ror FINANCIAL REPORTING jm financial reportin tere . . gf means I resercalion of financial statements for ee Pie he and vor riod of less than one 34 prescribes the minimum conte: peak oh i i Feport and the principles for recognition ned een in complete or condensed financial statements fo Sa ern oo : for an interim 4 ial reports artel joterim financial may be presented month: « semiannually. Quarterly interim reports ox the nd ‘common ° However publicly traded entities are encouraged to provide interim financial reports at least semiannually and such reports are to be made available not later than 60 days after the end of interim period. Frequency of interim reporting PAS 34 does not mandate which entities are required to publish interim financial reports, how frequently, or how soon after the end of an interim period. . Philippine jurisdiction The Secirrities and Exchange Commission and Philippine. Stock Exchange require entities covered by the reportorial requirements of Revised Securities ‘Act to file quarterly interim financial reports within the end of each of the first three quarters. The SEC also requires entities covered by the Rules on Commercial Papers and Financing Act to file quarterly financial reports within 45 days after each quarter-end. Entities that provide interim financial reports in conformity with Philippine Financial Reporting Standards shall conform to the recognition, measurem 1 disclosure requirements Set out in the standard. 45 days after ent anc 227A Two views on interim financial reporting The integral view is that each interim period is a ing part of the annual accounting period. al i i ual operating exper Under the integral view, annuai c é exDenseg estimated and then allocated to the interim periods bra forecasted revenue or sales volume. Nn In other words, costs incurred which clearly benefit ‘ the en year are allocated to the interim periods benefited, tie Estimation and allocation are necaeen to avoid eating misleading fluctuations in interim period income. Using the integral view would result to interim income Whig, would be more indicative of the annual income and thus Usofy) in predicting future operations and making informed decisions. The independent view is that each interim Period jg considered a discrete or separate accounting period with Status equal to a fiscal year. Thus, no estimations or allocations are made for interim purposes, unless such estimations or allocations are allowed for annual reporting. ‘The same expense recognition rules shall apply as under annual reporting and no special interim accruals or deferrals are permitted, In other words, annual operating expenses are recognized in the interim period when incurred, irrespective of the number of interim periods benefited, unless deferral or accrual would be allowed in the annual financial statements, Which view is followed in practice? PAS 34 on interim financial reporting does not mention about the two views. Essentially, the standard adopts a mix of the integral ond independent views. 228wants of an i i componens » nterim financial report as gh rote ta: te ponent ( pndensed statement of financial position yaragraph 8, provides that 3 ine’ an interi ‘ ghall include, at a minimum tect Asan ° e wing © »nsed, stateme t * b condensed. # ment of comprehensive income condensed statement of changes in equity a 4 Condens gelected explanatory notes ed statement of cash flows © aragraph 8A provides that an entity can present items of prot or loss in a separate condensed income statement. Nothing in the standard is intended to prohibit or discourage an entity from publishing a complete set of financial siatements, rather than condensed financial statements and selected explanatory notes. Jn other words, PAS 34 allows an entity to publish a set of condensed financial statements or complete set of financial statements in the interim financial report. means that each of the headings and subtotals presented in the entity's most recent annual financial statements is required but there is no requirement to include greater detail unless this is specifically required. with PFRS "Condensed" Disclosure of compliance ovides that if an entity's interim Jiance with Philippine Financial fact shall be disclosed. PAS 34, paragraph 19, pr financial report is in comp. Reporting Standards, such An entity shall not describe an interim financial report as complying with PFRS unless it complies with all of the tequirements of each applicable Philippine Financial Reporting Standard. 