SEC Proposes Optional Semiannual Reporting for Public Companies: A Potential Sea Change in Periodic Disclosure

THE BOTTOM LINE

• The SEC proposal would give reporting companies that currently file quarterly reports on Form 10-Q the option to file a new “Form 10-S” semiannual report in lieu of three quarterly reports on Form 10-Q.
• Under the proposal:
  • The election to report semiannually would be made on an annual basis through a new checkbox on the cover page of the Form 10-K; a similar check box would be added to the cover page of Securities Act registration statements on Forms S-1, S-3, S-4, and S-11 and Exchange Act registration statements on Form 10;
  • Form 10-S would require the same narrative disclosures and financial information as existing Form 10-Q but would cover a six-month period rather than a fiscal quarter, and scaled disclosure would remain available to smaller reporting companies on Form 10-S, as with Form 10-Q;
  • The deadline for filing Form 10-S would be 40 days (for large accelerated filers and accelerated filers) or 45 days (for all other reporting companies) after the end of the fiscal year’s first semiannual period—the same deadlines that currently apply to Form 10-Q after a fiscal quarter end; and
  • As regards interim financial statements, a registrant would no longer assess the number of days from the filing date or effective date to the date of the most recent balance sheet to determine if that balance sheet falls within 130 or 135 days (depending on filer status), as currently required. Instead, registrants would be required to include the interim financial statements as of the end of the most recently completed fiscal quarter (for quarterly filers) or semiannual period (for semiannual filers) that has been filed, or is required to be filed on or before the filing (or effective) date, in a Form 10-Q or Form 10-S—no substantive changes are being proposed to existing requirements for annual financial statements.
• The proposal does not include any general changes to the current regulatory requirements governing earnings releases (other than technical amendments to Item 2.02 of Form 8-K, regarding disclosure of earnings releases, to include references to semiannual periods) or earnings guidance practices.

THE DETAILS

Overview

On May 5, 2026, the Securities and Exchange Commission (the “SEC”) issued a proposed rule that would, for the first time in over fifty years, allow reporting companies to file interim reports on a semiannual basis rather than quarterly. Specifically, the SEC is proposing amendments to Rules 13a-13 and 15d-13 under the Securities Exchange Act of 1934 (the “Exchange Act”) and related rules and forms to permit companies to file a new “Form 10-S” semiannual report in lieu of three quarterly reports on Form 10-Q. The proposal would also amend the financial statement requirements of Regulation S-X to facilitate semiannual reporting and to simplify the rules governing the age of financial statements in registration statements and other SEC filings. According to the SEC, the proposal is aimed at reducing regulatory burden and compliance costs, encouraging companies to go public and remain public, promoting long-term business strategies (instead of short-termism), and providing flexibility to “emerging growth companies” and “smaller reporting companies,” among other things.

Comments on the proposed rule are due 60 days after its publication in the Federal Register.

We summarize the key elements of the proposal and highlight important practical considerations for public companies and their advisors below.

The Semiannual Reporting Election

• Eligible Reporting Companies. Under the proposal, all reporting companies currently required to file quarterly reports on Form 10-Q would have the option to file semiannual reports on new Form 10-S in lieu of quarterly reports. The option would be available to those reporting companies, regardless of filer status, revenues, market capitalization, or other criteria.
• Election Timing; Making the Election. The election to report semiannually or quarterly would be made on an annual basis and cannot be changed mid-fiscal year. A reporting company would indicate its election to report semiannually by checking a new semiannual reporting box on the cover page of its Form 10-K; leaving the box unchecked would indicate a choice to report quarterly. A similar check box would be added to the cover page of Securities Act registration statements on Forms S-1, S-3, S-4, and S-11 and Exchange Act registration statements on Form 10, so that private companies conducting initial public offerings could make their initial election at that time.
• Correcting an Election Error. If a company mistakenly checks or fails to check the semiannual reporting box, it may amend its Form 10-K to correct the error. Such a corrective amendment must be filed as soon as practicable after discovery of the mistake but no later than the due date for the company’s first Form 10-Q for the fiscal year in which the initial Form 10-K with the erroneous election was filed. Electing to file semiannual reports and filing such a corrective amendment would not impact the company’s timeliness for the purposes of determining eligibility to file a Form S-3 registration statement.

New Form 10-S

A company electing semiannual reporting would file one semiannual report on new Form 10-S and one annual report on Form 10-K for each fiscal year. Form 10-S would require the same narrative disclosures and financial information as existing Form 10-Q but would cover a six-month period rather than a fiscal quarter. The financial statements for the covered semiannual period would be required to be prepared in accordance with U.S. GAAP and reviewed by an auditor (though not audited). Scaled disclosure would remain available to smaller reporting companies on Form 10-S, as with Form 10-Q.

• Filing Deadlines. The deadline for filing Form 10-S would be 40 days (for large accelerated filers and accelerated filers) or 45 days (for all other reporting companies) after the end of the fiscal year’s first semiannual period—the same deadlines that currently apply to Form 10-Q after a fiscal quarter end. The second semiannual period would be subsumed in the annual report on Form 10-K.

Companies Switching Between Reporting Frequencies

A company switching from quarterly to semiannual reporting generally would not need to take extra steps to prepare the comparable prior-year financial statements for its first semiannual report, because those six-month financial statements would already have been included in the prior year’s second-quarter Form 10-Q. However, a company switching from semiannual to quarterly reporting may need to take additional steps to prepare financial statements for comparable quarterly periods in the prior year, including ensuring that an independent public accountant has reviewed those comparable quarterly periods.

