This is FASB's first formal acknowledgment that its standards need to be assessed for a world in which not all public companies file quarterly.
The policy context: SEC Chairman Paul Atkins's Form 10-S proposal (Release No. 33-11414, May 5, 2026) would allow eligible public companies to file semiannual financial reports instead of quarterly. Atkins stated explicitly in the proposal that FASB may need to review references to quarterly filings in its own standards. Bloomberg Tax reported on May 7, 2026 that the SEC had drawn the accounting board into its semiannual reporting plan, and that a FASB official confirmed on a press call that FASB may need to consider places in the rulebook that refer to quarterly filings and determine when they need to refer to a different cadence.
FASB Chair Richard Jones addressed the question directly on the sidelines of a Baruch College conference: "I do think it's a fair question of 'Here's our interim disclosure requirements, are there things that should change?'"
The answer, now formalised in a research project, is: yes, some things may need to change. The research project will identify which ones. This post maps the specific ASC topics most likely to require attention, explains what the issue is in each, and addresses the practical question every CFO evaluating a Form 10-S election is asking: should I wait for FASB's results before deciding?
What Did FASB Chair Jones Announce and Why Is It Significant?
The Centri Consulting July 29, 2026 roundup confirmed the FASB research project in the following terms: "The research related to semi-annual reporting will explore whether targeted improvements to FASB standards are necessary related to current interim accounting and disclosure requirements, specifically where the guidance references a quarterly frequency. The information the staff gathers will be presented to the Board to determine whether to add items to the technical agenda."
The procedural significance: a Current Trends and Emerging Issues research project is the earliest stage of FASB standard-setting activity. It sits before a project is added to the technical agenda. It sits before an exposure draft is issued. It sits before a final standard is adopted. A research project can result in no action, in targeted improvements to specific standards, or in larger-scale reclassifications of requirements from quarterly to interim frequency.
The practical significance: for CFOs at companies considering whether to elect semiannual reporting under Form 10-S if and when the SEC finalises that proposal, the FASB research project answers a key uncertainty. The question of "what accounting guidance do I rely on today that currently refers to quarterly periods, and would I still be in compliance if I only filed semiannually" does not have a complete answer yet. FASB is beginning the process of answering it.
Jones's Accounting Today interview provides the most specific published statement of where FASB already believes existing standards work without modification: "Keep in mind that semiannual reporting occurs today every time a company files the second quarter Q, because the second quarter Q has six-month results already in it. It has the second quarter, but it also has that year-to-date six months." His point is that ASC standards already accommodate six-month period results within a quarterly filing framework, and that most FASB standards refer to "interim reporting" rather than to "quarterly reporting" specifically, meaning they would apply to a semiannual period without modification.
But the standards that do specifically reference quarterly frequency are the ones FASB is now examining. Those are the ones this post covers.
Why Did SEC Chair Atkins Specifically Call Out FASB in the Form 10-S Proposal?
SEC Chairman Atkins did something unusual in the Form 10-S proposing release: he specifically named FASB in the proposal and stated that FASB should review its standards for quarterly frequency references. This is atypical for an SEC proposing release, which ordinarily addresses SEC rules rather than directing the agenda of an independent standard-setting body.
The reason Atkins included the FASB call-out is straightforward: a Form 10-S election is not operationally viable for companies if the underlying GAAP standards still require quarterly calculations, quarterly estimates, or quarterly measurement dates as a matter of authoritative accounting guidance. If a company elects semiannual SEC reporting but is still required by ASC 740-270 to compute an annual effective tax rate on a quarterly basis, the semiannual election does not eliminate the quarterly accounting work. It only eliminates the public filing of the resulting quarterly financial statements.
The Bloomberg Tax reporting from May 7, 2026 quoted the SEC official on the press call: FASB may need to consider places in the rulebook that refer to quarterly filings and determine when they need to refer to a different cadence. The Atkins statement in the proposing release was designed to prompt exactly this response from FASB, and FASB has now delivered it in the form of the research project announced this week.
The KPMG analysis of the Form 10-S proposal, published May 21, 2026, was the most comprehensive pre-FASB-announcement treatment of the accounting standard implications. KPMG identified the same categories of standards discussed below as the primary areas where quarterly frequency references would need to be assessed. The FASB research project is now formally addressing exactly the issues KPMG identified.
What Is FASB's "Current Trends and Emerging Issues" Research Project and How Does It Lead to Standard Changes?
