The US Securities and Exchange Commission (SEC) has proposed changes that would give public companies the option to move from quarterly to semi-annual reporting.
Currently, public companies covered by Sections 13(a) or 15(d) of the Securities Exchange Act must submit quarterly updates on Form 10-Q.
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The proposal, if implemented, would allow those companies to choose to file interim results twice a year on a new Form 10-S.
Companies that take up the option would then provide one semi-annual report and one annual report in each financial year, instead of three quarterly filings plus the annual report.
According to the SEC, the initiative is aimed at allowing companies to select a reporting cycle they believe is most appropriate for their business and investors.
SEC chairman Paul Atkins said: “Public companies have an obligation under the federal securities laws to provide information that is material to investors.
“Yet, the rigidity of the SEC’s rules has prevented companies and their investors from determining for themselves the interim reporting frequency that best serves their business needs and investors.
“Today’s (5 May) proposed amendments, if ultimately adopted, would provide companies with increased regulatory flexibility in this regard.”
The draft rules set the submission deadline for Form 10-S at 40 or 45 days after the end of the first half of the fiscal year, depending on the filer category of the company.
The proposal would also revise Regulation S-X, which sets financial statement rules for periodic reports, registration statements and proxy materials, to incorporate the semi-annual reporting option and streamline current requirements.
The SEC said the proposing release will appear on SEC.gov and in the Federal Register. Stakeholders will have 60 days from its publication in the Federal Register to submit comments.
