Introduction

The U.S. Securities and Exchange (SEC)’s proposals to change the frequency of financial disclosure filing from quarterly to semiannually is a potential regulatory change that is often framed around cost and frequency. While most U.S. funds are registered under the Investment Company Act of 1940, many of those that are not remain subject to the requirements of the Securities Exchange Act of 1934, including the obligation to file 10-K and 10-Q. For these funds, including Business Development Corporations (BDCs), the bigger issue may be what reporting frequency reveals about their operating model.

SEC reporting depends on a number of interdependent activities — from fund accounting and valuation to audit coordination, governance and submission readiness. For many funds, any shift in reporting frequency therefore has implications not only in terms of operational burden, but also in terms of transparency, investor confidence and the ability to manage regulatory change effectively.

Beyond reporting frequency: the operational implications

In early May 2026, the U.S. SEC proposed a rule change that would allow issuers required to file annual reports on Form 10-K and quarterly reports on Form 10-Q to instead provide semi-annual reports on proposed Form 10-S. If adopted, this change would mark a notable shift in the frequency of reporting for affected issuers, including BDCs.

The stated policy objective is to provide issuers and investors with greater flexibility in how performance and financial information are reported. Supporters of semiannual reporting have long argued that quarterly reporting can reinforce short-term decision-making, placing disproportionate emphasis on near-term results at the expense of longer-term value creation, investment discipline and strategic execution. A longer reporting cycle is therefore seen by some as a way to create more space for longer-horizon planning and capital deployment.

The proposal also has a cost dimension. Reducing the frequency of required filings could lower the operational and compliance burden associated with periodic reporting. External estimates suggest that annual SEC compliance costs range from less than $0.5 million for smaller issuers to more than $5 million for larger ones, with an average of roughly $2.3 million per company. The SEC’s own estimates indicate that issuers moving to semiannual reporting could realize net annual savings of approximately $198,000 per issuer.

However, for many affected funds, the implications may be particularly significant. Reporting obligations for these vehicles often sit within more complex operating and structural environments than those of many traditional issuers. Complexity may arise from multi-entity structures, consolidation, fair value measurement, incentive allocation, tax considerations and heightened sensitivity around assets under management growth and performance disclosures. In that context, the burden of preparing 10-K and 10-Q filings often extends well beyond the mechanics of document production.

As a result, any move toward semiannual reporting could have an outsized impact. Fewer required filing cycles may help reduce cost, ease operational pressure and simplify aspects of the reporting process. More importantly, it could allow managers and service providers to devote greater attention to the quality, governance and coordination of reporting outputs rather than to the cadence of repeated quarterly execution.

Why some funds may choose to maintain quarterly reporting

Even if a semiannual reporting option becomes available, some funds may decide that quarterly reporting remains the better fit. For many managers, the choice is likely to be shaped not only by regulatory flexibility, but also by investor expectations, operating realities and the broader value of frequent disclosure.

Transparency is likely to be one of the most important considerations. Institutional investors in affected funds increasingly expect clear, regular reporting, particularly where portfolios contain less liquid or more complex assets. In that context, a move to semiannual reporting may be seen by some investors as a reduction in visibility rather than simply a reduction in burden. Less frequent reporting could increase information asymmetry and, in a competitive fundraising environment, may make some funds less attractive to prospective investors.

The economics may also be less straightforward than they appear at first. Many reporting-related costs are already embedded in a firm’s infrastructure, including finance, compliance, legal and audit support. As a result, fewer required filings may not lead to a proportionate reduction in overall expense.

Taken together, these considerations suggest that the choice between quarterly and semiannual reporting may not be straightforward for impacted alternatives. While a reduced filing cadence could lower certain direct burdens, many managers may determine that the benefits of continued quarterly reporting — particularly in relation to transparency, investor confidence and governance — remain compelling.

Supporting SEC 10-K and 10-Q filings in a more integrated operating model

Whether impacted funds choose quarterly or semiannual reporting, one point is increasingly clear: filing effectiveness depends on more than the preparation of a document. It is anchored in how well the broader operating model supports data quality, control, workflow coordination and regulatory execution.

What may appear to be a discrete filing obligation is, in practice, the product of multiple interconnected processes spanning accounting, data management, audit coordination, document preparation and regulatory submission. In that environment, the effectiveness of the filing process depends not only on technical reporting capability, but on the strength of the underlying operating model.

This is where an end-to-end servicing framework becomes increasingly relevant. When fund accounting, custody, transfer agency, liquidity support and regulatory reporting operate in a more connected way, the filing process can draw on a stronger foundation of trusted data, clearer governance and better coordinated workflows. That matters because periodic reporting showcases the quality, consistency and control of the information and processes behind it.

BNY’s experience servicing alternative funds reflects this broader shift in market need. With more than $2 trillion in alternative assets under administration and/or custody and more than 7,400 alternative funds serviced, BNY has seen the growing importance of integrating operational infrastructure with reporting requirements. As fund structures become more complex and regulatory expectations continue to evolve, filing support is increasingly defined by data connectivity across the servicing model.

In this context, support for SEC 10-K and 10-Q filings can be understood across several core components:

• Financial statement production for inclusion in Form 10-K and Form 10-Q filings
• Management of report production workflows, spanning planning, drafting, review and finalization
• iXBRL tagging, EDGARization and filing support for Form 10-K and Form 10-Q reports
• Annual fund audit facilitation and support

Each of these elements plays a distinct role, but their value is greatest when they are aligned. Financial statement production, for example, is not simply a drafting exercise; it depends on the integrity of fund accounting data and the reliability of the controls surrounding it. Audit facilitation similarly benefits from continuity across the reporting lifecycle, rather than being addressed as a standalone year-end requirement. The same is true of iXBRL tagging and EDGAR preparation, where technical filing requirements are better supported when embedded within a broader reporting process.

A more integrated model also creates the conditions for better collaboration. As digital workflows continue to reshape regulatory reporting, there is a growing opportunity to make the preparation of 10-K and 10-Q filings more transparent and coordinated, particularly where responsibility for filing inputs is shared across service providers, issuers and other stakeholders. In that sense, the future of filing support may be less about adding isolated tasks and more about improving how participants work together across the process.

For impacted funds that has practical implications. The question is no longer only whether the required filing can be completed, but how the broader operating model supports timeliness, control, transparency and regulatory change throughout the reporting cycle. As impacted funds face the potential choice of filing semiannually — and future regulatory change around SEC reporting — the firms best positioned to respond may be those that view filing readiness as an outcome of integrated servicing, trusted data and disciplined execution.

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