Washington, D.C. — MFA urged the Securities and Exchange Commission (SEC) to reconsider its proposal to allow public companies to replace quarterly Form 10-Q reports with new semiannual Form 10-S reports in a comment letter submitted today.
“The alternative asset management industry supports efforts to make U.S. public markets more attractive, but it is essential that public companies provide timely, material information to investors looking to make informed decisions,” said Bryan Corbett, MFA President and CEO.
Key parts of quarterly reporting give investors regular, material information to evaluate companies, allocate capital, monitor risk, and hold management accountable. Reducing required reporting to twice a year could raise costs for investors and issuers by widening information gaps, weakening price discovery, dampening liquidity, reducing comparability across public companies, and increasing reliance on voluntary disclosures and market rumors.
The letter also asserts that the SEC should consider changes to public company reporting holistically. Other anticipated reforms to Regulation S-K, as well as detailed proposals on filer status and Form S-3 eligibility potentially offer greater benefits while also directly affecting issuer compliance costs and the fullness of information investors receive.
Craig Lewis, Professor of Finance, Emeritus at Vanderbilt University and former Chief Economist of the SEC, and MFA Head of Research Ron Alquist submitted a separate assessment of the SEC’s economic analysis. They find that although the SEC’s analysis estimates compliance savings, it does not take full account of the investor and market costs associated with reducing the frequency of public company disclosures.
Read the full letter here.
Read the full economic assessment here.
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About the global alternative asset management industry
The global alternative asset management industry — including hedge funds, private credit funds, and hybrid funds — serves thousands of public and private pension funds, charitable endowments, foundations, and other global institutional investors. The industry provides portfolio diversification and risk-adjusted returns to help meet their funding obligations and return targets throughout the economic cycle.
About MFA
Managed Funds Association (MFA), based in Washington, D.C., New York City, Brussels, and London, represents the global alternative asset management industry. MFA’s mission is to advance the ability of alternative asset managers to raise capital, invest it, and generate returns for their beneficiaries. MFA advocates on behalf of its membership and convenes stakeholders to address global regulatory, operational, and business issues. MFA has more than 180 fund manager members, including traditional hedge funds, private credit funds, and hybrid funds, that employ a diverse set of investment strategies. Member firms help pension plans, university endowments, charitable foundations, and other institutional investors diversify their investments, manage risk, and generate attractive returns throughout the economic cycle.
