Interim financial statements are the statements or reports made for a brief period of time. The brief period may be a quarter or three months, a year or just a month.
Interim financial statements are generally not audited. The financial statements are made by abiding by the generally accepted accounting principles. The Interim financial statements denote the various financial activities and changes that have taken place within the short period. The procedure followed in maintaining an account of expenditure, revenues and costs are similar to the procedures followed in annual financial statements.
Interim financial statements are made after statistical data and other information pertaining to the activities of the company are made available to the accountants. While making Interim Financial statements are worked out, in addition to the most current information, the fiscal conditions in the previous year is also taken into account( previous performance)
Interim Financial Statements – Disclosures:
Disclosures to be made at the time of making Interim financial statements are as follows:
The method that has been employed to determine the gross profit in the present year. If the method employed is different from the one used in the previous year, the same has to be made known while preparation of Interim financial statements.
Temporary drop in market conditions are not recorded at interim date.
Factors, which caused drop in market conditions and were registered in the previous interim financial statements need to be furnished.
Effective tax rates (yearly) need to be applied for estimating the losses as well as profits.
Details of income tax should also be provided while preparing the interim financial reports.
It is mandatory to disclose the undermentioned information in case of companies, which are publicly traded.
Seasonal expenses, revenues and costs
Changes in the ownership of the business
In the event, when a balance sheet is not available for the preparation of a financial report, the following information should be provided. Changes pertaining to:
Adjustments made towards end of the year and their effects
Long term liabilities
Last Updated on : 26th June 2013