President Calls for Six-Month Corporate Reporting Cycle, Citing Cost Savings (bbc.com)
- Reference: 0179264394
- News link: https://news.slashdot.org/story/25/09/15/1815211/president-calls-for-six-month-corporate-reporting-cycle-citing-cost-savings
- Source link: https://www.bbc.com/news/articles/cm2zye8745do
Critics argue quarterly reporting increases costs and encourages short-term thinking. Supporters say frequent disclosures maintain investor trust and reduce market manipulation risks.
Further reading : [2]The Renewed Bid To End Quarterly Earnings Reports .
[1] https://www.bbc.com/news/articles/cm2zye8745do
[2] https://news.slashdot.org/story/25/09/09/1535229/the-renewed-bid-to-end-quarterly-earnings-reports
Quarterly reports serve small investors better (Score:4, Insightful)
But if you are a billionaire you don't really care about the regular reports of publicly traded companies. Because you can already get information outside of the quarterly cycle.
These sorts of changes will slam the middle class and drain away their 401K retirement. But that's always been part of his plan.
Re: (Score:2)
Without commenting on if moving a to a semiannual cycle is good or bad you're telling me corporate boards, and the C-suites are not going to take the calls of funds managers at big institutional investors but are going to pick up the phone because Zuck/Besos/Gates/Musk is on the line...
I don't buy it.
Re: (Score:1)
> .... the C-suites are not going to take the calls of funds managers at big institutional investors but are going to pick up the phone because Zuck/Besos/Gates/Musk is on the line...
> I don't buy it.
You apparently don't understand how corporate cock sucking works.
Re: (Score:1)
> We all know that there is no legitimate reason to do this.
This is how it works in all EU member states. Even the UK still does.
You also forgot to explain why you think there is no legitimate reason.
Why exactly is aligning the US stock exchange with the rest of the planet not legitimate?
Weren't you just arguing we should be using the metric system? While now saying there is no legitimate reason to do so, but not saying the reason?
Re:Donald Idocracy Trump Stikes Again (Score:4)
No, you see, the person you are replying to has put forward a theory, that this move might be to attempt and hide the impact of economic policies on company quarterly earnings by delaying the reporting of those earnings. This might be true or false, but it's not "just orange man bad" That is YOUR assertion, and sincerely a very weak defense of your disagreement.Of course, you could argue that it makes little difference whether the loss in profit is reported every three months or every six months, unless you really believe that things will improve in the six month period. I suspect what will happen is that the half-yearly reports will only show a much higher swing, and make it harder for investors to adjust, making the market as a whole a bit more volatile. It will also make insider trading much more profitable. Now, do you happen to have a better counterargument than "you are only saying this because you don't like my guy"?
As others have pointed out (Score:2)
It also unfairly biases towards the large investors. They are more likely to get insider information and also more likely to be able to absorb temporary losses.
Re: (Score:3)
You don't work in a Fortune 500 company, eh?
Public companies do ALL KINDS of things aligned to the quarter. It's exhausting and there is a ton of pressure to do this or that within this quarter. I think a little longer "lens" will provide more insight to investors and cause less constant churn within companies so they can focus more on providing value and less on getting A, B and C done within a specific quarter.
Re: (Score:2)
I am firmly in the quarterly reporting camp, but there are valid reasons for considering semi-annual reporting. Most importantly you have a smoothing effect without potential quarterly volatility which does help with prioritizing long-term objectives. It also reduces share price volatility which is good for long-term investment focus rather than day trading.
The problem is that you end up with a huge disconnect between the company/executives and shareholders.
Compare average annual returns between EU/UK and
1970 (Score:3, Interesting)
We've all seen the "WTF Happened in 1970/1/2?" meme. Now, no one can credibly claim that whatever that stuff means had anything at all to do with the inception of quarterly reporting around the same time. I can claim , however, that somehow, some way, the US economy did, in fact, function pretty well before Nixon's SEC mandated quarterly reporting. So, perhaps Trump's change isn't actually the end of the world and the dawn of the Forth Reich.
Re: (Score:2)
Sure I agree it's not some crazy proposal, hell maybe it's good but what's the counter to make the change which carries a nonzero cost to implement? We just have the claims of the President here. Has the business world been calling for this? Did he campaign on it?
If this was in a package of reforms, say things we might consider encourage companies to actually manage their companies better I might be more convinced but this feels like action for actions sake.
Re:1970 (Score:5, Interesting)
> Has the business world been calling for this?
I can't recall any business moguls jumping up and down about this. On the other hand, I haven't heard anyone screaming from the hills about the high costs of such a change either, and business never, ever fail to bitch about regulatory costs. So I have to discount your supposed concern.
> Did he campaign on it?
That I can recall. Yes he did. He mentioned it on occasion in speeches, so this no surprise to me. Obviously it's not a big vote-getter of an issue, so he didn't walk around in a big red "MAKE CORPORATE REPORTING GREAT AGAIN" hat, but it was a point in the campaign.