The Current Trends and Emerging Issues agenda is one of FASB's mechanisms for monitoring whether existing standards are working as intended in evolving business and regulatory environments. Unlike the technical agenda, which consists of projects for which FASB has committed to issuing authoritative guidance, the Current Trends and Emerging Issues agenda operates as a monitoring and assessment function.
When FASB staff adds an item to the Current Trends and Emerging Issues agenda, staff conduct outreach with preparers, auditors, and investors to understand how existing standards are being applied in the relevant context. Staff may also analyse existing codification language to identify specific sections that reference the relevant fact pattern. The results of that research are presented to the FASB board, which then decides whether to add a technical agenda project to address the identified issues.
The outcome is not predetermined. A research project can result in no further action if FASB concludes existing guidance adequately addresses semiannual reporting situations without modification. It can result in a narrow targeted improvement, such as amending a specific paragraph in ASC 740-270 to accommodate semiannual periods. Or it can result in broader guidance if the research reveals more pervasive issues with the quarterly frequency assumption embedded in current standards.
The specific framing of the FASB research project, confirmed from Centri Consulting, is "targeted improvements" rather than comprehensive revision. This language signals FASB's expectation that the issues will be specific and narrow rather than requiring a rewrite of ASC 270 as a whole. Jones's own Accounting Today statement supports this: "Most FASB standards don't explicitly refer to quarterly reporting, but to interim reporting instead," which suggests the list of standards requiring targeted improvement is shorter than a comprehensive audit of all ASC topics might suggest.
ASC Standard #1: ASC 270 (Interim Reporting), The Entire Framework Is Built on Quarterly Periods
ASC 270, Interim Reporting, is the foundational standard governing what must be disclosed and how financial results must be presented in interim financial statements. It was built in the era of mandatory quarterly reporting and reflects that origin throughout its structure.
FASB issued ASU 2025-11 in December 2025 to clarify ASC 270's scope and to reorganise its disclosure requirements. The BDO analysis of ASU 2025-11 confirmed that the update addresses the standard's structural complexity but that Regulation S-X still requires SEC registrants to provide comparative quarter-to-date (QTD) and year-to-date (YTD) information, even though ASU 2025-11 itself removed a prior ASC 270 requirement for QTD comparatives in non-SEC contexts.
The specific ASC 270 provisions most relevant to semiannual reporting:
ASC 270-10-45-5 requires each interim period to be viewed primarily as an integral part of an annual period. This principle does not itself require quarterly periods; it would apply equally to a semiannual period viewed as an integral part of the annual period.
ASC 270-10-50 disclosure requirements reference the period covered by the interim financial statements without specifying that the period must be a quarter. Most disclosures in ASC 270-10-50 refer to the "current interim period" which could be a six-month semiannual period.
The practical issue for semiannual filers: several ASC 270-10-50 disclosures reference period-to-period comparisons that assume a quarterly cadence in their structure. The comparison of the current three-month period to the prior three-month period, for example, is an assumption embedded in how preparers have historically structured the comparative presentation, even if the ASC text itself does not mandate three-month comparatives.
ASU 2025-11's removal of the prior QTD comparative requirement from ASC 270 (while noting that Reg S-X separately requires it for SEC registrants) means FASB has already taken one step toward making ASC 270 more cadence-neutral. The FASB research project may identify additional provisions that require similar clarification.
ASC Standard #2: ASC 740-270 (Income Taxes), What Happens to the AETR Method Without Quarterly Periods?
ASC 740-270-30 governs how income tax expense is recognised in interim periods. The dominant method required by this standard is the estimated annual effective tax rate (AETR) method. Under this method, the company:
Estimates the annual effective tax rate for the full fiscal year at the beginning of each interim period.
Applies that estimated annual rate to the year-to-date ordinary income to determine the year-to-date income tax provision.
Adjusts the year-to-date provision in each subsequent interim period as the estimated annual rate is updated.
ASC 740-270-30-2 explicitly references "each quarterly interim period" as the measurement interval at which the AETR calculation is performed. This is the most specific reference to quarterly frequency in all of ASC 740.
For a semiannual filer, the ASC 740-270 question is: does the AETR method need to be performed quarterly (producing a calculation that is not publicly disclosed in a quarterly report) or can it be performed only twice per year (at the semiannual period-end and at year-end)?
Jones's Accounting Today statement suggested that much of FASB's guidance already works for semiannual filers because it references "interim periods" rather than "quarterly periods." ASC 740-270-30-2's explicit "quarterly" reference is exactly the kind of provision the FASB research project is designed to identify and assess.
