SEC Reconsiders Corporate Reporting Rhythm

The Securities and Exchange Commission (SEC) is moving to evaluate President Trump’s renewed call to end the requirement for companies to file quarterly financial reports. The proposal, now entering the rulemaking phase, could fundamentally alter how public companies communicate with investors and regulators—a shift that has significant implications for corporate governance, market transparency, and the accounting industry’s revenue streams.

Trump’s argument is rooted in efficiency and deregulation. He claims that shifting to semi-annual reporting would “save money, and allow managers to focus on properly running their companies.” SEC Chair Paul Atkins confirmed that the proposal is under active review, suggesting the final rule could allow companies flexibility to choose their own reporting cadence.

This shift would halve the cost and time associated with the complex preparation of quarterly filings—each taking roughly 180 hours and costing up to $1 million for large corporations. Yet while the move might streamline corporate operations, it threatens a significant revenue pillar for independent auditors who rely heavily on quarterly review fees.

The Big Four Face a Changing Business Model

The firms most exposed to the change—Deloitte, EY, KPMG, and PwC—generate billions in audit-related services, much of which stems from quarterly reporting requirements. Experts estimate that as much as 15% of their annual audit fees could evaporate if companies no longer file Form 10-Qs every three months.

Jerry Maginnis, a former audit partner at KPMG, called the potential impact “very significant,” noting that the firms may be forced to accelerate their transition toward advisory and consulting services. That shift is already underway as AI and automation disrupt the auditing profession. PwC, for instance, has announced plans to hire 39% fewer audit graduates by 2028—anticipating both technological efficiencies and regulatory reform.

However, analysts note that the Big Four could offset these losses through the ongoing IPO boom and rising demand for advisory services. If fewer reporting requirements encourage more private firms to go public, the resulting influx of new clients could partly balance the equation.

Transparency vs. Efficiency—A Global Perspective

Opponents of the proposal warn that less frequent reporting could reduce transparency and increase information asymmetry between corporate insiders and investors. The Big Four themselves have historically defended quarterly reporting as essential to maintaining market confidence and timely disclosure.

European markets, which transitioned to optional quarterly reporting over a decade ago, offer a cautionary parallel: while companies saved on costs, most large firms continued to issue quarterly updates voluntarily to maintain investor trust and stable capital access.

Market observers expect similar behavior in the U.S.—especially among firms reliant on steady equity or debt issuance. As Morningstar’s Dominic Pappalardo noted, “If companies think there’s a benefit to giving investors quarterly information, they’re going to continue to do it.”

A Rule That Could Redefine Market Behavior

If implemented, the SEC’s rule could redefine how investors evaluate corporate performance and how companies manage disclosure risk. While the change would alleviate short-term cost pressures, it may introduce new challenges for valuation models and investor communication.

For the Big Four, adaptation will be critical. Whether through expanding advisory portfolios, deepening AI integration, or capturing new IPO mandates, accounting giants must reimagine their growth strategy in a deregulated era. With Trump’s administration prioritizing regulatory rollbacks and the SEC signaling alignment, a semi-annual reporting future looks increasingly plausible—one that may favor corporate flexibility but challenge market transparency for years to come.