Proposed Amendments to Regulation S-X

Streamlining Age of Financial Statements Requirements

The SEC is proposing amendments to Rules 3-01 and 8-08 of Regulation S-X to simplify and consolidate the age of financial statement requirements. The requirements of current Rule 3-12 of Regulation S-X, which addresses the age of financial statements at the effective date of a registration statement or mailing of a proxy statement, would be consolidated into revised Rule 3-01, and Rule 3-12 would be eliminated. Similar conforming amendments would be made to Rule 8-08 for smaller reporting companies.

Annual Financial Statements

No substantive changes are being proposed to existing requirements for annual financial statements.

New Model for Determining Age of Interim Financial Statements

Under the proposed amendments, a registrant would no longer assess the number of days from the filing date or effective date to the date of the most recent balance sheet to determine if that balance sheet falls within 130 or 135 days (depending on filer status), as currently required. Instead, registrants would be required to include the interim financial statements as of the end of the most recently completed fiscal quarter (for quarterly filers) or semiannual period (for semiannual filers) that has been filed, or is required to be filed on or before the filing (or effective) date, in a Form 10-Q or Form 10-S. A non-reporting registrant (e.g., a private company registering its initial public offering) would apply this rule as if it were required to file Form 10-Q or Form 10-S, as applicable, in line with the election it makes on its registration statement.

Other Regulation S-X Amendments

The SEC is proposing amendments to Rules 10-01 and 8-03 of Regulation S-X to clarify that “interim” for quarterly filers means a fiscal quarterly period and for semiannual filers means a fiscal semiannual period. Under these amendments, semiannual filers would provide an interim balance sheet as of the end of the first semiannual period and statements of comprehensive income and cash flows for that period and the corresponding period of the preceding fiscal year.

Proposed Amendments Regarding Transition Reports

The SEC is proposing amendments to Exchange Act Rules 13a-10 and 15d-10 to incorporate the semiannual reporting option into the SEC’s requirements for transition reports upon a change in fiscal year. The proposed amendments for semiannual filers would mirror the rules currently applicable to quarterly filers.

Earnings Releases and Guidance

The proposal does not include any general changes to the current regulatory requirements governing earnings releases (other than technical amendments to Item 2.02 of Form 8-K, regarding disclosure of earnings releases, to include references to semiannual periods) or earnings guidance practices. Federal securities laws do not impose general duties upon reporting companies to announce or publish earnings, conduct earnings calls, or issue earnings guidance. The SEC noted, however, that it is requesting comment on whether Item 2.02 Form 8-K disclosures should be treated as “filed” rather than “furnished” for semiannual filers, which would subject earnings releases by such filers to additional liability provisions such as Exchange Act Section 18.

The SEC acknowledged that quarterly earnings releases furnished under Item 2.02 of Form 8-K differ from Form 10-Q financial information because they are not required to be reviewed by an independent public accountant or to comply with the SEC’s interim financial statement requirements. The SEC expects that a company’s individual characteristics, facts, and circumstances will determine whether it continues to make quarterly earnings releases after electing to report semiannually, noting that experience in the United Kingdom was broadly illustrative: when quarterly reporting was no longer required of UK companies in 2014, less than 10% stopped issuing quarterly reports (as of the end of 2015).

Practical Considerations

Why Some Companies May Elect to Continue Quarterly Reporting. Companies might continue to report quarterly where they determine that quarterly frequency is best for the company and its investors, due to factors such as expectations of investors and securities analysts, disclosure practices in a particular industry, liquidity and fundraising considerations, contractual obligations, or other regulatory requirements. Some companies may also view semiannual reporting as increasing the length of time that directors or employees possess non-public information subject to closed trading windows and may prefer quarterly reporting because it provides more frequent open trading windows.

Impact on Insider Trading Policies. The SEC has requested comment on the impact of optional semiannual reporting on company insider trading policies, including trading windows. Companies may need to consider whether they would impose longer trading blackout periods at the beginning or end of a semiannual period than they would under quarterly reporting.

Impact on Securities Offerings. The SEC acknowledged that, depending on when a registration statement becomes effective, an investor in a semiannual filer may not receive interim financial statements that are as current as would be required today, noting, for example, that a registration statement filed as late as August 13 by a non-reporting registrant that elects semiannual reporting would not be required to include interim financial statements. If adopted as proposed, companies electing semiannual reporting would need to consider whether they would nonetheless include quarterly or more recent financial information in Securities Act registration statements or prospectuses based on market practices or liability concerns.

Exchange Rules and Accounting and Auditing Standards. The SEC recognized that, if the proposal is adopted, changes may be necessary or appropriate to the rules of securities exchanges or to various accounting or auditing standards. The SEC staff would be expected to coordinate with accounting and auditing standard-setters, securities exchanges, and other market participants on such changes.

Potential Impact on Auditor Reviews and Comfort Letters. Companies that elect semiannual reporting may still retain independent public accountants to perform quarterly reviews to support quarterly earnings releases or to guard against the possible need for quarterly review data should the company later switch back to quarterly reporting. The SEC has also requested comment on whether changes to PCAOB Auditing Standards governing comfort letters would be needed to permit auditors to provide negative assurance for semiannual filers conducting securities offerings.