Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

US SEC preparing to scrap quarterly reporting requirement

reuters.com

Post reply on HN
Print view View original

191–200 of 491 posts

Re: US SEC preparing to scrap quarterly reporting requirement

#191

Post by nightski »

wholinator2 wrote: post #181
logicallee wrote: post #164

Earlier quoted context omitted.

one per week should do it.

Honestly what would happen if the stock market didn't exist. It seems like these days the price of stock is so disconnected from lived reality that genuinely confused if it would be all that catastrophic

Well we’d go back to an era where private capital owns the world. The public would not be able to participate or benefit from the ownership of companies and share in the prosperity.

Re: US SEC preparing to scrap quarterly reporting requirement

#192

Post by ghufran_syed »

b40d-48b2-979e wrote: post #163
alexpotato wrote: post #69

One of my favorite stories about logistics and quarterly earnings deadlines (from when I worked at a pharmaceutical company: "In our business, a truckload of various drugs can easily reach $10-$15 million. Now, if that truck arrives at the depot at 11:59pm March 31st then it's first quarter earnings. If it arrives at 12:01am April 1st then it's second quarter earnings. $15 million is a BIG shortfall, even for us, so…

Okay, what's that to say it won't be the same but even worse on a 6mo reporting schedule?

as the time period gets longer, the the more likely it is that the numbers represent the true performance of the business rather than randomness. That has to be balanced against the fact that investors get less frequent updates i.e. the information is now potentially 6 months out of date rather than 3 months at worst. But then its just a judgment call of the relative benefit of each - you could argue that with modern accounting systems, modern companies could deliver weekly or even daily earnings , which would give investors much more timely information, and the high frequency would probably mean it wouldn’t be worth making the effort for management to fudge the numbers to bring forward or delay revenue one day or one week. There would be a lot more variance in the numbers if they were daily, but thats a good thing - it would just reflect the underlying randomness, and then the investors could decide when the accumulated trend over a period of time is meaningful or not, instead of management wasting time massaging numbers into a fairy tale of steady growth.

Re: US SEC preparing to scrap quarterly reporting requirement

#193

Post by jbrozena22 »

alexpotato wrote: post #69

One of my favorite stories about logistics and quarterly earnings deadlines (from when I worked at a pharmaceutical company: "In our business, a truckload of various drugs can easily reach $10-$15 million. Now, if that truck arrives at the depot at 11:59pm March 31st then it's first quarter earnings. If it arrives at 12:01am April 1st then it's second quarter earnings. $15 million is a BIG shortfall, even for us, so…

Over the long run, companies that spend resources on this micromanagement of earnings probably are not seeing the forest for the trees. I cringe thinking about how much time and top talent at a company is spent preparing for earnings rather than spending those hours improving the business itself.

Re: US SEC preparing to scrap quarterly reporting requirement

#194

Post by mcoliver »

munificent wrote: post #182
mcoliver wrote: post #120

Simultaneously they are opening up 0DTE options on certain stocks starting with large market caps but don't be surprised when this expands. Currently this was limited to large etfs like SPX. They are also extending trading hours towards 24/7 and eventually 365. How they square increasing liquidity with delaying information is insane. I know there is a lot of manipulation to make quarterly numbers and the tax code is…

> if companies reported dollars in and dollars out live to shareholders at least we would have an idea of how the company is doing in a general sense. Goodhart's law is knocking on your door right now.

Help me understand what you are saying here. For those that don't know this one is "a measure becomes a target, it ceases to be a good measure".

I'm not advocating for a single metric that can be gamed. A business is fundamentally about dollars in and dollars out. Maybe add receivables in there and a few other metrics from the P&L. I'm not trying to be prescriptive here on purely cash in and out.

I do think there is a low friction way that companies could report daily certain metrics that over time would give their shareholders a sense of the company's health and trajectory.

Re: US SEC preparing to scrap quarterly reporting requirement

#195

Post by hattmall »

vessenes wrote: post #177
drewda wrote: post #173

Earlier quoted context omitted.

General Electric has a history of using that exact trick... just with jet engines and power generators and medical devices that can represent much larger amounts of revenue.

Not just - Welch pioneered using GE Capital to “smooth” earnings - lots of judgment calls in those finance companies in the early 90s.

GE's latest trick is to roll long term maintenance contracts into the price of the product and then sell off the unit holding the bag on the maintenance contract. Very shady but very clever.

Re: US SEC preparing to scrap quarterly reporting requirement

#196

Post by doom2 »

arduanika wrote: post #167
ginkoleaf wrote: post #83

This seems like bad news for regular investors, and good news for insiders. Reporting is burdensome, sure, but being listed on public exchanges is not a requirement.

Listing on a public exchange is not a requirement, but it is generally a boon to the public interest. The theory is that if we close the gap in regulatory burden between public companies and large private companies, then maybe we'll see more IPOs like back in the 90's, before Sarbanes-Oxley and other new laws. Now, with an admin that's disposed to deregulation, the usual approach to closing that gap is to loosen requ…

> The theory is that if we close the gap in regulatory burden between public companies and large private companies, then maybe we'll see more IPOs like back in the 90's, before Sarbanes-Oxley and other new laws.

And maybe more Enrons?

Re: US SEC preparing to scrap quarterly reporting requirement

#197

Post by mcoliver »

baby wrote: post #166
bizzletk wrote: post #158

Earlier quoted context omitted.

Can you enumerate some examples of when it having less information is better than having more?

For the company it doesnt work well, you’re leaking too much info to competitors

Maybe. I'l am also not saying they need to say where the dollars came from, went to, or what they were for. Aggregate daily flows. Could you do some deductive reasoning to make an informed guess especially when large sums are involved? Perhaps.

I am also of the (perhaps wrong) opinion that the majority of the important stuff leaks anyways, just not on a level playing field.

Re: US SEC preparing to scrap quarterly reporting requirement

#198

Post by fsckboy »

stogot wrote: post #190
wholinator2 wrote: post #181

Earlier quoted context omitted.

Honestly what would happen if the stock market didn't exist. It seems like these days the price of stock is so disconnected from lived reality that genuinely confused if it would be all that catastrophic

I hypothesize all dividends, no share value. How would that world look

that makes no sense. companies need capital, that's why there is a stock market. dividends are paid from past earnings, never capital (earnings are only a %age of the value of the capital) and not from higher expectations of the future.

Re: US SEC preparing to scrap quarterly reporting requirement

#199

Post by Uvix »

chermi wrote: post #133
runarberg wrote: post #127

Earlier quoted context omitted.

Feels like a first world problem. If your company cannot afford to output accurate reports every month, maybe it shouldn’t be a company at all.

Ahhh yes. As we all know regulations and requirements and bureaucracy never have unintended consequences, especially on the little guy. All that matters is intent, right?

The "little guy" isn't a publicly listed company issuing reports. By the time you have an IPO, you're no longer little.

Re: US SEC preparing to scrap quarterly reporting requirement

#200

Post by colechristensen »

plussed_reader wrote: post #176
jandrewrogers wrote: post #165

Earlier quoted context omitted.

The beauty of it, though, is that it would recover almost immediately as systems arbitrage an obviously stupid situation.

But on what time scale? Before a few connected entities make a profit or after?

If you're not trading overnight and there's a flash crash that corrects itself overnight... it's the people who are trading overnight taking money from each other.
Post reply on HN