229Selected explanatory notes d explanatory notes are designed ty of significant events and transaction, nnual financial statements. The selecte ty an explanation 8 nei ide since the last a ny nancial statement users have a, ent annual report. on PAS 34 assumes that fi to the entity's most rec d reiterates that it is a super, the interim financial report at As a result, the standar‘ ¢ annual financial report, to provide the same notes in appeared in the most recen! Examples of disclosures required in a condensed inter financial report include: tim Writedown of inventories to net realizable value and 4 reversal of such a writedown he Joss from the impairment of propert gible assets and the all 7 a. b. Recognition of a and equipment and intan| such an impairment loss c. The reversal of any provisions for d, Acquisitions and disposal of items of property, plant and equipment Commitments for the purchase of property, plant and equipment f, Litigation settlements Corrections of prior period errors in previously reported financial data h. Any debt default or any breach of a debt covenant that has ‘not been corrected subsequently the costs of restructuring i. Related party transactions j. Changes in economic circumstances that affect fair value! financial asset and financial liability k. Change in the classification of financial asset 1. Contingent liabilities and contingent assets 230 ‘Scanned with CamScannerntation of comparative interj it 05? im statement of financial position statements Statement of financial posit; interim period Position at the end of current : Comparative statement o} i of preceding year. f financial Position at the end A jncome statement Income statement for the ¢; rel , ur) i im period . Income statement cumulatively ite thee is cial vaar to data e current finan Comparative income stat jaterim period of the preceting foo the comparable d. Comparative income statement i comparable financial year to date Sibeee oF 4, Statement of comprehensive income a See i comprehensive income for the current p. Statement of comprehensive i " Aiicutient ‘Ghenenl 7 ee Le cumulatively for c. Comparative statement of comprehensive income for the comparable interim period of the preceding year d. Comparative statement of comprehensive income cumulatively for the comparable financial year to date of the preceding year 4, Statement of changes in equity a. Statement of changes in equity cumulatively for the current financial year to date b. Comparative statement of changes in equity for the comparable financial year to date of the preceding year 5. Statement of cash flows a. Statement of cash flows cumulatively for the current financial year to date . b. Comparative statement of cash flows for the comparable financial year to date of the preceding year 231 Scanned with CamScannerIllustration - Half-yearly If an entity publishes interim financial reports hale, the following ‘comparative financial statements are Pree on June 30, 2020: Statement finance position: Tune 30,2020 December 3} 2a eae june 30,2020 Jue 30, 2019 oe. Tune 30,2020 June 30, 2019 Sato te ea June 30,2020 June 30, 2019 Another illustration - Quarterly If an entity publishes interim financial reports quarterly, the following comparative financial statements are included in the quarterly interim financial report on dune 30, 2020: Statement of financial position: On dune 30, 2020 December 31, 2019 Statement of comprehensive income: 3 months ending dune 30,2020 dune 30, 2019 6 months ending dune 30,2020 dune 30, 2019 Statement of cash flows: 6 months ending dune 30,2020 June 30, 2019 Statement of changes in equity: 6 months ending dune 30, 2020 June 30, 2019 232———eeoororerererererererererererereeeeeeeee asic principles of interim — rting 34, paragraph 28 » Provide; Y a i 8 th; pe sane te ae aro a Policies ja qt ohtity shall apply tal applied ; e interi statements. Plied in fhe annual” ‘aa ancial owever, the frequency of a: i mM entity’ annual, half-yearly or quartery neeporting whether peasurement of the annual results, all not affect the therefore, measurements for interi urpo: " e shall be made on a year to date bat _ Reventes from products sold or services rendered are enerally recognized for interim as for the annual period. reports on the same basis a 3, Costs and expenses are recognized as in i inte period. curred in an a Expenses associated directly with revenue are matched against revenue in those interim periods in which the yelated revenue is recognized. pb. Expenses not associated directly with revenue are recognized in interim periods as incurred or allocated over the interim periods benefited. 