A System Built on Lessons from the Past

Quarterly reporting requirements didn’t appear by accident. They were forged in the aftermath of market collapses and scandals, when companies routinely lied, concealed losses, and manipulated results. The goal was simple: keep retail investors — the everyday people whose retirement accounts and savings flow into these companies — informed on a regular basis. Without that cadence, history shows management teams can (and do) mislead the public.

Transparency Is Non-Negotiable

Cutting disclosures in half gives executives more time to cover up poor decisions, questionable accounting, or outright fraud before anyone notices. Scandals like Enron, WorldCom, or more recently Wirecard remind us how quickly misinformation can spiral. In each of those cases, timely disclosures could have caught issues earlier — potentially saving billions in losses.

The “Cost Savings” Myth

Proponents argue semi-annual reporting would save companies money. That’s misleading. Only the annual 10-K is required to be audited by firms overseen by the PCAOB. The quarterly 10-Q filings are typically unaudited and far less expensive to produce. In other words: transparency isn’t where companies are bleeding money. Suggesting otherwise is a distraction.

The Europe Comparison Doesn’t Hold

Another argument is that European firms aren’t required to report quarterly. But many of those same firms raise capital in the U.S. and rely on American investors. Lowering our standards to match Europe exposes U.S. taxpayers and retirement savers to higher fraud risk. The strength of U.S. markets has always been transparency and accountability — why dilute it?

What If Semi-Annual Reporting Happens Anyway?

If regulators do move forward with semi-annual reporting, investor protections must get stronger — not weaker:

• Independent Oversight: A tri-agency committee (PCAOB, SEC, FBI) should conduct rolling monthly audits, with results made public.

• Executive Accountability: CEOs and CFOs should face Senate subpoenas if multiple misstatements or missed audits occur.

• Compliance Scorecards: An annual public “report card” should grade each company on disclosure accuracy, management quality, and baseline financial health.

Additional Guardrails

Beyond that, Congress and regulators could:

• Expand real-time event reporting (beyond the current 8-K framework).

• Strengthen whistleblower protections and mandatory disclosure of investigations.

• Tighten clawback rules to strip executives of compensation when fraud is revealed after semi-annual gaps.

Confidence Is the Currency

At the end of the day, markets run on confidence. Transparency builds trust, trust attracts capital, and capital fuels growth. Less reporting doesn’t mean efficiency — it means opacity. If companies want to save money, they should streamline operations, not starve investors of information.

Quarterly reporting isn’t just tradition — it’s a safeguard. Abandoning it risks eroding one of the core advantages of U.S. markets: the belief that investors, no matter their size, can rely on timely, accurate information.