SEC Proposes Optional Semiannual Reporting Framework for Exchange Act Issuers

The US Securities and Exchange Commission proposed amendments to Exchange Act Rules 13a-13 and 15d-13 on May 5, 2026 that would permit Exchange Act reporting companies to elect to file semiannual reports on a new Form 10-S in lieu of quarterly reports on Form 10-Q. The proposed amendments would retain quarterly reporting as the default but introduce an optional semiannual reporting alternative intended to reduce compliance burdens while preserving core disclosure requirements.

Companies subject to the periodic reporting obligations of Sections 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (Exchange Act) are currently required to file three quarterly reports on Form 10-Q each fiscal year, with fourth-quarter results included in an annual report on Form 10-K. Form 10-Q’s requirements include unaudited financial statements prepared in accordance with US generally accepted accounting principles and management’s discussion and analysis of financial condition and results of operations (MD&A) for the fiscal periods covered, updates to risk factors, disclosures regarding legal proceedings, certifications by the company’s executive officers regarding its company’s disclosure and internal controls, certain exhibits, and tagging of information in inline XBRL.

The financial statements in a Form 10-Q are required to be reviewed by an independent public accounting firm, but do not need to be audited. The US Securities and Exchange Commission’s (SEC’s) proposed amendments reflect a continuing policy discussion regarding whether the costs and potential short-term focus associated with quarterly reporting outweigh its informational benefits for certain issuers.

KEY FEATURES OF THE PROPOSED SEMIANNUAL REPORTING FRAMEWORK

The proposed amendments would introduce a voluntary reporting option under which eligible Exchange Act reporting companies could elect to file semiannual reports on new Form 10-S instead of quarterly reports on Form 10-Q. The framework is structured to preserve existing disclosure while reducing reporting frequency.

Key features include:

• Existing reporting companies: Any issuer already subject to Exchange Act periodic reporting obligations would elect semiannual reporting by checking a box on the cover page of their Form 10-K. The election would apply for the following fiscal year and would be binding for that fiscal year; failure to check the box would see a semiannual filer revert to quarterly reporting. The proposed amendments would also permit correction of an inadvertent election error by amending the relevant Form 10-K, provided the amendment is filed no later than the due date for the issuer’s first Form 10-Q following the filing of the Form 10-K.
• New reporting companies: In addition to through the checkbox on Form 10-K, any private companies entering the Exchange Act reporting system could make an initial election in certain registration statements (Forms S-1, S-3, S-4, or S-11, or Form 10).
• Consistent filing deadlines: Filing deadlines for Form 10-S would mirror those for Form 10-Q (40 days for large accelerated and accelerated filers and 45 days for other issuers).
• Substantially similar disclosure requirements: Form 10-S would require the same disclosures as Form 10-Q, including interim financial statements that would continue to be subject to independent auditor review, but covering six-month and prior year comparative periods, rather than three-month periods. Forms 10-S filers would continue to file annual reports on Form 10-K covering full fiscal years.
• Transition considerations: Because issuers would have an annual opportunity to switch between semiannual and quarterly reporting, a semiannual reporter that returns to quarterly reporting would again be subject to quarterly interim reporting requirements, including presentation of comparative prior-year quarterly periods, which may require preparation and auditor review of prior year quarterly financial information that had not previously been presented.
• Renovation of Regulation S-X: The SEC has also proposed amendments to Regulation S-X to align financial statement requirements with the semiannual reporting option and simplify existing rules. The proposed amendments would consolidate the age of financial statement requirements into Rule 3-01 and eliminate Rule 3-12, align financial statement “staleness” updating requirements with Form 10-Q and Form 10-S deadlines, and revise Rules 10-01 and 8-03 to specify that “interim” financial statements for semiannual filers refer to semiannual fiscal periods.
• Conforming changes, but otherwise the framework remains the same: The proposed amendments would introduce defined terms for “quarterly filer” and “semiannual filer” and conforming changes across SEC forms and rules. The treatment of earnings releases under Item 2.02 of Form 8-K, the functioning of Regulation FD, and the other aspects of the existing disclosure framework would remain in place.