4, PAS 34, paragraph 21, provides that if the business is seasonal, in addition to the current interim period ~ financial statements, the entity is encouraged to disclose financial information: a. For the latest 12 months b. Comparative jnformation for the prior comparable 12-month period that the preparation of interim 5 , Paragraph 41 provides es a greater use of financial report: rally requir Ne ports gene 7 estimation than annua! nncial reports: 233 ‘Scanned with CamScannerInventories sx B of PAS 34 provides that inven, . Paragraph 26 of Appenaxx : ti tie are measured for interim financial reporting by the sane principles as at financial year-end. This simply means that inventories shall be measured gt lower of cost or net realizable value even for interim PUrposeg The cost of the inventory. may be estimated using the Bross profit method or retail inventory method. Full inventory and valuation procedures are not required for inventories at interim date. Accordingly, if the net realizable value is lower than cost, a logs on inventory writedown shall be recognized regardless of whether the writedown is temporary or nontemporary, PAS 34, paragraph 17, requires disclosure of the writedown of inventories to net realizable value and the reversal of such writedown in a later interim period. The net realizable value of inventories is determined by reference to selling prices and related cost to complete and dispose at interim dates." onal, cyclical or occasional . revenue nal, cyclical or occasio, 280 d nal rey Sa dno ea lah tern ts hl 24 be af qoserral w appropriate at thew” if anticipation os ting period. end of the entity's i dividend revenue, royaiti S, preye ies 1h ye recognized in the interim yo, fovernment grants ey occur. mple, dividend revenye ; yor ex@ nue is not recogni ‘ gana boeause even when highly predictable Saned sonny experience, 1 nd is not an obligation of the entit o*fil itis Iegally declared. entity Uneven costs costs that are incurred unevenly during an entity's financi ar shall be anticipated or deferred for inten eens nly if it is also appropriate to anticipate or de wost at the end of the financial year. een for example, a provision for warranty is recognized at interim date because the entity has no realistic alternative but to make a transfer of economic benefits as a result of an event that has created a legal or constructive obligation. However, the cost of a planned major periodic maintenance or overhaul that is expected to occur late in the year is not anticipated for interim purposes unless an event has caused the entity to have a legal or constructive obligation. Expenditure for advertising is not deferred but recognized #8 expense in the interim period it is incurred because it is tot appropriate to defer such cost at year-end. Year-end bonuses The nature of year-end bonuses varies widely. Some are ‘arned simply by continued employment during a time Period. Some bonuses are earned based on a monthly, Warterly or annual measure of performance. Some bonuses may be purely discretionary, contractual_or “sed on years of historical precedent. 235 Scanned with CamScanner_Recognition of bonus ‘A bonus is antitipated for interim purposes if and only i igati st practice wo The bonus is a legal obligation or pai "© Would, a. a bonus a constructive obligation for which the eng? has no realistic alternative but to make the Paymen, b. Areliable estimate of the obligation can be made, Irregular costs Certain costs are expected to be incurred irregularly durj the financial year, such a8 charitable contribution ai employee training cost. Such costs are generally discretionary and even though they are planned shall not be anticipated as of an inter hy 1M date simply because the costs have not yet been incurred, Depreciation and amortization Depreciation and amortization for an interim period shall be based only on assels owned during that interim period, Asset acquisitions or dispositions planned for later in the financial year shall not be taken into account. Paid vacation and holiday leave Paid vacation and holiday leave shall be accrued for interim purposes because these are enforceable as legal commitments. Gain and loss Gain or loss from disposal of property, gain or loss from discontinued operation and other gain or loss shall not be allocated over the interim periods. The gain is reported in the interim period when realized and the loss is reported in the interim period when incurt®Ss rermE_—S—S——<“‘<—‘ ;!W!WWh e tax c y riod income t ‘ax ex) esim Fi nciples of i ‘pense shal ral principiee of income tax ccna the same pthyal FOROS: ‘ing applicable to a” : aph 12 of Appendix B of PAS 3, Ob : 4 sti Bsc porerd income tax expense is accrued wine gte interim annua pe? tive income tax rate applied to i Bes ed the pretax income of the gustration entity has the following income before tax and annual Mave tax rate for the first three quarters of the current yeut Income before tax Tax rate gist quarter toot 20K second quarter 8,000,000 ae see quarter 8,000,000, iil sralincome 19,000,000 The income tax for each quarter is computed as follows: (30% x 5,000,000) 1,500,000 First quarter Second quarter (80% x 6,000,000) 1,800,000 Total income tax for first two quarters 3,300,000 Cumulative income tax for three quarters (26%x 19,000,000) 4750,000 Income tax for first two quarters (8,300,000) 1,450,000 SS Third quarter — income tax expense 237 Scanned with GamScannerDifference in financial reporting year ang ee fe 1 a i d the income tax Year ¢;, ial reporting year an di ata Rane Appendix B of PAS 34 ptates that the ing es for interim periods of that financja) Year tax exp d using