Asking SEC to consider ending quarterly earnings reports, says Donald Trump

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Washington | Published: August 18, 2018 8:12:22 AM

President Donald Trump said he had asked stock market regulators to look into ending the requirement for businesses to issue quarterly earnings reports.

Asking the Securities and Exchange Commission — an independent agency — to move to twice-yearly reporting could help create jobs, Trump said on Twitter. (File photo)

President Donald Trump said he had asked stock market regulators to look into ending the requirement for businesses to issue quarterly earnings reports.

Asking the Securities and Exchange Commission — an independent agency — to move to twice-yearly reporting could help create jobs, Trump said on Twitter.

“In speaking with some of the world’s top business leaders I asked what it is that would make business (jobs) even better in the US. ‘Stop quarterly reporting & go to a six month system,’ said one. That would allow greater flexibility & save money,” he tweeted.

“I have asked the SEC to study!” He later attributed the suggestion to PepsiCo chief Indra Nooyi, who last week announced she was stepping down in early October.

He told reporters “the head of Pepsi-Cola, a great woman who is now retiring… I asked, what could we do to make it better? She said, two times a year reporting, not quarterly.”

“It made sense to me,” he added.

“We are looking at that very, very seriously.” Trump held a dinner for business executives on August 8, two days after Nooyi announced her departure, at his golf club in Bedminster, New Jersey.

Nooyi confirmed she had made suggestions on how to encourage companies to have a more long-term view.

“Most agree that a short-term only view can inhibit long-term strategy and thus long-term investment and value creation,” she said in an statement to AFP.

“My comments were made in that broader context, and included a suggestion to explore the harmonization of the European system and the US system of financial reporting. In the end, all companies have to balance short-term and long-term performance,” Nooyi said.

SEC Chairman Jay Clayton issued a statement saying the agency “continues to study public company reporting requirements, including the frequency of reporting.”

And he said, the SEC already had implemented some regulatory changes and continued to consider others that “encourage long-term capital formation while preserving and, in many instances, enhancing key investor protections.”

The SEC was created in 1934 in the midst of the great depression and requires publicly-traded companies to issue quarterly and annual earnings reports to keep the public informed on their operations and financial situation.

The securities law that created the SEC requires public reports, but the agency interprets the law in setting regulations.

The SEC consists of five commissioners appointed by the president, although there currently are only four in place, three named by Trump, including Clayton. No more than three can be from any one party.

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