Interim Reporting - 20B Flashcards
What is Interim Reporting?
Financial reporting for periods of less than one year
What is the primary purpose of Interim Reporting?
- To provide information that is more timely than is available in the annual reports
- To highlight business turning points which could get buried in the annual report
What are the two views for Interim Reporting?
- Discrete View - each interim period is a separate accounting period and must stand on it’s own
- Integral View - each interim period is a integral part of the annual period
Interim Reporting - Revenues
General Rule - Same as annual reports
Exceptions - None
Interim Reporting - COGS
General Rule - Same as annual reports
Exceptions
- Gross Profit Method may be used to estimate CGS and Ending Inventory for each interim period
- Temporary declines in inventory market value need not be recognized
- Recoveries of permanent declines may not exceed the original amount
Interim Reporting - All other costs & exp
General rule - Same as annual reports
Exceptions - Expenditures which clearly benefit more than one interim period may be allocated among periods benefited
Interim Reporting - Income Taxes
General Rule - (Year to date income x Estimated Annual effective tax rate) - (Expense recognized in previous periods)
Exceptions - None
The Effective Tax Rate expected should anticipate:
- Capital Gains
- Foreign Tax Rates
Interim Reporting - Discontinued Operations & Extraordinary Items
General Rule - Recognized in Interim period as incurred
Exceptions - None
Interim Reporting - Change in Accounting Principle
General Rule - Retrospective Application - Treat as if occurred in the first quarter of the year
Exceptions - None
Does IFRS mandate Interim Reporting?
No
If a company under IFRS elects Interim Reporting, what reports does IFRS require?
- The Statement of Financial Position
- The Statement of Comprehensive Income
- The Statement of Change in Equity
- The Statement of Cash Flows