The OBBBA's new CAMT, NCTI, and other tax provisions compound the ASC 740-270 complexity: the estimated annual rate for 2026 must incorporate these new provisions, and the quarterly AETR recalculation is the mechanism by which unexpected developments (oil price changes affecting taxable income, OBBBA effective dates) are captured in the interim provision. A semiannual filer that only performs the AETR calculation twice per year may have larger true-up adjustments at each measurement date, with less frequent opportunities to correct for prior-period estimation errors.
Until FASB issues guidance specifically addressing semiannual filers under ASC 740-270, a company that elects semiannual Form 10-S reporting should continue to consult with its tax advisors and external auditors about whether performing the AETR calculation only at the semiannual period-end satisfies the requirements of ASC 740-270.
ASC Standard #3: ASC 855-10 (Subsequent Events), What Is the "Event Horizon" for a Semiannual Filer?
ASC 855-10 governs the recognition and disclosure of subsequent events: events or transactions that occur after the balance sheet date but before the financial statements are issued or available to be issued.
ASC 855-10-55 contains implementation guidance that specifically references issuance of quarterly financial statements as a reference point for the subsequent event period. For a quarterly filer, the subsequent event period for Q1 ends when the Q1 10-Q is filed, which is typically 40 to 45 days after March 31. The period between March 31 and the May filing date is the window during which Type 1 and Type 2 subsequent events must be assessed.
For a semiannual filer, the subsequent event assessment period at the June 30 balance sheet date would extend until the Form 10-S is filed, approximately August 11 for large accelerated filers. That is similar to the current quarterly filer timeline. But the subsequent event period at December 31 (the annual period-end) would be unchanged.
The more significant issue is the interim period between the annual December 31 balance sheet and the semiannual June 30 balance sheet. Under a quarterly reporting cadence, there are three quarterly balance sheet dates (March 31, June 30, September 30) and three sets of subsequent event assessments that capture events between those dates. Under a semiannual cadence, the period from January 1 through June 29 has no publicly reported balance sheet date. Events that occur during that period are not subsequent events to any published financial statement until the June 30 Form 10-S is filed.
The Deloitte Heads Up on the Form 10-S proposal (May 8, 2026) flagged this as a disclosure timing question: material events that occur in the first half of the year are captured in the semiannual report rather than in a quarterly report that would otherwise be filed in May. Whether this creates any ASC 855 interpretation question for preparers is exactly the type of issue the FASB research project would identify.
ASC Standard #4: ASC 260-10 (EPS), How Do You Calculate Weighted Average Shares Without Quarterly Data?
ASC 260-10 governs earnings per share computation and disclosure. The standard requires both basic EPS (weighted average shares outstanding) and diluted EPS (weighted average shares outstanding plus dilutive securities) for each period presented.
The weighted average share calculation for EPS is inherently a period-specific calculation: shares outstanding are weighted by the proportion of the period during which they were outstanding. For a semiannual filer presenting six-month EPS, the weighted average share count would cover the six-month period rather than a three-month quarter.
The question ASC 260-10 raises for semiannual filers is less about the weighted average calculation itself (which works for any period length) and more about the structure of the required presentations.
ASC 260-10-45-3 requires EPS to be presented for each period for which an income statement is presented. For a semiannual filer, this means six-month EPS rather than quarterly EPS, which is straightforward.
The interim EPS guidance in ASC 270-10-45-13 through 45-17 addresses specific EPS adjustments for interim periods, including requirements related to discontinued operations and the cumulative effect of accounting changes. These provisions reference the "interim period" without specifying quarterly frequency, so they are likely to work without modification for semiannual periods.
The specific concern: diluted EPS antidilution assessments. ASC 260-10-45-22 requires that securities be assessed for dilution or antidilution based on the year-to-date period rather than the most recent quarter. For a semiannual filer, the year-to-date period is the six-month period, which is co-extensive with the semiannual filing period. The sequential quarter-by-quarter antidilution test mechanics that some preparers use in their EPS calculations may require reconfiguration for a semiannual cadence.
ASC Standard #5: ASC 842-20 (Leases), Quarterly Variable Payment Reassessment for a Semiannual Filer?
ASC 842-20, the lessee accounting guidance under the leases standard, includes requirements for reassessing certain aspects of lease accounting when triggering events occur or at each reporting date.
Variable lease payments that depend on an index or rate (such as CPI-adjusted lease payments) are remeasured when there is a remeasurement event under ASC 842-20-35-4. That remeasurement event includes a modification, a reassessment of lease term or purchase option, or a change in the lease liability that requires remeasurement.
