0% found this document useful (0 votes)
23 views4 pages

Module 5

The document discusses PAS 34, which provides guidance on interim financial reporting. It defines an interim financial report as a complete or condensed set of financial statements for a period shorter than a full financial year. The minimum requirements for an interim financial report include condensed versions of the standard financial statements along with selected explanatory notes. Measurement and recognition in interim reports should be on a year-to-date basis using the same accounting policies as the annual financial statements. The objective is to provide updates to users while using estimates to the extent necessary for interim periods.

Uploaded by

Karen Garcia
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
0% found this document useful (0 votes)
23 views4 pages

Module 5

The document discusses PAS 34, which provides guidance on interim financial reporting. It defines an interim financial report as a complete or condensed set of financial statements for a period shorter than a full financial year. The minimum requirements for an interim financial report include condensed versions of the standard financial statements along with selected explanatory notes. Measurement and recognition in interim reports should be on a year-to-date basis using the same accounting policies as the annual financial statements. The objective is to provide updates to users while using estimates to the extent necessary for interim periods.

Uploaded by

Karen Garcia
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 4

MODULE 5 INTERIM FINANCIAL REPORTING

LEARNING 1. Define an interim financial reports.


OBJECTIVES
2. State the scope of PAS 34.
3. Describe the recognition and measurement principles applied in
interim financial reporting.
4. Compute for income tax expense in the interim financial
statements.
OVERVIEW PAS 34 Interim Financial Reporting applies when an entity prepares an
interim financial report, without mandating when an entity should prepare
such a report. Permitting less information to be reported than in annual
financial statements (on the basis of providing an update to those financial
statements), the standard outlines the recognition, measurement and dis-
closure requirements for interim reports.
Acquiring new Asynchronous - links to more information: www.farhatlectures.com;
knowledge http://www.ifrsbox.com
A synchronous discussion for this lesson will be scheduled on November
17, 2020 (Tuesday 9:00 – 10:00 AM)

Objective of PAS 34
The objective of PAS 34 is to prescribe the minimum content of an interim
financial report and to prescribe the principles for recognition and mea-
surement in financial statements presented for an interim period.

Key definitions

Interim period: a financial reporting period shorter than a full financial


year (most typically a quarter or half-year). [PAS 34.4]

Interim financial report: a financial report that contains either a complete


or condensed set of financial statements for an interim period. [PAS 34.4]

Minimum content of an interim financial report


The minimum components specified for an interim financial report are:
[PAS 34.8]
o a condensed balance sheet (statement of financial position)
o either (a) a condensed statement of comprehensive income or (b) a
condensed statement of comprehensive income and a condensed
income statement
o a condensed statement of changes in equity
o a condensed statement of cash flows
o selected explanatory notes

If a complete set of financial statements is published in the interim report,


those financial statements should be in full compliance with PFRSs. [PAS
34.9]
If the financial statements are condensed, they should include, at a
minimum, each of the headings and sub-totals included in the most recent
annual financial statements and the explanatory notes required by PAS 34.

Additional line-items or notes should be included if their omission would


make the interim financial information misleading. [PAS 34.10]

If the annual financial statements were consolidated (group) statements,


the interim statements should be group statements as well. [PAS 34.14]

If the annual financial statements were consolidated (group) statements,


the interim statements should be group statements as well. [PAS 34.14]

The periods to be covered by the interim financial statements are as


follows: [PAS 34.20]
o balance sheet (statement of financial position) as of the end of the
current interim period and a comparative balance sheet as of the
end of the immediately preceding financial year
o statement of comprehensive income (and income statement, if
presented) for the current interim period and cumulatively for the
current financial year to date, with comparative statements for the
comparable interim periods (current and year-to-date) of the imme-
diately preceding financial year
o statement of changes in equity cumulatively for the current financial
year to date, with a comparative statement for the comparable
year-to-date period of the immediately preceding financial year
o statement of cash flows cumulatively for the current financial year
to date, with a comparative statement for the comparable year-to-
date period of the immediately preceding financial year

Accounting policies
The same accounting policies should be applied for interim reporting as
are applied in the entity's annual financial statements, except for
accounting policy changes made after the date of the most recent annual
financial statements that are to be reflected in the next annual financial
statements. [PAS 34.28]

A key provision of PAS 34 is that an entity should use the same


accounting policy throughout a single financial year. If a decision is made
to change a policy mid-year, the change is implemented retrospectively,
and previously reported interim data is restated. [PAS 34.43]

Measurement
Measurements for interim reporting purposes should be made on a year-
to-date basis, so that the frequency of the entity's reporting does not affect
the measurement of its annual results. [PAS 34.28]

Several important measurement points:


o Revenues that are received seasonally, cyclically or occasionally
within a financial year should not be anticipated or deferred as of
the interim date, if anticipation or deferral would not be appropriate
at the end of the financial year. [PAS 34.37]
o Costs that are incurred unevenly during a financial year should be
anticipated or deferred for interim reporting purposes if, and only if,
it is also appropriate to anticipate or defer that type of cost at the
end of the financial year. [PAS 34.39]
o Income tax expense should be recognised based on the best
estimate of the weighted average annual effective income tax rate
expected for the full financial year. [PAS 34 Appendix B12]

An appendix to PAS 34 provides guidance for applying the basic recogni-


tion and measurement principles at interim dates to various types of asset,
liability, income, and expense.

Materiality
In deciding how to recognise, measure, classify, or disclose an item for
interim financial reporting purposes, materiality is to be assessed in
relation to the interim period financial data, not forecast annual data. [PAS
34.23]

Disclosure in annual financial statements


If an estimate of an amount reported in an interim period is changed signif-
icantly during the financial interim period in the financial year but a
separate financial report is not published for that period, the nature and
amount of that change must be disclosed in the notes to the annual
financial statements. [PAS 34.26]

Summary:

 An interim financial report is a complete or condensed set of


financial statements for a period shorter than a financial year. PAS
34 applies if an entity using PFRS Standards in its annual financial
statements publishes an interim financial report that asserts
compliance with PFRS Standards.
 The minimum content is a set of condensed financial statements
for the current period and comparative prior period information, i.e.
statement of financial position, statement of comprehensive
income, statement of cash flows, statement of changes in equity,
and selected explanatory notes. In some cases, a statement of
financial position at the beginning of the prior period is also
required. Generally, information available in the entity’s most recent
annual report is not repeated or updated in the interim report. The
interim report deals with changes since the end of the last annual
reporting period.
 The same accounting policies are applied in the interim report as in
the most recent annual report, or special disclosures are required if
an accounting policy is changed. Assets and liabilities are
recognised and measured for interim reporting on the basis of
information available on a year-to-date basis. While measurements
in both annual financial statements and interim financial reports are
often based on reasonable estimates, the preparation of interim
financial reports will generally require a greater use of estimation
methods than annual financial statements.

You might also like

pFad - Phonifier reborn

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.

Note: This service is not intended for secure transactions such as banking, social media, email, or purchasing. Use at your own risk. We assume no liability whatsoever for broken pages.


Alternative Proxies:

Alternative Proxy

pFad Proxy

pFad v3 Proxy

pFad v4 Proxy