he says.
The whims of investors, too, play a role: If there’s an “uproar” in the investor community about the level of information disclosed, it could force companies to change their practices accordingly, he says.
For what it’s worth, Atkins said as much back in September. In an interview with CNBC at the time, Atkins noted that investors “will demand that sort of information at the cadence that’s appropriate to what the company’s doing and what it’s up to.” In his view, it would ultimately be up to markets to decide “what the proper cadence is.”
An existing model
It also bears noting that there is precedent for semiannual reporting requirements, both domestically and abroad. It wasn’t until 1970 the U.S. switched from semiannual disclosure requirements to quarterly ones. And overseas, the United Kingdom did the opposite, shifting from quarterly to semiannual requirements in 2014.
Even now, some companies that are listed on U.S. exchanges but have headquarters outside the country follow rules that look a lot like the SEC’s proposed changes, Bartz says. Such companies, known as foreign private issuers or FPIs, are generally required to file annual reports to the SEC, along with six-month financials to Nasdaq or the New York Stock Exchange.
Bartz says he’s worked with plenty of FPI clients, and though there are some differences in what the SEC is proposing, he sees clear parallels.
“Technically this is already happening for Nasdaq- and NYSE-listed foreign private issuers,” Bartz says. “To a certain extent, we already have a model for it.”
Differing conclusions in different markets?
What the SEC’s proposal would ultimately mean for business remains to be seen.
Certainly, much in business and society has changed since the U.S. shifted from semiannual requirements to quarterly ones in 1970, so it’s difficult to predict exactly what a reversal would mean today. Michael Dambra, associate professor of accounting and law at the University at Buffalo, points to two academic papers that arrived at opposing conclusions from the U.S. change decades ago and the U.K.’s change in 2014.
The former, which was issued in 2018 by the American Accounting Association, looked at the American shift from semiannual to quarterly disclosure requirements in 1970. The paper suggested that “firms significantly reduce investments in fixed assets following an increase in reporting frequency.” To calculate such investment levels, researchers measured both firms’ capital expenditures and the change in net fixed assets.
Dambra said that would be “consistent with the short-termism argument,” which says that companies are less inclined to invest when they’re mandated to report more regularly.
But the other paper, which was issued in 2017 and studied changes both before and after the United Kingdom’s flip to semiannual requirements, found that “the imposition of mandatory quarterly reporting has virtually no impact on firms’ investment decisions.” The paper suggested that “a new SEC rule extending the reporting period from three to six months may not have significant effects on the time horizons of U.S. company executives,” although it also acknowledged that “the U.K. context for quarterly reporting is different from that in the U.S.”
Whether the SEC’s proposal would indeed remove administrative burdens is up for debate, too. Dambra points out that, while companies could decrease their audit fees and compliance costs, there could be other unintended consequences.
“If you’re removing the volume of information you’re providing to the market, your investor relations department might take on an increased burden, at least in the short term, fielding calls from investors,” he says. “Maybe the CEO is taking more meetings to address the information demands from analysts and investors.”
And Dambra agrees with the notion that many companies might still be filing some disclosure reports on a similar cadence, even if those aren’t provided to the public.
“Our bigger firms that have large institutional investors that demand information, that have lenders that require such information, I don’t see them stopping (their disclosures), at least in the near term,” he says.