Re: (Score:2)
Good thing I didn't say high costs, I just said nonzero to switch and your correct statement that they yell about high costs they haven't been complaining about this which makes sense, it's baked into every process of their business.
To be fair what I can find is he floated it his first term and I guess asked the SEC to evaluate it. Like did they do that? Whats the evidence or this vibes? Do other nations do it this way?
Re: (Score:2, Interesting)
> Like did they do that? Whats the evidence or this vibes? Do other nations do it this way?
If they did or didn't wouldn't matter to Trump in any meaningful way. Trump doesn't listen to technocrats until they make the mistake of opposing him. Trump also doesn't given a damn what other nations do or don't.
That's leadership. You may hate him for it, but you can't deny it.
Re: (Score:2, Insightful)
If you could get a commie (or whatever you'd prefer) elected with the temerity to "just do stuff," you'd follow he/she/it off any number of cliffs as well. Pretend otherwise and show me your perfidity.
The framers put a lot of power in the Executive. The fact that whatever your side might be is incapable of producing actual leaders that can set aside the establishment group-think and leverage this is both a symptom of your sclerotic nature and also a shame. I'm not the simple minded knuckle dragger you
Re: (Score:2, Troll)
See the thing is by the nature of who I support I don't have to be faced with the choice of jumping off a cliff, that's the difference.
Oh for sure you're not a " knuckle dragger" (your term here) you just support leader making decisions without evidence. You don't even feel they owe you one. I might use the term "servile".
Re: (Score:1)
> evidence
That, right there.
Just as one minute example of many: did you notice or care that BLS disappeared ~1.7 million US jobs in less than 12 months? "Corrections."
You have no "evidence." What you have is your preferred propaganda. Failure to dutifully inculcate propaganda as "evidence" is the exact opposite of servile.
Re: (Score:2)
You lack of desire to understand how the BLS does data collection is not at issue here, nice deflection.
Did you have opinions on inflation numbers from 21-22 or were you extolling the issues with the numbers or was it not until Trump called it out? That's the exact definition lol
Re: (Score:2)
There are few wells of propaganda deeper than those of "inflation numbers."
Re: (Score:2)
By all means, where do you get your information from then?
Re: (Score:1)
> If they did or didn't wouldn't matter to Trump in any meaningful way. Trump doesn't listen to technocrats until they make the mistake of opposing him. Trump also doesn't given a damn what other nations do or don't.
> That's leadership. You may hate him for it, but you can't deny it.
I don't think I'd call not listening to anyone, pretending we exist in a vacuum, and "knowing" that you're the smartest person in every room "leadership", but I guess we all have our opinions.
Re: (Score:2)
Not taking in information from outside the country is leadership in your mind? Ignorance is the only correct term for being oblivious to the outside. Especially when your nation and (non-existing) industry plans to make money exporting things. Without outside data, you will not know if you overproduce/underproduce, can expect to get paid on time or not at all etc.
No, not being open to the situation in neighboring countries and/or the whole world is not "leadership", instead it is the stupidest thing any nat
Re: (Score:3)
> We've all seen the "WTF Happened in 1970/1/2?" meme.
So what happened? On the first day Unix created time, and on the second day Unix created... files??? Or did Unix first took a rest, then created time on the second day ex post facto?
Ex Post Facto is a supported feature (Score:2)
The first bug was found September 9, 1947 3:45pm (presumably Eastern Daylight Time?).
That works out to a Unix timestamp of -704088900
So we can fully support describing history before Unix, despite Unix being religiously observed as the beginning of computing history.
Re: (Score:2)
Ask yourself this question. Who do you think benefits most from this change?
Re: (Score:2)
On the flip side financial reporting should be a far less of burden today in the era of fully electronic accounting and enterprise resource planning, then it was in the 70s.
Considering the distribution of reports is also mostly digital where are these savings coming from?
I am hardly the last person to defend Trump or his administration around here but 'savings' does not seem to be the story here. I don't really have an opinion on this call as if it is right or wrong. I can see some arguments being made a l
Re: (Score:2)
I was thinking the same thing. I doubt there's a lot of real money that anyone can call savings due to a change like this, but I also think that a longer window between reporting might increase longer term thinking. If that were to happen, I would call it a net positive.
Re: (Score:2)
I cant speak for the broader market but for operations with large amounts of physical inventory the counting of everything is a bit burdensome. Everything has to be counted for one of these reports.
That's not to say I think this is a good idea though.
Re: (Score:2)
Average investors in 1969 recieved stock prices via the newspaper the following day; the market had very little transparency and investors were completely reliant on brokers for knowledge and trading.
Sounds like a FASB problem (Score:3, Interesting)
We have an organization which sets standards for accounting. the Financial Accounting Standards Board (FASB). They set the Generally Accepted Accounting Principles (GAAP).