separate effective tax rates for each i Bee applied to the portion of pretax income Carne i: each of those tax years. i te of a particular tax . imply stated, the effective tax ra J ] war cap cones to the pretax income of the interim period in the fan, tax year. Illustration An entity's financial reporting year ends June 30 and it reports quarterly. This means that the financial Teporting i, from July 1 of one year to June 30 of next year. The tax Year ends December 31. ‘The income before tax for the financial year from July 1, 2019 to June 30, 2020 is as follows: First quarter July 1, 2019 to Septomber 30, 2019 1,000,009 aquarer October 1, 2019 to December 31, 2019 2,000,009 Third quarter January 1, 2020 to March 31, 2020 2°500,099 Fourthquarter April 1, 2020 to June 30, 2020 4,000,000 The effective income tax rate is 30% for 2019 and 25% for 2020. The income tax expense for each quarter of the financial reporting year is computed as follow: 'S: First quarter (80% x 1,000,000) 300,000 Second quarter (80% x 2,000,000) 600,000 Third quarter (25% x 2,500,000) 625,000 Fourth quarter (25% x 4,000,000) 1,000,000 Total income tax expense 2,525,000 238in accounting policy a in accounting policy other than i u One fe i gn, js specified a statemenmndard shall be tit os aeigging the financee’ statements of prior inggre tHested eatent year and the comparable inter, perio ods the ncial year’ ae -octive of this requirement is to ensure i ait policy, is applied tate : that a single 1 rticul, throughout the entire financial ee BIEES of oun” pansion’ shioring's ting policies for th wv differing accoun| es tor the same clas; ae tions within a single financial year would ote 1 m allocation difficulties, obscured Operating results, ‘ns omplicated analysis and understandability of interim jpformation". 239nOBLEMS ole 12-1 (AICPA Adapted) Company has estimated tha; Vin the year ended December 3° depreciation expense h fot O00, and that 2019 1, 20458 Pate tioog 19 Year-end hints i amplneee interim income state: jn the 5019, what total een for the six m t , th: ie reported? Amount of these cape ad 1,700,000 k 1,100,000 b. "500,000 § 860,000 problem 12-2 (IFRS) ‘The terms and conditions of employment wi ndude entitlement to share in the staff hoe ee ee whic 4 ihe profit for fhe year before charging the bonus is local (0 the bonus pool, provid 900,000. Pp led the annual profit exceeds The profit before accrual of any bonus for the first half of the current year amounts to P40,000,000 and the latest estimate of the profit before accrual of any bonus for the year as a whole is 60,000,000. What amount should be recognized as bonus expense for the first half of the current year? a. 1,500,000 b. 3,000,000 e. 2,000,000 a. 0 Problem 12-3 (AICPA Adapted) On March 15, 2019, Rex Company paid property taxes of P60, i building for calendar year 2019. On Ap aan oe a eaty made P900,000 in unanticipated ordinary repairs to equipment. What total amount of these expens®’ the quarterly income ‘statement endin es should be included in g June 30, 2019? 1,050,000 4 1,500,000 {450,000 "900,000 241 ‘Scanned with CamScannerProblem 12-4 (AICPA Adapted) Bell Company reported P950,000 net income for the qu ended September 30, 2019 which included the followse’ i after-tax items: * A P600,000 gain from expropriation realized On Apri} 30 2019 was allocated equally to the second, third ang fours, quarters of 2019. A P150,000 loss resulting from a change in invento, valuation method was recognized on August 1, 2019 * In addition, the entity paid P480,000 on February }, 2019 for 2019 calendar-year property taxes. Of this amount, P120,000 was allocated to the third quarter of 2019” For the quarter ended September 30, 2019, what amount should be reported as net income? a. 1,200,000 b. 1,400,000 c. 950,000 d. 900,000 Problem 12-5 (IFRS) Apucao Company operates in the travel industry and incurs costs unevenly through the financial year. Advertising costs of P2,000,000 were incurred on March 1, 2019, and staff bonuses are paid at year-end based on sales. Staff bonuses are expected to be around P20,000,000 for the year. Of that sum, P3,000,000 would relate to the period ending March 31, 2019. What total amount of expenses should be included in the quarterly financial report ending March 31, 2019? a. 7,000,000 b. 5,500,000 c. 5,000,000 d. 3,500,000 242 Scanned with CamScannerfi yoplem 12-6 (IFRS) 9 Company prepares qu, pa ntity sells electrigay Tin rs claim on the; S re} geome Warranty. “84 normally gop ot n provision in the first iin we to date which amounte, Was caleu| r 4 to Pig i 000,000. tor Se ee ae ™, a design fault y &xpected Was found vot. Sales for the second Quarter con ma foe the whole ue 15, at would be the provision charged in the inte. 000,000. gatement for the second quarter? in the interim income ». 