The big market loser if Trump is, SEC ends the quarterly reports not investors

With the Securities Committee and the Stock Exchange now President TrumpRequest to look at the base of that The mandate ends These public companies provide quarterly reports, there is a lot to earn to companies in time and money, and many of the four major accounting companies to lose.

Trump originally suggested the transition to semi -annual reports in a post on the social truth a few weeks ago, saying it “will save money, and allow managers to focus on the management of their companies properly.”

SEC Paul Atkins President CNBC said shortly after the al -Qaeda suggestion is underway, although he suggested any change Give companies the option to change Their reports schedule. “For shareholders and public companies, the market can decide what is the right rhythm,” said Atkins.

With semi -annual reports, companies can submit large costs and employment associated with quarterly reports. But independent accounting companies, especially “Big Four” – Deloitte, EY, KPMG and PWC – that help them prepare them for losing a large part of their work in scrutiny. On average, it takes about 180 hours to prepare a required 10-e model, at an expense that can vary from $ 50,000 for smaller companies to more than a million dollars for large institutions. This does not include the expenses of internal audit teams and operations.

It is important to note the distinction between a quarterly report, or 10-e, and a profit report. 10-e required SEC and reviewed by independent auditors, after strict disclosure standards. Almost at the same time, through a press release, companies issue a separation profit report-which has not been reviewed-to the media and investors, highlighting the revenues, profits and other main standards mentioned in the official 10-Q.

“I am sure that (the big four) pay attention to this proposal because it is likely to move through the Supreme Education Council,” said Jerry Maginnis, a former KPMG review partner. “It can have a significant impact on their business model.”

It is estimated that up to 15 % of the annual auditing fees for companies “can disappear”.

Larry Rand, a visiting economist at the University of Brown and a financial advisor, said that the four adults may be able to recover some of these missing revenues by expanding the scope of consulting and tax services, but if not the case, they will have to think about cost discounts. “If you are going to lose a large revenue flow, you will definitely have to consider ways to save money,” he said. “They will employ fewer people. They will use more artificial intelligence tools,” he added.

This happens as it is. PWC said In August, in which you expect to employ a third of less people outside the campus by 2028-less than 39 % in scrutiny-partially driven by the rapid appearance of Amnesty International and how to change beginners’ functions. Changing the SEC base can be another blow to the workforce of accounting companies.

The SEC base change was somewhat surprising. Among a large number of Trump’s goals was not to cancel the restrictions, from immigration to Dei, and it was not included in the Playbook 2025 Project 2025 now.

But during the first period of Trump, he threw the same stadium in 2018. “I asked the Supreme Education Council to study!” SEC raised comments Of a variety of affected stakeholders – accounting industry, investment research companies, institutional investors, individuals and academics – but in the end, the momentum stops.

This repetition is likely to pass in the same process, but it has a good opportunity to succeed, especially given the current administration Drilling victories so far And the fixed agencies of Trump’s desires. In fact, a spokesman for the Supreme Education Council said that the agency “gives priority to this proposal to increase the elimination of unnecessary regulatory burdens on companies.”

Both the four major accounting companies refused to comment.

Although today’s economy is significantly different from that in 2018 – it does not look further than customs tariffs, commercial wars and AI – it is useful to review accounting companies comments in 2018 when SEC was first exposed to the issuance of quarterly reports.

Not surprisingly, given the negative effects of the industry, all of them preferred to keep the separate rhythm, as each indicated values ​​that bring them to investors and capital markets. For example, Deloitweth said, “By helping to ensure investors receive regular, reliable and reliable information, the SEC system helped make American markets stronger and more confident in the world.”

“We believe that the quarterly reports reduce the lack of consistency of information between administration and investors and reduce uncertainty in the market,” said EY. “Spanish reports also help reduce risks in the corporate financial reports system by facilitating the identification and issues of possible time.”

“They have historically relied on the negative assertion provided by the review of the references to their investment decisions,” KPMG told users of the Financial statement.

“The irregular nature of profit versions may make it difficult for investors to determine the information that is subject to temporary review procedures for independent reviews. Additional guidelines must be developed,” said PWC, who has noticed the difficulty of reports.

Meanwhile, they argued against changing al -Qaeda, companies were keen to recognize the SEC authority to review the quarter -reports schedule, which has been assigned since 1970.

“It can benefit from the targeted improvements that would reduce the burden of compliance with companies,” the reports said.

A long time ago, it has been discussed by business leaders and investors, but the concept of semi -annual reports has previously. The European Union and the United Kingdom have turned from a quarterly rhythm for more than a decade, although companies can voluntarily choose to issue quarterly reports.

“These foreign companies” are not required to report a quarter of an annual, but there is still a good amount of large companies, “said Dominic Pabaldo, chief asset manager at Mooringstar, even if it is not an official release of profits.

He said that Pabalardo could expect the same scenario to be adopted in the United States. “If companies believe that there is benefit to give investors quarterly information, they will continue to do so. I think some, if not much, will continue to provide a kind of quarterly update,” he said.

Some commentators in 2018 indicated that any public companies need to issue debts or ownership rights at any specific time that may have no choice but to report quarterly numbers, or to face higher cost of capital. There will also be a level of peer exams that take place on the market – if the public company is not step with the main competitors in reporting schedules, it can move away from the investor’s money.

For these reasons and many other reasons, accounting companies may be less extreme of work, than the surface. Magnes said: “Even if it is not required by the Supreme Education Council, it will not be surprising to me (some customers) that their accounting company shares somewhat similar to what is happening now. In these cases, revenue flows may not be affected as much.”

In addition to reducing the expenses and transgressions of the quarterly reports, another argument in favor of a semi -annual mandate is that they will encourage private companies to announce public. The number of companies listed for the public in the United States decreased from more than 7,000 in 1996 to less than 4000 in 2020.

Activating the public subscription market – which was recently Gain momentum It will be an additional way for the biggest environment to keep their heads over water. “From their point of view, it is zero,” said Rand. “They may lose revenues from their current customer base, but they will get revenues from more companies that are publicly considered if they know that they only have to report an annual.”

It will take months until SEC collects again and moves through comments on this proposal. Although the four adults have declined, if gently, against Trump’s suggestion 2018, companies may be more suitable this time – if there is no reason other than anxiety of the jaw type that was a distinctive feature of Trump 2.0. “This is a widespread reaction to many potential commentators,” Rand said. “I don’t think it will be a safe thing to do.”

Regardless, Maginnis believes that the stars are in favor of changing scheduling. “Between the president’s support and encouragement to this, the SEC’s current leadership approach to the organizational scene, I would like to say that it has at least 50-50 of traffic, and perhaps a little better than that.”