I'm sure they're not perfect but I trust them way more than I trust Trump (a felon convicted of accounting fraud, lest we forget).
Re: (Score:2, Funny)
Trump doesn't pay women for sex. He pays women to not tell anybody he had sex with them!
Re: (Score:1)
That's pretty much a distinction without a difference.
Re: (Score:2)
"Trump does not pay women for sex".
Nope, he pays after sex. And with the nation's courts trying to please him over doing their actual work, he's not paying nearly enough.
Re: (Score:1)
I thought the fraud conviction was because he overinflated the value of his assets in order to mislead investors? Using company funds to hide his adultery surely counts as embezzling, not fraud.
UK and EU report biannually already (Score:5, Interesting)
As the article pointed out, the UK and the European Union already changed their regulations for reporting to be on a biannual basis. So the move would actually bring the United States in closer alignment with Europe.
Re: (Score:2)
Since when do we follow those commies?
/s
Fraud-friendly presidency (Score:1)
Apparently reporting every 3 months makes it harder to fake the financials?
Re: (Score:2)
My supposition is that it would make it harder to hide when the cash-flow has exceeded the revenue and reserves. It would allow insolvent firms to remain operating for longer because it's harder to verify that they're out-of-whack. Entities they do business with that might well end up being creditors in a bankruptcy would possibly be deeper-in with failing firms because it wouldn't be so obvious that partners need to pull back against a firm that might not be able to make net-90 terms.
Statistics (Score:2)
All part of his statistics are bad campaign...
The Great Depression (Score:2)
Everyone who remembers it is clearly dead.
Transparency (Score:4, Insightful)
One reason for quarterly reporting is that it gives greater transparency and insight into how a business actually works. Many businesses are seasonal. Most obviously, virtually all retail has its best quarter at the end of the calendar year. But many other types of businesses have key cycles each year that are tied to, for example, the buying habits of their largest customers. Suppliers matter, too; if farms have a bad quarter due to weather or other factors, for example, you're going to want to watch how that impacts food producers somewhere down the line.
SOZ (Save Our Zombies) (Score:2)
What better time to put the blinders on everyone and add artificial delays to reporting the bad news... than when the wheels are falling off?
Bad idea (Score:3)
The better idea would be to make it weekly for companies larger than $x in revenue, and it must be automated. Any revision required after 8 weeks would incur an automatic penalty as a percentage of the absolute value of the adjustment.
Monthly (Score:3)
Internally all businesses report monthly, except a few that have 13, 4 week periods in a year. It's how their accounting software works. The only difference between what they do monthly ( which could simply be posted on their web sites ) and the quarterly dog and pony shows they put on is that quarterly, management has to get up on stage and explain why they did or didn't make targets this quarter. I'ld be perfectly happy to have only one or two dog and pony shows per year if their GL showed up on their web sites no more than 2 weeks after the month-end.
Re: (Score:1)
Sensible, less frequently but more immediate. Sure, make reporting semiannual, but give them maximum 30 days for an interim report and 45 for the annual. I believe it is now 45 and 75. Two weeks seems a bit onerous on smaller companies with limited financial organizations.
The real reason (Score:5, Insightful)
Corporations every quarter: Record profits!
Employees: How about some raises or better benefits?
Corporations: We can't possibly afford that!
Re:The real reason (Score:5, Insightful)
Real reason? To delay any financial reporting that shows the negative economic impact of administration's policies
Re: (Score:3)
In this case I disagree - six months makes good sense in several ways. I wonder who managed to talk him into making a sensible suggestion for once.
Re:The real reason (Score:4, Insightful)
>> Real reason? To delay any financial reporting that shows the negative economic impact of administration's policies
> In this case I disagree - six months makes good sense in several ways. I wonder who managed to talk him into making a sensible suggestion for once.
In this case, you both may be correct.
Re: (Score:3)
If a six-month reporting period is better, would a one-year period be even better? Three months does seem arbitrary, but six months seems just as arbitrary.
Also, corporate reporting is similar to employee performance reviews in one respect. If you expect mostly criticism from your boss, less frequent performance reviews are better. However, for many workers at healthy companies, performance reviews are opportunities for raises and bonuses, so they want more frequent reviews.
Re: (Score:2, Insightful)
> If a six-month reporting period is better, would a one-year period be even better?
The answer is another question: Better for who?
If Trump had his way, there would be no data from anyone, just his say-so -- and we can all imagine how that would go...
Re: (Score:2)
something something stopped clocks...
Re: (Score:2)
As a code monkey working in several publicly traded companies, a 6 month reporting cycle is wonderful. The current 3 month reporting slows down development. Every 3 months we'd get a 1-2 week code freeze leading up to the quarterly shareholder call. That's disrupting. Non-public companies don't have this problem.
Re: (Score:2)
Corporations: We can afford to pay you much more, but we don't want to. We want to keep that money for ourselves. So, we will pay you only what you could get somewhere else, thus keeping your incentive to leave nice and low while saving money.