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Chapter 15

Interim Financial Reporting (PAS 34) involves financial statements for periods less than one year, commonly on a quarterly basis, to provide timely information and aid decision-making. The report includes condensed financial statements and selected notes highlighting significant changes since the last annual report. Key principles include using the same accounting policies as annual financial statements and recognizing revenue and expenses in alignment with annual practices.

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3 views2 pages

Chapter 15

Interim Financial Reporting (PAS 34) involves financial statements for periods less than one year, commonly on a quarterly basis, to provide timely information and aid decision-making. The report includes condensed financial statements and selected notes highlighting significant changes since the last annual report. Key principles include using the same accounting policies as annual financial statements and recognizing revenue and expenses in alignment with annual practices.

Uploaded by

bulawinkc7
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© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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INTERIM FINANCIAL REPORTING (PAS 34)

Interim Financial Reporting = Financial COMPONENTS


statements for periods < 1 year (monthly,
quarterly, semiannual). Minimum Interim FS:

Most common: Quarterly reporting SFP (Condensed)

In PH: SCI (Condensed)

SEC/PSE → Quarterly reports within 45 days SCE (Condensed)

PURPOSE SCF (Condensed)

 Provide timely financial information Notes (Selected)


 Bridge gap between annual reports “Condensed” = same headings as annual, less
 Aid decision-making detail
TWO APPROACHES SELECTED NOTES
Concept Map Only significant changes since last annual
INTERIM REPORTING report:

│  Inventory writedown/reversal
 Impairment losses/reversals
┌───────────┴───────────┐  PPE acquisitions/disposals
 Litigation
│ │  Debt default
INTEGRAL VIEW INDEPENDENT VIEW  Related party transactions
 Changes in fair value
Comparison Table  Contingencies

Avoid repeating annual disclosures

Aspect Integral View Independent COMPARATIVE PRESENTATION


View
Structure Diagram
Concept Interem = part of Interem =
manual separate period SFP → Current interim vs Last year-end
Expenses Allocated Recognized Income/SCI →
when incurred
Current period
Estimates Allowed Limited
YTD
Focus Annual Period
performance performance Prior comparable period
Prior YTD Measure: Lower of Cost or NRV (LCNRV)

Cash Flow & Equity → Methods allowed:

YTD vs Prior YTD  Gross profit method


 Retail method
BASIC PRINCIPLES
Writedown:
KEY RULE:
 Recognize even if temporary
Same accounting policies as annual FS  Reversal allowed

INCOME TAX
Recognition Summary Formula:
REVENUE → Same as annual Interim Tax Expense =
EXPENSES → Pretax Income × Annual Effective Tax Rate
Direct → Match with revenue If fiscal ≠ tax year: → Use separate effective
Indirect → As incurred / allocated rates

Special Rules:
SEASONAL BUSINESSES

Item Treatment Must disclose:

Seasonal revenue No anticipation/deferral  Last 12 months data


 Comparative 12 months
Uneven costs Defer only if allowed annually

ESTIMATION
Advertising Expense immediately
Interim reporting uses MORE estimates than
Bonuses Recognize if obligation +
annual
estimable
CHANGE IN ACCOUNTING POLICY
Irregular costs Do not anticipate
Apply:
Deprecitaion Based on assets in period
only
 Retrospective restatement
Vacation leave Accrue  Ensure consistency within the year

Gains/losses Recognize whe occurs

INVENTORIES

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