The Securities and Exchange Commission's initiative to permit public companies to report financial results twice a year, rather than quarterly, has encountered fierce resistance from the investment community. Three major industry groups—the Investment Adviser Association (IAA), CFP Board, and the CFA Institute—have warned that the change would deprive investors and their advisors of timely data essential for sound decision-making, potentially widening information gaps and raising costs.
The proposal, which introduces a new Form 10-S for semiannual filings as an alternative to the current Form 10-Q, is a key component of SEC Chairman Paul S. Atkins's deregulatory agenda. Atkins has framed the effort under the slogan "Make IPOs Great Again," aiming to reduce the burden of public company status to encourage more firms to list and remain listed in the U.S. However, the backlash from money managers, financial planners, and retail investors suggests the agency may have underestimated the importance of quarterly reporting in American capital markets.
The SEC's 60-day comment period for File No. S7-2026-15 closed on July 6. According to a tracker by Tzachi Zach, an accounting professor at Ohio State University's Fisher College of Business, 11,997 individually classified comment letters were recorded as of July 9, with approximately 97% opposing the proposal. This tally excludes nearly 60,000 form-letter submissions across ten templates, all of which also opposed the change. The overwhelming opposition contrasts sharply with the SEC's 2018 feedback request, where only 43% of respondents opposed moving away from quarterly filings, as noted by Sarah McVay, an accounting professor at the University of Washington's Foster School of Business.
Industry experts view the near-unanimous opposition as significant. Daniel Brinks, a forensic accounting partner at StoneTurn and former SEC enforcement accountant, said the one-sided comment file increases the likelihood of a legal challenge if the SEC finalizes the rule. The IAA, whose members manage over $57 trillion in client assets, did not outright reject the proposal but raised numerous concerns. The group argued that less frequent reporting would hinder fiduciary investment advisers from accessing standardized, comparable information needed to act in clients' best interests, particularly disadvantaging smaller advisory firms that lack the resources of larger competitors.
The IAA also challenged the SEC's suggestion that quarterly filings primarily serve short-term traders. The group emphasized that long-term investors and advisors require regular disclosures to monitor leverage, liquidity, management performance, and emerging risks. They recommended that the SEC streamline the content of existing 10-Q filings instead of reducing the reporting cadence—an alternative also suggested by SEC Commissioner Hester Peirce.
CFP Board, which oversees certification for financial planners, warned that moving away from mandatory quarterly reporting could disadvantage retail investors, push markets toward less standardized private data sources, and complicate comparisons across companies and industries. "Quarterly reporting gives retail investors and the financial professionals who serve them a reliable baseline of timely, comparable information," said Erin Koeppel, managing director of government relations at CFP Board. She added that reducing the cadence would widen information gaps, weaken transparency, and make fraud harder to detect.
A survey of 2,500 CFA charterholders found that 62% opposed replacing quarterly filings with semiannual ones, and 63% believed the benefits of quarterly reporting outweigh its costs. Notably, 70% opposed giving companies flexibility to choose their own schedule, and only 32% expected firms to voluntarily continue quarterly filings if the requirement became optional. Retail investors also voiced strong opposition, with informal submissions and letters from corporate veterans like David Bolling Wells, former CFO of Netflix, who called quarterly reporting a foundational element of "democratic capital markets." Groups from Reddit's WallStreetBets community submitted a dissenting letter, arguing that quarterly disclosures help level the playing field between individual and institutional investors.
The proposal's fate remains uncertain, but the breadth of opposition suggests the SEC may face significant hurdles in implementing the rule. For advisors and investors, the outcome could reshape the flow of financial information in U.S. markets, with potential implications for portfolio monitoring and client advice.
