FINANCIAL REPORTING reporting INTERIM Interim financi of financial statements for

means the preparatios and period the minimum content of of less than M an interior andrement in
prescribes mport and the principles for recognition PAS 34 complete or condensed financial period.

sentation

statements for an intern reports may be presented monthly, quarterly Quarterly interim reports are the most
financial Interim semiannually. ommon 20

However, publicly traded entities are encouraged to provide interim financial reports at least semiannually
and such reporta 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 Parim financial reports, how frequently, or
how soon after the end of an interim period.

Philippine jurisdiction

The Securities 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 45 days
after 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, measurement and disclosure requirements set out in the standard.

Two views on interim financial reporting The integral view is that each interim period is an integral part of
the annual accounting period.

Under thand then allocated to the interim periods based on integral view, annual operating forecasted
revenue or sales volume In other words, costs expenses

clearly benefit the entire allocated to the interim periods benefited. year are Estimation and allocation are
necessary to avoid creating misleading fluctuations in interim period income.

incurred which

Using the integral view would result to interim income which ald be more indicative of the annual income
and thus useful predicting future operations and making informed decisions. independent view is that each
interim period is considered in The 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 and independent views.
Components paragraph PAS 34.

shall include, at a minimum, the following statement Condensed of financial position

report omponents

statement of comprehensive income of changes in equity of cash flows Condensed Condensed statement
Condensed Selected statement explanatory

8A provides that an entity can present items of erofit or loss in a separate condensed income statement.
Paragraph Nothing in

an entity the standard is intended to prohibit or discourage from publishing a complete set of financial
statements, selected rather than condensed financial statements and explanatory notes.

In other words, PAS 34 allows an entity to publish a set of ondensed financial statements or complete set of
financial statements in the interim financial report.

Condensed" means that each of the headings and subtotals statements is required but there is no
requirement to include greater detail unless this is specifically required.

Disclosure of compliance with PFRS

PAS 34, paragraph 19, provides that if an entity's interim financial report is in compliance with Philippine
Financial Reporting Standards, such fact shall be disclosed.

An entity shall not describe an interim financial report as complying with PFRS unless it complies with all of
the requirements of each applicable Philippine Financial