The lease liability remeasurement itself is not triggered by the quarterly reporting cadence, which means semiannual filers would remeasure when the triggering events occur regardless of whether they file quarterly or semiannually. In this respect, ASC 842-20 is already largely cadence-neutral for the remeasurement obligation.
However, the disclosure requirements under ASC 842-20-50 reference amounts recognised in the financial statements "in the period" without specifying quarterly or semiannual periods. Those disclosures would apply to a six-month semiannual period without modification.
The FASB research project's inclusion of ASC 842-20 in its scope may relate to specific variable payment reassessment disclosures that reference quarterly measurement dates in implementation examples rather than in the authoritative text itself. Jones's comment that most FASB standards use "interim reporting" rather than "quarterly" as the operative term is likely accurate for ASC 842-20.
What Did FASB Chair Jones Say Is Already Working for Both Quarterly and Semiannual?
Jones's Accounting Today statement is the clearest articulation of where FASB sees no problem requiring immediate attention.
"Our guidance is generally based on interim reporting as opposed to quarterly reporting," Jones said. "When we do refer to quarterly reporting, those are the places that we would need to look at."
The implication: the vast majority of FASB standards already use "interim period," "current period," or "period covered" language that is cadence-neutral. Those standards apply equally to a three-month quarter and a six-month semiannual period without any standard change.
Jones reinforced this with a structural observation: "Keep in mind that semiannual reporting occurs today every time a company files the second quarter Q, because the second quarter Q has six-month results already in it." The six-month year-to-date results in a Q2 Form 10-Q are already prepared under the same ASC standards that semiannual filers would use for their Form 10-S. The accounting for the year-to-date period is not new; what is new for a semiannual filer is the absence of a separate Q1 filing.
This observation narrows the research project's scope significantly. The issues FASB is examining are not about how to account for a six-month period (companies already do this in Q2) but about whether specific standards that reference quarterly measurement dates create obligations that cannot be satisfied without quarterly calculations even by companies that no longer file quarterly reports.
ASC 740-270's AETR quarterly reference is the clearest example of a standard that creates this issue. The others listed above are more likely to be cadence-neutral on examination.
What Is the Research-to-Standard Timeline and When Would Changes Take Effect?
The Current Trends and Emerging Issues research project is at stage zero of FASB's standard-setting process. Converting research findings into a final accounting standard requires passing through each subsequent stage.
Stage 1 (current): research under the Current Trends and Emerging Issues agenda. FASB staff gather information, conduct outreach with preparers and auditors, and analyse existing codification language. Timeline: typically 6 to 12 months.
Stage 2: Board presentation. Staff present findings to the FASB board. Board determines whether to add a technical agenda project. If yes, the standard-setting process begins. If no, the research is complete with no standard change.
Stage 3: Technical agenda project. FASB staff prepare a proposed ASU and deliberate with the Board. Timeline: typically 6 to 18 months.
Stage 4: Exposure draft. FASB publishes a proposed ASU for public comment. Comment period typically 60 to 90 days.
Stage 5: Final standard. FASB deliberates on comments, finalises the ASU. Effective date is set, typically 12 to 24 months after issuance with early adoption permitted.
The Form 10-S proposal itself has not been finalised. The Form 10-S comment period closed July 6, 2026. The SEC must review comments, potentially issue a final rule, and set an effective date. The realistic earliest effective date for Form 10-S is 2027, and possibly later.
The realistic timeline for any FASB standard changes related to semiannual reporting: 2028 to 2029 at the earliest, and only if FASB determines that targeted improvements are necessary following the research phase. Companies that elected semiannual reporting before those FASB changes take effect would be operating under existing quarterly-frequency GAAP standards, with the ambiguity the research project is designed to resolve.
What Should CFOs Considering a Form 10-S Election Wait For Before Deciding?
Three specific things to wait for before making the semiannual reporting election, in addition to the Form 10-S final rule itself.
First: the Form 10-S final rule. The SEC has not finalised the rule. Until a final rule is issued with an effective date, no company can make the election. Companies should monitor sec.gov for the final rule announcement.
Second: FASB's research findings. The research project will identify which ASC standards require targeted improvements for semiannual filers. Those findings will determine whether the AETR quarterly reference in ASC 740-270 creates a practical obstacle to semiannual reporting or whether the existing standard can be applied to a semiannual period without modification. If the research concludes that material changes to FASB standards are necessary before semiannual reporting is operationally viable under GAAP, that conclusion will affect the practical timeline for any company's semiannual election.
