Source: Fortune
Summary
The Securities and Exchange Commission is preparing a proposal to allow U.S. public companies to report financial results semiannually instead of quarterly. The change would make quarterly filings optional rather than mandatory. CFOs and experts are debating the potential impact, including effects on investor relations, transparency, and market volatility. Some argue that the change would save companies time and money, while others believe it would lead to increased volatility and strain on board oversight.
Our Reading
The announcement sounds familiar.
CFOs are rethinking the cadence of financial reporting, and the SEC is preparing a proposal to make quarterly filings optional. J. Eric Johnson, partner at Winston & Strawn, notes that the change would require companies to rethink their investor relations strategy and maintain transparency. Shivaram Rajgopal, an accounting professor at Columbia Business School, believes the shift would lead to more demands on IR groups and increased volatility. The proposal is expected to be released as soon as April.
The market participants will demand information in some form or fashion, and companies will have to adapt to a new rhythm.
Author: Evan Null
