President Trump Is Interested in a Major Shakeup for Corporate Earnings Reports

Adjust Comment Print

SEC Chairman Jay Clayton, a Trump nominee, has said increasing the number of public companies and initial public offerings are among his top priorities.

U.S. President Donald Trump on Friday said meetings with corporate executives had prompted him to ask the U.S. Securities and Exchange Commission (SEC) to study letting public companies file financial reports every six months instead of every quarter. "That would allow greater flexibility & save money", he tweeted.

Trump said he got the idea after speaking with "some of the world's top business leaders".

While Trump can not force Clayton to make changes, as a matter of courtesy the SEC chairman may promise to study the issue.


WASHINGTON (AP) - President Donald Trump is calling on federal regulators to consider scrapping the requirement for public companies to report quarterly results, after business executives told him twice-yearly reports would make better economic sense. The Commissioners' offices did not immediately respond to a request for comment.

Nooyi confirmed she had talked to Trump about the change of schedule.

Even if the SEC concluded the change was a good idea, companies would likely stick with the current regime to avoid investor backlash, said Ed Yardeni, founder and chief investment strategist at Yardeni Research.

But he said energy companies would probably still report some oil and gas well data every three months to please investors. The most recent data from the United Kingdom shows that only 57 of the companies in the benchmark FTSE 100 index were still issuing quarterly reports as of September 2017, according to the Investment Association. The U.S. enacted quarterly reporting in.


While the quarterly earnings season has a negligible impact on market-wide volume, it does coincide with an increase in price turbulence among individual companies. Some high-profile executives, including JPMorgan Chase chief executive Jamie Dimon, have recommended that companies stop providing Wall Street analysts guidance on what to expect from quarterly profits, for example.

"You're probably going to get a debate where you have people saying these reports are unnecessary, and I don't think that will convince a lot of people", said Martin, who's now a senior counsel at the law firm Covington & Burling.

On the other side are many investors who say frequent insight into the financial performance of corporations is critical to their own decision-making and financial security.

He would need to draft a proposed rule-change which would then be put to an industry consultation during which investors, companies, exchanges, pension funds and public interest groups would likely bombard the SEC with information.


Comments