IMPLICATIONS FOR ISSUERS, INVESTORS, AND CAPITAL MARKETS ACTIVITY

The proposed amendments would introduce optionality into the periodic reporting framework, which may result in differing approaches depending on issuer size, investor base and expectations, and capital market activity.

In statements accompanying the proposing release, SEC leadership emphasized flexibility, deemphasizing short-termism, and cost reduction as principal objectives of the amendments. Chair Paul Atkins stated that the current reporting framework may prevent companies and investors from determining the reporting frequency that “best serves their business needs and investors,” while Commissioners Hester Peirce and Mark Uyeda similarly emphasized issuer choice and the potential benefits of reducing reporting burdens.

The proposing release notes that emerging growth and smaller reporting companies, which would continue to enjoy scaled disclosure requirements on Form 10-S, may benefit from adopting semiannual reporting, and provides the example of a pre-revenue biotechnology company whose investors are focused on product development and regulatory approvals rather than results of operations or balance sheet information.

Key considerations for all companies include:

• Cost savings versus practical and contractual constraints: While the SEC estimates meaningful compliance cost savings for companies that adopt semiannual reporting, some issuers may be constrained by debt covenants, provisions in equity distribution agreements for at the market offering programs, or other contractual restraints that necessitate quarterly reporting or the preparation of equivalent information on the same cadence.
• Capital markets considerations: Issuers that frequently access the capital markets may continue to produce quarterly financial information to support offering processes and auditor comfort practices, regardless of whether they elect semiannual reporting. In particular, under current Public Company Accounting Oversight Board (PCAOB) standards for auditors, including Accounting Standard 6101, auditors generally may provide comfort letters expressing negative assurance on changes subsequent to the date and period of the latest financial statements included or incorporated by reference in the offering materials for securities offerings only if they have performed a review of annual or interim financial statements within the preceding 135 days. This may limit the practical ability of frequent issuers to rely solely on semiannual reporting.
• Investor and analyst expectations: Institutional investors and analysts often rely on quarterly financial data for modeling and valuation and issuers—particularly those whose peers continue to report quarterly—may face pressure to maintain quarterly disclosure to avoid becoming an outlier within their industry. Even where issuers elect semiannual reporting, they may continue to provide quarterly earnings releases or investor calls to meet market expectations, resulting in a hybrid disclosure approach.
• Information availability and comparability: Form 8-K reporting, Regulation FD, and voluntary earnings releases may not fully replicate the consistency, comparability, and completeness of structured quarterly reports, which may both be to the detriment of investors and to the benefit of companies that are able to present results over a longer period. Longer intervals between filed financial results could affect insider trading windows, blackout periods, and the operation of Rule 10b5-1 trading plans.

REQUEST FOR COMMENT

The proposing release requests comments from the public, and includes 58 specific questions on the application, benefits, and drawbacks of the proposed rules.

Topics include whether requirements for auditor review should be extended to earnings releases; whether disclosure and exhibits under Item 2.02 of Forms 8-K reporting earnings releases should be “filed” rather than “furnished,” which would subject them to liability under Section 18 of the Exchange Act as well as Section 11 of the Securities Act of 1933, as amended (Securities Act), if incorporated into a Securities Act registration statement; whether Forms 10-K filed by semiannual reporters should provide separate financial information for the second half of the covered fiscal year; the potential impact of longer silence by issuers between periodic reports on insider trading risks, policies and procedures; and need for conforming changes to PCAOB standards and stock exchange rules.

Issuers and other market participants may wish to evaluate the proposed amendments after considering their reporting obligations, capital markets activities, and investor expectations, and consider submitting comments addressing the potential benefits and risks of the proposed framework, including the interaction with capital markets practices and existing contractual obligations.