"Now President Trump is taking up their cause. In a social media post, he called for companies to report their earnings every six months, which he says would benefit the country. "This will save money, and allow managers to focus on properly running their companies," Trump said in his social media post. "Did you ever hear the statement that, "China has a 50 to 100 year view on management of a company, whereas we run our companies on a quarterly basis???" Not good!!!""
"Prof. Salman Arif from the University of Minnesota's Carlson School of Management says moving to reporting earnings twice a year could potentially lead to illegal activities by companies because there would be less chances for investors to scrutinize their financial numbers. "If we want to reduce accounting fraud, reduce opportunities for insider trading, improve the strength of our capital markets, and allow companies to invest for the long run, I think more transparency is is truly beneficial," Arif says."
A proposal calls for companies to report earnings every six months, arguing it would save money and allow managers to focus on running companies properly. Many executives view quarterly reporting as expensive and as encouraging short-term decision-making. Investor advocates and finance experts warn that less frequent disclosures would reduce transparency, allow companies to withhold important information for longer periods, and could increase risks of accounting fraud and insider trading. The SEC has required quarterly earnings reports since 1970. Larger companies typically hold investor calls and provide guidance. Any change to disclosure frequency would require regulatory action and take considerable time to implement.
Read at www.npr.org
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