How do these changes affect auditors?

Following former Chair Erica Williams' resignation in July, the SEC designated George Botic to serve as Acting Chair of the Public Company Accounting Oversight Board (PCAOB) in late July. The SEC also announced that it’s soliciting new candidates for all five Board positions. This announcement wasn’t surprising as the new administration’s deregulatory philosophy stands in stark contrast with the current Board’s active approach to regulating auditors over the past few years. Many stakeholders expect the future Board to focus on reducing unnecessary compliance costs and taking a more collaborative posture with auditors–consistent with the SEC’s priorities. Along those lines, in late August the PCAOB postponed the effective date of QC 1000, a significant new standard that imposes specific requirements for an audit firm’s system of quality control. The new standard was supposed to be effective in December 2025, but auditors now have an additional year to comply.

What should public companies focus on related to financial reporting?

The FASB’s new income tax disclosure standard, ASU 2023-09, is effective for the 2025 annual financial statements of calendar year-end companies. The standard requires more disaggregated information to be included in the rate reconciliation and more jurisdictional information about income taxes paid. Interestingly, this standard was included in recent versions of the House Appropriations Committee’s 2026 spending bill. The bill includes text that would prevent the SEC from approving the FASB’s budget until ASU 2023-09 is withdrawn. It’s notable that Congress is attempting to influence accounting standards in this way, but not unprecedented. Stakeholders should continue to monitor the progress of the bill over the rest of the year. In the meantime, preparers should continue implementing the standard, ensuring they have access to disaggregated tax information that wasn’t required in in prior years. Internal-use software In September, the FASB issued ASU 2025-06, significantly amending the accounting for internal-use software costs. The new ASU eliminates the concept of project stages and instead requires capitalization of software costs to begin when management has both authorized and committed to funding the project, and it’s probable the project will be completed. Under the new standard, some costs that previously would have qualified for capitalization may instead be expensed. While the new standard isn’t effective until 2027, software development companies should begin evaluating the impact of the standard on their projects now and communicate early with board members and other stakeholders on the expected impact.

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Q3 SEC outlook: Regulatory and financial reporting updates from 2025

Oct. 6, 2025 · Authored by Porter Loud

The momentum behind the new administration’s regulatory priorities gained more steam during the third quarter. From artificial intelligence to crypto, embracing innovation and reducing regulatory friction continue to be central themes at the SEC.

Learn more about what’s happening at the SEC and how it can impact public companies below.

What’s happening at the SEC?

The Spring 2025 unified agenda of regulatory and deregulatory actions (Reg-Flex Agenda) was released on Sept. 4, 2025, detailing the SEC’s rulemaking priorities. This is the first agenda released during Chairman Paul Atkins' tenure and reflects the Commission’s renewed focus on facilitating capital formation.

A number of topics are being considering for potential rule changes that stakeholders should keep an eye on moving forward:

Emerging Growth Company (EGC) and Filer Status. Expand EGC accommodations to include more issuers and simplify filer status categories generally to be less complex.
Crypto Assets and Market Structure. Clarify the regulatory framework for crypto assets including new and amended rules related to the offer and sale of crypto assets, including exemptions and safe harbors.
Disclosure Practices. Rationalize disclosure practices with focus on material disclosures, including potential changes to executive compensation disclosures.
Exempt Offerings. Simplify the pathways for private companies to raise capital.
Shelf Registrations. Modernize the shelf registration process to reduce compliance burdens.
Rule 144 Safe Harbor. Expand Rule 144 safe harbor to increase instances in which it would be available.

Porter Loud

Principal

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Q4 2025 SEC regulatory and reporting updates

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The information provided here is of a general nature and is not intended to address the specific circumstances of any individual or entity. In specific circumstances, the services of a professional should be sought. Tax information, if any, contained in this communication was not intended or written to be used by any person for the purpose of avoiding penalties, nor should such information be construed as an opinion upon which any person may rely. The intended recipients of this communication and any attachments are not subject to any limitation on the disclosure of the tax treatment or tax structure of any transaction or matter that is the subject of this communication and any attachments.

Q3 SEC outlook: Regulatory and financial reporting updates from 2025

What’s happening at the SEC?

Porter Loud

Q4 2025 SEC regulatory and reporting updates

Quarterly reporting

International

Leadership changes

How do these changes affect auditors?

What should public companies focus on related to financial reporting?

Internal-use software

Have questions? Baker Tilly can help.