2,000,000 p, 1,250,000 ¢, 1,500,000 4 750,000 lated at 5% of Problem 12-7 (IFRS) Verna Company reported profit before tax for the first six nonths ended June 30, 2019 at P5,000,000. However, the business is seasonal and profit before tax for the last six nonths ended December 31, 2019 is almost certain to be ?9,000,000. Profit before tax equals taxable profit for this entity. ‘The entity operates in a country where income tax on entities isat a rate of 80% if annual profit is below P11,000,000 and a tate of 35% where annual profit exceeds P11,000,000. These tax rates apply to the entire profit for the year. What amount should be reported as income tax expense in interim financial statements for the half year ended June %0, 20199 i 1,750,000 * 2,100,000 * 1,500,000 * 2,450,000 243 Scanned with CamScannerProblem 12-8 (IFRS) Bailan Company, a calendar-year entity, had the fg income before tax provision and effective annual tay rane the first three quarters of the current year: © fo Income before tax Tex iu First quarter 6,000,000 309, . Second quarter 7,000,000 ane Third quarter 8,000,000 25 . What is the income tax provision in the interim ineo, statement for the third quarter? me 5,250,000 1,350,000 2,400,000 2,000,000 Boop Problem 12-9 (IFRS) Sigma Company has a financial reporting year that begins July 1, 2019 and ends an June 30, 2020. The tax year ends every December 31. The entity reports quarterly for interim purposes and the quarterly income is P 1,000,000 for the first quarter, P1,500,000 for the second quarter, P2,500,000 for the third quarter and P4,000,000 for the fourth quarter. The income tax rate is 30% for 2019 and 25% for 2020. What is the total income tax expense for the year ended June 30, 2020? 2,375,000 2,700,000 2,250,000 1,625,000 Be op 244aplem 12-10 (TAA) , Company has histori sales in each quarter. ally reported bad debt expense 5 ‘or the afryod she same procedure in the theoo quarter of th ona ‘ 6 of the year. gover in i ieee quarter, the entity determi tt expense for the entire year should be oo that bad jes iD each quarter of the year we: Sond quarter P1,500,000, third rite Po mano0 ae ste 'p4,000,000. ,000 and fourth , amount should be recogni es a quarter? nized as bad debt expense for problem 12-11 (IAA) any is preparing the interim financial statements Snider Comps fpr the first quarter ended March 31, 2019. Expenses jn the first quarter totaled P4,000,000 of which 25% was variable ‘The fixed expenses included television advertising expense of P1,500,000 representing air time to be incurred evenly during 9919, and depreciation expense of 600,000 for 2019 for an equipment that was available for use 07 March 1, 2019. should be reported as total expenses in the ? What amount arch 31, 2019? fist quarter ended Mi & 4,000,000 b, 2,875,000 & 2,825,000 4. 2,335,000 245 Scanned with CamScanner __eeeeeeeProblem 12-12 (AICPA Adapted) , At the beginning of current year, Cambridge Comp entered into a 20,000,000 long-term fixed price contray construct a factory building. to The entity accounted for this contract under the Percents, of completion at the end of each quarter. ge Quarter Percentage of completion Estimateg Cost an, ov 1 10% 15,000,009 2 10% 15,000,009 3 25% 19,200,009 4 25% 19,200,009 No work was performed in the second and fourth quarters 1. What amount of income should be reported in the fry quarter? “ a. 2,000,000 b. 200,000 ¢.. 500,000 d. 0 2. What amount of income should be reported in the second quarter? a. 500,000 b. 250,000 c. 750,000 da. 0 8. What amount of income or loss should be reported in the third quarter? a. 200,000 income b. 200,000 loss ¢. 300,000 income d. 300,000 loss 4, ‘What amount of income should be reported in the fourth quarter? a. 800,000 b. 400,000 c. 200,000 da. 0 246 ‘Scanned with CamScanner ———— SYproblem 12-18 (LAA) jrmaine Company bona che" palance on Ma: P ed pial bal rch 31, 2019, he following becasue cash i jocounts receivable 1,000,000 aventory 2,000,000 prepaid insurance 1,500,000 Note receivable 400.000 jand 5,000,000 puildinge and equipment 1,500,000 egounts payable 18,000,000 ghare capital 8,500,000 gare prom 5,000,000 retained earnings 4,000,000 sales 9,500,000 hases 25,000,000 pjstribution costs [Link] Administrative expenses _2:400,000 Uncollectible accounts typically average 1% of net sales. On January 1, 2019, buildings and equipment have an average remaining life of 10 years. One-third of the account balance consists of assets related to selling activities. The entity uses the straight line method. 3 The note receivable is dated January 1, 2019, matures on January 1, 2021, and carries a 12% interest rate. Interest will be collected annually starting January 1, 2020. 4 On January 1, 2019, the entity had purchased a one-year insurance policy debiting the payment to prepaid insurance. Z : . 