IAS 34, INTERIM FINANCIAL REPORTING § SFP at the end of the current interim period

• Interim Financial Statements – are financial § Comparative SFP at the end of the preceding
statements covering a period of less than one year
year. Thus, they may be reported monthly,
quarterly, or semi-annually. • Income Statement

Annual Interim § IS for the current interim period

TIME PERIOD 1 year or longer Monthly,
quarterly, or § IS cumulatively for the current financial year
semi-annually to date
PURPOSE Reporting to Give timelier
creditors and source of § Comparative IS cumulatively for the
investors information comparable financial year to date of the
OTHER Audited and Less reliable; preceding year
DIFFERENCE detailed Requires greater
estimation of
used information § Comparative IS for the comparable interim
ACCOUNTING Same Same period of the preceding year.
PRINCIPLES
APPLIED • Statement of Comprehensive Income

• Components of Interim Financial Reporting § Statement of Comprehensive Income for the

a. Condensed statement of financial position
b. Condensed statement of comprehensive
income
c. Condensed statement of changes in equity
d. Condensed statement of cash flows
e. Selected explanatory notes
• An entity can either issue a set of condensed FS
or complete FS. The difference is that in
condenses FS some additional details are not
included in the report unless required to.
• Selected explanatory notes are provided to avoid
repetition of notes from the latest annual report
with the interim report.
• Examples of Disclosures:
current interim period
§ Statement of Comprehensive Income
cumulatively for the current financial year to
date
§ Comparative Statement of Comprehensive
Income cumulatively for the comparable
financial year to date of the preceding year
§ Comparative Statement of Comprehensive
Income for the comparable interim period of
the preceding year.
• Statement of Changes in Equity
§ Statement of Changes in Equity cumulatively
for the current financial year to date

o The reversal of any provision for § Comparative statement of Changes in Equity

restructuring
o Acquisition and disposals of items of
property, plant and equipment
o Litigation settlements
o Changes in the classification of financial
statements
o Related part transactions and etc.
for the comparable financial year to date of
the preceding.
• Statement of Cash Flows
§ Statement of Cash Flows cumulatively for the
current financial year to date

§ Comparative statement of Cash Flows for the

PRESENTATION OF COMPARATIVE INTERIM comparable financial year to date of the
STATEMENTS preceding.

• Statement of Financial Position

RECOGNITION AND MEASUREMENTS • Recognition of Bonuses and Benefits

• Same Accounting Principles as Annual
Reports
§ Same principles will be applied in interim
reporting except for changes made after the
issuance of the latest annual reporting. To
avoid the effects of the frequent reports in
interim reporting , measurements shall be
made on a year-to-date basis.
§ This is also applicable in tax computation.
But if the financial year is different from the
tax year, effective tax rates will be applied for
the tax year it was incurred.
§ If there will be change in accounting policy,
it must be applied for the whole year thus
report from previous interim period will be
restated.
§ Bonuses are not just given annually. They
may be due to special recognition of deed or
skills anytime of the year.
§ Bonus is expected if and only if:
The bonus is a legal obligation or past
practice would make the bonus a constructive
obligation for which the entity has no realistic
alternative but to make the payment
A reliable estimate of the obligation can be
made.
§ Unlike bonuses, benefits such as vacation and
holiday leave shall be anticipated for interim
purposes since it’s in the law to give such.
• Gains and Losses

• Revenues are recognized on the same basis as § Gain and loses will be reported as realized
in the annual report and incurred respectively thus it will not be
allocated over interim periods.
§ Since revenues are not earned regularly in a
timely manner, like for seasonal or
occasional instances, it shall not be predicted
or delayed as of an interim date. Revenues
like dividend , royalties or government grants
are reported when realized.

• Cost and expenses are recognized as incurred

§ For expenses directly related with revenue, it

corresponds in the period the revenue is
realized.

§ For expenses not directly related, it is

recognized as incurred in the period.

§ Uneven cost shall be expected or delayed if

necessary for that type at the end of the
period.

§ Examples are Provision for Warranty or

Advertising Expenses

§ Irregular Cost shall not be recognized in

interim report since it is not incurred yet.
Even it was planned, management may
decide not to incur this cost.

§ Depreciation and amortization will only be

applied to assets owned during the interim
period.