Third: the PCAOB AS 6101 comfort letter problem. The prior blog in this cluster on PCAOB AS 6101 confirmed that the 134-day negative assurance window creates a capital markets access blackout of approximately 80 to 90 days per year for semiannual filers. Until PCAOB amends AS 6101 to address semiannual filers, the comfort letter gap is a structural constraint on the semiannual election for companies with regular capital markets activity.
The companies for which the semiannual election is most straightforwardly beneficial in the near term: companies without frequent capital markets activity, without material quarterly-frequency-dependent accounting processes (no complex AETR calculations, no quarterly lease remeasurements that generate material variation), and with stable enough business conditions that the reduced quarterly disclosure frequency does not create investor relations risks.
Frequently Asked Questions
What is FASB's new semiannual reporting research project?
FASB has added a research project under its Current Trends and Emerging Issues agenda to explore whether targeted improvements to FASB standards are necessary related to current interim accounting and disclosure requirements, specifically where the guidance references a quarterly frequency. The research findings will be presented to the FASB board to determine whether to add technical agenda items. Confirmed from Centri Consulting's Bridging the GAAP: July 2026 roundup.
Which FASB standards reference quarterly reporting frequency?
Most FASB standards use "interim period" language that is cadence-neutral. The primary standard with an explicit quarterly frequency reference is ASC 740-270-30-2, which references "each quarterly interim period" for the AETR method calculation. Other standards with potential quarterly frequency questions include ASC 270 (certain presentation assumptions), ASC 855-10 (implementation guidance referencing quarterly filings), ASC 260-10 (interim EPS sequential antidilution testing), and ASC 842-20 (certain disclosure references).
What happens to the ASC 740 AETR method if a company files semiannually?
ASC 740-270-30-2 requires the estimated annual effective tax rate calculation to be performed at each quarterly interim period. If a company files semiannually, the question is whether the AETR must still be calculated quarterly (producing calculations not publicly disclosed) or whether semiannual AETR calculations would satisfy the standard. FASB's research project is examining this question. Until guidance is issued, companies should consult with tax advisors and external auditors.
Will FASB change ASC 270 for semiannual filers?
FASB Chair Jones indicated in his Accounting Today interview that most FASB standards, including most of ASC 270, already use "interim reporting" language rather than "quarterly reporting" language, and therefore may not require modification. FASB's December 2025 ASU 2025-11 already clarified ASC 270's scope and removed a prior QTD comparative requirement. Whether additional targeted improvements are needed for ASC 270 in a semiannual context is part of the research project's scope.
Should my company wait for FASB's research results before electing semiannual reporting under Form 10-S?
Yes, for three reasons. First, the Form 10-S final rule has not been issued. Second, FASB's research may identify specific GAAP standards that create practical obstacles to semiannual reporting under current guidance, which would affect operational readiness. Third, the PCAOB AS 6101 comfort letter gap creates a capital markets access constraint that has not been resolved. The combination of an unfinished SEC rule, in-progress FASB research, and an unresolved PCAOB standard creates a three-part uncertainty that most companies should wait to resolve before electing semiannual reporting.
Key Takeaways
- FASB has formally added a research project to its Current Trends and Emerging Issues agenda exploring whether targeted improvements to FASB standards are necessary where guidance references quarterly frequency. Confirmed from Centri Consulting's Bridging the GAAP: July 2026 roundup, published yesterday.
- The research project is FASB's direct response to SEC Chairman Atkins's statement in the Form 10-S proposal that FASB should examine quarterly references in its standards, and to FASB Chair Jones's acknowledgment that it is a fair question whether interim disclosure requirements should change.
- Most FASB standards use "interim period" language that is cadence-neutral and would apply to semiannual periods without modification. Jones confirmed: "Our guidance is generally based on interim reporting as opposed to quarterly reporting."
- The primary standard with an explicit quarterly frequency reference requiring examination is ASC 740-270-30-2, which requires the estimated annual effective tax rate calculation at each quarterly interim period. Other standards under review include ASC 270, ASC 855-10, ASC 260-10, and ASC 842-20.
- The research-to-standard timeline is 2028 to 2029 at the earliest, requiring research findings, technical agenda addition, exposure draft, comment period, and final standard issuance. The Form 10-S final rule itself has not yet been issued by the SEC.
- Companies evaluating whether to elect semiannual reporting should wait for three things before deciding: the Form 10-S final rule, FASB's research findings on which standards require targeted improvements, and a PCAOB AS 6101 amendment to resolve the 134-day comfort letter gap.
- FASB Chair Jones is in the final year of his tenure. The research project and any resulting standard changes will likely span the transition to the next FASB Chair, adding another timeline uncertainty to the semiannual adoption planning question.
