SEC Prepares Proposal to End Quarterly Earnings Reports

The U.S. Securities and Exchange Commission is preparing a proposal to eliminate the mandatory quarterly earnings reporting requirement for public companies, allowing them instead to disclose financial results only twice a year. The change, if adopted, would represent one of the most substantial reforms to corporate disclosure rules in over five decades and could be formally released as early as April.

Under the proposed rule, companies would no longer be required to file Form 10-Q reports every three months, which provide unaudited financial statements and management's discussion of results. Quarterly disclosures would become optional, while annual Form 10-K filings and Form 8-K reports for material events would remain mandatory. SEC officials have consulted with major stock exchanges on potential adjustments to listing standards to accommodate the shift. Once published, the proposal would enter the standard rulemaking process, including a public comment period of at least 30 days, followed by a commission vote. Adoption is not assured and could take six to 12 months or longer.

The initiative builds on discussions that intensified late last year, when the Long-Term Stock...