5. The gross profit method is used to determine the interim im veraged 40% of net sales. wentory. Gross profit has a) z ‘cata . The income tax rate is 30% and the income paid on or before April 15, 2019. re Required: the first quarter and a Prepare an income statement for Ha 2018. tement of financial position 0 247Problem 12-14 (IAA) quarterly and year to date inter, i any prepare: ca interim, fopors. The eny proved he ONT em nan statement for the quarter ended Ma , ° Sales (1000 000 500 Cost of sales Pre Gross income er Dividend revenue =m Total income ( "300.000 Distribution costs ; 900,009 General expenses . (ab 000) Depreciation ' 400,000 Interest expense 10,000) Income tax ( 400,009) i 1,000, Net income 21,000,000 On June 30, 2019, the accountant completed a worksheet in preparing the year to date income statement. The worksheet showed the following incomé statement accounts: Sales 20,000,000 Interest revenue 250,000 Dividend revenue 500,000 Cost of sales 11,500,000 Distribution costs 2,500,000 General expenses 1,100,000 Depreciation 700,000 Interest expense 300,000 Income tax expense 1,300,000 Required: L Prepars an income statement for the first six months of 2. Prepare an interim in come statement for the second quarter of 2019, a iad 248 | Scanned with CamScanneroblem 12-15 (IFRS) pr Company encountered the fol potions as part of the quarterly finn ‘owing product cost an ncial reporting: e entity conducted inventory cou, * second quarter and end of the fiscal a of ths ._ gypical gross pent rate ‘ it rate at th 0% actual gross profi e end of the se ‘actual Bross profit rate at the end of the Sean quarter 5% ; quarterly sales: first quarter hird quarter 7,000,000 Fouth quarter 15,000,000 There was a temporary decline in inventory value of P100,000 in the first quarter which was recovered fully jn the second quarter. There was a net realizable value adjustment of P150,000 in the third quarter. The inventory value increased by P200,000 at the end of the fourth quarter. Required: | Compute the cost of goods sold for each quarter. ° Compute the gross income for each quarter. 249» choice (FRS) 2-16 Multipl yarding Interim repory, "y? Problem 1 pment in € 1, Which atatent ' The independent view in required for interim Finang, . statements b, Interim © sports a © Interim reports d reports red nt of comprehenst nancial position quired on a quartor| req rH Y banig not requ the preparation of », nly ve income and a stay! a Ment a, rh of fi rim financial report iy tp ue 2, Which statement about an int »port must consist of 4 &, p 8 comples, a, An interim financial set of financial statements. a] report must congigs ‘f te An interim finan . ed set of financial statements, condens c. An interim financial report may consist of condensed set or complete set of financial statem,,," d. All of these statements are true. 3. Interim financial reports shall include as a minimum a. A complete set of financial statements. b. A condensed set of financial statements and gele, notes. ected c. A statement of financial position and an income statement. A condensed statement of financial position, incom d. statement and statement of cash flows. 4. An interim financial report shall include ini all of the following components, except Cais a. Condensed statement of financial positi b. Condensed statement of cash flows S Condensed statement of changes in equity : Accounting policies and explanatory notes 5. Which statement is true about interim reporting? a. All entiti i , interim Benen Tepe an annual report must issue . The integral view ie the d ral view is the more ri ach c. A complete interim financial won = 9 presented Bea of financial gtatements must be | The same 1 m period, report should rane principles used for the annus! employed for the interim report 250 iki iste el oeA complete gs a set of p. Interim amount aa later interim periods c. The integral view and th, two appr ie pproaches of interim i lependent view are the ancial advertigi gents is required. is , 8 expensed asd 7 Interim financial reporting should be vi viewed. a. As useful if activity i . lvity 1s spread p.. As if the interim ial yee period evled ¢. As reporting for an inte; ; ‘As special gral part of ai it d pecial type of reporting that need. not flow GAAP ly through the year y ei Were an “annual accounting g, Interim financial statements are usually presented on a a. Monthly basis b. Quarterly basis c, Semiannual basis d. Nine-month basis 9, When the business is seasonal, what does the standard suggest for interim reporting? a, Additional notes be written in the interim reports about seasonal nature of the business b, Disclosure of financial information for the latest and comparative 12-month period in addition to the interim report . ¢. Additional disclosure in the accounting policy note d. No additional disclosure the income tax expense ting, A reporting 4 by using the 10. For interim financial rn hould be compute| for the second quarter S &. Statutory tax rate for the vont: d quarter. 3 cted for the second q' . i Effective tax ee oxPeoted for the full year. . Effecti ffective tax ate or the fi ull. d. Average tax ral 251 nit einer