Trump proposes to switch from quarterly to semi-annual reports for public companies. This has sparked controversy over transparency and the impact on investors.

Trump calls on the SEC to eliminate quarterly company reports

US President Donald Trump wants to break the tradition that has existed for more than half a century: mandatory quarterly financial reports for public companies. He proposes that the SEC allow companies to report only twice a year.

“This will save money and give managers more time to run companies,” Trump said on social networks.

SEC Chairman Paul Atkins, appointed by Trump, has already called the idea “the right step forward.” Companies, he said, will be able to choose: to stay with quarterly reporting or switch to semi-annual.

Arguments for and against

Supporters of the change believe that quarterly reports encourage short-term thinking. The EU and the UK have already switched to semi-annual reports, although a 2017 Columbia Business School study found that investment volumes have not increased significantly.

Opponents argue that longer reporting intervals mean more “white space” for investors, more opportunities to hide problems, and more room for insiders. Bloomberg writes that “six months in a dynamic economy is an eternity.”

What Buffett and Dimon say

Warren Buffett and JPMorgan CEO Jamie Dimon agree that quarterly reports have value. But they criticize the mandatory “guidance” section because it pushes companies to focus on short-term profits.

“Transparency is important, but not at the expense of long-term strategy,” they wrote back in 2018.

What investors should do

• Keep a long-term plan. History shows that profitability increases over 5-10-year time horizons.
• Don’t just wait for reports. Follow companies beyond the official financial reports.
• Analyze the details. If the numbers look questionable, check deeper.
• Diversify your portfolio. This is the main protection against surprises in the market.

The SEC also advises investors to independently review the documents that companies submit to the regulator and to be attentive to signs of fraud.